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What changed in Texas Community Bancshares, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Texas Community Bancshares, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+241 added−254 removedSource: 10-K (2025-03-27) vs 10-K (2024-03-27)

Top changes in Texas Community Bancshares, Inc.'s 2024 10-K

241 paragraphs added · 254 removed · 203 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

82 edited+8 added−9 removed199 unchanged
Biggest changeMaturities are based on the final contractual payment dates and do not reflect the impact of prepayments or early redemptions that may occur. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ ​ Due in One Year ​ One to Five Years ​ Five to Ten Years ​ After Ten Years ​ Total Investment Securities ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ ​ Value Yield Value Yield Value Yield Value Yield Value Yield ​ Securities available for sale: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ — ​ — % $ 219 ​ 2.23 % $ 2,459 ​ 2.32 % $ 22,247 ​ 4.96 % $ 24,925 ​ 4.67 % Collateralized mortgage obligations ​ ​ — ​ — % ​ 11,661 ​ 6.89 % ​ 3,884 ​ 6.03 % ​ 34,334 ​ 4.43 % ​ 49,879 ​ 5.13 % State and municipal ​ — ​ — % 1,913 ​ 1.94 % 7,090 ​ 2.40 % 4,347 ​ 1.66 % 13,350 ​ 2.09 % Corporate bonds ​ — ​ — % — ​ — % 4,234 ​ 4.79 % 939 ​ 3.97 % 5,173 ​ 4.64 % U.S.
Biggest changeMaturities are based on the final contractual payment dates and do not reflect the impact of prepayments or early redemptions that may occur. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2024 ​ ​ ​ Due in One Year ​ One to Five Years ​ Five to Ten Years ​ After Ten Years ​ No Fixed Maturity ​ Total Investment Securities ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ Fair ​ Average ​ ​ Value Yield Value Yield Value Yield Value Yield Value Yield Value Yield ​ Securities available for sale: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ — ​ — % $ — ​ — % $ — ​ — % $ — ​ — % $ 9,151 ​ 2.63 % $ 9,151 ​ 2.63 % Collateralized mortgage obligations ​ ​ — ​ — % ​ — ​ — % ​ — ​ — % ​ — ​ — % ​ 46,568 ​ 5.36 % ​ 46,568 ​ 5.36 % State and municipal ​ — ​ — % 3,313 ​ 2.27 % 5,709 ​ 2.30 % 4,255 ​ 1.57 % — ​ — % 13,277 ​ 2.06 % Corporate bonds ​ — ​ — % — ​ — % 5,217 ​ 4.90 % 976 ​ 3.96 % — ​ — % 6,193 ​ 4.75 % Total securities available for sale ​ $ — ​ ​ ​ $ 3,313 ​ ​ ​ $ 10,926 ​ ​ ​ $ 5,231 ​ ​ ​ $ 55,719 ​ ​ ​ $ 75,189 ​ ​ ​ ​ The following table summarizes securities held to maturity: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ 2024 ​ 2023 ​ ​ ​ Amortized ​ Percentage of ​ Amortized ​ Percentage of ​ ​ Cost Total ​ Cost Total ​ Securities held to maturity: ​ ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ 19,090 ​ 86.4 % $ 22,301 ​ 85.7 % State and municipal ​ 1,567 ​ 7.1 % 1,985 ​ 7.6 % U.S.
Broadstreet Bank, SSB Formerly named Mineola Community Bank, S.S.B., Broadstreet Bank is a Texas-chartered savings bank headquartered in Mineola, Texas. On December 4, 2023, the name of the Bank changed from Mineola Community Bank to Broadstreet Bank to be more inclusive of all of the communities we serve.
Broadstreet Bank, SSB Formerly named Mineola Community Bank, S.S.B., Broadstreet Bank, SSB is a Texas-chartered savings bank headquartered in Mineola, Texas. On December 4, 2023, the name of the Bank changed from Mineola Community Bank to Broadstreet Bank to be more inclusive of all of the communities we serve.
The majority of Broadstreet Bank’s loans are currently fixed-rate loans, however the Bank is originating more commercial loans with 5 Table of Contents adjustable rates to diversify our loan portfolio and decrease risk associated with fluctuations in market rates.
The majority of Broadstreet Bank’s loans are currently fixed-rate loans, however the Bank is originating more 5 Table of Contents commercial loans with adjustable rates to diversify our loan portfolio and decrease risk associated with fluctuations in market rates.
These are the counties in which our offices are located. 6 Table of Contents Lending Activities General. Our historical lending activity consists primarily of originating one-to four-family residential mortgage loans, commercial real estate loans, and construction and land loans. To a substantially lesser extent, we originate agricultural loans, commercial loans, and consumer and other loans.
These are the counties in which our offices are located. 6 Table of Contents Lending Activities General. Our historical lending activity consists primarily of originating one-to four-family residential mortgage loans, commercial real estate loans, and construction and land loans. To a substantially lesser extent, we originate agricultural loans, commercial loans, loans to municipalities, and consumer and other loans.
Decisions on loan applications are made on the basis of detailed applications submitted by the prospective borrower, credit histories that we obtain, and property valuations (consistent with our appraisal policy) prepared by our internal licensed appraiser and outside independent licensed appraisers approved by our board of directors as well as internal evaluations, where permitted by regulations.
Decisions on loan applications are made on the basis of detailed applications submitted by the prospective borrower, credit histories that we obtain, and property valuations (consistent with our appraisal policy) prepared by our internal licensed appraiser or outside independent licensed appraisers approved by our board of directors as well as internal evaluations, where permitted by regulations.
We also use borrowings, and occasionally brokered deposits, to supplement cash flow needs, lengthen the maturities of liabilities for interest rate risk purposes and to manage the cost of funds. In addition, we receive funds from scheduled loan payments, investment maturities, loan prepayments, retained earnings and income on earning assets.
We also use borrowings, and occasionally brokered deposits, to supplement cash flow needs, manage the maturities of liabilities for interest rate risk purposes and to manage the cost of funds. In addition, we receive funds from scheduled loan payments, investment maturities, loan prepayments, retained earnings and income on earning assets.
Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings from the Federal Home Loan Bank of Dallas, in residential real estate loans and commercial real estate loans and, to a lesser extent, commercial loans, construction and land loans, and consumer and other loans.
Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings from the Federal Home Loan Bank of Dallas, in residential real estate loans, commercial real estate loans, construction and land loans, municipality loans, and, to a lesser extent, commercial loans, and consumer and other loans.
These loans are generally secured by business assets, such as equipment and accounts receivable. Commercial loans secured by accounts receivable are made with fixed-interest rates and for terms not to exceed 12 months. Commercial equipment loans are made with fixed-interest rates and for terms generally up to 60 months.
These loans are generally secured by business assets, such as equipment and accounts receivable. Commercial loans secured by accounts receivable are made with adjustable rates and for terms not to exceed 12 months. Commercial equipment loans are made with fixed-interest rates and for terms generally up to 60 months.
Residential mortgage loans are generally originated at a fixed rate of 15, 20, or 30 years or with the optional 10-year balloon terms based on a 20- or 30-year amortization schedule.
Residential mortgage loans are generally originated at a fixed rate of 15, 20, or 30 years or with the optional 6-year or 10-year balloon terms based on a 20- or 30-year amortization schedule.
Subsidiary Activities Broadstreet Bank is the sole and wholly owned subsidiary of Texas Community Bancshares, Inc. Broadstreet Bank has one subsidiary, Mineola Financial Service Corporation, which is currently inactive.
Subsidiary Activities Broadstreet Bank is the sole and wholly owned subsidiary of Texas Community Bancshares. Broadstreet Bank has one subsidiary, Mineola Financial Service Corporation, which is currently inactive.
Failure to meet the qualifying criteria within the grace period or maintain a leverage ratio of 8% or greater requires the institution to comply with the generally applicable regulatory capital requirements. 22 Table of Contents At December 31, 2023, Broadstreet Bank had opted into the community bank leverage ratio framework and its capital exceeded all applicable requirements. Loans-to-One Borrower.
Failure to meet the qualifying criteria within the grace period or maintain a leverage ratio of 8% or greater requires the institution to comply with the generally applicable regulatory capital requirements. 22 Table of Contents At December 31, 2024, Broadstreet Bank had opted into the community bank leverage ratio framework and its capital exceeded all applicable requirements. Loans-to-One Borrower.
Multi-family loan underwriting and terms are based on commercial real estate loan guidelines. At December 31, 2023, our largest multi-family loan relationship consisted of one loan totaling $7.7 million, which is secured by a townhome apartment complex. At December 31, 2023, all multi-family loans were performing according to their original terms. Construction and Land Loans .
Multi-family loan underwriting and terms are based on commercial real estate loan guidelines. At December 31, 2024, our largest multi-family loan relationship consisted of one loan totaling $7.7 million, which is secured by a townhome apartment complex. At December 31, 2024, all multi-family loans were performing according to their original terms. Construction and Land Loans .
