Winchester Bancorp, Inc./MD/
For the period ended Sep 30, 2026. Filed Nov 4, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 4, 2026
WSBK$13.61-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-13.
0001193125-26-221566
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-04.
0001193125-26-447179
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 146 previous paragraphs and 115 current paragraphs.
69 unchanged; 38 reworded; 8 added; 34 removed; 5 previous and 0 current paragraphs rearranged.
Tables are not compared: 12 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;
Current report
the other risks and uncertainties detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2026 and other filings submitted to the Securities and Exchange Commission.
Current report
Total Stockholders’ Equity. Total stockholders’ equity decreased $886,000, and was $119.6 million at September 30, 2026 and $120.5 million at June 30, 2026. Total stockholders’ equity was driven by an other comprehensive loss of $2.2 million due to higher unrealized losses on the available for sale portfolio, partially offset by net income of $1.3 million for the quarter ended September 30, 2026.
Current report
In July 2025, the Company recognized a one-time loss of $317,000 from the sale of available-for-sale securities as part of its investment portfolio restructuring. The increase in miscellaneous income reflects higher construction loan fees.
Current report
Annualized.
Current report
Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
Current report
Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
Current report
Net interest margin represents net interest income divided by average total interest-earning assets.
Removed paragraphs (34)
Previous report
adverse changes in the securities or secondary mortgage markets;
Previous report
monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board;
Previous report
the inability of third-party providers to perform as expected;
Previous report
our ability to manage market risk, credit risk and operational risk;
Previous report
our ability to enter new markets successfully and capitalize on growth opportunities;
Previous report
our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames, and any goodwill charges related thereto;
Previous report
changes in consumer spending, borrowing and savings habits;
Previous report
changes in accounting and/or tax estimates;
Previous report
the effects of any national or global conflict, war or act of terrorism;
Previous report
the ability of the U.S. Government to remain open, function properly and manage federal debt limits;
Previous report
the potential effects of tariffs;
Previous report
the impact of a pandemic on our operations and financial results and those of our customers;
Previous report
our compensation expense associated with equity allocated or awarded to our employees; and
Previous report
changes in the financial condition, results of operations or future prospects of issuers of securities that we own.
Previous report
Although we believe that we use the best information available to establish the allowance for credit losses on loans, future adjustments to the allowance may be necessary if economic conditions differ substantially from the assumptions used in making the evaluation. In addition, the Massachusetts Commissioner of Banks and the FDIC, as an integral part of their examination process, periodically review our allowance for credit losses on loans, and as a result of such reviews, we may have to adjust our allowance for credit losses on loans. A large loss could deplete the allowance and require increased provisions to replenish the allowance, which would adversely affect earnings.
Previous report
Total Stockholders’ Equity. Total stockholders’ equity increased $3.8 million, and was $119.1 million at March 31, 2026 and $115.4 million at June 30, 2025. Total stockholders’ equity increased due to a $457,000 decrease in accumulated other comprehensive loss to $1.2 million at March 31, 2026, and the net income increase of $3.2 million for the nine months ended March 31, 2026.
Previous report
The decrease in loss on marketable equity securities, net, was due to the liquidation of the equities portfolio in June 2025.
Previous report
General. We recorded net income of $3.2 million and net income of $46,000 for the nine months ended March 31, 2026 and 2025, respectively. The increase in net income was due primarily to increases in net interest income and lower provision for credit losses, partially offset by an increase in non-interest expense and income tax expense.
Previous report
Interest and Dividend Income. Interest and dividend income increased $5.5 million, or 17.6%, to $36.9 million for the nine months ended March 31, 2026, from $31.4 million for the nine months ended March 31, 2025. Interest and fees on loans, which is our primary source of interest income, increased $4.2 million, or 15.2%, to $32.0 million for the nine months ended March 31, 2026, from $27.7 million for the nine months ended March 31, 2025.
Previous report
The average balance of loans increased by $79.1 million, or 11.0%, to $796.6 million for the nine months ended March 31, 2026, over the average balance for the nine months ended March 31, 2025, while the average yield on loans increased by 19 basis points to 5.35% for the nine months ended March 31, 2026, from 5.16% for the nine months ended March 31, 2025. The increase in the average yield was primarily due to increases in higher yielding construction, commercial and residential real estate, and multi-family loan balances. The increase in average balance was due to our continuing to pursue new commercial relationships.
