LOANS

12 Months Ended

Dec. 31, 2025

LOANS

LOANS

4. LOANS

Net loans for the December 31, 2025 and 2024 are as follows:

	At December 31,
(In thousands)		2025		2024
Mortgage loans on real estate:
One-to four-family first lien residential	$	93,006	$	101,236
Residential construction		3,196		1,288
Home equity loans and lines of credit		15,921		11,916
Commercial		87,954		59,505
Total mortgage loans on real estate		200,077		173,945
Commercial and industrial		22,243		23,411
Consumer loans		4,349		5,339
Total loans		226,669		202,695
Allowance for credit losses		(1,915)		(1,804)
Net deferred loan costs		1,276		1,538
Net loans	$	226,030	$	202,429

Residential real estate loans serviced for others, not included in net loans, by the Company totaled $33.4 million and $29.4 million at December 31, 2025 and 2024, respectively.

Loan Origination/Risk Management

The Company has lending policies and procedures in place that are designed to maximize loan income within an acceptable level of risk. Management reviews and approves these policies and procedures on a regular basis. A reporting system supplements the review process by frequently providing management with reports related to loan production, loan quality, loan delinquencies, non-performing and potential problem loans. Diversification in the loan portfolio is a means of managing risk associated with fluctuations in economic conditions.

Risk Characteristics of Portfolio Segments

The risk characteristics within the loan portfolio vary depending on the loan segment. Consumer loans generally are repaid from personal sources of income. Risks associated with consumer loans primarily include general economic risks such as declines in the local economy creating higher rates of unemployment. Those conditions may also lead to a decline in collateral values should the Company be required to repossess the collateral securing consumer loans. These economic risks also impact the commercial loan segment, however commercial loans are considered to have greater risk than consumer loans as the primary source of repayment is from the cash flow of the business customer. Real estate loans, including residential mortgages, manufactured housing, commercial and home equity loans, comprise approximately 88.3% and 85.8% of the portfolio at December 31, 2025 and 2024, respectively. Loans secured by real estate provide the best collateral protection and thus significantly reduce the inherent risk in the portfolio.

Management has reviewed its loan portfolio and determined that, to the best of its knowledge, little or no exposure exists to sub-prime or other high-risk residential mortgages. The Company is not in the practice of originating these types of loans.

Description of Credit Quality Indicators

Real estate, commercial and consumer loans are assigned a “Pass” rating unless the loan has demonstrated signs of weakness as indicated by the ratings below:

● Special Mention:   The relationship is protected but are potentially weak. These assets may constitute an undue and unwarranted credit risk but not to the point of justifying a substandard rating. All loans 60 days past-due are classified Special Mention. The loan is not upgraded until it has been current for six consecutive months.

● Substandard:   The relationship is inadequately protected by the current sound worth and paying capacity of the obligor or the collateral pledge, if any. Assets so classified have a well-defined weakness or a weakness that jeopardizes the liquidation of the debt. All loans 90 days past-due are classified Substandard. The loan is not upgraded until it has been current for six consecutive months.

● Doubtful/Loss:   Loans are considered uncollectible and of such little value that continuance as bankable assets are not warranted. It is not practicable or desirable to defer writing off this basically worthless asset even though partial recovery may be possible in the future.

The risk ratings are evaluated at least annually for commercial loans or when credit deficiencies arise, such as delinquent loan payments, for commercial, real estate or consumer loans.

The following tables present the loans to customers as of December 31, 2025 and 2024, based on year of origination within each credit quality indicator:

	At December 31, 2025
															Revolving
															Loans
															Converted
													Revolving		to Term
													Loans		Loans
													Amortized		Amortized
	2025		2024		2023		2022		2021		Prior		Cost Basis		Cost Basis		Total
Mortgage loans on real estate:
One-to-four-family first lien residential:
Pass	$	2,429	$	2,712	$	10,223	$	16,772	$	10,643	$	50,227	$	—	$	—	$	93,006
Total		2,429		2,712		10,223		16,772		10,643		50,227		—		—		93,006
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Residential construction:
Pass		2,190		750		—		113		—		143		—		—		3,196
Total		2,190		750		—		113		—		143		—		—		3,196
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Home equity loans and lines of credit:
Pass		278		636		—		—		—		60		14,682		265		15,921
Total		278		636		—		—		—		60		14,682		265		15,921
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial:
Pass		31,612		8,687		12,995		7,331		6,581		16,919		—		—		84,125
Special Mention		—		576		—		—		—		—		—		—		576
Substandard		—		1,221		735		—		—		1,297		—		—		3,253
Total		31,612		10,484		13,730		7,331		6,581		18,216		—		—		87,954
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and Industrial:
Pass		8,179		4,619		3,260		1,827		1,554		2,298		—		—		21,737
Special Mention		31		288		94		93		—		—		—		—		506
Total		8,210		4,907		3,354		1,920		1,554		2,298		—		—		22,243
Current period gross write-offs	$	—	$	—	$	(652)	$	(7)	$	(4)	$	(16)	$	—	$	—	$	(679)
Current period recoveries		—		—		—		—		—		2		—		—		2
Current period net write-offs	$	—	$	—	$	(652)	$	(7)	$	(4)	$	(14)	$	—	$	—	$	(677)
Consumer:
Pass		711		1,788		731		909		1		116		92		1		4,349
Total		711		1,788		731		909		1		116		92		1		4,349
Current period gross write-offs	$	—	$	(28)	$	(9)	$	—	$	—	$	(2)	$	—	$	—	$	(39)
Current period recoveries		—		—		5		—		—		1		—		—		6
Current period net write-offs	$	—	$	(28)	$	(4)	$	—	$	—	$	(1)	$	—	$	—	$	(33)

