Bogota Financial Corp.

2024 Auditor firm PCAOB number:74 Auditor name: S. R. Snodgrass P.C. Auditor location: Cranbury Township, PA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors of Bogota Financial Corp.

Opinion on the Financial Statements

We have audited the accompanying consolidated statements of financial condition of Bogota Financial Corp. and subsidiary (the “Company”) as of December 31, 2024 and 2023; the related consolidated statements of operations, comprehensive income, equity, and cash flows for the years then ended; and the related notes to the consolidated financial statements (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Change in Accounting Principle

As discussed in Note 1 to the financial statements, the Company changed its method of accounting for credit losses effective January 1, 2023, due to the adoption of Accounting Standards Codification (ASC) Topic 326, Financial Instruments – Credit Losses.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent, with respect to the Company, in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the Company’s auditor since 2021.

/s/S.R. Snodgrass, P.C.

Cranberry Township, Pennsylvania

March 28, 2025

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF EQUITY

CONSOLIDATED STATEMENTS OF CASH FLOWS

NOTE1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations and Principles of Consolidation: On* January 15, 2020,Bogota Financial Corp. (the “Company,” “we” or “our”) became the mid-tier stock holding company for Bogota Savings Bank (the “Bank”) in connection with the reorganization of Bogota Savings Bank into thetwo*-tier mutual holding company structure.

The Bank maintainstwo subsidiaries Bogota Securities Corp, which was formed for the purpose of buying, selling and holding investment securities and Bogota Properties, LLC, which was inactive at* December 31, 2024*.

The Bank generally originates residential, commercial and consumer loans to, and accepts deposits from, customers in New Jersey. The Bank is also subject to the regulations of, and examination by, certain federal and state regulatory agencies.

Bogota Financial Corp. completed its stock offering in connection with the mutual holding company reorganization of Bogota Savings Bank on* January 15, 2020.*The Company sold 5,657,735 shares of common stock at $10.00 per share for gross proceeds of $56.6 million. In connection with the reorganization, the Company also issued 263,150 shares of common stock and $250,000 in cash to Bogota Savings Bank Charitable Foundation, Inc. and 7,236,640 shares of common stock to Bogota Financial, MHC, its New Jersey-chartered mutual holding company.

Reclassifications: Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassifications hadno effect on prior year net income or equity.

Earnings per Share: Basic earnings per share (“EPS”) is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. For purposes of calculating basic EPS, weighted average common shares outstanding excludes unallocated employee stock ownership plan shares that havenot been committed for release. Diluted EPS is computed using the same method as basic EPS, but also reflects the potential dilution which could occur if stock options shares were exercised and converted into common stock. The potentially dilutive shares would then be included in the weighted average number of shares outstanding for the period using the treasury stock method. For thetwelve-month periods ended* December 31, 2024and2023*, options to purchase 510,119 common shares with an exercise price of $10.45 were outstanding but werenot included in the calculation of diluted EPS because the options were anti-dilutive, meaning the exercise price for such options were higher than the average price for the Company for such period.

The following is a reconciliation of the numerators and denominators of the basic earnings per share calculations for the years ended* December 31, 2024and2023*.

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Use of Estimates: To prepare financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided. Actual results could differ from those estimated.

Cash Flows: Cash and cash equivalents include cash and deposits with other banks with original maturities of90 days or less. Net cash flows are reported for customer loan and deposit transactions and short-term FHLB advances.

Interest-Bearing Deposits in Other Banks: Interest-bearing deposits in other banks have original maturities of90 days or less and are carried at cost.

Securities: Debt securities are classified as held to maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Debt securities are classified as available for sale when they might be sold before maturity. Securities available for sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income (loss), net of tax.

Interest income includes amortization of purchase premium or discount. Premiums and discounts on securities are amortized on the level-yield method without anticipating prepayments, except for mortgage-backed securities (“MBSs”), where prepayments are anticipated. Gains and losses on sales are recorded on the trade date and determined using the specific identification method.

Held-to-maturity ("HTM") debt securities are required to utilize the Current Expected Credit Losses ("CECL") approach to estimate expected credit losses. As of* December 31, 2024*, the Company didnot have any debt securities that were classified as HTM, and therefore, an allowance for credit losses wasnot recorded. During2024, all of the Company's HTM securities were transferred to available-for-sale ("AFS"), which eliminated the need for an allowance for credit losses. See Note3 for additional information.

AFS debt securities are measured at fair value rather than amortized cost. For AFS debt securities in an unrealized loss position, the Companyfirst assesses whether it intends to sell, or it is more likely thannot that it will be required to sell the security before recovery of its amortized cost basis. If either criteria is met, the security’s amortized cost basis is written down to fair value through income. For AFS debt securities that donot meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that hasnot been recorded through an allowance for credit losses is recognized in other comprehensive income. Changes in the allowance for credit losses are recorded as a provision for (or reversal of) credit losses. Losses are charged against the allowance when management believes the uncollectibility of an AFS security is confirmed or when either of the criteria regarding intent or requirement to sell is met. As of* December 31, 2024and2023*, the Company determined that the unrealized loss positions in AFS securities werenot the result of credit losses, and management had the intent and ability to hold to recovery, therefore, an allowance for credit losses wasnot recorded. Accrued interest receivable on AFS securities is excluded from the estimate of credit losses and is included in Accrued interest receivable on the Consolidated Statements of Financial Condition. At* December 31, 2024and2023*, accrued interest receivable on AFS securities was $809,000 and $654,000, respectively.

Loans: Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at the principal balance outstanding, net of deferred loan fees and costs, and an allowance for credit losses. Interest income is accrued on the unpaid principal balance. The Bank originates real estate, commercial and consumer loans. A substantial portion of the loan portfolio is represented by loans in northern New Jersey. The ability of the Bank’s debtors to honor their contracts is dependent upon the real estate values and general economic conditions in this area. Loan origination fees, net of certain direct origination costs, are deferred and recognized in interest income using the level-yield method without anticipating prepayments.

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Interest income on real estate, commercial and consumer loans is discontinued at the time the loan is90 days delinquent unless the loan is well-secured and in process of collection. Past due status is based on the contractual terms of the loan. In all cases, loans are placed on nonaccrual status or charged-off at an earlier date if collection of principal or interest is considered doubtful. Nonaccrual loans and loans past due90 days and still on accrual status include both smaller balance homogeneous loans that are collectively evaluated for impairment and individually classified impaired loans. A loan is moved to nonaccrual status in accordance with the Bank’s policy, typically after90 days of non-payment.