Previous report
Interest Expense. Total interest expense decreased $415,000, or 2.2%, to $18.8 million for the nine months ended March 31, 2026, compared to $19.2 million for the nine months ended March 31, 2025. Interest expense on deposits decreased $184,000, or 1.3%, to $14.4 million for the nine months ended March 31, 2026, from $14.6 million for the nine months ended March 31, 2025. Our average balance of interest-bearing deposits increased $65.1 million, or 10.8%, to $665.8 million, while our average cost of deposits decreased 36 basis points to 2.89% for the nine months ended March 31, 2026, from 3.25% for the nine months ended March 31, 2025. The decrease in the average cost of deposits was due to decreases in market interest rates as well as an increase in money market accounts, which typically bear lower rates than certificates of deposits.
Previous report
Interest expense on Federal Home Loan Bank advances was $4.3 million for the nine months ended March 31, 2026, compared to $4.5 million for the nine months ended March 31, 2025. We decreased Federal Home Loan Bank borrowings in recent periods due to increases in money market accounts. The decrease in the average cost of borrowings was due to decreases in market interest rates between the periods.
Previous report
Net Interest Income. Net interest income was $18.1 million for the nine months ended March 31, 2026, compared to $12.2 million for the nine months ended March 31, 2025, as our interest income increased faster than our interest expense. Our interest rate spread increased to 2.01% for the nine months ended March 31, 2026 from 1.50% for the nine months ended March 31, 2025, while our net interest margin increased to 2.52% for the nine months ended March 31, 2026 from 1.93% for the nine months ended March 31, 2025. The interest rate spread and net interest margin were both positively impacted by the lower market interest rates.
Previous report
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a provision for credit losses of $393,000 for the nine months ended March 31, 2026, compared to a provision of $1.4 million for the nine months ended March 31, 2025. The decrease in the provision for credit losses on loans for the nine months ended March 31, 2026 was primarily due to lower charge offs of $592,000 compared to our charge offs of $1.4 million for the nine months ended March 31, 2025. Additionally, there was a net credit of $158,000 recorded for the nine months ended March 31, 2026 due to the change in the credit loss methodology from the Federal Reserve Scaled CECL Allowance for Credit Loss Estimated (SCALE) method to the DCF model which was completed in the first quarter of 2026.
Previous report
Other Income. Other income information is as follows.
Previous report
The decrease in gain on marketable equity securities, net, was due to the liquidation of the portfolio in June 2025. The loss on sale of securities for the nine months ended March 31, 2026 was due to the sale of securities available for sale, which were replaced with higher yielding investment securities as part of the Company’s investment portfolio restructuring. The increase in miscellaneous other income for the nine months ended March 31, 2026 is primarily due to higher release fees on construction loans.
Previous report
Operating Expense. Operating expense information is as follows.
Previous report
The increase in salaries and employee benefits was due to the addition of key staff in finance and commercial real estate, while the increase in data processing expense was due to our implementing a new program for electronic communications and online account opening. The decrease in deposit insurance expense was due to a decrease in FDIC insurance rates. The lower credit in net periodic pension and post-retirement cost is due to the freezing of the pension plan, while the increase in marketing and advertising is due to the launch of a new website as well as a new investor relations site. The increase in other expense were primarily due to higher cost for professional services related to our operation as a public reporting entity.
Previous report
Income Taxes. Income taxes increased by $1.1 million to a provision of $981,000 for the nine months ended March 31, 2026, compared to a benefit of $90,000 for the nine months ended March 31, 2025. The increase in the income tax provision was due primarily to higher income for the nine months ended March 31, 2026.
Previous report
Average Balances and Yields
Previous report
Rate/Volume Analysis
Previous report
Assumes an instantaneous uniform change in interest rates at all maturities.
Previous report
Assumes an instantaneous uniform change in interest rates at all maturities.
Previous report
The net proceeds from the offering significantly increased our liquidity and capital resources. Over time, the initial level of liquidity will be reduced as net offering proceeds are used for general corporate purposes, including funding loans. Our financial condition and results of operations will be enhanced by the net proceeds from the offering, which will increase our net interest-earning assets and net interest income. However, due to the increase in equity resulting from the net proceeds, as well as other factors associated with the offering, our return on equity may remain lower in the immediate future.
