# CSB Bancorp, Inc.: Form 10-Q for the period ended Jun 30, 2025

- Company: [CSB Bancorp, Inc.](/companies/csbb.md) (CIK 880417)
- Form: 10-Q
- Filed: 2025-08-11
- Accepted by EDGAR: Aug 11, 2025, 15:36 ET
- Period: 2025-06-30
- Accession: 0000950170-25-106490
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/880417/000095017025106490/csbb-20250630.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/880417/000095017025106490/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Income tax | 3 months, 2025-04-01 to 2025-06-30 | $903.0k | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 6 months, 2025-01-01 to 2025-06-30 | $1.8m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-04-01 to 2025-06-30 | $3.7m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2025-01-01 to 2025-06-30 | $7.3m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-04-01 to 2025-06-30 | $1.41 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2025-01-01 to 2025-06-30 | $2.78 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-04-01 to 2025-06-30 | $1.41 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2025-01-01 to 2025-06-30 | $2.78 | us-gaap:EarningsPerShareBasic |
| Operating cash flow | 6 months, 2025-01-01 to 2025-06-30 | $7.5m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 6 months, 2025-01-01 to 2025-06-30 | $221.0k | us-gaap:PaymentsToAcquireProductiveAssets |
| Dividends paid | 6 months, 2025-01-01 to 2025-06-30 | $2.1m | us-gaap:PaymentsOfDividendsCommonStock |
| Share repurchases | 6 months, 2025-01-01 to 2025-06-30 | $436.0k | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Total assets | at 2025-06-30 | $1.24bn | us-gaap:Assets |
| Total liabilities | at 2025-06-30 | $1.12bn | us-gaap:Liabilities |
| Shareholders' equity | at 2025-06-30 | $121.7m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 26,197 characters.

The following management’s discussion and analysis focuses on the consolidated financial condition of the Company on June 30, 2025 as compared to December 31, 2024, and the consolidated results of operations for the three and six months ended June 30, 2025 compared to the same period in 2024. The purpose of this discussion is to provide the reader with a more thorough understanding of the Consolidated Financial Statements. This discussion should be read in conjunction with the interim condensed Consolidated Financial Statements and related footnotes contained in Part I, Item 1 of this Quarterly Report.

### FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report are not historical facts but rather are forward-looking statements that are subject to certain risks and uncertainties. When used herein, the terms “anticipates”, “plans”, “expects”, “believes”, and similar expressions as they relate to the Company or its management are intended to identify forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company’s actual results, performance or achievements may materially differ from those expressed or implied in the forward-looking statements. Risks and uncertainties that could cause or contribute to such material differences include, but are not limited to, general economic conditions, interest rate environment, competitive conditions in the financial services industry, changes in law, governmental policies and regulations, and rapidly changing technology affecting financial services. Other factors not currently anticipated may also materially and adversely affect the Company’s results of operations, cash flows, and financial position. There can be no assurance that future results will meet expectations. While the Company believes that the forward-looking statements in this report are reasonable, the reader should not place undue reliance on any forward-looking statement.

The Company does not undertake, and specifically disclaims any obligation, to publicly revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as may be required by applicable law.

### FINANCIAL CONDITION

Total assets increased $46 million to $1.23 billion at June 30, 2025 compared to $1.19 billion at December 31, 2024. During the six months ended June 30, 2025, securities decreased $25 million, net loans increased $50 million, and cash and cash equivalents increased $22 million. Deposits and short-term borrowings increased $41 million.

Net loans increased $50 million, or 7%, as commercial and commercial real estate loans increased $52 million, or 12%, compared to December 31, 2024 and residential real estate loans increased $5 million, or 3%, from December 31, 2024. Construction loans decreased $10 million, or 15%, from December 31, 2024. Consumer refinance activity remains slow on mortgage loans, while home purchase activity remains stable despite limited inventory, and home equity line balances increased by $3 million. Residential mortgage loan originations, including home equity lines, for the six months ended June 30, 2025 totaled $32 million, an increase from $22 million in mortgage originations during the six months ended June 30, 2024. Mortgage loan originations sold into the secondary market increased slightly to $4 million from $3 million, respectively during the six months ended June 30, 2025 and June 30, 2024. The Bank originates and sells primarily fixed rate thirty-year mortgages into the secondary market.