	At December 31, 2024
															Revolving
															Loans
															Converted
													Revolving		to Term
													Loans		Loans
													Amortized		Amortized
	2024		2023		2022		2021		2020		Prior		Cost Basis		Cost Basis		Total
Mortgage loans on real estate:
One-to-four-family first lien residential:
Pass	$	5,633	$	12,938	$	18,451	$	11,101	$	7,929	$	45,184	$	—	$	—	$	101,236
Total		5,633		12,938		18,451		11,101		7,929		45,184		—		—		101,236
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Residential construction:
Pass		1,006		—		120		—		101		61		—		—		1,288
Total		1,006		—		120		—		101		61		—		—		1,288
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Home equity loans and lines of credit:
Pass		768		—		—		—		—		65		10,895		188		11,916
Total		768		—		—		—		—		65		10,895		188		11,916
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial:
Pass		9,609		12,513		8,375		6,939		4,434		15,124		—		—		56,994
Substandard		500		—		—		—		97		1,914		—		—		2,511
Total		10,109		12,513		8,375		6,939		4,531		17,038		—		—		59,505
Current period gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Commercial and Industrial:
Pass		6,145		5,802		5,975		1,656		1,502		1,593		—		—		22,673
Substandard		738		—		—		—		—		—		—		—		738
Total		6,883		5,802		5,975		1,656		1,502		1,593		—		—		23,411
Current period gross write-offs	$	—	$	(31)	$	—	$	(25)	$	—	$	(22)	$	—	$	—	$	(78)
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	—	$	(31)	$	—	$	(25)	$	—	$	(22)	$	—	$	—	$	(78)
Consumer:
Pass		2,536		1,038		1,406		271		47		41		—		—		5,339
Total		2,536		1,038		1,406		271		47		41		—		—		5,339
Current period gross write-offs	$	(4)	$	(10)	$	(4)	$	—	$	—	$	—	$	—	$	—	$	(18)
Current period recoveries		—		—		—		—		—		—		—		—		—
Current period net write-offs	$	(4)	$	(10)	$	(4)	$	—	$	—	$	—	$	—	$	—	$	(18)

At December 31, 2025, two loan relationships consisting of one commercial real estate loan for each relationship, were downgraded to substandard, resulting in a net increase of substandard loans by $742,000 as compared to December 31, 2024. A loan relationship consisting of one commercial real estate loan and seven commercial and industrial loans totaling $1.1 million was downgraded to special mention from watch, increasing special mention loans by $576,000 and $506,000, respectively, as compared to December 31, 2024. At December 31, 2024, a loan relationship consisting of two commercial and industrial loans totaling $738,000 was rated substandard. One commercial real estate loan relationship consisting of two loans totaling $500,000 was restructured and rated as substandard during the year ended December 31, 2024. All commercial loan relationships are current and paying as agreed.

Loans are considered past-due if the required principal and interest payments have not been received within thirty days of the payment due date. An age analysis of past-due loans, segregated by class of loans, are as follows:

	At December 31, 2025
	30-59 Days		60-89 Days		90 Days		Total Past-				Total Loans
(In thousands)	Past-Due		Past-Due		Past-Due		Due		Current		Receivable
Mortgage loans on real estate:
One-to four-family first lien residential	$	2,310	$	297	$	770	$	3,377	$	89,629	$	93,006
Residential construction		—		—		—		—		3,196		3,196
Home equity loans and lines of credit		139		53		32		224		15,697		15,921
Commercial		314		735		843		1,892		86,062		87,954
Total mortgage loans on real estate		2,763		1,085		1,645		5,493		194,584		200,077
Commercial and industrial		33		—		—		33		22,210		22,243
Consumer loans		42		3		—		45		4,304		4,349
Total loans	$	2,838	$	1,088	$	1,645	$	5,571	$	221,098	$	226,669