Reworded paragraphs (38)
Previous wording
Management’s discussion and analysis of financial condition and results of operations at March 31, 2026 and June 30, 2025 and for the three months and nine months ended March 31, 2026 and 2025 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1, of this Quarterly Report on Form 10-Q.
Current wording
Management’s discussion and analysis of financial condition and results of operations at September 30, 2026 and June 30, 2026 and for the three months ended September 30, 2026 and 2025 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1, of this Quarterly Report on Form 10-Q.
Previous wording
statements regarding our business plans, prospects, growth and operating strategies;
Current wording
statements regarding our business plans, prospects, growth and financial condition and results of operation;
Previous wording
These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.
Current wording
These forward-looking statements are based on current beliefs and expectations and are subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this report.
Previous wording
general economic conditions, including any recessionary conditions and/or increases in unemployment, either nationally or in our market areas, that are worse than expected;
Current wording
general economic conditions, nationally or in our market areas;
Previous wording
changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for loan losses;
Current wording
changes in the level and direction of loan delinquencies and write-offs and changes in estimates of and methodology for calculating the adequacy of the allowance for loan losses;
Previous wording
fluctuations in real estate values and in the conditions;
Current wording
fluctuations in real estate values;
Previous wording
our ability to implement and change our business strategies;
Current wording
our ability to implement our business strategies;
Previous wording
competition among depository and other financial institutions, including with respect to ability to charge overdraft fees;
Current wording
competition among depository and other financial institutions;
Previous wording
inflation and changes in the interest rate environment that reduce our margins and yields, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and will make;
Current wording
inflation and changes in the interest rate;
Previous wording
changes in laws or government regulations or policies affecting financial institutions and/or their holding companies, including changes in regulatory fees, capital requirements and insurance premiums;
Current wording
changes in laws or government regulations or policies, including changes in monetary and fiscal policies;
Previous wording
changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;
Current wording
changes in accounting policies and practices;
Previous wording
our ability to retain key employees;
Current wording
our ability to retain key employees; and
Previous wording
The allowance for credit losses on loans is evaluated on a regular basis by management. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. For example, an increase of 25 basis points as to our lifetime loss rate for qualitative factors for all loan categories at March 31, 2026 would have increased our allowance for credit losses on loans at that date to $6.6 million from $4.5 million.
Current wording
The allowance for credit losses on loans is evaluated on a regular basis by management. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. For example, an increase of 25 basis points as to our lifetime loss rate for qualitative factors for all loan categories at September 30, 2026 would have increased our allowance for credit losses on loans at that date to $7.4 million from $5.1 million.
Previous wording
Total Assets. Total assets increased $107.7 million, or 11.3%, to $1.06 billion at March 31, 2026, from $949.4 million at June 30, 2025. The increase was primarily due to increases in loans and investment securities.
Current wording
Total Assets. Total assets increased $45.3 million, or 4.1%, to $1.14 billion at September 30, 2026, from $1.1 billion at June 30, 2026. The increase was primarily due to increases in the loan portfolio.
Previous wording
Cash and Cash Equivalents. Cash and cash equivalents decreased $1.3 million, or 2.3%, to $54.0 million at March 31, 2026 from $55.2 million at June 30, 2025.
Current wording
Cash and Cash Equivalents. Cash and cash equivalents increased $3.2 million, or 5.2%, to $63.2 million at September 30, 2026 from $60.0 million at June 30, 2026.
Previous wording
Investment Securities. Investment securities, comprised of both available for sale and held to maturity securities, aggregated $124.0 million at March 31, 2026 compared to $104.5 million at June 30, 2025, as we continued to invest stock offering proceeds into government agency and mortgage backed securities.
Current wording
Investment Securities. Investment securities, comprised of both available for sale and held to maturity securities, aggregated $123.2 million at September 30, 2026 compared to $125.0 million at June 30, 2026. The portfolio declined as rising rates increased unrealized losses in the AFS portfolio.
Previous wording
Gross Loans. Loans increased $89.4 million, or 11.9%, to $843.5 million at March 31, 2026 compared to $754.1 million at June 30, 2025. The main driver of the new growth was in multi-family and residential real estate loans, which increased $49.6 million and $31.7 million, respectively. The commercial real estate and home equity portfolios also increased $6.2 million and $2.2 million, respectively. We remained focused on originating multi-family, commercial and residential real estate loans as the primary drivers of loan portfolio growth.