At December 31, 2023, Broadstreet Bank was in compliance with the loans-to-one borrower limitations. Capital Distributions. The Federal Deposit Insurance Act generally provides that an insured depository institution may not make any capital distribution if, after making such distribution, the institution would fail to meet any applicable regulatory capital requirement.
At December 31, 2024, Broadstreet Bank was in compliance with the loans-to-one borrower limitations. Capital Distributions. The Federal Deposit Insurance Act generally provides that an insured depository institution may not make any capital distribution if, after making such distribution, the institution would fail to meet any applicable regulatory capital requirement.
At December 31, 2023, all of these loans were performing according to their terms. We consider a number of factors in originating commercial real estate loans. We evaluate the qualifications and financial condition of the borrower, including credit history, profitability and expertise, as well as the value and condition of the property securing the loan.
At December 31, 2024, all of these loans were performing according to their terms. We consider a number of factors in originating commercial real estate loans. We evaluate the qualifications and financial condition of the borrower, including credit history, profitability and expertise, as well as the value and condition of the property securing the loan.
Broadstreet Bank reviews for impairment, based on the ultimate recoverability, the cost basis of the Federal Home Loan Bank of Dallas stock. At December 31, 2023, no impairment had been recognized. 26 Table of Contents Holding Company Regulation Texas Community Bancshares is a bank holding company within the meaning of Bank Holding Company of 1956, as amended.
Broadstreet Bank reviews for impairment, based on the ultimate recoverability, the cost basis of the Federal Home Loan Bank of Dallas stock. At December 31, 2024, no impairment had been recognized. 26 Table of Contents Holding Company Regulation Texas Community Bancshares is a bank holding company within the meaning of Bank Holding Company of 1956, as amended.
Members of the Federal Home Loan Bank are required to acquire and hold shares of capital stock in their Federal Home Loan Bank. Broadstreet Bank complied with this requirement at December 31, 2023. Based on redemption provisions of the Federal Home Loan Bank of Dallas, the stock has no quoted market value and is carried at cost.
Members of the Federal Home Loan Bank are required to acquire and hold shares of capital stock in their Federal Home Loan Bank. Broadstreet Bank complied with this requirement at December 31, 2024. Based on redemption provisions of the Federal Home Loan Bank of Dallas, the stock has no quoted market value and is carried at cost.
As such, it is grouped with any other capital losses for the year to which it is carried and is used to offset any capital gains. Any undeducted loss remaining after the five-year carryover period is no longer deductible. At December 31, 2023, Broadstreet Bank had no capital loss carryovers. Corporate Dividends.
As such, it is grouped with any other capital losses for the year to which it is carried and is used to offset any capital gains. Any undeducted loss remaining after the five-year carryover period is no longer deductible. At December 31, 2024, Broadstreet Bank had no capital loss carryovers. Corporate Dividends.
Management’s periodic evaluation of the adequacy of the allowance is based on various factors, including, but not limited to, management’s ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and nonaccrual loans, existing risk characteristics of specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses.
Management’s periodic evaluation of the adequacy of the allowance is based on various factors, including, but not limited to, management’s ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and nonaccrual loans, existing risk characteristics of 15 Table of Contents specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses.
At December 31, 2023, Broadstreet Bank met the criteria for being considered “well capitalized.” Insurance of Deposit Accounts. The Deposit Insurance Fund of the Federal Deposit Insurance Corporation insures deposits at Federal Deposit Insurance Corporation-insured financial institutions such as Broadstreet Bank, generally up to a maximum of $250,000 per separately insured depositor.
At December 31, 2024, Broadstreet Bank met the criteria for being considered “well capitalized.” Insurance of Deposit Accounts. The Deposit Insurance Fund of the Federal Deposit Insurance Corporation insures deposits at Federal Deposit Insurance Corporation-insured financial institutions such as Broadstreet Bank, generally up to a maximum of $250,000 per separately insured depositor.
The following tables set forth the contractual maturities of our total loan portfolio at December 31, 2023. Demand loans, loans having no stated repayment schedule or maturity, and overdraft loans are reported as being due in one year or less.
The following tables set forth the contractual maturities of our total loan portfolio at December 31, 2024. Demand loans, loans having no stated repayment schedule or maturity, and overdraft loans are reported as being due in one year or less.
At December 31, 2023, we had one loan for the construction of a convenience store, secured by the completed project of $4.2 million, for which we sold one participation interest totaling $1.2 million. We generally do not originate loans for sale. At December 31, 2023, we had no loans held for sale.
At December 31, 2024, we had one loan for the construction of a convenience store, secured by the completed project of $4.2 million, for which we sold one participation interest totaling $1.2 million. We generally do not originate loans for sale. At December 31, 2024, we had no loans held for sale.
At December 31, 2023, based on this limitation, Broadstreet Bank’s loans-to-one-borrower limit was approximately $12.0 million. Notwithstanding this legal limit, Broadstreet Bank had an in-house limit of $3.0 million for a consumer borrower and $8 million for a commercial borrower at December 31, 2023.
At December 31, 2024, based on this limitation, Broadstreet Bank’s loans-to-one-borrower limit was approximately $12.0 million. Notwithstanding this legal limit, Broadstreet Bank had an in-house limit of $3.0 million for a consumer borrower and $8.0 million for a commercial borrower at December 31, 2024.
For additional information regarding the fair value hedge, see Note 21 to the notes to consolidated financial statements. Sources of Funds General. Customer deposits have traditionally been our primary source of funds for use in lending and investment activities.
For additional information regarding the fair value hedge, see Note 19 to the notes to consolidated financial statements. Sources of Funds General. Customer deposits have traditionally been our primary source of funds for use in lending and investment activities.
As a result, in addition to the risks associated with traditional construction loans, speculative construction loans carry the added risk that the builder will have to pay the property taxes and other carrying costs of the property until an end buyer is found. Land loans have substantially similar risks to speculative construction loans. Balloon Loans.
As a result, 11 Table of Contents in addition to the risks associated with traditional construction loans, speculative construction loans carry the added risk that the builder will have to pay the property taxes and other carrying costs of the property until an end buyer is found. Land loans have substantially similar risks to speculative construction loans. Balloon Loans.
Generally, we require title insurance or abstracts on our mortgage loans as well as fire and extended coverage casualty insurance in amounts at least equal to the principal amount of the loan or the value of improvements on the property, depending on the type of loan. 12 Table of Contents Delinquencies and Asset Quality Delinquency Procedures.
Generally, we require title insurance or abstracts on our mortgage loans as well as fire and extended coverage casualty insurance in amounts at least equal to the principal amount of the loan or the value of improvements on the property, depending on the type of loan. Delinquencies and Asset Quality Delinquency Procedures.
When an insured institution classifies problem assets as “loss,” it is required either to establish a specific allowance for losses equal to 14 Table of Contents 100% of that portion of the asset so classified or to charge-off such amount.
When an insured institution classifies problem assets as “loss,” it is required either to establish a specific allowance for losses equal to 100% of that portion of the asset so classified or to charge-off such amount.
Moreover, as part of their examination authority, the banking regulators assign numerical ratings to banks and savings institutions relating to capital, asset quality, management, liquidity, earnings and 20 Table of Contents other factors.
Moreover, as part of their examination authority, the banking regulators assign numerical ratings to banks and savings institutions relating to capital, asset quality, management, liquidity, earnings and other factors.
A less than satisfactory rating may also prevent a financial institution, such as Broadstreet Bank or its holding company, from obtaining necessary regulatory approvals to access the capital markets, pay dividends, acquire other financial institutions or establish new branches.
A less than satisfactory rating may also prevent a financial institution, such as Broadstreet Bank or its holding company, from 20 Table of Contents obtaining necessary regulatory approvals to access the capital markets, pay dividends, acquire other financial institutions or establish new branches.
An environmental phase one report is 10 Table of Contents obtained when required by policy or when the possibility exists that hazardous materials may have existed on the site, the site may have been impacted by adjoining properties that handled hazardous materials.
An environmental phase one report is obtained when required by policy or when the possibility exists that hazardous materials may have existed on the site or the site may have been impacted by adjoining properties that handled hazardous materials.
Costs relating to the development and improvement of the property, however, are capitalized to the extent of estimated fair value less estimated costs to sell. Delinquent Loans .
Costs relating to the development and improvement of the property, however, are capitalized to the extent of estimated fair value less estimated costs to sell. 13 Table of Contents Delinquent Loans .
Government and agency ​ 1,734 ​ 6.7 % — ​ — % Total securities held to maturity ​ $ 26,020 ​ 100.0 % $ 27,827 ​ 100.0 % ​ The following table sets forth information regarding amortized costs, weighted average yields and maturities of all held to maturity investments. The yields have been computed on a tax equivalent basis.
Government and agency ​ 1,439 ​ 6.5 % 1,734 ​ 6.7 % Total securities held to maturity ​ $ 22,096 ​ 100.0 % $ 26,020 ​ 100.0 % ​ The following table sets forth information regarding amortized costs, weighted average yields and maturities of all held to maturity investments. The yields have been computed on a tax equivalent basis.
