The following two tables present loan balances outstanding as of March 31, 2025 and December 31, 2024 and an analysis of the recorded investment in loans that are past due at these dates. Generally, Arrow considers a loan past due 30 or more days when the borrower is two payments past due. Loans held-for-sale of $2.3 million and $759 thousand as of March 31, 2025 and December 31, 2024, respectively, are included in the residential real estate balances for current loans.


Schedule of Past Due Loans by Loan Category
			Commercial
	Commercial		Real Estate		Consumer		Residential		Total
March 31, 2025
Loans Past Due 30-59 Days	$	528	$	146	$	10,480	$	3,397	$	14,551
Loans Past Due 60-89 Days	147		—		3,320		239		3,706
Loans Past Due 90 or more Days	17		15,008		1,039		2,037		18,101
Total Loans Past Due	692		15,154		14,839		5,673		36,358
Current Loans	153,583		788,861		1,103,896		1,334,170		3,380,510
Total Loans	$	154,275	$	804,015	$	1,118,735	$	1,339,843	$	3,416,868

December 31, 2024
Loans Past Due 30-59 Days	$	355	$	—	$	11,211	$	391	$	11,957
Loans Past Due 60-89 Days	156		318		5,417		2,685		8,576
Loans Past Due 90 or more Days	102		14,902		2,225		2,239		19,468
Total Loans Past Due	613		15,220		18,853		5,315		40,001
Current Loans	158,378		781,145		1,100,128		1,314,889		3,354,540
Total Loans	$	158,991	$	796,365	$	1,118,981	$	1,320,204	$	3,394,541


Schedule of Non Accrual Loans by Category
			Commercial
March 31, 2025	Commercial		Real Estate		Consumer		Residential		Total
Loans 90 or More Days Past Due and Still Accruing Interest	$	—	$	—	$	8	$	397	$	405
Nonaccrual Loans	17		15,008		1,045		2,542		18,612
Nonaccrual With No Allowance for Credit Loss	17		—		1,045		2,542		3,604
Interest Income on Nonaccrual Loans	—		—		—		—		—

December 31, 2024
Loans 90 or More Days Past Due and Still Accruing Interest	$	—	$	—	$	19	$	379	$	398
Nonaccrual Loans	102		14,902		2,241		3,376		20,621

Commercial - Arrow offers a variety of loan options to meet the specific needs of our commercial customers including term loans, time notes and lines of credit. Such loans are made available to businesses for working capital needs such as inventory and receivables, business expansion and equipment purchases. Generally, a collateral lien is placed on equipment or other assets owned by the borrower. In the event of default by the borrower, Arrow may be required to liquidate collateral at deeply discounted values. To reduce the risk, management usually obtains personal guarantees to support the borrowing, as permitted by applicable law.

Commercial Real Estate - Arrow offers commercial real estate loans to finance real estate purchases, refinancings, expansions and improvements to commercial properties. Commercial real estate loans are made to finance the purchases of real property which generally consists of real estate with completed structures. These commercial real estate loans are typically secured by first liens on the real estate, which may include apartments, commercial structures, housing businesses, healthcare facilities, and both owner- and non-owner-occupied facilities. Arrow also offers commercial construction and land development loans to finance projects. Many projects will ultimately be used by the borrowers' businesses, while others are developed for resale. These real estate loans are also typically secured by first liens on the real estate, which may include apartments, commercial structures, housing businesses, healthcare facilities and both owner-occupied and non-owner-occupied facilities. There is enhanced risk during the construction period, since the loan is secured by an incomplete project. Arrow’s Commercial Real Estate loans are primarily located within the footprint of the Company’s branch network, with some loans extending into the greater upstate New York area. Arrow does not provide Commercial Real Estate loans in major metropolitan areas such as New York City, Boston, etc.

Consumer Loans - This category is primarily comprised of automobile loans. Arrow primarily finances the purchases of automobiles indirectly through dealer relationships located throughout upstate New York and Vermont. Most automobile loans carry a fixed rate of interest with principal repayment terms typically ranging from three to seven years. Automobile loans are underwritten on a secured basis using the underlying collateral being financed. Arrow also offers a variety of consumer installment loans to finance personal expenditures. Most of these loans carry a fixed rate of interest with principal repayment terms typically ranging from one to five years, based upon the nature of the collateral and the size of the loan. In addition to installment loans, Arrow also offers personal lines of credit and overdraft protection. Several of these consumer loans are unsecured, which carry a higher risk of loss.