Current wording
Loans, net. Loans increased $37.9 million, or 4.4%, to $908.7 million at September 30, 2026 compared to $870.8 million at June 30, 2026. Growth was driven primarily by construction and residential real estate loans, which increased $21.9 million and $14.1 million, respectively. Multi-family real estate and home equity portfolios also increased $4.0 million and $1.7 million, respectively. We remain focused on originating construction, multi-family, and residential real estate loans as the primary drivers of loan portfolio growth.
Previous wording
Deposits. Deposits increased $104.5 million, or 15.4%, to $783.7 million at March 31, 2026 from $679.2 million at June 30, 2025. Money market accounts drove the increase, rising $108.7 million, or 90.1%, to $229.3 million at March 31, 2026 from $120.6 million at June 30, 2025, primarily due to growth in municipal customer deposits. Offsetting the increase in money market accounts was a decrease of $4.2 million, or 1.5%, in certificates of deposit to $278.9 million at March 31, 2026 from $283.2 million at June 30, 2025. All of our deposits are fully insured by the FDIC or the Depositors Insurance Fund.
Current wording
Deposits. Deposits increased $53.4 million, or 6.6%, to $862.7 million at September 30, 2026 from $809.2 million at June 30, 2026. Certificates of deposits drove the increase, rising $29.8 million, or 10.6%, to $311.3 million at September 30, 2026 from $281.5 million at June 30, 2026. Money market accounts increased $20.2 million to $280.8 million at September 30, 2026 from $260.6 million at June 30, 2026. All of our deposits are fully insured by the FDIC or the Depositors Insurance Fund.
Previous wording
Borrowings. Borrowings, which consisted solely of Federal Home Loan Bank of Boston advances, decreased $117,000, or 0.1%, to $146.9 million at March 31, 2026, compared to $147.0 million at June 30, 2025, as the inflows from the increase in deposits were used to restructure wholesale funding.
Current wording
Borrowings. Borrowings, which consisted solely of Federal Home Loan Bank of Boston advances, decreased $8.2 million, or 5.2%, to $149.9 million at September 30, 2026, compared to $158.2 million at June 30, 2026.
Previous wording
General. We recorded net income of $1.1 million and $305,000 for the three months ended March 31, 2026 and 2025, respectively. The increase in net income was due to an increase in interest and dividend income and a decrease in the cost of funds, partially offset by an increase in operating expense.
Current wording
General. We recorded net income of $1.3 million and $962,000 for the three months ended September 30, 2026 and 2025, respectively. The increase in net income was due to an increase in interest and dividend income, partially offset by an increase in the cost of funds and operating expense.
Previous wording
Interest and Dividend Income. Interest and dividend income increased $1.9 million, or 17.9%, to $12.5 million for the three months ended March 31, 2026, from $10.6 million for the three months ended March 31, 2025. Interest and fees on loans, which is our primary source of interest income, increased $1.4 million, or 14.6%, to $10.9 million for the three months ended March 31, 2026.
Current wording
Interest and Dividend Income. Interest and dividend income increased $2.3 million, or 18.8%, to $14.2 million for the three months ended September 30, 2026, from $11.9 million for the three months ended September 30, 2025. Interest and fees on loans, which is our primary source of interest income, increased $2.0 million, or 19.6%, to $12.4 million for the three months ended September 30, 2026.
Previous wording
The average balance of loans increased by $82.1 million, or 11.2%, to $817.3 million for the three months ended March 31, 2026, over the average balance for the three months ended March 31, 2025, while the average yield on loans increased by 16 basis points to 5.32% for the three months ended March 31, 2026, from 5.16% for the three months ended March 31, 2025. The increase in the average yield was due to a change in the composition of our loan portfolio to include a higher percentage of higher yielding construction and commercial real estate loans, as well as multi-family residential real estate loans. The increase in average balance was due to our continuing to pursue new commercial relationships.
Current wording
The average balance of loans increased by $124.0 million, or 16.0%, to $899.0 million for the three months ended September 30, 2026, over the average balance for the three months ended September 30, 2025, while the average yield on loans increased by 16 basis points to 5.53% for the three months ended September 30, 2026, from 5.37% for the three months ended September 30, 2025. The higher average yield primarily reflects a shift in the loan portfolio mix toward higher-yielding construction, commercial real estate and multifamily real estate loans. Growth in the average balance was driven by our continued efforts to develop new commercial relationships.