The allowance for credit losses for loans increased $656 thousand from December 31, 2024 to $8 million. The increase in the allowance was primarily due to the volume increase in loans originated. Net charge-offs were $391 thousand, or an annualized 0.10% of average loans, in the current six-month period compared to net charge-offs of $320 thousand, or 0.09% of average loans in the year-ago six-month period. At June 30, 2025, the allowance for credit losses to total loans was 1.05%. We believe the allowance level is appropriate given the level of problem loans and composition of the overall loan portfolio in the current economic environment.

Nonperforming loans decreased $348 thousand to $1.4 million, or 0.17%, of total loans from $1.7 million, or 0.23% of total loans, on December 31, 2024. For the six months ended June 30, 2025, $437 thousand in loans were placed on nonaccrual status, $284 thousand in paydowns were received, and $370 thousand in loans were charged-off due to non-payment.

*(Dollars in thousands)*

|  | June 30, 2025 | December 31, 2024 | June 30, 2024 |
| --- | ---: | ---: | ---: |
| Non-performing loans | $1,357 | $1,705 | $6,683 |
| Other real estate | — | — | — |
| Repossessed assets | — | 14 | — |
| Allowance for credit losses | 8,251 | 7,595 | 10,587 |
| Total loans | 788,070 | 737,641 | 721,916 |
| Allowance for credit losses as a percentage of total loans | 1.05% | 1.03% | 1.47% |
| Allowance for credit losses to total nonperforming loans | 608% | 445% | 158% |

The ratio of gross loans to deposits was 72% and 71% at June 30, 2025 and December 31, 2024.

The Company has no exposure to government-sponsored enterprise preferred stocks, collateralized debt obligations, or trust preferred securities. Management has considered industry analyst reports, sector credit reports, and the volatility within the bond market in concluding that the gross unrealized losses of $32 million within the available-for-sale and held-to-maturity portfolios as of June 30, 2025, was primarily the result of current market yields compared to the yields at the time the investments were purchased by the Company and not due to credit quality. As a result, all embedded security losses on June 30, 2025, are considered temporary and no allowance for credit loss is necessary.

The weighted average life of total debt securities was 5.45 years at June 30, 2025 as compared to 5.14 years at December 31, 2024. If interest rates declined 100 basis points, the weighted average life was estimated to fall to 5.13 years at June 30, 2025. If interest rates rose 100 basis points the weighted average life would be expected to increase to 5.73 years at June 30, 2025.

Deposits increased $44 million, or 4%, from December 31, 2024 with noninterest-bearing deposits increasing approximately $1 million, or less than 1%, and interest-bearing deposit accounts increasing approximately $43 million, or 6%. Total deposits as of June 30, 2025 are $1.1 billion, or 6%, above June 30, 2024 deposit balances. On a year over year comparison, increases were recognized in noninterest-bearing demand deposits of $5 million, savings accounts of $5 million, interest bearing demand accounts of $22 million, and time deposits of $34 million. Decreases were recognized in money market accounts of $244 thousand. Deposits have increased as customers move funds into interest bearing demand accounts and time certificates of deposit to take advantage of higher interest rates in those products. The estimated amount of uninsured deposits was $266 million, $244 million, and $249 million as of June 30, 2025, December 31, 2024, and June 30, 2024, respectively.

Short-term borrowings consisting of overnight repurchase agreements with retail customers decreased $3 million, or 13%, to $22 million at June 30, 2025 as compared to December 31, 2024 as customers moved money into higher interest rate money market and time deposit accounts. Other borrowings decreased $301 thousand as the Company repaid FHLB advances.

Total shareholders’ equity amounted to $122 million, or 9.8%, of total assets at June 30, 2025, an increase of $6.8 million, or 6%, from $115 million at December 31, 2024. The increase in shareholders’ equity during the six months ended June 30, 2025 was due to net income of $7.3 million, other comprehensive income of $2.1 million, less cash dividends of $2.1 million, and treasury stock repurchases of $436 thousand. Total accumulated other comprehensive loss ("AOCL") decreased during the six months ended June 30, 2025 due to decreases in interest rates and improvements in pricing in government agency and corporate bonds as AFS securities are marked to fair value. This remaining unrealized loss in securities is temporary and is adjusted monthly for additional interest rate fluctuations, principal paydowns, calls, and maturities. The Company and the Bank met all regulatory capital requirements at June 30, 2025 as shown in the Capital Resources section of this report.