Residential - Residential real estate loans consist primarily of loans secured by first or second mortgages on primary residences. Arrow originates fixed-rate and adjustable-rate one-to-four-family residential real estate loans for the construction, purchase of real estate or refinancing of an existing mortgage. These loans are collateralized primarily by owner-occupied properties generally located in Arrow's market area. Loans on one-to-four-family residential real estate are generally originated in amounts of no more than 80% of the purchase price or appraised value (whichever is lower), or have private mortgage insurance. Arrow’s underwriting analysis for residential mortgage loans typically includes credit verification, independent appraisals, and a review of the borrower’s financial condition. Mortgage title insurance and hazard insurance are normally required. It is Arrow's general practice to underwrite residential real estate loans to secondary market standards. Construction loans have a unique risk, because they are secured by an incomplete dwelling. This risk is reduced through periodic site inspections, including one at each loan draw period. In addition, Arrow offers fixed home equity loans, as well as home equity lines of credit to consumers to finance home improvements, debt consolidation, education and other uses. Arrow's policy allows for a maximum loan to value ratio of 80%, although periodically higher advances are allowed. Arrow originates home equity lines of credit and second mortgage loans (loans secured by a second junior lien position on one-to-four-family residential real estate). Risk is generally reduced through underwriting criteria, which include credit verification, appraisals, a review of the borrower's financial condition, and personal cash flows. A security interest, with title insurance when necessary, is taken in the underlying real estate.

Loan segments were selected by class code and application code to ensure each segment is comprised of loans with homogenous loan characteristics and similar risk profiles. The resulting loan segments are commercial, commercial real estate, consumer and residential real estate loans. The consumer segment is mainly comprised of automobile loans, and since they are relatively short-term in nature, with similar dollar amounts and collateral, the vintage analysis method was selected to determine the credit loss reserve. The vintage method utilizes Arrow loan data exclusively as the method calculates a loss rate based on the total origination balance of the loans by year and the charge-off and recovery rate of the same origination year. Arrow maintains, over the life of the loan, the loss curve by vintage year. The discounted cash flow method (DCF) is used to calculate the reserve for credit losses for the commercial, commercial real estate and residential real estate segments.

The March 31, 2025 allowance for credit losses calculation incorporated a reasonable and supportable forecast period to account for economic conditions utilized in the measurement. The quantitative model utilized a six-quarter economic forecast sourced from reputable third-parties that projects a negative change of approximately 0.05% in the forecasted national unemployment rate, forecasted gross domestic product projected to improve by approximately 0.08%, and the home price index (HPI) forecast to increase by approximately 0.09% from the previous quarter economic forecast. The overall change in the allowance from December 31, 2024 was primarily driven by the following factors: net loan growth contributed $282 thousand, changes in macro economic conditions increased the allowance by $140 thousand, net charge-offs of $846 thousand, and a specific reserve of $3.75 million on a $15 million commercial real estate loan participation ("Loan Participation")secured by properties in two office parks in upstate New York, where Arrow is a 22% participant in a $67 million multi-bank lending facility (the “Reserve”). The Loan Participation had been reported as non-performing in Arrow’s 2024 and 2023 Forms 10-K and had no previous reserve, given the most current appraised valuation of $86.1 million. However, the initiation of foreclosure proceedings during the quarter materially altered the expected resolution strategy

and reduced the anticipated recovery value of the collateral. In connection with these developments, an updated appraisal was obtained on April 1, 2025, at the direction of the lead bank representing the participant group, which indicated a significant decline in collateral value. Accordingly, Arrow recorded the above mentioned Reserve in the first quarter of 2025. As of March 31, 2025, the subject properties remained largely tenant-occupied and continued to generate positive net operating income.


Allowance for Credit Losses
	Commercial		Commercial Real Estate		Consumer		Residential		Total















December 31, 2024	$	1,925	$	14,507	$	3,882	$	13,284	$	33,598
Charge-offs	$	—	$	—	$	(1,519)	$	(31)	$	(1,550)
Recoveries	$	—	$	—	$	704	$	—	$	704
Provision	$	(124)	$	3,729	$	1,080	$	334	$	5,019
March 31, 2025	$	1,801	$	18,236	$	4,147	$	13,587	$	37,771
















December 31, 2023	$	1,958	$	15,521	$	2,566	$	11,220	$	31,265
Charge-offs	$	(9)	$	—	$	(1,274)	$	—	$	(1,283)
Recoveries	$	—	$	—	$	962	$	—	$	962
Provision	$	893	$	(1,353)	$	502	$	575	$	617
March 31, 2024	$	2,842	$	14,168	$	2,756	$	11,795	$	31,561

Financial instrument credit losses apply to off-balance sheet credit exposures such as unfunded loan commitments and standby letters of credit. A liability for expected credit losses for off-balance sheet exposures is recognized if the entity has a present contractual obligation to extend the credit and the obligation is not unconditionally cancellable by the entity. Changes in this allowance are reflected in other operating expenses within the non-interest expense category. As of March 31, 2025, the total unfunded commitment off-balance sheet credit exposure was $1.3 million, a decrease from the December 31, 2024 balance of $1.6 million.

