Central Plains Bancshares, Inc.
For the period ended Mar 31, 2026. Filed Jun 18, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Jun 18, 2026
CPBI$20.80+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2025-03-31; filed 2025-06-26.
0000950170-25-090434
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-03-31; filed 2026-06-18.
0001193125-26-275962
Item 7. 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 100 previous paragraphs and 112 current paragraphs.
52 unchanged; 37 reworded; 19 added; 11 removed; 0 previous and 4 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 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 (19)
Current report
Allowance for Credit Losses. The Current Expected Credit Losses ("CECL") accounting methodology requires entities to estimate and recognize an allowance for lifetime expected credit losses for loans and other financial assets measured at amortized cost. The accounting estimates relating to the allowance for credit losses is a “critical accounting policy” as:
Current report
changes in the provision for credit losses can materially affect our financial results;
Current report
estimates relating to the allowance for credit losses require us to project future borrower performance, including cash flows, delinquencies and charge-offs, along with, when applicable, collateral values, based on a reasonable and supportable forecast period utilizing forward-looking economic scenarios in order to estimate probability of default and loss given default;
Current report
the allowance for credit losses is influenced by factors outside of our control such as industry and business trends, geopolitical events and the effects of laws and regulations as well as economic conditions such as trends in housing prices, interest rates, GDP, inflation, energy prices and unemployment; and
Current report
considerable judgment is required to determine whether the models used to generate the allowance for credit losses produce an estimate that is sufficient to encompass the current view of lifetime expected credit losses.
Current report
Interest expense on deposits increased $817,000, or 10.1%, to $8.9 million for the year ended March 31, 2026 compared to $8.1 million for the year ended March 31, 2025. The increase was due to an increase in the average balances of all interest-bearing liabilities.
Current report
Provision for Credit Losses. Provision for credit losses was $306,000 for the year ended March 31, 2026, compared to $200,000 for the year ended March 31, 2025. The increase in provision expense was primarily attributable to loan growth during the period, as gross loans held for investment increased $46.1 million, or 11.5%, with notable growth in commercial non-real estate, real estate, and agricultural loan segments.
Current report
The allowance for credit losses increased to $5.8 million at March 31, 2026 from $5.4 million at March 31, 2025, reflecting the higher level of outstanding loans as well as continued evaluation of portfolio risk characteristics. Despite the increase in the allowance balance, the allowance for credit losses as a percentage of total loans decreased to 1.30% at March 31, 2026 from 1.35% at March 31, 2025, primarily due to the mix and relative credit quality of loan growth during the period.
Current report
Occupancy and equipment expenses increased $529,000, or 50.2%, to $1.6 million for the year ended March 31, 2026 from $1.1 million for the year ended March 31, 2025, due to recognizing a full year of depreciation for our newly constructed branches in Lincoln and Hastings, Nebraska.
Current report
Income Tax Expense. Income tax expense increased $122,000, or 14.0%, to $991,000 for the year ended March 31, 2026, compared to $869,000 for the year ended March 31, 2025, primarily reflecting higher pre-tax income. The effective tax rate increased to 19.9% for the year ended March 31, 2026 from 19.2% for the year ended March 31, 2025.
Current report
The increase in the effective tax rate was primarily driven by changes in the composition of taxable income and a lower relative benefit from permanent tax differences, including tax-exempt income, compared to the prior year.
Current report
The Board of Directors regularly reviews the interest rate risk inherent in our assets and liabilities and establishes the level of risk deemed appropriate. These reviews are conducted in the context of our overall business strategy, operating environment, capital position, liquidity profile and performance objectives, and are guided by policies and limits approved by the Board.
Current report
maintaining capital levels in excess of the regulatory thresholds for "well-capitalized" institutions;
Current report
maintaining adequate levels of on-balance sheet and contingent liquidity;
Current report
Using this model, we estimate net interest income over a one-year horizon under various interest rate scenarios. These scenarios assume gradual and parallel shifts in the United States Treasury yield curve, both upward and downward, of up to 400 basis points. A basis point equals one one-hundredth of one percent; therefore, 100 basis points equals 1.0%. For example, an increase in interest rates from 3.0% to 4.0% represents a 100 basis point increase.
Current report
Liquidity. Liquidity refers to our ability to generate sufficient cash flows to fund loan demand, repay maturing borrowings, meet deposit withdrawal requirements, and fund operating expenses. Our primary sources of funds include deposits; scheduled repayments of loans and investment securities, including interest payments; maturities and sales of loans and investment securities; borrowings from the FRB; advances from the FHLB; and cash flows generated from operations.