### RESULTS OF OPERATIONS

### Three months ended June 30, 2025 and 2024

For the quarters ended June 30, 2025 and 2024, the Company recorded net income of $3.7 million and $1.6 million and $1.41 and $0.61 per share, respectively. The $2.1 million increase in net income for the period was primarily the result of a reduced provision for credit losses and off-balance sheet commitments of $614 thousand compared to the provision for credit losses in the prior year period of $2.9 million. Additionally, an increase of $1.4 million in net interest income and $36 thousand increase in noninterest income is partially offset by a $1.1 million increase in noninterest expenses. The federal income tax provision increased $555 thousand. Pre-provision net revenue ("PPNR"), (a non-GAAP measure), totaled $5.2 million for the quarter ended June 30, 2025, an increase of $392 thousand, or 8.1%, from the prior year's second quarter.

Return on average assets and return on average equity were 1.23% and 12.48%, respectively, for the three-month period of 2025, compared to 0.56% and 5.89%, respectively for the same quarter in 2024.

### Average Balance Sheets and Net Interest Margin Analysis

*(Dollars in thousands)*

| ASSETS | For the Three Months Ended June 30, 2025 Average balance1 | Interest | Average rate2 | 2024 Average balance1 | Interest | Average rate2 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Federal Funds Sold | $393 | $4 | 4.08% | $446 | $6 | 5.41% |
| Interest-earning deposits in other banks | 60,529 | 674 | 4.47 | 26,903 | 373 | 5.58 |
| Taxable securities | 296,305 | 1,678 | 2.27 | 334,253 | 1,817 | 2.19 |
| Tax-exempt securities 4 | 16,786 | 95 | 2.28 | 18,999 | 112 | 2.37 |
| Loans 3,4 | 779,664 | 11,508 | 5.92 | 717,105 | 10,229 | 5.74 |
| Total interest-earning assets | 1,153,677 | 13,959 | 4.85% | 1,097,706 | 12,537 | 4.59% |
| Noninterest-earning assets | 66,629 |  |  | 63,827 |  |  |
| **TOTAL ASSETS** | $1,220,306 |  |  | $1,161,533 |  |  |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |  |  |  |  |
| Interest-bearing demand deposits | $230,267 | $429 | 0.75% | $220,741 | $493 | 0.90% |
| Savings deposits | 308,601 | 695 | 0.90 | 301,549 | 827 | 1.10 |
| Time deposits | 255,754 | 2,392 | 3.75 | 217,003 | 2,169 | 4.02 |
| Borrowed funds | 25,377 | 67 | 1.06 | 29,134 | 89 | 1.23 |
| Total interest-bearing liabilities | 819,999 | 3,583 | 1.75% | 768,427 | 3,578 | 1.87% |
| Noninterest-bearing demand deposits | 275,514 |  |  | 277,276 |  |  |
| Other liabilities | 5,014 |  |  | 5,611 |  |  |
| Shareholders' Equity | 119,779 |  |  | 110,219 |  |  |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | $1,220,306 |  |  | $1,161,533 |  |  |
| Taxable equivalent net interest income, (Non-GAAP) |  | $10,376 |  |  | $8,959 |  |
| Tax equivalent adjustment 4 |  | (31) |  |  | (34) |  |
| Net interest income, (GAAP) |  | $10,345 |  |  | $8,925 |  |
| Net interest margin, (GAAP) |  |  | 3.60% |  |  | 3.27% |
| Tax equivalent adjustment 4 |  |  | 0.01 |  |  | 0.01 |
| Net interest margin-taxable equivalent, (Non-GAAP) |  |  | 3.61% |  |  | 3.28% |
| Taxable equivalent net interest spread |  |  | 3.10% |  |  | 2.72% |