	At December 31, 2024
	30-59 Days		60-89 Days		90 Days		Total Past-				Total Loans
(In thousands)	Past-Due		Past-Due		Past-Due		Due		Current		Receivable
Mortgage loans on real estate:
One-to four-family first lien residential	$	1,089	$	230	$	369	$	1,688	$	99,548	$	101,236
Residential construction		—		—		—		—		1,288		1,288
Home equity loans and lines of credit		1		—		32		33		11,883		11,916
Commercial		371		—		—		371		59,134		59,505
Total mortgage loans on real estate		1,461		230		401		2,092		171,853		173,945
Commercial and industrial		513		—		—		513		22,898		23,411
Consumer loans		5		9		—		14		5,325		5,339
Total loans	$	1,979	$	239	$	401	$	2,619	$	200,076	$	202,695

At December 31, 2025 and 2024, we had approximately $32,000 home equity loans and lines of credit past-due 90 days and still accruing. Nonaccrual loans, segregated by class of loan as of December 31, 2025 and 2024 are as follows:

	At December 31, 2025
			Nonaccrual
			loans
			without
			related
			allowance
			for		Recognized
	Nonaccrual		credit		interest
(In thousands)	loans		losses		income
Mortgage loans on real estate:
One-to four-family first lien	$	1,455	$	1,054	$	—
Residential construction		—		—		—
Home equity loans and lines of credit		—		—		—
Commercial		1,578		1,578		6
Commercial and industrial		41		41		—
Consumer loans		—		—		—
Total nonaccrual loans	$	3,074	$	2,673	$	6

	At December 31, 2024
			Nonaccrual
			loans
			without
			related
			allowance
			for		Recognized
	Nonaccrual		credit		interest
(In thousands)	loans		losses		income
Mortgage loans on real estate:
One-to four-family first lien	$	369	$	369	$	—
Residential construction		—		—		—
Home equity loans and lines of credit		—		—		—
Commercial		46		—		—
Consumer loans		—		—		—
Total nonaccrual loans	$	415	$	369	$	—

Collateral-dependent loans

A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the operation or sale of the collateral. Loans considered collateral-dependent were as follows:

	At December 31, 2025
(In thousands)	Amortized cost		Collateral type
Real estate:
Residential one-to four-family	$	725	Residential real estate property
Home equity line of credit		32	Residential real estate property
Commercial real estate		1,590	Commercial real estate property
Total real estate	$	2,347
Commercial and industrial loans	$	41	Commercial business assets
Total commercial and industrial	$	41

	At December 31, 2024
(In thousands)	Amortized cost		Collateral type
Real estate:
Residential one-to four-family	$	620	Residential real estate property
Home equity line of credit		32	Residential real estate property
Total real estate	$	652

During the year ended December 31, 2024, two Commercial loans to one borrower were combined into one loan to extend the terms of the loans and increase the collateral coverage of the portfolio relationship with an amortized cost basis of $493,000, representing 0.56% of the total class of financing receivable. There were no loans modified to borrowers experiencing financial difficulty during the year ended December 31, 2025.

The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulty during the year ended December 31, 2024:

Term Extension
Mortgage loans on real estate:	Financial Effect
Commercial	Added a weighted-average 20 years to the life of loans, which reduced monthly payment amounts for the borrower.

Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or a portion of the loan) is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The Company closely monitors the performance of the loans that are modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts. Loans modified to borrowers experiencing financial difficulty did not have payment default during the year and were current as of December 31, 2025.

Changes in the allowance for credit losses for the years ended December 31, 2025 and 2024 are as follows:

	At December 31, 2025
	Mortgage		Commercial
	Loans		and
	on Real		Industrial		Consumer
(In thousands)	Estate		Loans		Loans		Unallocated		Total
Allowance for credit losses:
Beginning balance	$	1,071	$	372	$	144	$	217	$	1,804
Charge-offs		—		(679)		(39)		—		(718)
Recoveries		—		2		6		—		8
Provision		98		760		77		(114)		821
Ending balance	$	1,169	$	455	$	188	$	103	$	1,915

	At December 31, 2024
	Mortgage		Commercial
	Loans		and
	on Real		Industrial		Consumer
(In thousands)	Estate		Loans		Loans		Unallocated		Total
Allowance for credit losses:
Beginning balance	$	1,218	$	325	$	93	$	409	$	2,045
Charge-offs		—		(78)		(18)		—		(96)
Recoveries		—		—		—		—		—
Provision		(147)		125		69		(192)		(145)
Ending balance	$	1,071	$	372	$	144	$	217	$	1,804

In the ordinary course of business, the Company makes loans to its directors and officers, including their families and companies in which certain directors are principal owners. All such loans were made on substantially the same terms including interest rates and collateral, as those prevailing at the same time for comparable transactions with unrelated persons. Loans to directors and officers are listed below and are included in loans on the statement of financial condition.

	At December 31,
	2025		2024
Balance, beginning of period	$	780	$	924
Proceeds		300		—
Payments		(229)		(144)
Balance, end of period	$	851	$	780