COMMUNITY BANCORP /VT

RESULTS OF OPERATIONS

The Company’s net income decreased $667 thousand, or 5.0%, from 2023 to 2024, resulting in earnings per common share of $2.28 for 2024 versus $2.43 for 2023. Core earnings (NII) increased $422 thousand, or 1.2%, in 2024 compared to 2023. Interest income in 2024 was supported by increases in the volume of the loan portfolio and overnight deposits at FRBB. Interest and fees on loans, which is the major component of interest income, increased $7.8 million, or 18.7% in 2024 and interest paid on deposits, which is the major component of total interest expense, increased $4.8 million, or 51.1% in 2024, reflecting the increase in interest-bearing deposits in 2024. Additionally, interest on borrowed funds increased $2.8 million, or 181.2% due to the Company’s increased reliance on borrowings as a funding source.

Return on average assets, which is net income divided by average total assets, measures how effectively a corporation uses its assets to produce earnings. Return on average equity, which is net income divided by average shareholders' equity, measures how effectively a corporation uses its equity capital to produce earnings.

The following table shows these ratios, as well as other equity ratios, for each of the last two fiscal years:

(1) Dividends declared per common share divided by earnings per common share.