1 Average balances have been computed on an average daily basis.

2 Average rates have been computed based on the amortized cost of the corresponding asset or liability.

3 Average loan balances include nonaccrual loans.

4 Taxable equivalent adjustments have been computed assuming a 21% tax rate in 2025 and 2024 (non-GAAP).

Interest income for the quarter ended June 30, 2025, was $13.9 million representing a $1.4 million, or 11% increase, compared to the same period in 2024. This increase was primarily due to higher average balances of loans and interest-earning deposits in other banks. These increases were partially offset by the volume decreases in taxable securities over the comparable period. Rates on average interest-earning deposits in other banks decreased 111 basis points, while loan rates rose 18 basis points, and taxable securities' interest rates increased 8 basis points for the quarter ended June 30, 2025 as compared to the same period in 2024. Interest expense for the quarter ended June 30, 2025 was $3.6 million, an increase of $5 thousand, or less than 1%, from the same quarter in 2024. The increase in interest expense occurred primarily due to volume increases in time deposit accounts during the quarter ended June 30, 2025.

For the quarter ended June 30, 2025, the bank recognized net charge-offs of $362 thousand, compared to $246 thousand net charge-offs for the same quarter in 2024. The provision for credit losses on loans in the current quarter of $639 thousand, compared to a provision of $3.7 million in the same quarter ended 2024. The company recorded a $25 thousand recovery for credit loss expense on off-balance commitments in the second quarter 2025 compared to a $808 thousand recovery in the same quarter of 2024. The quarter increase results primarily from the increase in loan volume during second quarter 2025.

Economic indicators reflect somewhat flat business activity with uncertainty related to trade policies and national unemployment rates just above 4%. The provision for credit losses is determined based on management’s calculation of the adequacy of the allowance for credit losses, which includes provisions for classified loans as well as for the remainder of the portfolio based on historical data, including past charge-offs and current economic trends.

Noninterest income increased $36 thousand, or 2%, compared to the second quarter of 2024. The increase was primarily the result of a $35 thousand increase in earnings on bank owned life insurance, a $29 thousand increase in unrealized gain on equity securities, and a $22 thousand increase in debit card interchange fees. These increases were partially offset by decreases of $19 thousand in loss on sale of other assets, $16 thousand decrease in other income, and a $15 thousand decrease in trust services.

Noninterest expense increased $1.1 million, or 18%, from the second quarter 2024. Salary and employee benefit costs increased $865 thousand, or 28%, compared to the prior year quarter with increases in base salary, retirement, and incentive compensation. Occupancy expense costs increased $58 thousand, or 20%, with increases in heating system and elevator repairs. Software expense increased $27 thousand, or 7%, state financial institutions tax increased $17 thousand, or 8%, due to the increase in capital. Professional and director fees decreased $45 thousand, or 10%. The Company’s second quarter efficiency ratio increased to 56.6% compared to 54.2% in the prior year.

Federal income tax expense increased $555 thousand, or 159%, for the quarter ended June 30, 2025 as compared to the second quarter 2024. The provision for income taxes was $903 thousand (effective rate of 19.5%) for the quarter ended June 30, 2025, compared to $348 thousand (effective rate of 17.7%) for the same quarter ended 2024.

### RESULTS OF OPERATIONS

### Six months ended June 30, 2025, and 2024

For the six months ended June 30, 2025, and 2024, the Company recorded net income of $7.3 million and $4.5 million and $2.78 and $1.71 per share, respectively. The $3 million increase in net income for the six-month period was primarily the result of the provision for credit losses and off-balance sheet commitments of $1 million compared to the provision for credit losses in the prior year period of $4 million, and a $2 million increase to net interest income. The increase to net income was partially offset by an increase in noninterest expense of $1 million and a decrease of $40 thousand in noninterest income.

The federal income tax provision was $740 thousand higher during the six-month period in 2025 than in 2024. Return on average assets and return on average equity were 1.22% and 12.53%, respectively, for the six months ended June 30, 2025, compared to 0.79% and 8.35%, respectively for the same period in 2024.