As of June 30, 2023 (the most recent date for which data is available), our deposit market share in Smith County was 0.19% (20 th among 26 Federal Deposit Insurance Corporation-insured institutions with offices in the county), 8.49% in Van Zandt County (6 th among 8 Federal Deposit Insurance Corporation-insured institutions with offices in the county) and 18.27% in Wood County (3 rd among 7 Federal Deposit Insurance Corporation-insured institutions with offices in the county).
As of June 30, 2024 (the most recent date for which data is available), our deposit market share in Smith County was 0.27% (19 th among 26 Federal Deposit Insurance Corporation-insured institutions with offices in the county), 8.90% in Van Zandt County (6 th among 8 Federal Deposit Insurance Corporation-insured institutions with offices in the county) and 19.94% in Wood County (3 rd among 7 Federal Deposit Insurance Corporation-insured institutions with offices in the county).
For further information regarding our borrowings from the Federal Home Loan Bank of Dallas, see note 10 of the notes to consolidated financial statements. Personnel As of December 31, 2023, we had 62 full-time employees and five part-time employees. Our employees are not represented by any collective bargaining group. Management believes that we have good working relations with our employees.
For further information regarding our borrowings from the Federal Home Loan Bank of Dallas, see note 8 of the notes to consolidated financial statements. Personnel As of December 31, 2024, we had 60 full-time employees and eight part-time employees. Our employees are not represented by any collective bargaining group. Management believes that we have good working relations with our employees.
We also generally require inspections of the property before disbursements of funds during the term of the construction loan. Commercial Loans. At December 31, 2023, commercial loans were $6.9 million, or 2.4% of total loans. We make commercial loans primarily to small businesses in our market area.
We also generally require inspections of the property before disbursements of funds during the term of the construction loan. Commercial Loans. At December 31, 2024, commercial loans were $6.3 million, or 2.1% of total loans. We make commercial loans primarily to small businesses in our market area.
On the basis of this review of our assets, our classified and special mention assets at the dates indicated were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2023 2022 ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ ​ Substandard assets ​ $ 3,667 ​ $ 3,006 Doubtful assets ​ ​ — ​ 389 Loss assets ​ ​ — ​ — Total classified assets ​ $ 3,667 ​ $ 3,395 Special mention assets ​ $ 788 ​ $ 658 Foreclosed assets ​ $ 162 ​ $ — ​ Allowance for Credit Losses The allowance for credit losses is maintained at a level which, in management’s judgment, is adequate to absorb current expected credit losses inherent in the loan portfolio.
On the basis of this review of our assets, our classified and special mention assets at the dates indicated were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2024 2023 ​ ​ (In thousands) ​ ​ ​ ​ ​ ​ ​ Substandard assets ​ $ 3,904 ​ $ 3,667 Doubtful assets ​ ​ — ​ — Loss assets ​ ​ — ​ — Total classified assets ​ $ 3,904 ​ $ 3,667 Special mention assets ​ $ 6,931 ​ $ 788 Foreclosed assets ​ $ — ​ $ 162 ​ Allowance for Credit Losses The allowance for credit losses is maintained at a level which, in management’s judgment, is adequate to absorb current expected credit losses inherent in the loan portfolio.
At December 31, 2023, Broadstreet Bank had no minimum tax credit carryovers. Net Operating Loss Carryovers. As a result of the Tax Cuts and Jobs Act generally, a financial institution may carry net operating losses forward indefinitely. At December 31, 2023, Broadstreet Bank had no federal net operating loss carryforwards. Capital Loss Carryovers.
At December 31, 2024, Broadstreet Bank had no minimum tax credit carryovers. Net Operating Loss Carryovers. As a result of the Tax Cuts and Jobs Act generally, a financial institution may carry net operating losses forward indefinitely. At December 31, 2023, Broadstreet Bank had a $2.3 million federal net operating loss carryforward. Capital Loss Carryovers.
The majority of the loans we originate are fixed rate loans, however we have updated our commercial lending terms and are originating more commercial loans with adjustable rates. Loan Portfolio Composition. The following table sets forth the composition of our loan portfolio by type of loan at the dates indicated.
While the majority of the Company’s loan portfolio is comprised of fixed rate loans, we have updated our commercial lending terms and are originating more commercial loans with adjustable rates. Loan Portfolio Composition. The following table sets forth the composition of our loan portfolio by type of loan at the dates indicated.
We have also originated residential mortgage loans secured by owner-occupied properties located in the northern and eastern sections of the Dallas Metroplex. We began originating these loans in 2014, and continue to do so primarily through word-of-mouth referrals. These are generally jumbo loans with low loan-to-value ratios, generally in the range of 60% to 75%.
We have also originated residential mortgage loans secured by owner-occupied properties located in the northern and eastern sections of the Dallas Metroplex. These loans are originated primarily through existing relationships and word-of-mouth referrals. These are generally jumbo loans with low loan-to-value ratios, generally in the range of 60% to 75%.
Government and agency ​ — ​ — % 14,555 ​ 13.6 % Total securities available for sale ​ $ 93,327 ​ 100.0 % $ 107,153 ​ 100.0 % ​ The following table sets forth information regarding fair values, weighted average yields and maturities of available for sale investments. The yields have been computed on a tax equivalent basis.
Government and agency ​ — ​ — % — ​ — % Total securities available for sale ​ $ 75,189 ​ 100.0 % $ 93,327 ​ 100.0 % ​ The following table sets forth information regarding fair values, weighted average yields and maturities of available for sale investments. The yields have been computed on a tax equivalent basis.
As of December 31, 2023 and 2022, all of our available for sale investment securities are carried at fair value through accumulated other comprehensive loss and our held to maturity securities are carried at cost. 17 Table of Contents The following table summarizes securities available for sale: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ 2023 ​ 2022 ​ ​ ​ Fair ​ Percentage of ​ Fair ​ Percentage of ​ ​ Value Total Value Total ​ Securities available for sale: ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ 24,925 ​ 26.7 % $ 23,758 ​ 22.2 % Collateralized mortgage obligations ​ ​ 49,879 ​ 53.4 % ​ 50,244 ​ 46.9 % State and municipal ​ 13,350 ​ 14.3 % 13,781 ​ 12.9 % Corporate bonds ​ 5,173 ​ 5.6 % 4,815 ​ 4.4 % U.S.
As of December 31, 2024 and 2023, all of our available for sale investment securities are carried at fair value through accumulated other comprehensive loss and our held to maturity securities are carried at cost. 17 Table of Contents The following table summarizes securities available for sale: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ ​ 2024 ​ 2023 ​ ​ ​ Fair ​ Percentage of ​ Fair ​ Percentage of ​ ​ Value Total Value Total ​ Securities available for sale: ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ 9,151 ​ 12.2 % $ 24,925 ​ 26.7 % Collateralized mortgage obligations ​ ​ 46,568 ​ 61.9 % ​ 49,879 ​ 53.4 % State and municipal ​ 13,277 ​ 17.7 % 13,350 ​ 14.3 % Corporate bonds ​ 6,193 ​ 8.2 % 5,173 ​ 5.6 % U.S.
Various state consumer laws and regulations also affect the operations of Broadstreet Bank, including state usury laws and consumer credit laws. 21 Table of Contents Texas law further provides that, subject to the limitations established by rule of the Texas Finance Commission, a Texas savings bank may make any loan or investment or engage in any activity permitted under state law for a bank or savings and loan association or under federal law for a federal savings and loan association, savings bank or national bank if such institution’s principal office is located in Texas.
Texas law further provides that, subject to the limitations established by rule of the Texas Finance Commission, a Texas savings bank may make any loan or investment or engage in any activity permitted under state law for a bank or 21 Table of Contents savings and loan association or under federal law for a federal savings and loan association, savings bank or national bank if such institution’s principal office is located in Texas.
Treasury securities; securities issued by the U.S. government and its agencies or government sponsored enterprises including mortgage-backed securities and collateralized mortgage obligations; corporate and municipal bonds; certificates of deposit in other financial institutions; federal funds and money market funds. At December 31, 2023, our investment portfolio consisted of securities and obligations issued by U.S.
Treasury securities; securities issued by the U.S. government and its agencies or government sponsored enterprises including mortgage-backed securities, mortgage backed securities and collateralized mortgage obligations issued by other entities; corporate and municipal bonds; certificates of deposit in other financial institutions; federal funds and money market funds.
We generally will limit the maximum number of speculative units (units that are not 9 Table of Contents pre-sold) approved for each builder, typically starting with one speculative loan per builder until we develop a relationship with the builder. At December 31, 2023, speculative construction loans consisted of four loans totaling $6.8 million, upon completion.
We generally will limit the maximum number of speculative units (units that are not pre-sold) approved for each builder, typically starting with one speculative loan per builder until we develop a relationship with the builder. At December 31, 2024, speculative construction loans consisted of thirteen loans totaling $5.1 million, upon completion.