All interest accrued butnot received for loans placed on nonaccrual status is reversed against interest income. Interest received on such loans is accounted for on the cash-basis or cost-recovery method, until qualifying for return to accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

Allowance for Credit Losses - Loans and Leases: The CECL model requires an estimate of the credit losses expected over the life of an exposure (or pool of exposures).

The estimate of expected credit losses is based on relevant information about past events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amounts. Historical loss experience is generally the starting point for estimating expected credit losses. The Company then considers whether the historical loss experience should be adjusted for asset-specific risk characteristics or current conditions at the reporting date that didnot exist over the historical period used. The Company considers future economic conditions and portfolio performance as part of a reasonable and supportable forecast.

Portfolio segment is defined as the level at which an entity develops and documents a systematic methodology to determine its allowance for credit losses (“ACL”). The Company has designatedsix portfolio segments, which are residential, commercial real estate, multi-family, construction, commercial and industrial and consumer. These portfolio segments are further disaggregated into classes, which represent loans and leases of similar type, risk characteristics, and methods for monitoring and assessing credit risk.

The Company has minimal history of credit losses and therefore uses the Weighted Average Remaining Maturity (WARM) method for all segments and relies on the use of qualitative factors to determine future credit losses. Accrued interest receivable on loans is excluded from the estimate of credit losses and is included in Accrued interest receivable on the Consolidated Statements of Financial Condition. At* December 31, 2024and2023*, accrued interest receivable on loans was $3.4 million and $3.3 million, respectively.

The Company considers the impact of current environmental factors at the reporting date that didnot exist over the period from which historical experience was used. Relevant factors include, but arenot limited to, concentrations of credit risk (geographic, large borrower, and industry), economic trends and conditions, changes in underwriting standards, experience and depth of lending staff, trends in delinquencies, and the amount of criticized loans.

The Company also incorporates aone-year reasonable and supportable loss forecast period to account for the effect of forecasted economic conditions and other factors on the performance of the commercial portfolio, which could differ from historical loss experience. The Company performs a quarterly asset quality review, which includes a review of forecasted gross charge-offs and recoveries, non-performing assets, criticized loans and leases, and risk rating migration. The asset quality review is reviewed by management and the results are used to consider a qualitative overlay to the quantitative baseline. After theone-year reasonable and supportable loss forecast period, this overlay adjustment assumes an immediate reversion to historical loss rates for the remaining loan life period.

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The Company establishes a specific reserve for individually evaluated loans which donot share similar risk characteristics with the loans included in the quantitative baseline. These individually evaluated loans are removed from the pooling approach discussed above for the quantitative baseline, and include non-accrual loans, and other loans as deemed appropriate by management.

A financial asset is considered collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. For all classes of loans deemed collateral-dependent, the Company elected the practical expedient to estimate expected credit losses based on the collateral’s fair value less cost to sell. In most cases, the Company records a partial charge-off to reduce the loan’s carrying value to the collateral’s fair value less cost to sell. Substantially all of the collateral consists of various types of real estate including: residential properties; commercial properties, such as retail centers, office buildings, and lodging; agriculture land; and vacant land.

The reserve for unfunded commitments (the “Unfunded Reserve”) represents the expected credit losses on off-balance sheet commitments such as unfunded commitments to extend credit and standby letters of credit. However, a liability isnot recognized for commitments unconditionally cancellable by the Company. The Unfunded Reserve is recognized as a liability (other liabilities in the consolidated statements of financial condition), with adjustments to the reserve recognized in other noninterest expense in the consolidated statements of operations. The Unfunded Reserve is determined by estimating future draws and applying the expected loss rates on those draws. Future draws are based on historical averages of utilization rates (i.e., the likelihood of draws taken). To estimate future draws on unfunded balances, current utilization rates are compared to historical utilization rates. If current utilization rates are below historical utilization rates, the rate difference is applied to the committed balance to estimate the future draw. Loss rates are estimated by utilizing the same loss rates calculated for the allowance general reserves.

Acquired Loans: Loans acquired in a business combination that have experienced more-than-insignificant deterioration in credit quality since origination are considered purchased with credit deterioration (“PCD”) loans. The Company evaluated acquired loans for deterioration in credit quality based on, butnot limited to, the following: (1) non-accrual status; (2) previously a troubled debt restructured designation; (3) risk ratings of special mention, substandard or doubtful; or (4) delinquency status. At the acquisition date, an estimate of expected credit losses was made for groups of PCD loans with similar risk characteristics and individual PCD loans without similar risk characteristics. This initial allowance for credit losses is allocated to individual PCD loans and added to the purchase price or acquisition date fair values to establish the initial amortized cost basis of the PCD loans. As the initial allowance for credit losses is added to the purchase price, there isno credit loss expense recognized upon acquisition of a PCD loan. Any difference between the unpaid principal balance of PCD loans and the amortized cost basis is considered to relate to noncredit factors and results in a discount or premium. Discounts and premiums are recognized through interest income on a level-yield method over the life of the loans. For acquired loansnot deemed PCD at acquisition, the differences between the initial fair value and the unpaid principal balance are recognized as interest income on a level-yield basis over the lives of the related loans. At the acquisition date, an initial allowance for expected credit losses is estimated and recorded as credit loss expense.

Residential First Mortgage Loans – Residentialfirst mortgage loans are generally made on the basis of the borrower’s ability to make repayment from his or her employment and other income but are secured by real property whose value tends to be more easily ascertainable. Credit risk for these types of loans is generally influenced by general economic conditions, the characteristics of individual borrowers and the nature of the loan collateral.

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Commercial and Multi-Family Real Estate Loans – Commercial and multi-family real estate loans generally have larger balances and involve a greater degree of risk than residential real estate loans, inferring higher potential losses on an individual customer basis. Loan repayment is often dependent on the successful operation and management of the properties and/or businesses occupying the properties, as well as on the collateral securing the loan. Economic events or conditions in the real estate market could have an adverse impact on the cash flows generated by the properties securing the Bank’s commercial real estate loans and on the value of such properties.