All loans that exceed $250,000, which are on nonaccrual status, are evaluated on an individual basis. Arrow has a policy applicable to collateral dependent financial assets when the borrower is experiencing financial difficulty and the repayment is expected through the sale of the collateral. This policy allows Arrow to use fair value of the collateral at the reporting date adjusted for estimated cost to sell when recording the net carrying amount of the asset and determining the allowance for credit losses for a financial asset. In the event where the repayment of a collateral dependent financial asset is expected to be provided substantially through the operation of the collateral, Arrow will use fair value of the collateral at the reporting date when recording the net carrying amount of the asset and determining the allowance for credit losses. As of March 31, 2025, there were three total relationships identified to be evaluated for loss on an individual basis which had an amortized cost basis of $15.8 million. Arrow recognized the Reserve in the first quarter of 2025, see page 18 for additional discussion of the Reserve.


Allowance for Credit Losses - Collectively and Individually Evaluated
	Commercial		Commercial Real Estate		Consumer		Residential		Total
March 31, 2025
Ending Loan Balance - Collectively Evaluated	$	154,275	$	789,007	$	1,118,735	$	1,339,071	$	3,401,088
Allowance for Credit Losses - Loans Collectively Evaluated	1,801		14,486		4,147		13,587		34,021

Ending Loan Balance - Individually Evaluated	—		15,008		—		772		15,780
Allowance for Credit Losses - Loans Individually Evaluated	—		3,750		—		—		3,750

December 31, 2024
Ending Loan Balance - Collectively Evaluated	$	158,991	$	781,463	$	1,118,981	$	1,318,787	$	3,378,222
Allowance for Credit Losses - Loans Collectively Evaluated	1,925		14,507		3,882		13,284		33,598
Ending Loan Balance - Individually Evaluated	—		14,902		—		1,417		16,319
Allowance for Credit Losses - Loans Individually Evaluated	—		—		—		—		—

Through the provision for credit losses, an allowance for credit losses is maintained that reflects the best estimate of the calculated expected credit losses in Arrow's loan portfolio as of the balance sheet date. Additions are made to the allowance for credit losses through a periodic provision for credit losses. Actual credit losses are charged against the allowance for credit losses when loans are deemed uncollectible and recoveries of amounts previously charged off are recorded as credits to the allowance for credit losses.


	Term Loans Amortized Cost Basis by Origination Year												Revolving Loans Amortized Cost Basis		Revolving Loan Converted to Term		Total
March 31, 2025	2025		2024		2023		2022		2021		Prior
Commercial:
Risk rating
Satisfactory	$	7,720	$	41,090	$	26,444	$	21,475	$	15,801	$	23,978	$	9,801	$	—	$	146,309
Special mention	96		—		70		189		—		—		483		—		838
Substandard	—		—		501		1,118		—		2,997		2,512		—		7,128
Doubtful	—		—		—		—		—		—		—		—		—
Total Commercial Loans	$	7,816	$	41,090	$	27,015	$	22,782	$	15,801	$	26,975	$	12,796	$	—	$	154,275

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Commercial Real Estate:
Risk rating
Satisfactory	$	9,712	$	103,985	$	96,978	$	136,141	$	107,903	$	296,123	$	2,578	$	—	$	753,420
Special mention	—		2,988		—		12,593		—		3,033		—		—		18,614
Substandard	—		—		346		169		322		14,765		1,371		—		16,973
Doubtful	—		—		—		—		1,656		13,352		—		—		15,008
Total Commercial Real Estate Loans	$	9,712	$	106,973	$	97,324	$	148,903	$	109,881	$	327,273	$	3,949	$	—	$	804,015

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Consumer:
Risk rating
Performing	$	105,293	$	368,022	$	269,633	$	216,799	$	105,322	$	52,138	$	475	$	—	$	1,117,682
Nonperforming	—		206		162		297		291		97		—		—		1,053
Total Consumer Loans	$	105,293	$	368,228	$	269,795	$	217,096	$	105,613	$	52,235	$	475	$	—	$	1,118,735

Current-period gross charge-offs	$	—	$	363	$	392	$	357	$	317	$	90	$	—	$	—	$	1,519