Current report
Our funding needs vary from period to period based on loan demand, deposit activity, and the level of amortization and prepayments on loans and investment securities. The use of borrowings from the FRB, FHLB advances, and other sources is influenced by loan originations, deposit inflows and outflows, and balance sheet management strategies designed to enhance net interest income.
Current report
Net cash provided by financing activities totaled $43.5 million, consisting primarily of net increases in deposit accounts.
Current report
In November 2024, the FASB issued ASU 2024‑03, "Income Statement Reporting—Comprehensive Income (Topic 220): Disaggregation of Income Statement Expenses," which requires expanded disclosures regarding the disaggregation of certain expense categories, including employee compensation, depreciation, and other material components of operating expenses. In January 2025, the FASB issued ASU 2025‑01, which clarifies the effective date of ASU 2024‑03. The guidance is effective for the Company for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this guidance; however, as the update is limited to expanded disclosures, it is not expected to have a material effect on the Company’s consolidated financial statements.
Removed paragraphs (11)
Previous report
Allowance for Credit Losses. Determining the allowance for loan and lease losses has historically been identified as a critical accounting policy. On April 1, 2023, we adopted the new CECL accounting methodology. The CECL model utilizes a lifetime “expected credit loss” measurement objective for the recognition of credit losses for loans, held-to-maturity securities, and other receivables at the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses. For available for-sale securities where fair value is less than cost, credit-related impairment, if any, will be recognized in an allowance for credit losses and adjusted each period for changes in expected credit risk. This model replaced the previous existing impairment models, which generally required that a loss be incurred before it is recognized.
Previous report
31, 2024 to 3.62% for the year ended March 31, 2025, and by a $757,000 increase in the average balance of securities to $59.2 million for the year ended March 31, 2025 from $58.4 million for the year ended March 31, 2024.
Previous report
Provision for Credit Losses. We recorded a provision for credit losses of $200,000 for the year ended March 31, 2025 compared to a provision for credit losses of $88,000 for the year ended March 31, 2024. Our allowance for credit losses was $5.4 million at March 31, 2025 compared to an allowance for credit losses of $5.9 million at March 31, 2024. The ratio of our allowance for credit losses to total loans was 1.35% at March 31, 2025 compared to 1.54% at March 31, 2024.
Previous report
Income Tax Expense. Income tax expense decreased $8,000, or 0.9%, to $869,000 for the year ended March 31, 2025 from $877,000 for the year ended March 31, 2024. The effective tax rate for the years ended March 31, 2025 and 2024 were 19.2% and 18.9%, respectively. The most significant difference between our effective tax rate and statutory rates results from investment partnership tax credits.
Previous report
maintaining capital levels that exceed the thresholds for well-capitalized status under federal regulations;
Previous report
maintaining adequate levels of liquidity;
Previous report
Liquidity. Liquidity describes our ability to meet 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 of securities. We also have the ability to borrow from the FHLB. The Association had remaining availability for FHLB borrowings of approximately $40.5 million at March 31, 2025. The FHLB has sole discretion to deny additional advances. Additionally, the Association had the capacity to borrow $5.0 million from a private bankers’ bank at March 31, 2025. We could significantly increase our borrowing capacity from the FHLB Topeka if we pledged additional assets as security. We also have the ability to participate in the Federal Reserve Board's Bank Term Funding Program if needed.
Previous report
For the year ended March 31, 2024, cash flows from operating, investing, and financing activities resulted in a net decrease in cash and cash equivalents of $5.1 million. Net cash provided by operating activities amounted to $5.7 million, primarily due to net income of $3.8 million. Net cash used in investing activities amounted to $31.1 million, primarily due to a net increase in loans of $26.4 million and the purchase of available-for-sale investment securities of $11.6 million, partially offset by proceeds from paydowns of available-for-sale investment securities of $9.0 million. Net cash provided by financing activities amounted to $20.3 million, consisting primarily of the activity in deposit accounts and proceeds from the issuance of common stock.
Previous report
On November 27, 2023, the FASB issued ASU 2023-07, "Segment Reporting (ASC 280): Improvements to Reportable Segment Disclosures", intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. Provisions in the amendment include: (1) Requirement that a public entity disclose, on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss (collectively referred to as the "significant expense principle"); (2) Requirement that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss; (3) Requirement that a public entity provide all annual disclosures about a reportable segment's profit or loss and assets currently required by ASC 280 in interim periods; (4) Clarification that if the CODM uses more than one measure of a segment's profit or loss in assessing segment performance and deciding how to allocate resources, a public entity may report one or more of those additional measures of segment profit. However, at least one of the reported segment profit or loss measures (or the single reported measure, if only one is disclosed) should be the measure that is most consistent with the measurement principles used in measuring the corresponding amounts in the public entity's consolidated financial statements; (5) Requirement that a public entity disclose the title and position of the CODM and explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources; and (6) Requirement that a public entity that has a single reportable segment provide all the disclosures by the amendments in the update and all existing segment disclosures in ASC 280.