At December 31, 2023, our construction and development loans totaled $31.2 million, or 11.0% of our total loan portfolio, in addition to $6.3 million of land loans. At December 31, 2023, $11.4 million of our single-family construction loans were to individuals and $5.1 million were to builders.
At December 31, 2024, our construction and development loans totaled $33.1 million, or 11.2% of our total loan portfolio, in addition to $21.0 million in land loans. At December 31, 2024, $7.7 million of our single-family construction loans were to individuals and $3.9 million were to builders.
Government-sponsored enterprises and others including mortgage-backed securities and collateralized mortgage obligations, corporate bonds including bank subordinated debt as well as state and municipal securities. At December 31, 2023, we also owned $3.3 million of Federal Home Loan Bank of Dallas stock.
At December 31, 2024, our investment portfolio consisted of securities and obligations issued by U.S. Government-sponsored enterprises and others including mortgage-backed securities and collateralized mortgage obligations, corporate bonds including bank subordinated debt as well as state and municipal securities. At December 31, 2024, we also owned $3.5 million of Federal Home Loan Bank of Dallas stock.
At December 31, 2023, we had $172.2 million of loans secured by one- to four-family real estate, or 60.8% of total loans. The majority of our one-to-four family residential real estate loans are secured by properties located in our primary market area.
At December 31, 2024, we had $145.6 million of loans secured by one- to four-family real estate, or 49.0% of total loans. The majority of our one-to-four family residential real estate loans are secured by properties located in our primary market area.
At December 31, 2023, we had $37.5 million in construction and land loans, or 13.3% of total loans. We make construction loans, primarily to individuals for the construction of their primary residences and to contractors and builders of single-family homes.
At December 31, 2024, we had $54.1 million in construction and land loans, or 18.2% of total loans. We make construction loans primarily to individuals for the construction of their primary residences and to contractors and builders of single-family homes.
At December 31, 2023, we had outstanding advances of $76.9 million from the Federal Home Loan Bank of Dallas. At December 31, 2023, we had unused borrowing capacity of $72.6 million with the Federal Home Loan Bank of Dallas.
At December 31, 2024, we had outstanding advances of $49.9 million from the Federal Home Loan Bank of Dallas. At December 31, 2024, we had unused borrowing capacity of $102.4 million with the Federal Home Loan Bank of Dallas.
We also make a limited amount of land loans to complement our construction lending activities, as such loans are generally secured by lots that will be used for residential development. Land loans also include loans secured by land purchased for investment purposes.
We also originate land loans to complement our construction lending activities, as such loans are generally secured by lots that will be used for residential development, and land loans for future commercial real estate development. Land loans also include loans secured by land purchased for investment purposes.
At December 31, 2023, these loans amounted to $45.1 million, of which $29.2 million were jumbo loans and $15.9 million were conventional loans. Our one-to-four family residential real estate loans are generally underwritten to Freddie Mac guidelines. Substantially all of our residential mortgage loans are fixed-rate loans.
At December 31, 2024, these loans amounted to $44.6 million, of which $27.8 million were jumbo loans and $16.8 million were conventional loans. Our one-to-four family residential real estate loans are generally underwritten to Freddie Mac guidelines. Substantially all of our residential mortgage loans are fixed-rate loans.
The following table sets forth our loan delinquencies, including nonaccrual loans, by type and amount at the dates indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2023 ​ 2022 ​ ​ 30-59 ​ 60-89 ​ 90 Days ​ 30-59 ​ 60-89 ​ 90 Days ​ ​ Days ​ Days ​ or More ​ Days ​ Days ​ or More ​ Past Due Past Due Past Due Past Due Past Due Past Due ​ ​ (In thousands) Real estate loans: ​ ​ ​ ​ ​ ​ 1-4 family residential ​ $ 344 ​ $ 271 ​ $ 137 $ 1,172 $ 43 $ 348 Multi-family ​ — ​ — ​ — ​ — ​ — ​ — Commercial ​ — ​ 410 ​ 22 ​ 126 ​ — ​ — Construction and land ​ 808 ​ 1,153 ​ — ​ 836 ​ 94 ​ — Farmland ​ — ​ — ​ — ​ 162 ​ — ​ 165 Agriculture loans ​ — ​ — ​ — ​ — ​ — ​ — Commercial loans ​ — ​ — ​ 8 ​ — ​ — ​ — Consumer loans ​ — ​ — ​ — ​ 3 ​ 7 ​ — PPP loans ​ — ​ — ​ — ​ — ​ — ​ 2 Total ​ $ 1,152 ​ $ 1,834 ​ $ 167 $ 2,299 $ 144 $ 515 ​ 13 Table of Contents Nonperforming Assets.
The following table sets forth our loan delinquencies, including nonaccrual loans, by type and amount at the dates indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2024 ​ 2023 ​ ​ 30-59 ​ 60-89 ​ 90 Days ​ 30-59 ​ 60-89 ​ 90 Days ​ ​ Days ​ Days ​ or More ​ Days ​ Days ​ or More ​ Past Due Past Due Past Due Past Due Past Due Past Due ​ ​ (In thousands) Real estate loans: ​ ​ ​ ​ ​ ​ 1-4 family residential ​ $ 260 ​ $ 8 ​ $ 25 $ 344 $ 271 $ 137 Multi-family ​ — ​ — ​ — ​ — ​ — ​ — Commercial ​ 301 ​ ​ ​ — ​ — ​ 410 ​ 22 Construction and land ​ — ​ — ​ 301 ​ 808 ​ 1,153 ​ — Farmland ​ — ​ — ​ — ​ — ​ — ​ — Agriculture loans ​ — ​ — ​ — ​ — ​ — ​ — Commercial loans ​ 2 ​ — ​ — ​ — ​ — ​ 8 Consumer and other loans ​ 2 ​ — ​ — ​ — ​ — ​ — Total ​ $ 565 ​ $ 8 ​ $ 326 $ 1,152 $ 1,834 $ 167 ​ Nonperforming Assets.
Our Executive Committee has approval authority up to $2.0 million. Our Board of Directors must approve all loans greater than or equal to $2.0 million. These loan approval authorities are established by our loan policy.
Individual loan officer approval authorities range up to $200,000. Our Loan Committee has approval authority up to $500,000 on commercial and $750,000 on residential properties. Our Executive Committee has approval authority up to $2.0 million. Our Board of Directors must approve all loans greater than or equal to $2.0 million. These loan approval authorities are established by our loan policy.
In addition to the loans disclosed in the table below, we had loans in process of $22.9 million and $23.3 million at December 31, 2023 and December 31, 2022, respectively.
In addition to the loans disclosed in the table below, we had loans in process, with scheduled closings, of $6.2 million and $22.9 million at December 31, 2024 and December 31, 2023, respectively.
Market Area We consider Franklin County, Hopkins County, Smith County, Van Zandt County and Wood County, and contiguous areas, as our primary market area for originating loans and gathering deposits. Our main office, six branch offices and a loan production office (LPO) are located in these counties.
Market Area We consider Franklin County, Hopkins County, Smith County, Van Zandt County and Wood County, and contiguous areas, as our primary market area for originating loans and gathering deposits. Our main office and six branch offices are located in these counties including the Tyler, Texas branch in Smith County which opened in the first quarter of 2024.
At December 31, 2023, the Company had total consolidated assets of $452,044,000, net loans and leases of $279,932,000, deposits of $317,241,000 and stockholders’ equity of $53,689,000. Our executive offices are located at 215 West Broad Street, Mineola, Texas 75773 and our telephone number is (903) 569-2602. Our website address is www.broadstreet.bank .
At December 31, 2024, the Company had total consolidated assets of $443,457,000, net loans and leases of $293,708,000, deposits of $335,828,000 and stockholders’ equity of $52,108,000. Our executive offices are located at 215 West Broad Street, Mineola, Texas 75773 and our telephone number is (903) 569-2602. Our website address is www.broadstreet.bank .
Due to the continued growth in our market area, the need for multi-family housing has increased. At December 31, 2023, multi-family construction totaled $10.3 million, upon completion, and is primarily apartment construction in our market area.
Due to the continued growth in our market area, the need for multi-family housing has increased and at December 31, 2024, multi-family construction totaled $15.5 million, upon completion, which primarily consists of apartment and quad-plex construction in our market area.
At December 31, 2023, eight construction loans totaling $4.6 million were outstanding to individual borrowers in the Metroplex. While we may originate loans to builders whether or not the collateral property underlying the loan is under contract for sale, we consider each project carefully in light of current residential real estate market conditions.
While we may originate loans to builders whether or not the collateral property underlying the loan is under contract for sale, we consider each project carefully in light of current residential real estate market conditions.
At December 31, 2023, consumer and other loans were $6.9 million, or 2.4% of total loans. Our consumer loan portfolio generally consists of loans secured predominately by used automobiles, recreational vehicles, all-terrain vehicles and boats, as well as share loans secured by a deposit account at Broadstreet Bank. Loan Underwriting Risks Commercial Real Estate Loans.