*(Dollars in thousands)*

| ASSETS | For the Six Months Ended June 30, 2025 Average balance1 | Interest | Average rate2 | 2024 Average balance1 | Interest | Average rate2 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Federal Funds Sold | $390 | $8 | 4.14% | $384 | $10 | 5.24% |
| Interest-earning deposits in other banks | 54,417 | 1,206 | 4.47 | 27,148 | 738 | 5.47 |
| Taxable securities | 303,219 | 3,474 | 2.31 | 339,933 | 3,707 | 2.19 |
| Tax-exempt securities 4 | 16,787 | 191 | 2.29 | 19,041 | 223 | 2.36 |
| Loans 3,4 | 767,830 | 22,393 | 5.88 | 711,199 | 20,457 | 5.78 |
| Total interest-earning assets | 1,142,643 | 27,272 | 4.81% | 1,097,705 | 25,135 | 4.60% |
| Noninterest-earning assets | 66,486 |  |  | 63,401 |  |  |
| **TOTAL ASSETS** | $1,209,129 |  |  | $1,161,106 |  |  |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |  |  |  |  |
| Interest-bearing demand deposits | $220,567 | $787 | 0.72% | $226,224 | $1,056 | 0.94% |
| Savings deposits | 310,333 | 1,424 | 0.93 | 299,337 | 1,608 | 1.08 |
| Time deposits | 253,072 | 4,832 | 3.85 | 209,852 | 4,125 | 3.95 |
| Borrowed funds | 26,509 | 141 | 1.07 | 32,092 | 197 | 1.23 |
| Total interest-bearing liabilities | 810,481 | 7,184 | 1.79% | 767,505 | 6,986 | 1.83% |
| Noninterest-bearing demand deposits | 275,423 |  |  | 278,244 |  |  |
| Other liabilities | 5,050 |  |  | 5,829 |  |  |
| Shareholders' Equity | 118,175 |  |  | 109,528 |  |  |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | $1,209,129 |  |  | $1,161,106 |  |  |
| Taxable equivalent net interest income, (Non-GAAP) |  | $20,088 |  |  | $18,149 |  |
| Tax equivalent adjustment 4 |  | (62) |  |  | (76) |  |
| Net interest income, (GAAP) |  | $20,026 |  |  | $18,073 |  |
| Net interest margin, (GAAP) |  |  | 3.54% |  |  | 3.31% |
| Tax equivalent adjustment 4 |  |  | 0.01 |  |  | 0.01 |
| Net interest margin-taxable equivalent, (Non-GAAP) |  |  | 3.55% |  |  | 3.32% |
| Taxable equivalent net interest spread |  |  | 3.02% |  |  | 2.77% |

Interest income for the six months ended June 30, 2025, was $27 million representing a $2 million increase, or 9%, compared to the same period in 2024. This increase was primarily due to volume and yield increases on loans for the period ended June 30, 2025, as compared to the same period in 2024. Interest expense for the six months ended June 30, 2025, was $7 million, an increase of $197 thousand, or 3%, from the same period in 2024.

For the six months ended June 30, 2025, the provision for credit losses and off-balance sheet commitments was $1 million, compared to $4 million for the same period in 2024. For more discussion see Results of Operations, three months. The provision for credit losses is determined based on management’s calculation of the adequacy of the allowance for credit losses, which includes provisions for classified loans as well as for the remainder of the portfolio based on historical data, including past charge-offs and current economic trends.

Noninterest income for the six months ended June 30, 2025, was $3.5 million, a decrease of $40 thousand, or 1%, compared to the same period in 2024. Earnings on bank owned life insurance policies increased $63 thousand for the period. Unrealized gain on equity securities increased $35 thousand, or 121%. Debit card interchange income increased $30 thousand, or 3%. The gain on the sale of mortgage loans to the secondary market increased $21 thousand to $130 thousand for the six months ended June 30, 2025, as improved pricing for smaller balance mortgage loans attracted buyers and some mortgage loan refinancing. Service charges on deposit accounts increased $21 thousand, or 4%, compared to the same period in 2024 primarily from increases in monthly service fees. Fees from trust and brokerage services decreased $131 thousand for the period due to a one time fee collected in the first quarter of 2024. Credit card fee income decreased $21 thousand, or 7%.

Noninterest expenses for the six months ended June 30, 2025, increased $1.4 million, or 12%, compared to the same period in 2024. Salaries and employee benefits increased $1.1 million, or 17%, a result of increased incentive accruals and filled open positions. Debit card expense increased $27 thousand, or 7%, primarily due to processing increases. Professional and director fees increased $36 thousand for the six months ended June 30, 2025, as compared to the same period in 2024. Financial institutions tax increased $31 thousand, or 7%, based on increased capital. Occupancy and equipment expenses increased $131 thousand over the same period in 2024 with an increase in maintenance and snow removal expense. FDIC assessment increased $21 thousand, or 8%.