Previous report
The amendments in the update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. For public business entities, amendments in the update should be applied retrospectively to all periods presented in the financial statements, and upon transition the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. The Company adopted this standard effective January 1, 2024, and it did not have a material impact on the consolidated financial statements.
Previous report
On December 14, 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”. The amendments require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation, and (2) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income (or loss) by the applicable statutory income tax rate). The amendments require that all entities disclose on an annual basis the following information about income taxes paid: (1) The amount of income taxes paid (net of refunds received) disaggregated by federal (national), state, and foreign taxes, and (2) The amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received). The amendments also require that all entities disclose the following information: (1) Income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign, and (2) Income tax expense (or benefit) from continuing operations disaggregated by federal (national), state, and foreign. The ASU is effective for public business entities for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments should be applied on a prospective basis. Retrospective application is permitted. The Company will adopt this ASU for the reporting period beginning April 1, 2025, and does not expect the amendments to have a material impact on the consolidated financial statements.
Reworded paragraphs (37)
Previous wording
The Jumpstart Our Business Startups ("JOBS") Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We intend to take advantage of the benefits of this extended transition period. Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards.
Current wording
The Jumpstart Our Business Startups ("JOBS") Act contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We determined to take advantage of the benefits of this extended transition period. Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards.
Previous wording
The discount rate is determined by matching the anticipated defined pension plan cash flows to the spot rates of a high-quality corporate bond index/yield curve and solving for the single equivalent discount rate which would produce the same present value. This methodology is applied consistently from year to year. The discount rate utilized in 2025 was 5.55%.
Current wording
The discount rate is determined by matching the anticipated defined pension plan cash flows to the spot rates of a high-quality corporate bond index/yield curve and solving for the single equivalent discount rate which would produce the same present value. This methodology is applied consistently from year to year. The discount rate utilized in 2026 was 5.75%.
Previous wording
The weighted average expected long-term rate of return on plan assets is determined based on the current and anticipated future mix of assets in the plan. The assets currently consist of equity securities, U.S. Government and Government-agency debt securities, and real estate investments. The weighted average expected long-term rate of return on plan assets utilized for 2024 was 5.40%. We anticipate using a weighted average expected long-term rate of return on plan assets of 5.25% in 2025.
Current wording
The weighted average expected long-term rate of return on plan assets is determined based on the current and anticipated future mix of assets in the plan. The assets currently consist of equity securities, U.S. Government and Government-agency debt securities, and real estate investments. The weighted average expected long-term rate of return on plan assets utilized for 2025 was 5.25%. We anticipate using a weighted average expected long-term rate of return on plan assets of 5.50% in 2026.
Previous wording
The following tables set forth selected historical financial and other data at the dates and for the fiscal years presented. The information at and for the fiscal years ended March 31, 2025 and 2024 is derived in part from, and should be read together with, the audited consolidated financial statements and related notes included in this Annual Report on Form 10-K.
Current wording
The following table sets forth selected historical financial data at the dates presented. The information is derived in part from, and should be read together with, the audited consolidated financial statements and related notes included in this Annual Report on Form 10-K.
Previous wording
Total Assets. Total assets increased $45.4 million, or 9.8%, to $508.7 million at March 31, 2025 from $463.3 million at March 31, 2024. The increase was primarily due to a $22.4 million, or 6.0%, increase in net loans.
Current wording
Total Assets. Total assets increased $49.9 million, or 9.8%, to $558.6 million at March 31, 2026 from $508.7 million at March 31, 2025. The increase was primarily due to a $45.8 million, or 11.5%, increase in net loans.
Previous wording
Cash and Cash Equivalents. Cash and cash equivalents increased $17.2 million, or 150.4%, to $28.7 million at March 31, 2025 from $11.5 million at March 31, 2024. This increase was primarily due to proceeds from principal payment on securities and an increase in deposits. We regularly review our liquidity position based on alternative uses of available funds as well as market conditions.
Current wording
Cash and Cash Equivalents. Cash and cash equivalents increased $1.2 million, or 4.3%, to $29.9 million at March 31, 2026 from $28.7 million at March 31, 2025. The increase was primarily attributable to the timing of payments related to accounts payable and accrued expenses, including fluctuations in vendor disbursements near period end. We regularly evaluate our liquidity position in light of alternative uses of available funds and prevailing market conditions.