Our consumer loan portfolio generally consists of loans secured predominately by used automobiles, recreational vehicles, all-terrain vehicles and boats, as well as share loans secured by a deposit account at Broadstreet Bank. 10 Table of Contents Loan Underwriting Risks Commercial Real Estate Loans.
At December 31, 2023, our largest commercial real estate loan relationship consisted of three loans totaling $7.5 million, which are secured by self-storage facilities. At December 31, 2023, all of these loans were performing according to their original terms. Multi-Family Loans. At December 31, 2023, we had $9.3 million in multi-family loans, or 3.3% of total loans.
At December 31, 2024, our largest commercial real estate loan relationship consisted of a $7.5 million loan secured by self-storage facilities. At December 31, 2024, this loan was performing according to its original terms. Multi-Family Loans. At December 31, 2024, we had $10.5 million in multi-family loans, or 3.5% of total loans.
The following table sets forth the distribution of total deposits by account type at the dates indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2023 ​ 2022 ​ ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ Average ​ Amount Percent Rate Amount Percent Rate ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Noninterest-bearing demand deposits ​ $ 45,538 ​ 14.4 % — % $ 45,823 ​ 15.5 % — % Interest-bearing demand deposits ​ 63,581 ​ 20.0 % ​ 0.35 % ​ 68,912 ​ 23.3 % 0.35 % Regular savings deposits and other deposits ​ 49,755 ​ 15.7 % ​ 0.35 % ​ 66,586 ​ 22.5 % 0.35 % Money market deposits ​ 39,672 ​ 12.5 % ​ 0.78 % ​ 25,338 ​ 8.5 % 0.78 % Certificates of deposit ​ 118,695 ​ 37.4 % ​ 1.18 % ​ 89,418 ​ 30.2 % 1.18 % Total ​ $ 317,241 ​ 100.0 % ​ ​ ​ $ 296,077 100.0 % ​ ​ ​ 19 Table of Contents At December 31, 2023 and 2022, the aggregate amount of uninsured deposits, which includes deposit account balances in excess of $250,000, which is the maximum amount for federal deposit insurance, was $37.2 million and $29.4 million, respectively.
The following table sets forth the distribution of total deposits by account type at the dates indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ Average ​ Amount Percent Rate Amount Percent Rate ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Noninterest-bearing demand deposits ​ $ 41,465 ​ 12.3 % — % $ 45,538 ​ 14.4 % — % Interest-bearing demand deposits ​ 71,959 ​ 21.4 % ​ 0.66 % ​ 63,581 ​ 20.0 % 0.41 % Regular savings deposits and other deposits ​ 43,266 ​ 12.9 % ​ 0.29 % ​ 49,755 ​ 15.7 % 0.31 % Money market deposits ​ 49,203 ​ 14.7 % ​ 3.26 % ​ 39,672 ​ 12.5 % 3.23 % Certificates of deposit ​ 129,935 ​ 38.7 % ​ 4.31 % ​ 118,695 ​ 37.4 % 3.58 % Total ​ $ 335,828 ​ 100.0 % ​ ​ ​ $ 317,241 100.0 % ​ ​ ​ At December 31, 2024 and 2023, the aggregate amount of uninsured deposits, which includes deposit account balances in excess of $250,000, which is the maximum amount for federal deposit insurance, was $50.3 million and $37.2 million, respectively.
At December 31, 2023 and 2022, the aggregate amount of all our uninsured certificates of deposit was $8.6 million and $5.9 million, respectively. At December 31, 2023 and December 31, 2022, we had no deposits that were uninsured for any reason other than being in excess of the maximum amount for federal deposit insurance.
At December 31, 2024 and December 31, 2023, we had no deposits that were uninsured for any reason other than being in excess of the maximum amount for federal deposit insurance. At December 31, 2024 and 2023, the amount of deposits that were brokered was $22.0 million and $12.0 million, respectively. All brokered deposits were fully insured.
The allowance for credit losses allocated to each category is not necessarily indicative of future losses in any particular category and does not restrict the use of the allowance to absorb losses in other categories. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ ​ 2023 ​ 2022 ​ ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ ​ ​ Allowance ​ Percent of ​ ​ ​ ​ Allowance ​ Percent of ​ ​ ​ ​ ​ ​ in Each ​ Loans in ​ ​ ​ ​ in Each ​ Loans in ​ ​ ​ ​ ​ Category ​ Each ​ ​ ​ Category ​ Each ​ ​ ​ Allowance ​ to Total ​ Category ​ Allowance ​ to Total ​ Category ​ ​ ​ for Credit ​ Allocated ​ to Total ​ for Credit ​ Allocated ​ to Total ​ ​ Losses Allowance Loans Losses Allowance Loans ​ ​ ​ (Dollars in thousands) ​ Real estate loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1-4 Residential & multi-family ​ $ 1,621 ​ 52 % 64 % $ 812 ​ 46 % 64 % Commercial ​ ​ 482 ​ 16 ​ 15 ​ ​ 227 ​ 13 ​ 13 ​ Construction and land 378 ​ 12 ​ 13 ​ ​ 262 ​ 15 ​ 14 ​ Farmland 66 ​ 2 ​ 3 ​ ​ 31 ​ 2 ​ 3 ​ Agriculture loans 2 ​ — ​ — ​ ​ 1 ​ — ​ — ​ Commercial loans 441 ​ 14 ​ 2 ​ ​ 359 ​ 20 ​ 3 ​ Consumer and other loans 106 ​ 3 ​ 3 ​ ​ 63 ​ 4 ​ 3 ​ Total allocated allowance $ 3,096 ​ 100 % 100 % $ 1,755 ​ 100 % 100 % ​ Investment Activities General .
The allowance for credit losses allocated to each category is not necessarily indicative of future losses in any particular category and does not restrict the use of the allowance to absorb losses in other categories. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ ​ 2024 ​ 2023 ​ ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ Percent of ​ ​ ​ ​ ​ ​ ​ ​ Allowance ​ Percent of ​ ​ ​ ​ Allowance ​ Percent of ​ ​ ​ ​ ​ ​ in Each ​ Loans in ​ ​ ​ ​ in Each ​ Loans in ​ ​ ​ ​ ​ Category ​ Each ​ ​ ​ Category ​ Each ​ ​ ​ Allowance ​ to Total ​ Category ​ Allowance ​ to Total ​ Category ​ ​ ​ for Credit ​ Allocated ​ to Total ​ for Credit ​ Allocated ​ to Total ​ ​ Losses Allowance Loans Losses Allowance Loans ​ ​ ​ (Dollars in thousands) ​ Real estate loans: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1-4 Residential & multi-family ​ $ 1,355 ​ 42.1 % 52.5 % $ 1,621 ​ 52.4 % 64.1 % Commercial ​ ​ 605 ​ 18.8 ​ 18.9 ​ ​ 482 ​ 15.6 ​ 14.8 ​ Construction and land 632 ​ 19.6 ​ 18.2 ​ ​ 378 ​ 12.2 ​ 13.3 ​ Farmland 74 ​ 2.3 ​ 3.2 ​ ​ 66 ​ 2.1 ​ 2.9 ​ Agriculture loans 1 ​ — ​ — ​ ​ 2 ​ 0.1 ​ 0.1 ​ Commercial loans 375 ​ 11.6 ​ 2.1 ​ ​ 441 ​ 14.2 ​ 2.4 ​ Municipalities ​ ​ 83 ​ 2.6 ​ 3.1 ​ ​ 18 ​ 0.6 ​ 0.8 ​ Consumer and other loans 97 ​ 3.0 ​ 1.9 ​ ​ 88 ​ 2.8 ​ 1.7 ​ Total allocated allowance $ 3,222 ​ 100 % 100 % $ 3,096 ​ 100 % 100 % ​ Investment Activities General .
However, regulatory agencies are not directly involved in the process for establishing the allowance for credit losses as the process is our responsibility and any increase or decrease in the allowance is the responsibility of management. 15 Table of Contents The following table sets forth activity in our allowance for credit losses on loans for the periods indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At or For the Years Ended ​ ​ December 31, ​ ​ 2023 2022 ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses at beginning of year ​ $ 1,755 ​ $ 1,592 ​ Provision for credit losses ​ ​ 329 ​ ​ 208 ​ Charge-offs: ​ ​ ​ ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ ​ ​ ​ 1-4 family residential ​ ​ — ​ ​ — ​ Multi-family ​ ​ — ​ ​ — ​ Commercial ​ ​ — ​ ​ — ​ Construction and land ​ ​ — ​ ​ — ​ Agriculture loans ​ ​ — ​ ​ — ​ Commercial loans ​ ​ — ​ ​ — ​ Consumer loans ​ ​ 44 ​ ​ 26 ​ Consumer Other – Overdrafts ​ ​ 31 ​ ​ 32 ​ PPP loans ​ ​ — ​ ​ — ​ Total charge-offs ​ ​ 75 ​ ​ 58 ​ ​ ​ ​ ​ ​ ​ ​ ​ Recoveries: ​ ​ ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ ​ ​ 1-4 family residential ​ ​ — ​ ​ — ​ Multi-family ​ ​ — ​ ​ — ​ Commercial ​ ​ — ​ ​ — ​ Construction and loan ​ ​ — ​ ​ — ​ Agriculture loans ​ ​ — ​ ​ — ​ Commercial loans ​ ​ — ​ ​ — ​ Consumer loans ​ ​ 9 ​ ​ 13 ​ Total recoveries ​ ​ 9 ​ ​ 13 ​ Net (charge-offs) recoveries ​ ​ (66) ​ ​ (45) ​ Overage from off-balance sheet credit exposures ​ ​ 53 ​ ​ — ​ Adjustment for adoption of CECL methodology ​ ​ 1,025 ​ ​ — ​ Allowance for credit losses at end of year ​ $ 3,096 ​ $ 1,755 ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses to nonperforming loans ​ ​ 315.3 % 148.60 % Allowance for credit losses to total loans outstanding at the end of the year ​ ​ 1.09 % 0.69 % Net (charge-offs) recoveries to average loans outstanding during the year ​ ​ (0.02) % (0.01) % ​ 16 Table of Contents Allocation of Allowance for Credit Losses.