Construction Loans – Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost and timing of construction. During the construction phase, a number of factors could result in delays and cost overruns. If the estimate of construction costs proves to be inaccurate, additional funds* maybe required to be advanced in excess of the amount originally committed to permit completion of the building. If the estimate of value proves to be inaccurate, the value of the building maybe insufficient to assure full repayment if liquidation is required. If foreclosure is required on a building before or at completion due to a default, there can beno* assurance that all of the unpaid balance of, and accrued interest on, the loan as well as related foreclosure and holding costs will be recovered.

Commercial and Industrial Loans - A commercial and industrial loan is a loan to a business rather than a loan to an individual consumer. These short-term loans generally have an interest rate based on the prime rate and are secured by collateral owned by the business requesting the loan. Commercial and industrial loans expose us to additional risks since they typically are made on the basis of the borrower's ability to make repayments from the cash flows of the borrower's business and are secured by non-real estate collateral that* maydepreciate over time, maybe illiquid and may*fluctuate in value based on the success of the business, guarantor, or market conditions.

Consumer Loans – Consumer loans are passbook loans, which are collateralized by a customer's savings account or certificate of deposit. The amount of a passbook loan is limited to a certain percentage of the customer's savings account or certificate of deposit balance and have an interest rate that is a spread above the stated rate on the collateral account.

Mortgage Loan Sales: The Bank has a partnership through the Federal Home Bank of New York (“FHLBNY”) to sell loans within the Mortgage Partnership Finance (“MPF”) Program. The MPF Program gives the Bank another alternative to retaining mortgages in portfolio, which* mayincrease profits through fees earned through the sale of loans. It allows the Bank to be competitive in all the fixed-rate products. In addition, the MPF structure capitalizes on the Bank's credit expertise. MPF combines that expertise with the FHLBNY's expertise in handling interest rate risk. FHLBNY manages the interest rate, the liquidity and the prepayment risks, while the Bank manages the credit and servicing risks. The result involves the member receiving a very competitive price for loans plus fees over time for managing the credit and servicing risks. Loans are sold at origination; gains or losses on the sale of mortgage loans are recognized at the settlement date and are determined by the difference between the net proceeds and the amortized cost. All loans are sold with servicing being retained by the Bank. The outstanding principal balances sold and serviced by the Bank under the program were $3,550,443 and $3,865,316 at December 31, 2024and2023*, respectively.

Under the program, thefirst layer of losses is paid by the FHLBNY up to 100 basis points of the total funded amount of loans sold. (the “First Loss Account”). The Bank then provides asecond loss credit enhancement obligation, which is equivalent to “AA” credit risk less the First Loss Account. Loan losses beyond thefirst andsecond layers are absorbed by the FHLBNY. There wereno losses as of* December 31, 2024* on the loans sold under the program. Late fees and ancillary fees related to loan servicing arenot material.

Premises and Equipment: Land is carried at cost. Premises and equipment are stated at cost less accumulated depreciation. Building and related components are depreciated using the straight-line method with useful lives ranging from fifteen to 39 years. Furniture, fixtures and equipment are depreciated using the straight-line method with useful lives ranging fromone toten years. Leasehold improvements are amortized over the shorter of the terms of the respective leases or the estimated lives of the improvements.

Leases: The Company determines if an arrangement is a lease at inception. The Company's leases primarily relate to real estate property for branches and office space. All the Company's leases are classified as operating leases and the related right-of-use asset ("ROU") and lease liability are disclosed on the Consolidated Statements of Financial Condition.

ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease arrangements. The calculated amounts of the ROU asset and lease liabilities are impacted by the length of the lease term and the discount rate used to calculate the present value of minimum lease payments. As the Company's leases donot provide an implicit rate, the discount rate used in determining the lease liability for each individual lease is the Company's incremental borrowing rate. The present value of the lease liability* may*include the impact of options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options provided in the lease terms. Lease expense is recognized on a straight-line basis over the expected lease term, while variable lease payments are recognized as incurred. Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately.

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Federal Home Loan Bank (“FHLB”) Stock: FHLB stock is restricted stock, which is carried at cost, and periodically evaluated for impairment based on ultimate recovery of par value. Federal law requires a member institution of the FHLB to hold stock according to a predetermined formula based on the amount of borrowings held. Dividends are recorded as income on the consolidated statement of income.

Bank Owned Life Insurance: The Bank has purchased life insurance policies on certain key employees. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement.

Intangible Assets: Intangible assets, other than goodwill, include core deposit intangibles and mortgage servicing rights ("MSRs"). Core deposit intangibles are a measure of the value of consumer demand and savings deposits acquired in business combinations accounted for as purchases. The core deposit intangibles are being amortized over 10 years using the sum-of-the-years digits method of amortization.

MSRs arise from the Company originating certain loans for the express purpose of selling such loans in the secondary market. The Company maintains all servicing rights for these loans. The loans held for sale are carried at lower of cost or market value. Originated MSRs are recorded by allocating total costs incurred between the loans and servicing rights based on their relative fair values. MSRs are amortized in proportion to the estimated servicing income over the estimated life of the servicing portfolio and measured annually for impairment.

The recoverability of the carrying value of intangible assets is evaluated on an ongoing basis, and permanent declines in value, if any, are charged to expense.

Advertising Costs: Advertising costs are expensed as incurred. Any direct response advertising conducted by the Bank is immaterial and hasnot been capitalized. Advertising costs are included in “non-interest expenses” in the consolidated statements of operations.

Off-Balance-Sheet Financial Instruments: In the ordinary course of business, the Bank enters into off-balance-sheet financial instruments consisting of commitments to extend credit. Such financial instruments are recorded in the consolidated statement of financial condition when funded.

Income Taxes: Income tax (benefit) expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities, computed using enacted tax rates. A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

A tax position is recognized as a benefit only if it is “more likely thannot” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than50% likely of being realized on examination. For tax positionsnot meeting the “more likely thannot” test,no tax benefit is recorded. The Bank hadno unrecognized tax positions as of* December 31, 2024* or2023.

The Company recognizes interest and/or penalties related to income tax matters in income tax (benefit) expense.

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Retirement Plans: Pension expense is the net of service and interest cost and amortization of gains and lossesnot immediately recognized. Employee401(k) plan expense is the amount of matching and safe harbor contributions. Profit sharing expense is based on the amount of contributions made by the Bank as determined by the Board of Directors. Director’s retirement plan expense allocates the benefits over years of service. Supplemental Retirement Plan expense allocates the benefits over years of service.