Previous wording
Interest Expense. Total interest expense totaled $6.2 million for the three months ended March 31, 2026 which represents a decrease of $21,000, or 0.3%, compared to the same period in 2025. Interest expense on deposits increased $222,000, or 4.7%, to $4.9 million for the three months ended March 31, 2026. Our average balance of interest-bearing deposits increased $87.0 million, or 14.2%, to $699.6 million, while our average cost of deposits decreased 26 basis points to 2.80% for the three months ended March 31, 2026, from 3.06% for the three months ended March 31, 2025.
Current wording
Interest Expense. Interest expense totaled $7.0 million for the three months ended September 30, 2026 which represents an increase of $799,000, or 12.9%, compared to the same period in 2025. Interest expense on deposits increased $1.0 million, or 22.2%, to $5.7 million for the three months ended September 30, 2026. Our average balance of interest-bearing deposits increased $153.9 million, or 24.4%, to $783.4 million, while our average cost of deposits decreased 6 basis points to 2.91% for the three months ended September 30, 2026, from 2.97% for the three months ended September 30, 2025.
Previous wording
Interest expense on Federal Home Loan Bank advances decreased $243,000, or 15.6%, to $1.3 million for the three months ended March 31, 2026. Our average balance of Federal Home Loan Bank advances decreased $12.3 million, and our average cost of borrowings decreased 34 basis points to 3.98% for the three months ended March 31, 2026, from 4.32% for the three months ended March 31, 2025. The decrease in the Federal Home Loan Bank cost of funds is due to the decrease in average borrowing balances and lower advance rates.
Current wording
Interest expense on Federal Home Loan Bank advances decreased $239,000, or 15.7%, to $1.3 million for the three months ended September 30, 2026. Our average balance of Federal Home Loan Bank advances decreased $9.6 million, and our average cost of borrowings decreased 41 basis points to 3.91% for the three months ended September 30, 2026, from 4.32% for the three months ended September 30, 2025. The decrease in interest expense on Federal Home Loan Bank advances is due to lower average balances and lower rates on advances.
Previous wording
Net Interest Income. Net interest income was $6.3 million for the three months ended March 31, 2026, compared to $4.4 million for the three months ended March 31, 2025, as our interest income increased faster than our interest expense. Our interest rate spread increased to 2.06% for the three months ended March 31, 2026 from 1.61% for the three months ended March 31, 2025. Our net interest margin increased to 2.54% for the three months ended March 31, 2026 from 2.02% for the three months ended March 31, 2025
Current wording
Net Interest Income. Net interest income was $7.2 million for the three months ended September 30, 2026, compared to $5.7 million for the three months ended September 30, 2025, as our interest income increased faster than our interest expense. Our interest rate spread increased to 2.22% for the three months ended September 30, 2026 from 1.96% for the three months ended September 30, 2025. Our net interest margin increased to 2.67% for the three months ended September 30, 2026 from 2.49% for the three months ended September 30, 2025
Previous wording
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a provision for credit losses of $325,000 for the three months ended March 31, 2026, compared to a benefit of $21,000 for the three months ended March 31, 2025. The increase in provision for credit losses on loans for the three months ended March 31, 2026 was primarily due to loan portfolio growth.
Current wording
Provision for Credit Losses. Based on an analysis of the factors described in “Critical Accounting Policies—Allowance for Credit Losses,” we recorded a provision for credit losses of $415,000 for the three months ended September 30, 2026, compared to a benefit of $320,000 for the three months ended September 30, 2025. The decrease in provision for credit losses on loans for the three months ended September 30, 2026 was primarily due to lower loan portfolio growth during the period.
Previous wording
The allowance for credit losses on loans was $4.5 million at March 31, 2026 and $4.2 million at June 30, 2025, and represented 0.54% of total loans at March 31, 2026 and 0.55% at June 30, 2025 . The allowance for credit losses for off balance sheet commitments was $601,000 at March 31, 2026 and $1.1 million at June 30, 2025. The benefit for off balance sheet commitments is related to the change in ACL methodology and lower balances of loan commitments as the commitments were converted to loans.