The following table sets forth activity in our allowance for credit losses on loans for the periods indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At or For the Years Ended ​ ​ December 31, ​ ​ 2024 2023 ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses at beginning of year ​ $ 3,096 ​ $ 1,755 ​ Provision for credit losses ​ ​ 269 ​ ​ 329 ​ Charge-offs: ​ ​ ​ ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ ​ ​ ​ 1-4 family residential ​ ​ 16 ​ ​ — ​ Multi-family ​ ​ — ​ ​ — ​ Commercial ​ ​ — ​ ​ — ​ Construction and land ​ ​ — ​ ​ — ​ Agriculture loans ​ ​ — ​ ​ — ​ Commercial loans ​ ​ 84 ​ ​ — ​ Consumer loans ​ ​ 28 ​ ​ 44 ​ Consumer Other – Overdrafts ​ ​ 58 ​ ​ 31 ​ Total charge-offs ​ ​ 186 ​ ​ 75 ​ ​ ​ ​ ​ ​ ​ ​ ​ Recoveries: ​ ​ ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ ​ ​ 1-4 family residential ​ ​ — ​ ​ — ​ Multi-family ​ ​ — ​ ​ — ​ Commercial ​ ​ — ​ ​ — ​ Construction and loan ​ ​ — ​ ​ — ​ Agriculture loans ​ ​ — ​ ​ — ​ Commercial loans ​ ​ — ​ ​ — ​ Consumer loans ​ ​ 43 ​ ​ 9 ​ Total recoveries ​ ​ 43 ​ ​ 9 ​ Net (charge-offs) recoveries ​ ​ (143) ​ ​ (66) ​ Overage from off-balance sheet credit exposures ​ ​ — ​ ​ 53 ​ Adjustment for adoption of CECL methodology ​ ​ — ​ ​ 1,025 ​ Allowance for credit losses at end of year ​ $ 3,222 ​ $ 3,096 ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for credit losses to nonperforming loans ​ ​ 142.6 % 267.6 % Allowance for credit losses to total loans outstanding at the end of the year ​ ​ 1.09 % 1.09 % Net (charge-offs) recoveries to average loans outstanding during the year ​ ​ (0.05) % (0.02) % ​ 16 Table of Contents Allocation of Allowance for Credit Losses.
Substantially all of our commercial real estate loans are fixed-rate balloon loans with a six to ten year initial term and with a 10- to 20-year amortization period. In 2023, we changed our commercial real estate loan 8 Table of Contents terms to include more adjustable rates tied to the WSJ Prime rate.
Our commercial real estate loans are fixed-rate balloon loans with a six to ten year initial term and with a 10- to 20-year amortization period or adjustable rate loans tied to WSJ Prime rate. The majority of the commercial real estate loans originated in 2024 have adjustable rates.
Consumer loan collections depend on the borrower’s continuing financial stability, and therefore are likely to be adversely affected 11 Table of Contents by various factors, including job loss, divorce, illness or personal bankruptcy.
Consumer loan collections depend on the borrower’s continuing financial stability, and therefore are likely to be adversely affected by various factors, including job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including federal and state bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.
We had no loans held for sale at December 31, 2023 and December 31, 2022, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2023 ​ 2022 ​ Amount Percent Amount Percent ​ ​ (Dollars in thousands) ​ Real estate loans: ​ ​ ​ 1-4 family residential ​ $ 172,205 60.8 % $ 162,462 64.2 % Multi-family ​ 9,259 3.3 ​ 323 0.1 ​ Construction & land ​ 37,526 13.3 ​ 36,257 14.3 ​ Commercial ​ 41,788 14.8 ​ 33,678 13.3 ​ Farmland ​ 8,317 2.9 ​ 7,558 3.0 ​ Agriculture loans ​ 150 0.1 ​ 189 0.1 ​ Commercial loans ​ 6,900 2.4 ​ 7,029 2.8 ​ Consumer and other ​ 6,883 2.4 ​ 5,595 2.2 ​ PPP loans ​ — — ​ 2 — ​ Total loans ​ 283,028 100.0 % 253,093 100.00 % Less: ​ ​ ​ Allowance for losses ​ 3,096 ​ ​ 1,755 ​ ​ Total loans and leases, net ​ $ 279,932 ​ ​ $ 251,338 ​ ​ ​ Contractual Maturities.
We had no loans held for sale at December 31, 2024 and December 31, 2023, respectively. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ ​ 2024 ​ 2023 ​ Amount Percent Amount Percent ​ ​ (Dollars in thousands) ​ Real estate loans: ​ ​ ​ 1-4 family residential ​ $ 145,587 49.0 % $ 172,205 60.8 % Multi-family ​ 10,481 3.5 ​ 9,259 3.3 ​ Construction & land ​ 54,136 18.2 ​ 37,526 13.3 ​ Commercial ​ 56,068 18.9 ​ 41,788 14.8 ​ Farmland ​ 9,540 3.2 ​ 8,317 2.9 ​ Agriculture loans ​ 55 0.0 ​ 150 0.1 ​ Commercial loans ​ 6,315 2.1 ​ 6,900 2.4 ​ Municipalities ​ 9,253 3.1 ​ 2,173 0.8 ​ Consumer and other ​ 5,495 1.9 ​ 4,710 1.7 ​ Total loans ​ 296,930 100.0 % 283,028 100.00 % Less: ​ ​ ​ Allowance for losses ​ 3,222 ​ ​ 3,096 ​ ​ Total loans and leases, net ​ $ 293,708 ​ ​ $ 279,932 ​ ​ ​ Contractual Maturities.
Maturities are based on the final contractual payment dates and do not reflect the impact of prepayments or early redemptions that may occur. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ ​ Due in One Year ​ One to Five Years ​ Five to Ten Years ​ After Ten Years ​ Total Investment Securities ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ ​ Cost Yield Cost Yield Cost Yield Cost Yield Cost Yield ​ Securities held to maturity: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ — ​ — % $ 763 ​ 2.51 % $ 7,574 ​ 2.17 % $ 13,964 ​ 1.56 % $ 22,301 ​ 1.80 % State and municipal ​ 395 ​ 3.68 % 365 ​ 3.57 % 134 ​ 2.66 % 1,091 ​ 2.22 % 1,985 ​ 2.79 % U.S.
Maturities are based on the final contractual payment dates and do not reflect the impact of prepayments or early redemptions that may occur. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2024 ​ ​ ​ Due in One Year ​ One to Five Years ​ Five to Ten Years ​ After Ten Years ​ No Fixed Maturity ​ Total Investment Securities ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ ​ Weighted ​ ​ ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ Amortized ​ Average ​ ​ Cost Yield Cost Yield Cost Yield Cost Yield Cost Yield Cost Yield ​ Securities held to maturity: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Residential mortgage-backed ​ $ — ​ — % $ — ​ — % $ — ​ — % $ — ​ — % $ 19,090 ​ 1.76 % $ 19,090 ​ 1.76 % State and municipal ​ 365 ​ 4.29 % 134 ​ 2.65 % — ​ — % 1,068 ​ 2.20 % — ​ — % 1,567 ​ 2.73 % U.S.
The following table sets forth the maturity of our uninsured certificates of deposit at December 31, 2023. ​ ​ ​ ​ ​ ​ At December 31, ​ 2023 ​ ​ (In thousands) Maturity Period: ​ ​ Three months or less ​ $ 2,456 Over three through six months ​ ​ 2,007 Over six through twelve months ​ ​ 1,954 Over twelve months ​ 2,208 Total ​ $ 8,625 ​ Borrowings .
The following table sets forth the maturity of our uninsured certificates of deposit at December 31, 2024. ​ ​ ​ ​ ​ ​ At December 31, ​ 2024 ​ ​ (In thousands) Maturity Period: ​ ​ Three months or less ​ $ 3,361 Over three through six months ​ ​ 3,189 Over six through twelve months ​ ​ 3,148 Over twelve months ​ 999 Total ​ $ 10,697 ​ Borrowings .