Stock Based Compensation: Compensation cost is recognized for stock options and restricted stock awards issued to employees and directors, based on the fair value of these awards at the grant date. A Black-Scholes model is utilized to estimate the fair value of stock options, while the market price of the Company’s common stock at the date of the grant is used for restricted shares. Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award.

Comprehensive Income: Comprehensive income consists of net income and other comprehensive (loss) income. Other comprehensive (loss) income includes net unrealized holding gains and losses on securities available for sale and net unrealized gains and losses on the pension plan which are also recognized as separate components of equity and the change in fair value of the Company's swap derivatives.

Loss Contingencies: Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Recoveries, including proceeds from insurance claims are evaluated separately from loss contingencies and recognized when realized.

Fair Value of Financial Instruments: Fair values of financial instruments are estimated using relevant market information and other assumptions, as more fully disclosed in a separate note. Fair value estimates involve uncertainties and matters of significant judgment regarding interest rates, credit risk, prepayments, and other factors, especially in the absence of broad markets for particular items. Changes in assumptions or in market conditions could significantly affect the estimates.

Operating Segments: The Company’s operations are substantially in the financial services industry and include providing traditional banking and other financial services to its customers. Operating segments are components of a business about which separate financial information is available and evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assessing performance. The Company operates primarily in New Jersey through a single reportable operating segment upon which management makes decisions regarding how to allocate resources and assess performance. While the Company’s chief operating decision maker monitors the revenue streams of the various products and services, operations are managed and financial performance is evaluated on a Bank-wide basis. Management continues to evaluate business functions such as the cost of funding loan demand, between the commercial and retail operations of the Bank for separate reporting as facts and circumstances change. At* December 31, 2024*, the Company hadone reportable operating segment.

Derivatives and Hedging Activities: The Company uses derivative financial instruments principally to manage interest rate risk. Certain derivatives are entered into in connection with transactions with commercial customers. Derivatives arenot used for speculative purposes. All derivatives are recognized as either assets or liabilities in the Consolidated Statements of Financial Condition, reported at fair value and presented on a gross basis. Until a derivative is settled, a favorable change in fair value results in an unrealized gain that is recognized as an asset, while an unfavorable change in fair value results in an unrealized loss that is recognized as a liability.

The Company generally applies hedge accounting to its derivatives used for market risk management purposes. Hedge accounting is permitted only if specific criteria are met, including a requirement that a highly effective relationship exists between the derivative instrument and the hedged item, both at inception of the hedge and on an ongoing basis. Changes in the fair value of effective fair value hedges are recognized in current earnings (with the change in fair value of the hedged asset or liability also recognized in earnings). Changes in the fair value of effective cash flow hedges are recognized in other comprehensive income (loss) until earnings are affected by the variability in cash flows of the designated hedged item. Ineffective portions of hedge results are recognized in current earnings. Changes in the fair value of derivatives for which hedge accounting isnot applied are recognized in current earnings.

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The Company formally documents at inception all relationships between the derivative instruments and the hedged items, as well as its risk management objectives and strategies for undertaking the hedge transactions. This process includes linking all derivatives that are designated as hedges to specific assets and liabilities, or to specific firm commitments. The Company also formally assesses, both at inception of the hedge and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the fair values or cash flows of the hedged items. If it is determined that a derivative isnot highly effective or has ceased to be a highly effective hedge, the Company would discontinue hedge accounting prospectively. Gains or losses resulting from the termination of a derivative accounted for as a cash flow hedge remain in other comprehensive income (loss) and is (accreted) amortized to earnings over the remaining period of the former hedging relationship.

Certain derivative financial instruments are offered to certain commercial banking customers to manage their risk of exposure and risk management strategies. These derivative instruments consist primarily of currency forward contracts and interest rate swap contracts. The risk associated with these transactions is mitigated by simultaneously entering into similar transactions having essentially offsetting terms with athird party. In addition, the Company executes interest rate swaps withthird parties in order to hedge the interest rate risk of short-term FHLB advances.

Segment Reporting: The Company operatesone reportable segment of business, “retail banking”. Through its community banking segment, the Company provides a broad range of retail and commercial banking services. The accounting policies of the retail banking segment are the same as those described in the summary of significant accounting policies.

The Company's chief operating decision maker ("CODM") is the President, Chief Executive Officer and Director, who decides how to allocate resources based on net income that also is reported on the income statement as consolidated net income.

The measure of segment assets is reported on the balance sheet as total consolidated assets.

Adoption of Accounting Standard:

In* November 2023,the FASB issued ASU2023*-07, Segment Reporting (TOPIC280): Improvements to Reportable Segment Disclosures, which requires public entities to disclose information about their reportable segments’ significant expenses on an interim and annual basis. This ASU is effective for fiscal years beginning after* December 15,* 2023, and interim periods within fiscal years beginning after* December 15, 2024.Early adoption is permitted. Public entities are required to adopt the changes retrospectively, recasting each prior period disclosure for which a comparative income statement is presented in the period of adoption. The Company adopted this standard in the current year and included the updated disclosures in Note1*. This update didnot have a significant impact on the Company's financial statements.

NOTE2 – SECURITIES AVAILABLE FOR SALE

The following table summarizes the amortized cost, fair value, and gross unrealized gains and losses of securities available for sale for which an allowance for credit loss hasnot been recorded at* December 31, 2024and2023*:

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NOTE2 – SECURITIES AVAILABLE FOR SALE(Continued)

All of the MBS were issued by the following government sponsored agencies Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Government National Mortgage Association (“GNMA”).

During the year ended* December 31, 2024*, the Company sold 16 securities with a book value of $38.2 million and realized losses of $5.2 million upon sale. There wereno sales of securities during theyear ended* December 31, 2023*.

The age of unrealized losses and the fair value of related securities as of* December 31, 2024and2023* were as follows:

At* December 31, 2024and2023*, securities available for sale with a carrying value of $5,741,240 and $113,415, respectively, were pledged to secure public deposits.