Residential:
Risk rating
Performing	$	29,806	$	174,585	$	174,559	$	221,058	$	179,359	$	431,930	$	125,606	$	—	$	1,336,903
Nonperforming	—		—		201		344		201		1,937		257		—		2,940
Total Residential Loans	$	29,806	$	174,585	$	174,760	$	221,402	$	179,560	$	433,867	$	125,863	$	—	$	1,339,843

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	31	$	—	$	—	$	31

Total Loans	$	152,627	$	690,876	$	568,894	$	610,183	$	410,855	$	840,350	$	143,083	$	—	$	3,416,868

Total gross charge-offs	$	—	$	363	$	392	$	357	$	317	$	121			$	—	$	1,550


	Term Loans Amortized Cost Basis by Origination Year												Revolving Loans Amortized Cost Basis		Revolving Loan Converted to Term		Total
December 31, 2024	2024		2023		2022		2021		2020		Prior
Commercial:
Risk rating
Satisfactory	$	42,767	$	28,988	$	23,808	$	16,941	$	6,183	$	19,211	$	15,686	$	—	$	153,584
Special mention	107		229		930		—		72		—		483		—		1,821
Substandard	—		280		264		—		—		3,030		12		—		3,586
Doubtful	—		—		—		—		—		—		—		—		—
Total Commercial Loans	$	42,874	$	29,497	$	25,002	$	16,941	$	6,255	$	22,241	$	16,181	$	—	$	158,991

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	9	$	—	$	—	$	—	$	9

Commercial Real Estate:
Risk rating
Satisfactory	$	90,049	$	96,783	$	137,146	$	109,086	$	115,576	$	187,202	$	2,799	$	—	$	738,641
Special mention	3,002		200		12,680		—		—		9,506		—		—		25,388
Substandard	—		146		172		1,985		2,309		26,853		871		—		32,336
Doubtful	—		—		—		—		—		—		—		—		—
Total Commercial Real Estate Loans	$	93,051	$	97,129	$	149,998	$	111,071	$	117,885	$	223,561	$	3,670	$	—	$	796,365

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Consumer:
Risk rating
Performing	$	386,004	$	297,698	$	243,484	$	121,803	$	48,268	$	18,994	$	473	$	—	$	1,116,724
Nonperforming	345		424		602		593		178		115		—		—		2,257
Total Consumer Loans	$	386,349	$	298,122	$	244,086	$	122,396	$	48,446	$	19,109	$	473	$	—	$	1,118,981

Current-period gross charge-offs	$	1,272	$	949	$	1,669	$	1,270	$	434	$	243	$	—	$	—	$	5,837

Residential:
Risk rating
Performing	$	162,087	$	177,071	$	225,398	$	181,934	$	106,695	$	334,576	$	128,687	$	—	$	1,316,448
Nonperforming	—		201		254		201		464		2,386		250		—		3,756
Total Residential Loans	$	162,087	$	177,272	$	225,652	$	182,135	$	107,159	$	336,962	$	128,937	$	—	$	1,320,204

Current-period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	49	$	—	$	—	$	49

Total Loans	$	684,361	$	602,020	$	644,738	$	432,543	$	279,745	$	601,873	$	149,261	$	—	$	3,394,541

Total gross charge-offs	$	1,272	$	949	$	1,669	$	1,270	$	443	$	292	$	—	$	—	$	5,895

2) Special Mention - Loans in this category have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the institution’s credit position at some future date. "Special mention" assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Loans which might be assigned this credit quality indicator include loans to borrowers with deteriorating financial strength and/or earnings record and loans with potential for problems due to weakening economic or market conditions;

3) Substandard - Loans classified as “substandard” are inadequately protected by the current sound net worth or paying capacity of the borrower or the collateral pledged, if any. Loans in this category have well defined weaknesses that jeopardize the repayment. They are characterized by the distinct possibility that Arrow will sustain some loss if the deficiencies are not corrected. “Substandard” loans may include loans which are likely to require liquidation of collateral to effect repayment, and other loans where character or ability to repay has become suspect. Loss potential, while existing in the aggregate amount of substandard assets, does not have to exist in individual assets classified substandard;

4) Doubtful - Loans classified as “doubtful” have all of 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 current existing facts, conditions, and values, highly questionable and improbable. Although possibility of loss is extremely high, classification of these loans as “loss” has been deferred due to specific pending factors or events which may strengthen the value (e.g. possibility of additional collateral, injection of capital, collateral liquidation, debt restructure, economic recovery, etc). Loans classified as “doubtful” need to be placed on nonaccrual; and