Previous wording
Investment Securities Available for Sale. Securities available-for-sale decreased $1.0 million, or 1.6%, to $59.4 million at March 31, 2025 from $60.4 million at March 31, 2024. We purchased $6.2 million in securities, received principal payments of $8.3 million, had net premium amortization and discount accretion of $71,000 and had a decrease in the unrealized loss on the securities portfolio of $1.2 million during the year ended March 31, 2025.
Current wording
Investment Securities Available for Sale. Securities available-for-sale increased $3.1 million, or 5.3%, to $62.5 million at March 31, 2026 from $59.4 million at March 31, 2025. We purchased $10.4 million in securities, received principal payments of $8.5 million, had net discount amortization of $19,000 and a decrease in the unrealized loss on the securities portfolio of $1.2 million during the year ended March 31, 2026.
Previous wording
Gross Loans. Gross loans held for investment increased $22.0 million, or 5.8%, to $402.2 million at March 31, 2025 from $380.2 million at March 31, 2024. We experienced increases in two loan categories, residential real estate and agriculture loans. The largest increase was in agriculture loans, which increased $23.1 million, or 117.50%, to $42.8 million from $19.7 at March 31, 2024.
Current wording
Gross Loans. Gross loans held for investment increased $46.1 million, or 11.5%, to $448.3 million at March 31, 2026, from $402.2 million at March 31, 2025. We experienced increases in five loan categories: real estate construction, real estate residential, real estate commercial, commercial non-real estate, and agriculture loans. The largest increase was in commercial non-real estate loans, which increased $16.4 million, or 51.2%, to $48.4 million from $32.0 at March 31, 2025.
Previous wording
Total Deposits. Total deposits increased $41.1 million, or 10.9%, to $416.2 million at March 31, 2025 from $375.1 million at March 31, 2024. The increase in deposits reflected increases in NOW, money market, savings accounts and time deposits, which increased by $43.4 million from $308.3 million at March 31, 2024 to $351.7 million at March 31, 2025.
Current wording
Total Deposits. Total deposits increased $44.2 million, or 10.6%, to $460.4 million at March 31, 2026 from $416.2 million at March 31, 2025. The increase in deposits reflected increases in money market, savings accounts, and time deposits, which increased by $52.9 million from $198.9 million at March 31, 2025 to $251.8 million at March 31, 2026. Included in the increase in time deposits was $20.3 million of brokered deposits obtained during the year to support balance sheet growth and liquidity management.
Previous wording
Non-interest bearing deposits decreased $2.4 million, or 3.6%, to $64.5 million at March 31, 2025 from $66.9 million at March 31, 2024. We believe that long-term customers have continued to seek higher-yield deposits in the current market interest rate environment. We also had brokered deposits of $7.3 million at March 31, 2025 that are included in the $94.1 million total under other time deposits.
Current wording
Non-interest bearing deposits and NOW accounts decreased $8.7 million, or 6.0%, to $208.6 million at March 31, 2026 from $217.3 million at March 31, 2025. We believe that long-term customers have continued to seek higher-yield deposits in the current market interest rate environment. We also had brokered deposits of $27.6 million at March 31, 2026 and $7.3 million at March 31, 2025, which are included in the other time deposits.
Previous wording
Borrowings. We had no borrowings at March 31, 2025 or March 31, 2024. We have had limited borrowings in recent periods, as we have generally been able to utilize cash provided by our increase in deposits to fund our operations, although we will utilize FHLB advances as needed to support increased loan funding.
Current wording
Borrowings. We had no borrowings at March 31, 2026 or March 31, 2025. We have had limited borrowings in recent periods, as we have generally been able to utilize cash provided by our increase in deposits to fund our operations, although we will utilize FHLB and FRB's Discount Window advances as needed to support increased loan funding.
Previous wording
Total Equity. Total equity increased $5.0 million, or 6.5% to $83.3 million at March 31, 2025 from $78.3 million at March 31, 2024. This increase in total equity is the result of net income of $3.7 million for the period ended March 31, 2025 and other comprehensive income of $1.4 million.
Current wording
Total Equity. Total equity increased $5.7 million, or 6.8% to $89.0 million at March 31, 2026 from $83.3 million at March 31, 2025. This increase in total equity is the result of net income of $4.0 million for the year ended March 31, 2026 and other comprehensive income of $1.4 million.
Previous wording
The following tables set forth selected historical financial and other data at the dates and for the fiscal years presented. The information at and for the fiscal years ended March 31, 2025 and 2024 is derived in part from, and should be read together with, the audited consolidated financial statements and related notes included in this Annual Report on Form 10-K.
Current wording
The following table sets forth selected historical financial data for the fiscal years presented. The information is derived in part from, and should be read together with, the audited consolidated financial statements and related notes included in this Annual Report on Form 10-K.
Previous wording
General. Net income decreased $105,000, or 2.8%, to $3.7 million for the year ended March 31, 2025, compared to $3.8 million for the year ended March 31, 2024.