Unrealized losses on corporate bonds available for sale arenot considered to be credit losses because the issuer bonds are of high credit quality, management doesnot intend to sell and it is likely that management willnot be required to sell the securities prior to their anticipated recovery, and the decline in fair value was due to changes in interest rates and other market conditions. At* December 31, 2024*,100% of the mortgage-backed securities were issued by U.S. government-sponsored entities and agencies, primarily FNMA and FHLMC, institutions which the government has affirmed its commitment to support. Because the decline in fair value was attributable to changes in interest rates and illiquidity, andnot credit quality, and because the Bank doesnot have the intent to sell these mortgage-backed securities and it is likely that it willnot be required to sell the securities before their anticipated recovery, the Bank doesnot consider these losses to be credit-related at* December 31, 2024*. As of* December 31, 2024and2023*, no ACL was required on available-for-sale securities.

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NOTE 3–** SECURITIES HELD TO MATURITY**

Effective* January 1, 2023,the Company adopted ASC326,* which requires management to complete an evaluation of the held-to-maturity securities portfolio to identify whether any ACL is required. Management completed an evaluation as of the adoption date and determined the ACL on the held-to-maturity portfolio wasnot significant. This determination was based on a financial review of securities and ratings of each security.

At* December 31, 2024*, the Company didnot classify any securities as held-to-maturity. During the year ended* December 31, 2024* the Company sold 15 securities with a book value of $25.1 million and realized losses of $3.8 million upon sale. All remaining debt securities previously classified as held-to-maturity were reclassified as available-for-sale and marked to market.

The following table summarizes the amortized cost, fair value, and gross unrecognized gains and losses of securities held to maturity at * December 31, 2023*:

NOTE3 – SECURITIES HELD TO MATURITY(Continued)

Mortgage-backed securities include FHLMC, FNMA and GNMA securities, all of which are U.S. government sponsored agencies. There wereno non-performing held to maturity securities at * December 31, 2023*.

The following table presents HTM securities by type and credit rating as of * December 31, 2023*:

As of * December 31, 2023*, no ACL on the securities above had been recorded because the issuers of the securities were of high credit quality and the decline in fair value was due to changes in interest rates and other market conditions. Unrecognized losses hadnot been recognized into income because the issuers of the securities are of high credit quality, management didnot intend to sell and it wasnot more likely thannot that management would be required to sell the securities prior to their anticipated recovery, and the decline in fair value was largely due to changes in interest rates and other market conditions. The fair value was expected to recover as the securities approach maturity.

At* December 31, 2024and2023*, securities held to maturity with a carrying amount ofzero and $1,589,747, respectively, were pledged to secure repurchase agreements at the FHLB of New York (see Note9).

At* December 31, 2024and2023*, securities held to maturity with a carrying value ofzero and $4,976,927, respectively, were pledged to secure public deposits.

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NOTE4 – LOANS

Loans are summarized as follows at* December 31, 2024and2023*:

At* December 31, 2024and2023*, deferred loan fees were $2,496,364 and*$2*,873,724 respectively, which are included in the carrying amount of the loans presented in the above table.

The Bank has granted loans to executive officers and directors of the Bank. At* December 31, 2024and2023*, such loans totaled $2,256,911 and*$1,*610,688, respectively.

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The following tables present the activity in the allowance for credit losses by portfolio segments for the years ended* December 31, 2024and2023*:

The provision fluctuations during the years ended* December 31, 2024and2023* were due to increases or decreases in loan balances in different loans types and economic conditions and due to changes in asset quality.

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December 31, 2024and2023

NOTE4 – LOANS(Continued)

Collateral-dependent loans individually evaluated with the ACL by collateral type were as follows at* December 31, 2024and2023*:

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No nonaccrual loans had specific reserves as of* December 31, 2024* and the Bank hadno other real estate owned at either* December 31, 2024* or* December 31, 2023*.

The following table presents the recorded investment in nonaccrual and loans past due90 days or more and still on accrual by portfolio segment as of* December 31, 2024and2023*:

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The following tables present the aging of the recorded investment in past due loans as of* December 31, 2024and2023*, by class of loans:

Loans greater than89 days past due are considered to be non-performing.

Credit Quality Indicators

The Bank categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Bank analyzes loans individually by classifying the loans as to credit risk. Commercial and multi-family real estate, commercial and industrial and construction loans are graded on an annual basis. Residential real estate and consumer loans are primarily evaluated based on performance. Refer to the table on the prior page for the aging of the recorded investment of these loan segments. The Bank uses the following definitions for risk ratings:

Special Mention – Loans classified as special mention have a potential weakness that deserves management's close attention. If left uncorrected, these potential weaknesses* may*result in deterioration of the repayment prospects for the loan or of the institution's credit position at some future date.

Substandard – Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies arenot corrected.

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NOTE4 – LOANS(Continued)

Doubtful – Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loansnot meeting the criteria above are considered to be Pass rated loans.

Based on the most recent analysis performed as of* December 31, 2024and2023*, the risk category of loans by class is as follows:

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NOTE5 – PREMISES AND EQUIPMENT

During* December 2024,*the Bank entered into a sale-leaseback transaction whereby the Bank sold three of its branch offices resulting in a $9.0 million pre-tax gain. Subsequently, the Bank realized a pre-tax loss of $8.9 million on the sale of approximately $66.0 million in amortized cost ($57.1 million in market value) of securities with a weighted average life of approximately 5.5 years and a weighted average yield of 1.89%. The Bank reinvested $32.7 million of these proceeds into securities with a weighted average life of approximately 29.6 years and a weighted average yield of 5.60%.

Premises and equipment consists of the following at* December 31, 2024and2023*:

Depreciation expense was $496,984 and$514,983 for the years ended* December 31, 2024and2023*, respectively.

NOTE6 – LEASES

The Company leases real estate property for branches and office space. At* December 31, 2024and2023*, all of the Company's leases are classified as operating leases.

The Company determines if an arrangement is a lease at inception. Topic842 requires lessees to recognize a right-of-use asset and a lease liability, measured at the present value of the future minimum lease payments, at the lease commencement date. The calculated amount of the right-of-use asset and lease liabilities are impacted by the length of the lease term and the discount rate used to calculate the present value of minimum lease payments. At* December 31, 2024and2023*, the right of use asset was $10.8 million andzero, respectively. The lease liability at* December 31, 2024and2023*, was $10.8 million andzero, respectively.

At* December 31, 2024and2023*, the weighted average remaining lease term for operating leases was 14.9 years and 4.5 years, resp ectively, and the weighted average discount rate used in the measurement of operating lease liabilities was 7.37% for both years.