The Tyler metropolitan area is a growing regional economic center with a large, diversified employment base spread across varied economic sectors. Tyler Junior College and The University of Texas at Tyler are located in Tyler. Mineola has become an attractive, lower-cost of living, retirement area for residents of the Dallas area.
Tyler Junior College and The University of Texas at Tyler are located in Tyler. Mineola has become an attractive, lower-cost of living, retirement area for residents of the Dallas area.
At December 31, 2023, we had twelve loans secured by self-storage facilities totaling $16.6 million, eight loans secured by churches totaling $4.7 million, two loans secured by a rural water district totaling $3.6 million, five loans secured by restaurant/fast food restaurant properties totaling $2.0 million, and eleven loans secured by commercial rental properties totaling $3.6 million.
At December 31, 2024, we had twelve loans secured by self-storage facilities totaling $16.3 million, seven loans secured by gas stations with convenience stores totaling $10.5 million, sixteen loans secured by commercial rental properties totaling $7.6 million, eight loans secured by churches totaling $4.5 million, two loans secured by a rural water district totaling $3.8 million, six loans secured by restaurant/fast food restaurant properties totaling $3.6 million, and one loan secured by a hotel totaling $923,000.
Mineola, Texas, located in Wood County, is approximately 80 miles east of Dallas, Texas, and approximately 35 miles north of Tyler, Texas, two notable population centers. Our Edgewood branch office, located in Van Zandt County, is approximately 50 miles east of Dallas and our Lindale branch office, located in Smith County, is approximately 20 miles north of Tyler.
Our branch office in Winnsboro, Texas, is in Wood County, but the Winnsboro city limits also lie within Franklin County and Hopkins County. Mineola, Texas, located in Wood County, is approximately 80 miles east of Dallas, Texas, and approximately 35 miles north of Tyler, Texas, two notable population centers.
The loan applications are designed primarily to determine the borrower’s ability to repay the requested loan, and the more significant items on the application are verified through use of credit reports, bank statements and tax returns.
The loan applications are designed primarily to determine the borrower’s ability to repay the requested loan, and the more significant items on the application are verified through use of credit reports, bank statements and tax returns. 12 Table of Contents All loan approval amounts are based on the aggregate loans (total credit exposure), including total balances of outstanding loans and the proposed loan to the individual borrower and any related entity.
At December 31, 2023, we had one purchased construction loan participation interest in commercial real estate of $403,000 and one purchased construction participation of $1.0 million secured by a hotel and two purchased participations of residential real estate of $202,000.
We underwrite our participation interest in the loan that we are purchasing according to our own underwriting criteria and procedures. At December 31, 2024, we had one purchased construction loan participation interest in commercial real estate of $403,000, upon completion, and one purchased construction participation of $1.0 million, upon completion, secured by a hotel.
At December 31, 2023, all of these loans were performing according to their original terms. Our construction loans are primarily secured by properties in our primary market area. We have also developed long-term relationships with borrowers who now reside in the northern and eastern sections of the Dallas Metroplex and continue to provide them with financing, including residential construction.
We have also developed long-term relationships with borrowers who now reside in the northern and eastern sections of the Dallas Metroplex and continue to provide them with financing, including residential construction. At December 31, 2024, five construction loans totaling $3.2 million, upon completion, were in process to individual borrowers in the Metroplex.
There were four non-accruing loans modified to borrowers experiencing financial difficulties included in nonaccrual loans as of December 31, 2023 totaling $323,000 and $364,000 as of December 31, 2022. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2023 2022 ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ Nonaccrual loans: ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ 1-4 family residential ​ $ 497 ​ $ 548 ​ Multi-family ​ — ​ — ​ Commercial ​ 61 ​ 70 ​ Construction and land ​ — ​ — ​ Farmland ​ — ​ 165 ​ Agriculture loans ​ — ​ — ​ Commercial loans ​ 351 ​ 398 ​ Consumer loans ​ — ​ — ​ Total nonaccrual loans ​ $ 909 ​ $ 1,181 ​ ​ ​ ​ ​ ​ ​ ​ ​ Accruing loans past due 90 days or more ​ 30 ​ 1 ​ Other nonperforming loans under 90 days past due ​ ​ 241 ​ ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ Real estate owned: ​ ​ ​ ​ 1-4 family residential ​ — ​ — ​ Multi-family ​ — ​ — ​ Commercial ​ 162 ​ — ​ Construction and land ​ — ​ — ​ Bank owned property held for sale ​ — ​ — ​ Total real estate owned ​ 162 ​ — ​ ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming assets ​ $ 1,342 ​ $ 1,182 ​ ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming loans to total loans ​ 0.33 % 0.47 % Total nonaccruing loans to total loans ​ 0.32 % 0.47 % Total nonperforming assets to total assets ​ 0.30 % 0.28 % ​ Classified Assets .
The following table sets forth information regarding our nonperforming assets. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2024 2023 ​ ​ (Dollars in thousands) ​ ​ ​ ​ ​ ​ ​ ​ Nonaccrual loans: ​ ​ ​ ​ Real estate loans: ​ ​ ​ ​ 1-4 family residential ​ $ 610 ​ $ 497 ​ Multi-family ​ — ​ — ​ Commercial ​ 51 ​ 61 ​ Construction and land ​ 301 ​ — ​ Farmland ​ — ​ — ​ Agriculture loans ​ — ​ — ​ Commercial loans ​ 1,163 ​ 351 ​ Consumer loans ​ — ​ — ​ Total nonaccrual loans ​ $ 2,125 ​ $ 909 ​ ​ ​ ​ ​ ​ ​ ​ ​ Accruing loans past due 90 days or more ​ — ​ 30 ​ Other nonperforming loans under 90 days past due ​ ​ 135 ​ ​ 241 ​ ​ ​ ​ ​ ​ ​ ​ ​ Real estate owned: ​ ​ ​ ​ 1-4 family residential ​ — ​ — ​ Multi-family ​ — ​ — ​ Commercial ​ — ​ 162 ​ Construction and land ​ — ​ — ​ Bank owned property held for sale ​ 480 ​ — ​ Total real estate owned ​ 480 ​ 162 ​ ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming assets ​ $ 2,740 ​ $ 1,342 ​ ​ ​ ​ ​ ​ ​ ​ ​ Total nonperforming loans to total loans ​ 0.76 % 0.33 % Total nonaccruing loans to total loans ​ 0.72 % 0.32 % Total nonperforming assets to total assets ​ 0.62 % 0.30 % ​ 14 Table of Contents Classified Assets .
During the year ended December 31, 2023, the Company entered into interest rate swap agreements with a total notional amount of $25 million to hedge the risk of changes in the fair value of fixed rate available for sale securities for changes in the Secured Overnight Financing Rate (SOFR).
Government and Agency ​ ​ — ​ — % ​ — ​ — % ​ 1,439 ​ 6.68 % ​ — ​ — % ​ — ​ — % ​ 1,439 ​ 6.68 % Total securities held to maturity ​ $ 365 ​ ​ ​ $ 134 ​ ​ ​ $ 1,439 ​ ​ ​ $ 1,068 ​ ​ ​ $ 19,090 ​ ​ ​ $ 22,096 ​ ​ ​ ​ For additional information regarding our investment securities portfolio, see Note 3 to the notes to consolidated financial statements. 18 Table of Contents During the year ended December 31, 2023, the Company entered into interest rate swap agreements with a total notional amount of $25 million to hedge the risk of changes in the fair value of fixed rate available for sale securities for changes in the Secured Overnight Financing Rate (SOFR).
At December 31, 2023, our largest loan relationship with one borrower had extensions of credit totaling $10.4 million, when fully funded, secured by single-family residential construction and land development projects. At December 31, 2023, $7.2 million, or 69.2%, was funded and was performing according to its original terms.
At December 31, 2024, our largest loan relationship with one borrower had extensions of credit totaling $9.0 million, when fully funded, secured primarily by single-family residential construction and multi-family construction projects. At December 31, 2024, the loans were fully funded and were performing according to the original terms. Our lending is subject to written underwriting standards and origination procedures.
In general, we do not currently offer “subprime loans” on one-to-four family residential real estate loans (i.e., generally loans to borrowers with credit scores less than 620). Commercial Real Estate Loans . At December 31, 2023, we had $41.8 million in commercial real estate loans, or 14.8% of total loans.
In general, we do not currently offer “subprime loans” on one-to-four family residential real estate loans (i.e., generally loans to borrowers with credit scores less than 620). In 2023, the Company entered into an agreement with The Independent Bankers Bank (“TIB”) to facilitate the loan application process for conventional, FHA, VA, and USDA residential mortgage loans.
All loans originated by us are underwritten pursuant to our policies and procedures. We primarily originate fixed-rate loans, but we have updated our commercial loan terms to include more adjustable rates. We originate real estate and other loans through our loan officers, marketing efforts, our customer base, walk-in customers and referrals from real estate brokers, builders and attorneys.