Current wording
General. Net income increased $346,000, or 9.5%, to $4.0 million for the year ended March 31, 2026, compared to $3.7 million for the year ended March 31, 2025.
Previous wording
Interest and Dividend Income. Interest and dividend income increased $3.7 million, or 17.8%, to $24.7 million for the year ended March 31, 2025 from $21.0 million for the year ended March 31, 2024. The increase was due primarily to an increase in interest income on loans, which is our primary source of interest income, due to increases in market interest rates.
Current wording
Interest and Dividend Income. Interest and dividend income increased $3.0 million, or 12.0%, to $27.7 million for the year ended March 31, 2026 from $24.7 million for the year ended March 31, 2025. The increase was due primarily to an increase in interest income on loans, which is our primary source of interest income.
Previous wording
Interest income on loans increased $3.2 million, or 17.3%, to $22.2 million for the year ended March 31, 2025 from $19.0 million for the year ended March 31, 2024. The average balance of loans and loan balances increased $29.3 million, or 8.1%, to $391.3 million for the year ended March 31, 2025 from $362.0 million for the year ended March 31, 2024. The increase is due to our continued focus on growing our loan portfolio consistent with maintaining asset quality. Our yield on loans increased 44 basis points to 5.68% for the year ended March 31, 2025 from 5.24% for the year ended March 31, 2024. The increase in yield was due to increases in market interest rates.
Current wording
Interest income on loans increased $2.9 million, or 12.8%, to $25.1 million for the year ended March 31, 2026 from $22.2 million for the year ended March 31, 2025. The average balance of loans increased $27.4 million, or 7.0%, to $418.7 million for the year ended March 31, 2026 from $391.3 million for the year ended March 31, 2025. The increase is due to our continued focus on growing our loan portfolio consistent with maintaining asset quality. Our yield on loans increased 31 basis points to 5.99% for the year ended March 31, 2026 from 5.68% for the year ended March 31, 2025. The increase in yield was primarily due to loan repricing upon reaching scheduled reset dates and growth in the loan portfolio.
Previous wording
Interest income on securities increased $419,000, or 24.3%, to $2.1 million for the year ended March 31, 2025 from $1.7 million for the year ended March 31, 2024, due to a 67 basis point increase in the average yield from 2.95% for the year ended March
Current wording
Interest income on securities increased $136,000, or 6.3%, to $2.3 million for the year ended March 31, 2026 from $2.1 million for the year ended March 31, 2025, due to a 16 basis point increase in the average yield from 3.62% for the year ended March 31, 2025 to 3.78% for the year ended March 31, 2026, and by a $1.2 million increase in the average balance of securities to $60.4 million for the year ended March 31, 2026 from $59.2 million for the year ended March 31, 2025.
Previous wording
Interest Expense. Interest expense increased $1.7 million, or 26.6%, to $8.2 million for the year ended March 31, 2025 compared to $6.5 million for the year ended March 31, 2024, due primarily to increases in the average balance and higher costs of interest-bearing liabilities.
Current wording
Interest Expense. Interest expense increased $777,000, or 9.5%, to $9.0 million for the year ended March 31, 2026 compared to $8.2 million for the year ended March 31, 2025, driven primarily by an increase in the average balance of interest-bearing liabilities.
Previous wording
Interest expense on deposits increased $1.7 million, or 27.1%, to $8.1 million for the year ended March 31, 2025 compared to $6.4 million for the year ended March 31, 2024. The increase was due to a 32 basis point increase in the average cost of deposits to 2.56% for the year ended March 31, 2025 from 2.24% for the year ended March 31, 2024. The increase in the average cost of deposits was due to the higher interest rate environment and an increase in the average balances of certificates of deposit, NOW accounts, savings accounts and money market accounts. The average balances of certificates of deposit increased $15.0 million, or 17.2% to $101.8 million for the year ended March 31, 2025 from $86.8 million for the year ended March 31, 2024. The average balances of NOW accounts increased $9.6 million, or 8.1% to $128.5 million for the year ended March 31, 2025 from $118.9 million for the year ended March 31, 2024. The average balances of savings accounts increased $1.4 million, or 3.5% to $42.9 million for the year ended March 31, 2025 from $41.5 million for the year ended March 31, 2024. The average balances of money market accounts increased $5.7 million, or 26.4% to $27.5 million for the year ended March 31, 2025 from $21.8 million for the year ended March 31, 2024.