The Company elected to account for the lease and non-lease components separately since such amounts are readily determinable under the Company's lease contracts. Operating lease expense is recognized on a straight-line basis over the lease term, while variable lease payments are recognized as incurred. Variable lease payments include common area maintenance charges, real estate taxes, repairs and maintenance costs and utilities. Operating and variable lease expenses are recorded in occupancy expense in the Consolidated Statements of Income. During the years ended* December 31, 2024and2023*, operating and variable lease expenses totaled approximately $1.1 million for both years. The new leases added in2024, were as a result of the sale-leaseback transaction with an unrelated party that was completed in* December 2024.*

There wereno sale and leaseback transactions, leveraged leases or lease transactions with related parties during the years ended* December 31, 2024and2023*. At* December 31, 2024*, the Company hadno leases which hadnot yet commenced. The following table summarizes lease payment obligations for each of the nextfive years and thereafter as follows:

NOTE7 – INTANGIBLE ASSETS

Core deposit intangible carrying amounts were$152,893 for the year ended* December 31, 2024*. Core deposit accumulated amortization and amortization expense totaled $247,107 and $53,223, respecti vely, for the year ended* December 31, 2024*. Core deposit intangible carrying amounts were $206,116 for the year ended* December 31, 2023*. Core deposit accumulated amortization and amortization expense totaled $132,728 and $61,156, respectively, for the year ended* December 31, 2023*.

Core deposit intangible assets are amortized to their estimated residual values over their expected useful lives, commonlyten years. The estimated aggregate future amortization expense for core deposit intangible assets as of* December 31, 2024*, was as follows:

NOTE8 – DEPOSITS

The following table sets forth the distribution of total deposit accounts, by account type, and the weighted average rate paid at the dates indicated.

The aggregate amount of certificates of deposit with a minimum denomination of*$250,000* was approximately $186,585,000 and $132,100,000 at* December 31, 2024and2023*, respectively.

Insiders of the Bank have deposits totaling approximately $2,325,000 and $2,433,000 at* December 31, 2024and2023*, respectively.

The Bank had approximately $101,561,000 and $53,300,000 of brokered deposits at* December 31, 2024and2023*, respectively, which were primarily included in certificate of deposit accounts.

The scheduled maturities of certificates of deposits at* December 31, 2024* are as follows:

NOTE9 – ADVANCES FROM THE FEDERAL HOME LOAN BANK (“FHLB”) OF NEW YORK

Advances that mature withinone year as of* December 31, 2024* totaled $95.3 million with a weighted average interest rate of 4.53%. Advances that matured withinone year as of* December 31, 2023* totaled $37.5 million with a weighted average interest rate of 5.52%.

Advances that mature in greater thanone year at* December 31, 2024and2023* were as follows:

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NOTE9 – ADVANCES FROM THE FEDERAL HOME LOAN BANK (“FHLB”) OF NEW YORK(Continued)

At* December 31, 2024*, secur ities available for sale with a carrying amount of $12,881,892 were pledged to secure repurchase agreements. At* December 31, 2023*, secur ities held to maturity and available for sale with a carrying amount of $1,589,747 were pledged to secure repurchase agreements. Change in the fair value of pledged collateral* may*require the Bank to pledge additional securities.

Non-repo and amortizing advances are secured by the FHLB stock owned by the Bank, and a blanket assignment of qualifying loans and securities at* December 31, 2024and2023* amounted to $280,387,637 and $289,808,115, respectively.

The Bank had available additional borrowing capacity of $105,111,000 and $140,398,000 with the FHLB as of* December 31, 2024and2023*, respectively. The Bank also had outstanding lines of credit of $54,000,000 and $54,000,000 withfour correspondent banks as of* December 31, 2024and2023*, respectively. There wereno outstanding balances against these lines as of* December 31, 2024* or2023.

Payments over the nextfive years are as follows*:*

NOTE10 – INCOME TAXES

Income tax (benefit) expense was as follows:

Total income tax benefit expense differed from the amounts computed by applying the federal income tax rate of 21% to income before income taxes as a result of the following for the years ended* December 31, 2024and2023*:

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NOTE10 – INCOME TAXES(Continued)

Year-end deferred tax assets and liabilities were due to the following:

For the period ending* December 31, 2024,there was a tax reserve of $503,000 for the charitable foundation, an outstanding fraud claim and capital loss carryforward. Included in retained earnings at December 31, 2024and2023* was approxi mately $4,609,000 in bad debt reserves for whichno deferred income tax liabilities have been recorded. The amount represents allocations of income to bad debt deductions for tax purposes only. Reduction of these reserves for purposes other than tax bad-debt losses would create income for tax purposes only, which would be subject to the then current corporate income tax rate. There wereno unrecognized tax benefits at* December 31, 2024* or2023. The Bank doesnot expect the total amount of unrecognized tax benefits to significantly increase or decrease in the nexttwelve months. There was no material interest or penalties recorded in the income statement or accrued during the years ended* December 31, 2024* or2023. The Bank is subject to U.S. federal income tax as well as income tax of the State of New Jersey. The Bank isno longer subject to federal and state examination by taxing authorities for years before 2021 and 2020, respectively.

NOTE11 –** STOCK BASED COMPENSATION**

The Company maintains the Bogota Financial Corp.2021 Equity Incentive Plan (the*"2021* Plan"), which provides for the issuance of upto 902,602 shares (257,887 restricted stock awards and 644,718 stock options) of Bogota Financial Corp. common stock.

On* September 2,2021,* 226,519 shares of restricted stock were awarded, with a grant date fair value of $10.45 per share. On* February**28,* 2024, 10,000 shares of restricted stock were awarded, with a grant date fair value of $7.80 per share. To fund the grant of restricted common stock, the Company issued shares from authorized but unissued shares. Restricted shares granted under the2021 Plan vest in equal installments, over the service period offive years, beginningone year from the date of grant. Management recognizes compensation expense for the fair value of restricted shares on a straight-line basis over the requisite service period. During thetwelve months ended* December 31, 2024* and* December 31, 2023*, $507,000 and $473,000 of expense was recognized in regard to these awards, respectively. The expected future compensation expense related to the 94,607 non-vested restricted shares outstanding at* December 31, 2024* was approximately $802,000 over a weighted average period of 1.87 years.