Current wording
The allowance for credit losses on loans was $5.1 million at September 30, 2026 and $4.8 million at June 30, 2026, and represented 0.56% of total loans at September 30, 2026 and 0.55% at June 30, 2026 . The allowance for credit losses for off balance sheet commitments was $811,000 at September 30, 2026 and $746,000 at June 30, 2026. The increases in both allowances were primarily due to loan growth and higher unfunded commitments during the quarter.
Previous wording
Total nonaccrual loans were $1.7 million at March 31, 2026, compared to $2.2 million at June 30, 2025. Total loans past due 30 days or greater were $1.8 million at March 31, 2026, unchanged from June 30, 2025. As a percentage of nonperforming loans, the allowance for credit losses on loans was 272.17% at March 31, 2026 compared to 187.57% at June 30, 2025. The decrease in past due and non-accrual balances is primarily due to a loan payoff during the quarter.
Current wording
Total nonaccrual loans were $1.9 million at September 30, 2026, compared to $1.6 million at June 30, 2026. Total loans past due 30 days or greater were $1.5 million at September 30, 2026, unchanged from June 30, 2026.
Previous wording
The increase in salaries and employee benefits was due to the addition of key finance and commercial lending staff, and higher expenses related to our health plan, while the decrease in deposit insurance expense was due to a decrease in FDIC insurance rates. The increase in data processing cost is due to investments in new technologies that will improve customer experience and efficiencies. Increases in marketing expense were due to the launch of a new website as well as a new investor relations site while increases in other expense were primarily due to higher reserves for off balance sheet commitments.
Current wording
The increase in salaries and employee benefits reflected the addition of commercial lending and higher health plan expenses, while deposit insurance expense declined due to lower FDIC insurance rates. Data processing costs increased due to investments in new technologies designed to improve the customer experience and operational efficiency. Marketing expense increased with the launch of a new branding campaign, while other expenses rose primarily due to higher legal and audit fees associated with the Bank’s change in fiscal year end from June 30 to December 31.
Previous wording
Income Taxes. Income tax expense increased to $349,000 for the three months ended March 31, 2026, compared to $67,000 for the three months ended March 31, 2025. The effective tax rates were 23.4% and 18.0% for the three months ended March 31, 2026 and 2025, respectively, as we had lower levels of taxable income during the 2025 period.
Current wording
Income Taxes. Income tax expense increased to $387,000 for the three months ended September 30, 2026, compared to $356,000 for the three months ended September 30, 2025. The effective tax rates were 23.4% and 27.0% for the three months ended September 30, 2026 and 2025, respectively, as we had higher levels of taxable income during the 2026 period.
Previous wording
The tables above indicate that at March 31, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 15.7% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 5.7% increase in net interest income and at June 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 14.3% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 1.7% increase in net interest income.
Current wording
The tables above indicate that at September 30, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 23.2% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 9.8% decrease in net interest income and at June 30, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 17.9% decrease in net interest income, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 6.9% increase in net interest income.
Previous wording
The tables below sets forth, as of March 31, 2026 and June 30, 2025, the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve.
Current wording
The tables below set forth, as of September 30, 2026 and June 30, 2026, the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve.
Previous wording
The tables above indicate that at March 31, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 19.6% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 5.6% increase in EVE, and at June 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 22.0% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 7.1% increase in EVE.
Current wording
The tables above indicate that at September 30, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 24.2% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 6.8% decrease in EVE, and at June 30, 2026, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 20.1% decrease in EVE, and in the event of an instantaneous parallel 200 basis point decrease in interest rates, we would have experienced a 4.8% increase in EVE.
Previous wording
At March 31, 2026, all estimated changes described above with respect to net interest income and EVE with respect to potential increases in market interest rates were not in compliance with the current policy limits established by the board of trustees. We have determined that selling assets to comply with our internal policies would result in a significant loss that would deplete capital and, as a result, restrict future growth, while providing limited benefit during a period of declining market interest rates, as began in the latter half of 2024.
Current wording
At September 30, 2026, all estimated changes described above with respect to net interest income and EVE with respect to potential increases in market interest rates exceeded the current policy limits established by the board of trustees. We have determined that selling assets to comply with our internal policies would result in a significant loss that would deplete capital and, as a result, restrict future growth, while providing limited benefit during a period of declining market interest rates, as began in the latter half of 2024.