Current wording
The average balances of certificates of deposit increased $17.6 million, or 17.3% to $119.4 million for the year ended March 31, 2026 from $101.8 million for the year ended March 31, 2025. Included in the increase in time deposits was $20.3 million of brokered deposits obtained during the year to support balance sheet growth and liquidity management. The average balances of NOW accounts increased $4.5 million, or 3.5% to $133.0 million for the year ended March 31, 2026 from $128.5 million for the year ended March 31, 2025. The average balances of savings accounts increased $4.2 million, or 9.7% to $47.1 million for the year ended March 31, 2026 from $42.9 million for the year ended March 31, 2025. The average balances of money market accounts increased $5.6 million, or 20.4% to $33.1 million for the year ended March 31, 2026 from $27.5 million for the year ended March 31, 2025. The average balances of individual retirement accounts increased $876,000, or 5.2% to $17.6 million for the year ended March 31, 2026 from $16.7 million for the year ended March 31, 2025.
Previous wording
Interest expense on FHLB borrowings decreased $6,000, or 5.7%, to $99,000 for the year ended March 31, 2025 compared to $105,000 for the year ended March 31, 2024. The decrease was due to a decrease in the average balance of borrowings of $199,000, or 10.2%, to $1.8 million for the year ended March 31, 2025 compared to $2.0 million for the year ended March 31, 2024.
Current wording
Interest expense on FHLB borrowings decreased $40,000, or 40.4%, to $59,000 for the year ended March 31, 2026 compared to $99,000 for the year ended March 31, 2025. The decrease was due to a decrease in the average balance of borrowings of $428,000, or 24.4%, to $1.3 million for the year ended March 31, 2026 compared to $1.8 million for the year ended March 31, 2025.
Previous wording
Net Interest Income. Net interest income increased $1.9 million, or 13.2%, to $16.3 million for the year ended March 31, 2025 compared to $14.4 million for the year ended March 31, 2024.
Current wording
Net Interest Income. Net interest income increased $2.1 million, or 12.8%, to $18.4 million for the year ended March 31, 2026 compared to $16.3 million for the year ended March 31, 2025.
Previous wording
Our interest rate spread increased 15 basis points to 2.76% for the year ended March 31, 2025, compared to 2.61% for the year ended March 31, 2024, and our net interest margin increased 20 basis points to 3.56% for the year ended March 31, 2025 compared to 3.36% for the year ended March 31, 2024.
Current wording
Our interest rate spread increased 31 basis points to 3.07% for the year ended March 31, 2026, compared to 2.76% for the year ended March 31, 2025, and our net interest margin increased 24 basis points to 3.80% for the year ended March 31, 2026 compared to 3.56% for the year ended March 31, 2025.
Previous wording
We will continue to assess and evaluate the estimated future credit loss impact of current market conditions in subsequent reporting periods, which will be highly dependent on credit quality, macroeconomic forecasts and conditions, as well as the composition of our loan and available-for-sale securities portfolios. In addition, the OCC, as an integral part of its examination process, will periodically review our allowance for credit losses, and as a result of such reviews, we may have to adjust our allowance for credit losses.
Current wording
We will continue to assess and evaluate the estimated future credit loss impact of current market conditions in subsequent reporting periods, which will be highly dependent on credit quality, macroeconomic forecasts and conditions, as well as the composition of our loan and available-for-sale securities portfolios.
Previous wording
Non-Interest Income. Non-interest income decreased $243,000, or 8.5%, to $2.6 million for the year ended March 31, 2025 compared to $2.9 million for the year ended March 31, 2024. Service charges on deposit accounts increased $143,000, or 18.6%, to $912,000 for the year ended March 31, 2025 compared to $769,000 for the year ended March 31, 2024, primarily due to increases in overdraft income and debit card usage. Other income decreased $385,000, or 83.2%, to $78,000 for the year ended March 31, 2025 compared to $463,000 for the year ended March 31, 2024, due primarily to the recovery of loans previously written off on the books of an acquired institution for year ending March 31, 2024. Gain on sale of loans increased $20,000, or 10.3%, to $215,000 for the year ended March 31, 2025 from $195,000 for the year ended March 31, 2024.
Current wording
Non-Interest Income. Non-interest income increased $60,000, or 2.3%, to $2.7 million for the year ended March 31, 2026 compared to $2.6 million for the year ended March 31, 2025. Gain on sale of loans increased $156,000, or 72.6%, to $371,000 for the year ended March 31, 2026 from $215,000 for the year ended March 31, 2025. Service charges on deposit accounts decreased $146,000, or 16.0%, to $766,000 for the year ended March 31, 2026 compared to $912,000 for the year ended March 31, 2025, primarily due to decreases in ATM surcharges and miscellaneous operating income. Other income from the Company's insurance and investment subsidiary increased $57,000, or 73.1%, to $135,000 for the year ended March 31, 2026, from $78,000 for the year ended March 31, 2025, primarily reflecting improved market performance.