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NOTE11 –** STOCK BASED COMPENSATION** (Continued)

The following is a summary of the Company's restricted stock activity during thetwelve months ended* December 31, 2024*:

On* September 2, 2021,options to purchase 523,619 shares of Company common stock were awarded, with a grant date fair value of $4.37 per option. Stock options granted under the2021* Plan vest in equal installments over the service period offive years beginningone year from the date of grant. Stock options were granted at an exercise price of $10.45, which represents the fair value of the Company's common stock price on the grant date based on the closing market price, and have an expiration period of 10 years.

Management recognizes expense for the fair value of these awards on a straight-line basis over the requisite service period. During thetwelve months ended* December 31, 2024* and* December 31, 2023* approximately $445,000 and $459,000 in expense was recognized in regard to these awards, respectively. The expected future compensation expense related to the 203,447 non-vested options outstanding at* December 31, 2024* was $779,000 over the weighted average remaining vesting period of 1.67 years.

The following is a summary of the Company's option activity during thetwelve months ended* December 31, 2024*:

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value, the difference between the Company's closing stock price on the last trading day of the period and the exercise price, multiplied by the number of in-the-money options.

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NOTE12 – DERIVATIVES AND HEDGING ACTIVITES

Interest Rate Swaps. At* December 31, 2024*, the Company hadfive cash flow interest rate swaps with notional amounts of $65.0 million hedging certain FHLB advances and brokered deposits. The Company also hadtwo fair value interest rate swaps with notional amounts of $60.0 million hedging certain fixed-rate residential loans. The Company entered into the swaps to protect net interest margin in a rising rate environment. These interest rate swaps meet the hedge accounting requirements. Changes in the fair value of cash flow hedges are recorded in comprehensive income. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without the exchange of the underlying notional amount. Interest rate swaps designated as fair value hedges involve the payment of fixed-rate amounts to a counterparty in exchange for the Company receiving variable-rate payments over the life of the agreement without the exchange of the underlying notional amount. The fair value hedges are recorded as components of other assets and other liabilities on the Company’s consolidated statement of financial condition. Changes in fair value of the fair value hedges are recorded against the basis of the asset or liability being hedged. The gain or loss on these derivatives, as well as the offsetting loss or gain on the hedged items attributable to the hedged risk, are recognized in interest income in the Company’s consolidated statements of operations. At both* December 31, 2024* and* December 31, 2023*, the Company hadno back-to-back interest rate swaps in place with commercial banking customers.

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NOTE12 – DERIVATIVES AND HEDGING ACTIVITES(Continued)

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the Consolidated Statements of Financial Condition at* December 31, 2024*:

For thetwelve months ended* December 31, 2024*, changes in fair value of $411,830 were recorded in other comprehensive income, net of tax, for changes in fair value of interest rate swaps withthird parties. At* December 31, 2024*, accrued interest was $122,000. During the* 12 months ended* * December 31, 2024and2023,* the Company has $1.5 million and $364,000 in gains, classified to interest expense on interest rate swaps, respectively. For thetwelve months ended* December 31, 2023*, changes in fair value of $84,554 were recorded in other comprehensive income, net of tax, for changes in fair value of interest rate swaps withthird parties. At* December 31, 2023*, accrued interest was $72,000.

The Company has agreements with counterparties that contain a provision that if the Company defaults on any of its indebtedness, including default where repayment of the indebtedness hasnot been accelerated by the lender, then the Company could also be declared in default of its derivative obligations.

NOTE13 – BENEFIT PLANS

401(k) Plan: The Bank has a401(k) retirement plan covering substantially all employees. The Bank matches 100% of contributions up to thefirst 6% of salary that the employee defers to the retirement plan. The Bank also contributes a safe harbor contribution of 3% of the employee’s salary. In addition, on an annual basis, the Board of Directors* mayelect to make discretionary employer contributions. Bank contributions to the plan for the years ended December 31, 2024and2023* were $416,000 and $414,000, respectively.

Directors’ Retirement Plan: The Bank has an unfunded, non-qualified pension plan (the “Plan”) to provide post-retirement benefits to each non-employee director of the Bank. The Monthly Retirement Benefit is 100% of a director's average annual retainer paid over athree-year period (not necessarily consecutive) during which the highest annual retainer was received and payable for the same number of months the director served on the Board, up to a period of 120 months.

The measurement dates used in the Plan valuations were* December 31for plan years2024* and2023, respectively. The following table sets forth the Plan’s funded status at* December 31, 2024and2023*:

Amounts recognized in accumulated other comprehensive income at* December 31*consist of:

Components of net periodic benefit cost and other amounts recognized in other comprehensive income:

Assumptions

Weighted-average assumptions used to determine pension benefit obligations at year end:

Weighted-average assumptions used to determine net periodic pension cost:

The Monthly Retirement Benefit was changed from 100% of a director's average annual retainer paid over athree-year period (not necessarily consecutive) during which the highest annual retainer was received and payable for the same number of months the director served on the Board, up to a period of 120 months to be 15% of the final three-year average annual compensation paid intwelve equal installments, up to a period of 120 months. The change in the Monthly Retirement Benefit hadno material change on the financial statements.

For the year ended* December 31,*2025, the Bank expects to contribute $191,992 to the Plan.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid as of year ending* December 31:*

Employee Stock Ownership Plan (“ESOP”): Effective upon the consummation of the Bank's reorganization in* January 2020,an ESOP was established for all eligible employees. The ESOP used $6.0 million in proceeds from atwenty-year term loan obtained from the Company to purchase 515,775 shares of Company common stock. The term loan principal is payable in installments through January 2039.Interest on the term loan is based on a floating rate that was 7.50% as of December 31, 2024*.

Each year, the Bank makes discretionary contributions to the ESOP, which are equal to principal and interest payments required on the term loan. Shares purchased with the loan proceeds were initially pledged as collateral for the term loan and are held in a suspense account for future allocation among participants. Contributions to the ESOP and shares released from the suspense account are allocated among the participants on the basis of compensation, as described by the ESOP, in the year of allocation.

The ESOP shares pledged as collateral are reported as unearned ESOP shares in the consolidated statements of financial condition. As shares are committed to be released from collateral, the Bank reports compensation expense equal to the average market price of the shares during the year, and the shares become outstanding for basic net income per common share computations. ESOP compensation expense for the year ended* December 31, 2024and2023* was $193,209 and$224,870, respectively.