Federal income tax expense increased $740 thousand, or 71%, for the six months ended June 30, 2025, as compared to the same period in 2024. The provision for income taxes was $2 million (effective rate of 19.5%) for the six months ended June 30, 2025, compared to $1 million (effective rate of 18.6%) for the same period ended 2024.

### CAPITAL RESOURCES

The Company maintained a strong capital position with tangible common equity to tangible assets of 9.5% at June 30, 2025 compared with 9.3% at December 31, 2024.

Consistent with the Board of Director’s commitment to public confidence and safe and sound banking operations, capital targets and minimum risk-based capital ratios for CSB were established to maintain excess capital to well-capitalized standards. To be considered well-capitalized, an institution must have a total risk-based capital ratio of at least 10%, a tier 1 capital ratio of at least 8%, a leverage capital ratio of at least 5%, a common equity tier 1 (“CET1”) ratio of at least 6.5% and must not be subject to any order or directive requiring the institution to improve its capital level. An adequately capitalized institution has a total risk-based capital ratio of at least 8%, a tier 1 capital ratio of at least 6%, a CET1 ratio of at least 4.5%, and a leverage ratio of at least 4%.

Failure to meet specified minimum capital requirements could result in regulatory actions by the Federal Reserve or Ohio Division of Financial Institutions that could have a material effect on the Company’s financial condition or results of operations. Management believes there were no material changes to capital resources as presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. As of June 30, 2025, the Company and the Bank met all capital adequacy requirements to which they were subject.

| Total Capital To Risk Weighted Assets Ratio | Capital Ratios June 30, 2025 | December 31, 2024 |
| --- | ---: | ---: |
| Consolidated | 16.4% | 16.4% |
| Bank | 16.2 | 16.3 |
| Tier 1 Capital To Risk Weighted Assets Ratio |  |  |
| Consolidated | 15.3 | 15.3 |
| Bank | 15.2 | 15.2 |
| Common Equity Tier 1 Capital To Risk Weighted Assets |  |  |
| Consolidated | 15.3 | 15.3 |
| Bank | 15.2 | 15.2 |
| Tier 1 Leverage Ratio |  |  |
| Consolidated | 10.1 | 9.7 |
| Bank | 10.0 | 9.7 |

### LIQUIDITY

*(Dollars in thousands)*

|  | June 30, 2025 | December 31, 2024 | Change |
| --- | ---: | ---: | ---: |
| Cash and cash equivalents | $95,290 | $73,509 | $21,781 |
| Available from FHLB | 130,301 | 126,334 | 3,967 |
| Unpledged AFS securities at fair market value | 107,924 | 123,155 | (15,231) |
|  | $333,515 | $322,998 | $10,517 |
| Net deposits and short-term liabilities | $1,109,664 | $1,068,413 | $41,251 |
| Liquidity ratio | 30.1% | 30.2% | (0.1)% |
| Minimum board approved liquidity ratio | 20.0% | 20.0% |  |

Liquidity refers to the Company’s ability to generate sufficient cash to fund current loan demand, meet deposit withdrawals, pay operating expenses, and meet other obligations. Liquidity is monitored by the Company’s Asset Liability Committee. Other sources of liquidity include, but are not limited to, purchases of federal funds, advances from the FHLB, adjustments of interest rates to attract deposits, brokered deposits, and borrowing at the Federal Reserve discount window. Additionally, the Company could sell all of its AFS securities and the loss would not cause a change in the capital adequacy classification. Management believes its sources of liquidity are adequate to meet cash flow obligations for the foreseeable future.

### Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements (as such term is defined in applicable Securities and Exchange Commission (the “Commission”) rules) that are reasonably likely to have a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures, or capital resources.

### PER SHARE DATA

Earnings per share is computed based on the weighted average number of shares of common stock outstanding during each year. The company currently maintains a simple capital structure, thus, there are no dilutive effects on earnings per share.

The weighted average number of common shares outstanding for earnings per share computations was as follows:

*(Dollars in thousands, except per share data)*

|  | Three Months Ended June 30, 2025 | 2024 | Six Months Ended June 30, 2025 | 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net income | $3,727 | $1,615 | $7,343 | $4,548 |
| Weighted average common shares outstanding | 2,639,244 | 2,664,485 | 2,641,879 | 2,664,879 |
| **Earnings per share, basic and diluted** | $1.41 | $0.61 | $2.78 | $1.71 |

34

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

## Market risk

As filed, 2,754 characters.