Previous wording
Liquidity is our ability to meet current and future financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities and proceeds from maturities and calls of securities. We also have the ability to borrow from the Federal Home Loan Bank of Boston. At March 31, 2026, we had $146.9 million outstanding in advances from the Federal Home Loan Bank of Boston and a $25 million outstanding letter of credit. At March 31, 2026, we had the ability to borrow $146.1 million in additional Federal Home Loan Bank of Boston advances. At March 31, 2026, we had a $5.3 million line of credit with the Federal Home Loan Bank of Boston, which was not drawn at March 31, 2026. Additionally, at March 31, 2026, we had a $88.2 million secured line of credit through the Federal Reserve Borrower in Custody program. At that date, there were no amounts outstanding.
Current wording
Liquidity is our ability to meet current and future financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities and proceeds from maturities and calls of securities. We also have the ability to borrow from the Federal Home Loan Bank of Boston. At September 30, 2026, we had $149.9 million outstanding in advances from the Federal Home Loan Bank of Boston. At September 30, 2026, we had the ability to borrow $169.6 million in additional Federal Home Loan Bank of Boston advances. At September 30, 2026, we had a $5.3 million line of credit with the Federal Home Loan Bank of Boston, which was not drawn at September 30, 2026. Additionally, at September 30, 2026, we had a $147.9 million secured line of credit through the Federal Reserve Borrower in Custody program. At that date, there were no amounts outstanding.
Previous wording
We seek to maintain a minimum monthly liquidity ratio of 4% to 6% of assets, and a minimum quarterly Primary Liquidity ratio of 10%. At March 31, 2026 and June 30, 2025, we were in compliance with both of these guidelines.
Current wording
We seek to maintain a minimum monthly liquidity ratio of 4% to 6% of assets, and a minimum quarterly primary liquidity ratio of 15%. At September 30, 2026 and June 30, 2026, we were in compliance with both of these guidelines.
Previous wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities, investing activities, and financing activities. Net cash provided by operating activities was $4.3 million for the nine months ended March 31, 2026 and $571,000 for the nine months ended March 31, 2025. Net cash used by investing activities, which consists primarily of disbursements for loan originations and the purchase of investment securities, offset by principal collections on loans and proceeds from maturing securities and pay downs on securities, was $110.1 million and $47.5 million for the nine months ended March 31, 2026 and 2025, respectively. Net cash provided by financing activities was $104.6 million and $69.4 million for the nine months ended March 31, 2026 and 2025, respectively.
Current wording
Our cash flows are comprised of three primary classifications: cash flows from operating activities, investing activities, and financing activities. Net cash provided by operating activities was $2.2 million for the three months ended September 30, 2026 and $1.4 million for the three months ended September 30, 2025. Net cash used by investing activities, which consists primarily of disbursements for loan originations and the purchase of investment securities, offset by principal collections on loans and proceeds from maturing securities and pay downs on securities, was $44.5 million and $53.3 million for the three months ended September 30, 2026 and 2025, respectively. Net cash provided by financing activities was $45.5 million and $54.4 million for the three months ended September 30, 2026 and 2025, respectively.
Previous wording
We are committed to maintaining a strong liquidity position. We monitor our liquidity position on a daily basis. We anticipate that we will have sufficient funds to meet our current funding commitments based on our current strategy to increase loans with an increase in core deposits and the continued use of Federal Home Loan Bank of Boston advances, as needed.
Current wording
We are committed to maintaining a strong liquidity position. We consistently monitor our liquidity position. We anticipate that we will have sufficient funds to meet our current funding commitments based on our current strategy to increase loans with an increase in core deposits and the continued use of Federal Home Loan Bank of Boston advances, as needed.
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
Comparison of Operating Results for the Nine Months ended March 31, 2026 and 2025
Previous report — wording carried elsewhere
Our estimates and assumptions used in the determination of the adequacy of the allowance could require adjustments in the future, and the actual amount of future provisions may exceed the amount of past provisions. Any such increase in future provisions that may be required may adversely impact our financial condition and results of operations.
Previous report — wording carried elsewhere
The following table sets forth average balance sheets, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances, and the average balance of loans includes non-accrual loans. The yields set forth below
Previous report — wording carried elsewhere
include the effect of deferred fees/costs, discounts, and premiums that are amortized or accreted to interest income. Deferred loan fees for the nine months ended March 31, 2026 and 2025 were not material.
Previous report — wording carried elsewhere
The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The total column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. There were no out-of-period items or adjustments required to be excluded from the table below.