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The ESOP shares were as follows:

Supplemental Executive Retirement Plan (“SERP”): In2014, the Bank adopted an unfunded, non-qualified Supplemental Executive Retirement Plan (“SERP”) for the benefit of its senior officers. On* May 20, 2016,the SERP was amended and restated as of January 1, 2016.*The SERP provides the Bank with the opportunity to supplement the retirement income of the President and CEO to achieve equitable wage replacement at retirement.

As of* December 31, 2024*, the accrued SERP obligation was $922,384. The expense was $39,000 during2024. At* December 31, 2024*, the amount recognized in accumulated other comprehensive losswas $15,325. As of* December 31, 2023*, the accrued SERP obligation was$1,040,487. The expense was a benefit of $15,325 during2023. At* December 31, 2023*, the amount recognized in accumulated other comprehensive loss was $87,120.

NOTE14 – REGULATORY CAPITAL MATTERS

Banks are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. A capital conservation buffer of 2.5%, which was fully phased on* January 1, 2019resulted in the Bank effectively having the following minimum capital to risk-weighted assets ratios: a)7.0% based onCET1;* b)8.5% based on tier1 capital; and c)10.5% based on total regulatory capital. The net unrealized gain or loss on available for sale securities isnot included in computing regulatory capital. Failure to meet capital requirements can initiate regulatory action.

Prompt corrective action regulations providefive classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized, although these terms arenot used to represent overall financial condition. If only adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required. At year-end2021 and2020, the most recent regulatory notifications categorized the Bank as well capitalized under the regulatory framework for prompt corrective action.

In accordance with the Economic Growth, Regulatory Relief, and Consumer Protection Act, the federal banking agencies adopted, effective* January 1, 2020,a final rule whereby financial institutions and financial institution holding companies that have less than$10* billion in total consolidated assets and meet other qualifying criteria, including a leverage ratio of greater than9% (“qualifying community banking organizations”), are eligible to opt into a community bank leverage ratio (“CBLR”) framework. Qualifying community banking organizations that elect to use the CBLR framework and that maintain a leverage ratio of greater than9% are considered to have satisfied the generally applicable risk-based and leverage capital requirements in the agencies’ capital rules and will be considered to have met the well capitalized ratio requirements under the PCA statutes.

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NOTE14 – REGULATORY CAPITAL MATTERS (Continued)

The agencies reserved the authority to disallow the use of the CBLR framework by a financial institution or holding company, based on the risk profile of the organization.

The Bank elected to adopt the CBLR framework. As a qualifying community banking organization, the Company and the Bank* may*opt out of the CBLR framework in any subsequent quarter by completing its regulatory agency reporting using the traditional capital rules.

The Bank excludes accumulated OCI components from Tier1 and Total regulatory capital.

The Bank’s actual and required capital amounts and ratios under the CBLR rules at* December 31, 2024and2023* are presented in the tables below.

**NOTE15 – **COMMITMENTS AND CONTINGENCIES

The Bank is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments primarily include commitments to extend credit. Such instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated statements of financial condition. The contractual amounts of these instruments reflect the extent of involvement the Bank has in those particular classes of financial instruments.

The Bank’s exposure to credit loss in the event of non-performance by the other party to the financial instruments for commitments to extend credit is represented by the contractual amount of those instruments. The Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

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**NOTE15 – **COMMITMENTS AND CONTINGENCIES(Continued)

The Bank had outstanding firm commitments, all of which expire withintwomonths, to originate, or purchase participation interests in, loans at* December 31, 2024and2023* was as follows:

Commitments to make loans are generally made for periods of 90 days or less. As of* December 31, 2024*there was $118,000 in ACL for loan commitments.

At* December 31, 2024and2023*, undisbursed funds from approved lines of credit under a homeowners’ equity lending program amounted to approximately $54,581,083 and $50,175,046, respectively. At* December 31, 2024and2023*, undisbursed funds from approved lines of credit under a business line of credit program amounted to $6,649,437 and$2,579,759, respectively. Unless they are specifically cancelled by notice from the Bank, these funds represent firm commitments available to the respective borrowers on demand. At* December 31, 2024and2023*, the Bank recorded an allowance for credit losses related to these commitments of*$18*,000 andzero, respectively. Unless they are specifically cancelled by notice from the Bank, these funds represent firm commitments available to the respective borrowers on demand.

Commitments to extend credit are agreements to lend to a customer as long as there isno violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and* mayrequire payment of a fee. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts donot* necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Bank upon extension of credit, is based on management’s credit evaluation of the counterparty. Collateral held varies but primarily includes commercial and residential real estate. The Bank leases certain Bank properties and equipment under operating leases. Rent expense was $228,937 and $181,308 for2024 and2023, respectively.

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NOTE16 – FAIR VALUE

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There arethree levels of inputs that* may*be used to measure fair values:

Level1* *– Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level2** – Significant other observable inputs other than Level1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that arenot active; or other inputs that are observable or can be corroborated by observable market data.

Level3** – Significant unobservable inputs that reflect a bank’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

The Bank used the following methods and significant assumptions to estimate the fair value of each type of financial instrument:

The fair value for investment securities are determined by quoted market prices, if available (Level1). For securities where quoted prices arenot available, fair values are calculated based on market prices of similar securities (Level2).

Assets measured at fair value on a recurring basis are summarized below:

No assets were measured at fair value on a non-recurring basis at* December 31, 2024and2023*.

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NOTE16 – FAIR VALUE(Continued)

The carrying amounts and estimated fair values of financial instruments, at* December 31, 2024and2023* are as follows:

Carrying amount is the estimated fair value for cash and cash equivalents. The fair value of loans is determined using an exit price methodology. Certificates of deposits fair value is estimated by using a discounted cash flow approach. Fair value of FHLB advances is based on current rates for similar financing. Other balance sheet instruments such as cash and cash equivalents, accrued interest receivable, accrued interest payable and Bank owned life insurance holding costs approximate fair value. The fair value of off-balance sheet items isnot considered material.

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NOTE17 – ACCUMULATED OTHER COMPREHENSIVE LOSS

The components of accumulated other comprehensive loss included in equity as of* December 31*is as follows:

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