Previous wording
Non-Interest Expense. Non-interest expense increased $1.8 million, or 14.1%, to $14.4 million for the year ended March 31, 2025 from $12.6 million for the year ended March 31, 2024. Salaries and employee benefits increased $940,000, or 13.5%, to $7.9 million for the year ended March 31, 2025 from $7.0 million for the year ended March 31, 2024, due to our hiring additional lenders. Additionally, the Company implemented the 2024 Equity Incentive Plan on November 26, 2024, and began recognizing expense associated with this plan in December 2024. Other general and administrative expenses increased $622,000, or 31.3%, to $2.6 million for the year ended March 31, 2025 from $2.0 million for the year ended March 31, 2024, due to a combination of increases in insurance, auditing and consulting fees. These additional fees relate to public company filing requirements and further regulatory compliance consulting.
Current wording
Non-Interest Expense. Non-interest expense increased $1.6 million, or 11.6%, to $16.0 million for the year ended March 31, 2026 from $14.4 million for the year ended March 31, 2025. Salaries and employee benefits increased $874,000, or 11.1%, to $8.8 million for the year ended March 31, 2026 from $7.9 million for the year ended March 31, 2025, due to annual wage adjustments and a full year of recognizing stock based compensation expense from stock options and restricted stock awards granted under the 2024 Equity Incentive Plan. The Company implemented the 2024 Equity Incentive Plan on November 26, 2024, and began recognizing expense associated with this plan in December 2024. Other general and administrative expenses increased $273,000, or 10.5%, to $2.9 million for the year ended March 31, 2026 from $2.6 million for the year ended March 31, 2025, due to a combination of increases in insurance, auditing and consulting fees. The increase was primarily attributable to higher insurance, audit, and consulting expenses, as well as incremental costs related to recruiter fees and software licensing.
Previous wording
General. Our most significant form of market risk is interest rate risk because, as a financial institution, the majority of our assets and liabilities are sensitive to changes in interest rates. Therefore, a principal part of our operations is to manage interest rate risk and limit the exposure of our financial condition and results of operations to changes in market interest rates. All directors participate in discussions during the regular board meetings evaluating the interest rate risk inherent in our assets and liabilities, and the level of risk that is appropriate. These discussions take into consideration our business strategy, operating environment, capital, liquidity and performance objectives consistent with the policy and guidelines approved by them.
Current wording
General. Our most significant form of market risk is interest rate risk. As a financial institution, the majority of our assets and liabilities are sensitive to changes in interest rates. Accordingly, a principal component of our operations is to manage interest rate risk and to limit the exposure of our financial condition and results of operations to changes in market interest rates.
Previous wording
Our asset/liability management strategy attempts to manage the impact of changes in interest rates on net interest income, our primary source of earnings. Among the techniques we are using to manage interest rate risk are:
Current wording
Our asset/liability management strategy is designed to manage the impact of changes in interest rates on net interest income, which is our primary source of earnings. The primary techniques we use to manage interest rate risk include:
Previous wording
selling longer-term, fixed-rate loans, subject to market conditions; and
Current wording
selling longer-term, fixed-rate loans into the secondary market, subject to market conditions; and
Previous wording
continuing to diversify our loan portfolio by adding more commercial-related loans, which typically have shorter maturities and/or adjustable rates.
Current wording
diversifying our loan portfolio by increasing the proportion of commercial loans, which generally have shorter maturities and/or adjustable interest rates.
Previous wording
By following these strategies, we believe that we are better positioned to react to increases and decreases in market interest rates.
Current wording
Through these strategies, we believe we are better positioned to respond to changes in market interest rates.
Previous wording
We have not engaged in hedging activities, such as engaging in futures or options. We do not anticipate entering into similar transactions in the future.
Current wording
We do not currently engage in hedging activities, such as the use of interest rate futures or options, and we do not presently anticipate entering into such transactions.
Previous wording
Net Interest Income Analysis. We analyze our sensitivity to changes in interest rates through a third-party net interest income ("NII") model. NII is the difference between the interest income we earn on our interest-earning assets, such as loans and securities, and the interest we pay on our interest-bearing liabilities, such as deposits and borrowings. We estimate what our NII would be for a one-year period and then calculate what the NII would be for the same period under the assumptions that the United States Treasury yield curve increases or decreases gradually by up to 400 basis points. A basis point equals one-hundredth of one percent, and 100 basis points equals one percent. An increase in the interest rates from 3% to 4% would mean, for example, a 100 basis point increase in the "Change in Interest Rates" column below.