Ohio's unemployment rate continues to rise slightly to 4.9% in June 2025 which was up from 4.4% in December 2024. Holmes County, where the bank is headquartered, is reporting an unemployment rate of 3.8% in June 2025. Of the counties within the bank's footprint, Stark County reported the highest unemployment rate at 5.1%, while Tuscarawas, Wayne, and Medina Counties posted unemployment rates of 4.7%, 4.6% and 4.2% respectively in June 2025. The rate of inflation, as measured by the Consumer Price Index, decreased to 2.7% on a year over year basis at June 2025, following average inflation rates of 2.9% in 2024, 4.1% in 2023 and 8.0% in 2022. The rate continues to be above the Federal Reserve target rate of 2%. The Federal Reserve reduced the federal funds target rate in 2024 by 1% to a range of 4.25% to 4.50%.

Management performs a quarterly analysis of the Company’s interest rate risk over a twenty-four-month horizon. The analysis includes two balance sheet models, one based on a static balance sheet and one on a dynamic balance sheet with projected growth in assets and liabilities. All balance sheet positions, and interest rate projections are currently within the Company’s board-approved policy for both the twelve- month and twenty-four-month periods.

The following table presents an analysis of the estimated sensitivity of the Company’s annual net interest income to sudden and sustained -400 through +400 basis point changes, in 100 basis point increments, in market interest rates at June 30, 2025 and December 31, 2024. The net interest income reflected is for the first twelve-month period of the modeled twenty-four-month horizon. The underlying balance sheet for illustrative purposes is dynamic with projected growth in assets and liabilities.

*June 30, 2025*

*(Dollars in thousands)*

| Change in Interest Rates (basis points) | Net Interest Income | Dollar Change | Percentage Change | Board Policy Limits |
| --- | ---: | ---: | ---: | --- |
| + 400 | $45,137 | $656 | 1.5% | ± 25% |
| + 300 | 44,969 | 488 | 1.1 | ± 15 |
| + 200 | 44,809 | 328 | 0.7 | ± 10 |
| + 100 | 44,646 | 165 | 0.4 | ± 5 |
| 0 | 44,481 | — | — |  |
| – 100 | 44,258 | (223) | (0.5) | ± 5 |
| – 200 | 43,926 | (555) | (1.2) | ± 10 |
| – 300 | 43,455 | (1,026) | (2.3) | ± 15 |
| – 400 | 43,022 | (1,459) | (3.3) | ± 25 |
| **December 31, 2024** |  |  |  |  |
| + 400 | $42,231 | $1,333 | 3.3% | ± 25% |
| + 300 | 41,902 | 1,004 | 2.5 | ± 15 |
| + 200 | 41,571 | 673 | 1.7 | ± 10 |
| + 100 | 41,237 | 339 | 0.9 | ± 5 |
| 0 | 40,898 | — | — |  |
| – 100 | 40,432 | (466) | (1.1) | ± 5 |
| – 200 | 40,089 | (809) | (2.0) | ± 10 |
| – 300 | 39,553 | (1,345) | (3.3) | ± 15 |
| – 400 | 38,988 | (1,910) | (4.7) | ± 25 |

35

CONTROLS AND PROCEDURES

## Controls and procedures

As filed, 1,842 characters.

With the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, the Company has evaluated the effectiveness of its disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that:

(a) information required to be disclosed by the Company in this Quarterly Report on Form 10-Q would be accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure;

(b) information required to be disclosed by the Company in this Quarterly Report on Form 10-Q would be recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms; and

(c) the Company’s disclosure controls and procedures are effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that material information relating to the Company and its consolidated subsidiary is made known to them, particularly during the period for which the Company’s periodic reports, including this Quarterly Report on Form 10-Q, are being prepared.

### CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes during the period covered by this Quarterly Report on Form 10-Q in the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

FORM 10-Q

QUARTER ENDED JUNE 30, 2025

Filed Aug 11, 2025.
Source: SEC EDGAR, the filing index for accession 0000950170-25-106490. Last ingested by Listed: Nov 2, 2026, 09:27 ET. No prices; not investment advice.