Earnings per Share

12 Months Ended

Dec. 31, 2024

Earnings per share:

Earnings per Share

Note 17 – Earnings per Share

Following shareholder approval received on June 29, 2023, the Company converted 820,115 shares of its Series A Preferred Stock to an equal number of shares of its newly created Non-Voting Common Stock, which was effective on July 19, 2023.

The Company has voting common stock, restricted stock awards, and non-voting common stock that are all eligible to participate in dividends equal to the voting common stock dividends on a per share basis. Securities that participate in dividends, such as the Company’s restricted stock awards and non-voting common stock, are considered “participating securities.” The Company calculates net income available to voting common shareholders using the two-class method required for capital structures that include participating securities.

In applying the two-class method, basic net income per share was calculated by dividing net income (less any dividends on participating securities) by the weighted average number of shares of common stock and participating securities outstanding for the period. Diluted earnings per share may include the additional effect of other securities, if dilutive. Potentially dilutive common stock equivalents consist of employee stock options and warrants. Unallocated common shares held by the ESOP are not included in the weighted average number of common shares outstanding for purposes of calculating earnings per common share until they are committed to be released to plan participants. The following factors are used in the earnings per share computation:

	Year Ended December 31,
(dollars in thousands, except for earnings per common share amounts)	2024			2023
Net income (loss)	$	1,689		$	(3,402	)
Less: convertible preferred stock dividends		—			115
Less: earnings allocated to participating securities		(2	)		(11	)
Net income (loss) allocated to common shareholders	$	1,687		$	(3,506	)
Basic weighted average common shares outstanding - Voting		5,902			3,654
Basic weighted average common shares outstanding - Non-Voting		820			373
Diluted weighted average common shares outstanding - Voting		5,903			3,656
Diluted weighted average common shares outstanding - Non-Voting		820			373
Basic earnings per common share - Voting	$	0.25		($	0.88	)
Basic earnings per common share - Non-Voting	$	0.25		($	0.88	)
Diluted earnings per common share - Voting	$	0.25		($	0.88	)
Diluted earnings per common share - Non-Voting	$	0.25		($	0.88	)

Participating securities are restricted stock awards since they participate in common stock dividends. Stock options for 45,000 and 112,500 shares of common stock and warrants totaling 211,667 and 211,667 were not considered in computing diluted earnings per common share for 2024 and 2023, because they were antidilutive.

Performance restricted shares of 51,100 that have already vested as a result of meeting performance conditions are included in computing basic earnings per common share for 2024. Performance restricted shares totaling 70,800 shares subject only to service-based vesting were not considered in computing diluted earnings per common share for 2024 because they were antidilutive. Performance restricted stock awards for 76,800 shares were not considered in computing diluted earnings per common share for 2024 as they are considered contingently issuable shares due to certain performance conditions not being met.

Note 18 – Segment Reporting

The Company is a bank holding company, whose principal activity is the ownership and management of its wholly-owned subsidiary, the Bank. As a community-oriented financial institution, substantially all of the Company’s operations involve the delivery of loan and deposit products to customers. Management makes operating decisions and assesses performance based on an ongoing review of these banking operations, which constitute the Company’s only operating segment for financial reporting purposes.

The Company’s chief operating decision maker is comprised of the executive leadership team. For the Company, the executive leadership team net interest income after provision and income (loss) before provision for income taxes to allocate resources for in the annual budget and forecasting process. The chief operating decision maker considers budget-to-actual variances on a monthly basis for profit measures when making decisions about allocating capital and personnel to the operating segment. For the Bank, the executive leadership team uses net-interest income and non-interest income to allocate resources (including employees, financial, or capital resources) to that segment in the annual budget and forecasting process and uses that measure as a basis for evaluating lending terms for customer loans.

The following tables present information about reported segment revenue, measures of a segment’s profit or loss, and significant segment expenses for the years ended December 31, 2024, and December 31, 2023. The Company does not allocate all holding company expenses, income taxes, or unusual items to the reportable segment.