Current wording
Net Interest Income Analysis. We assess our sensitivity to changes in interest rates using a net interest income (“NII”) simulation model provided by a third-party vendor. Net interest income represents the difference between the interest income earned on interest-earning assets, such as loans and securities, and the interest expense paid on interest-bearing liabilities, such as deposits and borrowings.
Previous wording
The table above indicates that at March 31, 2025, we would have experienced a 0.77% increase in NII in the event of a gradual, one-year 200 basis point increase in market interest rates, and a 0.79% decrease in NII in the event of a gradual, one-year 200 basis point decrease in market interest rates.
Current wording
The table above indicates that at March 31, 2026, we would have experienced a 0.92% increase in NII in the event of a gradual, one-year 200 basis point increase in market interest rates, and a 0.63% decrease in NII in the event of a gradual, one-year 200 basis point decrease in market interest rates.
Previous wording
The table above indicates that at March 31, 2025, we would have experienced a 3.35% increase in MVE in the event of an instantaneous parallel 200 basis point increase in the market interest rates and a 13.87% decrease in MVE in the event of an instantaneous 200 basis point decrease in market interest rates.
Current wording
The table above indicates that at March 31, 2026, we would have experienced a 4.27% increase in market value of equity MVE in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 12.43% decrease in MVE in the event of an instantaneous 200 basis point decrease in market interest rates. As of March 31, 2026, all changes in net interest income NII and MVE reflected in the above tables were within policy limits established by the Board of Directors.
Previous wording
While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loan prepayments are greatly influenced by market interest rates, economic conditions, and competition. Our most liquid assets are cash and short-term investments. The levels of these assets are dependent on our operating, financing, lending and investing activities during any period.
Current wording
While contractual maturities and scheduled amortization of loans and investment securities are relatively predictable sources of liquidity, deposit flows and loan prepayments are influenced by market interest rates, general economic conditions, and competitive factors. Our most liquid assets consist of cash and short-term investments, the levels of which are dependent on our operating, financing, lending, and investing activities during any given period.
Previous wording
For the year ended March 31, 2025, cash flows from operating, investing, and financing activities resulted in a net increase in cash and cash equivalents of $17.2 million. Net cash provided by operating activities amounted to $4.5 million, primarily due to net income of $3.7 million. Net cash used in investing activities amounted to $27.9 million, primarily due to a net increase in loans of $22.6 million and the purchase of available-for-sale investment securities of $6.2 million, partially offset by proceeds from paydowns of available-for-sale investment securities of $8.3 million. Net cash provided by financing activities amounted to $40.7 million, consisting primarily of the activity in deposit accounts.
Current wording
For the year ended March 31, 2026, cash flows from operating, investing, and financing activities resulted in a net increase in cash and cash equivalents of $1.2 million. Net cash provided by operating activities totaled $6.4 million, driven primarily by net income of $4.0 million.
Previous wording
Off-Balance Sheet Arrangements. At March 31, 2025, we had $45.0 million of unfunded loan commitments, $12.8 million of which represents the balance of remaining funds to be disbursed on construction loans in process. Certificates of deposit (excluding retirement account deposits) that are scheduled to mature in less than one year from March 31, 2025 totaled $86.7 million at March 31, 2025. Management expects that a substantial portion of the maturing certificates of deposit will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize Federal Home Loan Bank of Topeka advances or our private bankers’ bank line of credit or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.
Current wording
Off-Balance Sheet Arrangements. At March 31, 2026, we had $48.4 million of unfunded loan commitments, $10.2 million of which represents the balance of remaining funds to be disbursed on construction loans in process. Certificates of deposit (excluding retirement account deposits) that are scheduled to mature in less than one year from March 31, 2026 totaled $89.0 million at March 31, 2026. Management expects that a substantial portion of the maturing certificates of deposit will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize FHLB advances, FRB borrowings, or our private bankers’ bank line of credit or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
Net cash used in investing activities totaled $48.7 million, primarily reflecting a net increase in loans of $46.1 million and purchases of available-for-sale investment securities of $10.5 million, partially offset by proceeds from principal paydowns and maturities of available-for-sale investment securities of $8.5 million.
Current report — wording carried from elsewhere
For the year ended March 31, 2025, cash flows from operating, investing, and financing activities resulted in a net increase in cash and cash equivalents of $17.2 million. Net cash provided by operating activities totaled $4.5 million, driven primarily by net income of $3.7 million.
Current report — wording carried from elsewhere
Net cash used in investing activities totaled $27.9 million, primarily reflecting a net increase in loans of $22.6 million and purchases of available-for-sale investment securities of $6.2 million, partially offset by proceeds from principal paydowns and maturities of available-for-sale investment securities of $8.3 million.
Current report — wording carried from elsewhere
Net cash provided by financing activities totaled $40.7 million, consisting primarily of net increases in deposit accounts.