The following tables present the reconciliations of reportable segment revenues and measures of profit or loss and line-item reconciliation to the Company’s consolidated financial statement totals.

				Unallocated Holding Company			Eliminations			Total
For the year ended December 31, 2024	Bank			Amounts
Interest and dividend income:
Interest and fees on loans	$	44,013		$	—		$	—		$	44,013
Interest on securities		2,164			—			—			2,164
Interest on other interest-earning assets		4,608			—			—			4,608
Interest on ESOP Loan		—			130			(130	)		—
Total interest income		50,785			130			(130	)		50,785
Interest expense:
Interest on deposits		19,016			—			—			19,016
Interest on borrowings		1,119			1,352			—			2,471
Interest on ESOP Loan		130			—			(130	)		—
Total interest expense		20,265			1,352			(130	)		21,487
Net interest income		30,520			(1,222	)		—			29,298
Provision for credit losses		3,825			—			—			3,825
Net interest income after provision for credit losses		26,696			(1,222	)		—			25,473
Noninterest income:
Service charges on deposit accounts		545			—			—			545
Bank owned life insurance		370			—			—			370
Gain on sale of loans, net		28			—			—			28
Loss on sale of other real estate owned		(432	)		—			—			(432	)
Preliminary bargain purchase gain on the merger (Note 2)		—			5,018			—			5,018
Other income		29			—			—			29
Income from subsidiary		—			(480	)		480			—
Total noninterest income		540			4,538			480			5,558
Noninterest expense:
Salaries and employee benefits		12,939			—			—			12,939
Occupancy		2,520			—			—			2,520
Data processing		3,934			—			—			3,934
FDIC and other insurance expense		586			—			—			586
Professional Fees		1,225			636			—			1,861
Merger Costs		1,929			1,834			—			3,763
Advertising		302			—			—			302
Core Deposit Intangible Amortization		1,341			—			—			1,341
Other expenses		3,167			3			—			3,170
Total noninterest expense		27,943			2,473			—			30,416
(Loss) income before provision for income taxes		(707	)		843			480			615
(Benefit from) provision for income taxes		(227	)		(846	)		—			(1,074	)
Net (loss) income	$	(480	)		1,689			480			1,689

				Unallocated Holding Company			Eliminations			Total
For the year ended December 31, 2023	Bank			Amounts
Interest and dividend income:
Interest and fees on loans	$	25,779		$	—		$	—		$	25,779
Interest on securities		1,611			—			—			1,611
Interest on other interest-earning assets		734			—			—			734
Interest on ESOP Loan		—			117			(117	)		—
Total interest income		28,124			117			(117	)		28,124
Interest expense:
Interest on deposits		11,139			—			—			11,139
Interest on borrowings		756			1,054			—			1,810
Interest on ESOP Loan		117			—			(117	)		—
Total interest expense		12,012			1,054			(117	)		12,949
Net interest income		16,112			(937	)		—			15,175
Provision  for credit losses		4,223			—			—			4,223
Net interest income after provision for credit losses		11,889			(937	)		—			10,952
Noninterest income:
Service charges on deposit accounts		463			—			—			463
Bank owned life insurance		248			—			—			248
Gain on sale of loans, net		32			—			—			32
Other income		(13	)		—			—			(13	)
Income from subsidiary		—			(1,709	)		1,709			—
Total noninterest income		730			(1,709	)		1,709			730
Noninterest expense:
Salaries and employee benefits		6,124			—			—			6,124
Occupancy		1,148			—			—			1,148
Data processing		2,665			—			—			2,665
FDIC and other insurance expense		348			—			—			348
Professional Fees		658			84			—			742
Merger Costs		2,196			814			—			3,010
Advertising		46			—			—			46
Other expenses		1,327			127			—			1,454
Total noninterest expense		14,512			1,025			—			15,537
(Loss) income before provision for income taxes		(1,893	)		(3,671	)		1,709			(3,855	)
(Benefit from) provision for income taxes		(119	)		(334	)		—			(453	)
Net (loss) income	$	(1,774	)	$	(3,337	)	$	1,709		$	(3,402	)