We originate real estate and other loans through our loan officers, marketing efforts, our customer base, walk-in customers and referrals from real estate brokers, builders and attorneys. In addition, from time to time, we may purchase or sell participation interests in loans.
At December 31, 2023, our largest commercial loan totaled $949,000 and is secured by manufacturing equipment. Our largest commercial relationship consists of seven loans totaling $1.1 million and is secured by machinery and equipment. At December 31, 2023, these loans were performing according to the original terms. Consumer and Other Loans .
At December 31, 2024, these loans performing according to the original terms. Consumer and Other Loans . At December 31, 2024, consumer and other loans were $5.5 million, or 1.9% of total loans.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur COO and ISO have over 25 years of combined related experience. We view cybersecurity as a shared responsibility, and we periodically perform simulations and tabletop exercises and incorporate external resources and advisors as needed. The Program is overseen by the Information Security Committee, Board of Directors, and Compliance Committee.
Biggest changeThe Chief Operating Officer (COO) along with the ISO are responsible for developing and implementing our Program and reporting on cybersecurity matters to the Board. Our COO and ISO have over 25 years of combined related experience. We view cybersecurity as a shared responsibility, and we periodically perform simulations and tabletop exercises and incorporate external resources and advisors as needed.
Governance The Company’s system of internal controls also incorporates a protocol for the appropriate reporting and escalation of information and cyber security matters to management and the Board of Directors for resolution and, if necessary, disclosure of any material incidents.
Governance The Company’s system of internal controls also incorporates a protocol for the appropriate reporting and escalation of information and cybersecurity matters to management and the Board of Directors for resolution and, if necessary, disclosure of any material incidents.
The Board of Directors is actively engaged in the oversight of the Company’s continuous efforts to reinforce and enhance its operational resilience and receives education to enhance their oversight efforts to accommodate for the ever-evolving information and cyber security threat landscape.
The Board of Directors is actively engaged in the oversight of the Company’s continuous efforts to reinforce and enhance its operational resilience and receives education to enhance their oversight efforts to accommodate for the ever-evolving information and cybersecurity threat landscape.
The Company’s Board of Directors monitors the Program including policies and practices.
The Program is overseen by the Information Security Committee, Board of Directors, and Compliance Committee. The Company’s Board of Directors monitors the Program including policies and practices.
The Information Security Officer (“ISO”) regularly updates these committees on the information and cyber security risks, threats, exposures, and mitigation measures. The Company’s incident response process is periodically tested and includes cybersecurity scenarios. The Chief Operating Officer (COO) along with the ISO are responsible for developing and implementing our Program and reporting on cybersecurity matters to the Board.
The Information Security Officer (“ISO”) regularly updates the Board, management and any appropriate committees on the information and cybersecurity risks, threats, exposures, and mitigation measures. The Company’s incident response process is periodically tested and includes cybersecurity scenarios.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table sets forth information regarding our offices as of December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Leased or ​ Year Acquired ​ Net Book Value of Location Owned or Leased Real Property ​ ​ ​ ​ ​ ​ (In thousands) Main Office: ​ ​ ​ ​ 215 West Broad Street Mineola, TX 75773 ​ Own ​ 1964 ​ $ 2,352 ​ ​ ​ ​ ​ ​ ​ ​ Branch Offices: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1224 North Pacific Street Mineola, TX 75773 Lease 1999 ​ $ 84 ​ ​ ​ ​ ​ ​ ​ ​ 415 West Frank Street Grand Saline, TX 75140 Own 2006 ​ $ 986 ​ ​ ​ ​ ​ ​ ​ ​ 500 South Main Street Winnsboro, TX 75494 Own 2005 ​ $ 1,253 ​ ​ ​ ​ ​ ​ ​ ​ 304 South Main Street Lindale, TX 75771 Own 2017 ​ $ 3,719 ​ ​ ​ ​ ​ ​ ​ ​ 500 West Pine Street Edgewood, TX 75117 Own 2018 ​ $ 825 ​ ​ ​ ​ ​ ​ ​ ​ 917 East Southeast Loop 323 Tyler, TX 75701 ​ Own ​ 2023 ​ $ 2,306 ​ ​ ​ ​ ​ ​ ​ ​ 1435 South Buffalo Canton, TX 75103 ​ Lease ​ 2023 ​ $ 2 ​ During the first quarter of 2023, we purchased two buildings adjacent to the Bank’s home office in Mineola with the intention of possible future expansion.
Biggest changeThe following table sets forth information regarding our offices as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Leased or ​ Year Acquired ​ Net Book Value of Location Owned or Leased Real Property ​ ​ ​ ​ ​ ​ (In thousands) Main Office: ​ ​ ​ ​ 215 West Broad Street Mineola, TX 75773 ​ Own ​ 1964 ​ $ 1,724 ​ ​ ​ ​ ​ ​ ​ ​ Branch Offices: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 1224 North Pacific Street Mineola, TX 75773 Lease 1999 ​ $ 81 ​ ​ ​ ​ ​ ​ ​ ​ 415 West Frank Street Grand Saline, TX 75140 Own 2006 ​ $ 971 ​ ​ ​ ​ ​ ​ ​ ​ 500 South Main Street Winnsboro, TX 75494 Own 2005 ​ $ 1,231 ​ ​ ​ ​ ​ ​ ​ ​ 304 South Main Street Lindale, TX 75771 Own 2017 ​ $ 4,174 ​ ​ ​ ​ ​ ​ ​ ​ 500 West Pine Street Edgewood, TX 75117 Own 2018 ​ $ 825 ​ ​ ​ ​ ​ ​ ​ ​ 917 East Southeast Loop 323 Tyler, TX 75701 ​ Own ​ 2023 ​ $ 2,466 ​ ​ ​ ​ ​ ​ ​ ​ ​ In 2024, the Company listed two buildings for sale that were purchased for future expansion.
ITEM 2. Properties As of December 31, 2023, the net book value of our land, building and equipment was $11.5 million.
ITEM 2. Properties As of December 31, 2024, the net book value of our land, building and equipment was $11.5 million.
In the first quarter of 2024, we opened a new branch in Tyler, Texas and moved into the new branch building located at the same location in Lindale. We believe that all other current facilities are adequate to meet our present and foreseeable needs, subject to possible future expansion. ​
These properties are now classified as other real estate owned. In the first quarter of 2024, we opened a new branch in Tyler, Texas and moved into the new branch building located at the same location in Lindale. We believe that all other current facilities are adequate to meet our present and foreseeable needs, subject to possible future expansion. ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeAt December 31, 2023, we were not a party to any pending legal proceedings that we believe would have a material adverse effect on our financial condition, results of operations or cash flows. ​ ITEM 4. Mine Safety Disclosures Not applicable. 31 Table of Contents PART II
Biggest changeAt December 31, 2024, we were not a party to any pending legal proceedings that we believe would have a material adverse effect on our financial condition, results of operations or cash flows. ​ ITEM 4. Mine Safety Disclosures Not applicable. 31 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe program has no stated expiration date. ​ The following table summarizes the Company’s repurchases of its outstanding shares of common stock during the quarter ended December 31, 2023. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Shares Purchased ​ Average Price Paid Per Share ​ Total Number of Shares Purchased as Part of Publicly Announced Plans ​ Maximum Number of Shares That May Yet be Purchased Under the Plans October 1, 2023 - October 31, 2023 ​ 29,500 ​ $ 12.81 ​ ​ 29,500 ​ ​ 7,925 November 1, 2023 - November 30, 2023 ​ 7,925 ​ ​ 12.75 ​ ​ 7,925 ​ ​ 161,316 December 1, 2023 - December 31, 2023 ​ 10,000 ​ ​ 12.33 ​ ​ 10,000 ​ ​ 151,316 Total ​ 47,425 ​ $ 12.70 ​ ​ 47,425 ​ ​ ​ ​ There were no sales of unregistered securities during the year ended December 31, 2023. ​ ITEM 6.
Biggest changeThe program has no stated expiration date. ​ The following table summarizes the Company’s repurchases of its outstanding shares of common stock during the quarter ended December 31, 2024. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Shares Purchased ​ Average Price Paid Per Share ​ Total Number of Shares Purchased as Part of Publicly Announced Plans ​ Maximum Number of Shares That May Yet be Purchased Under the Plans October 1, 2024 - October 31, 2024 ​ 5,000 ​ $ 15.05 ​ ​ 5,000 ​ ​ 76,385 November 1, 2024 - November 30, 2024 ​ 10,000 ​ ​ 15.02 ​ ​ 10,000 ​ ​ 66,385 December 1, 2024 - December 31, 2024 ​ 22,500 ​ ​ 15.09 ​ ​ 22,500 ​ ​ 43,885 Total ​ 37,500 ​ $ 15.07 ​ ​ 37,500 ​ ​ ​ ​ There were no sales of unregistered securities during the year ended December 31, 2024. ​ ITEM 6.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The common stock of Texas Community Bancshares is listed on The Nasdaq Capital Market under the symbol “TCBS”. As of March 1, 2024, we had 589 stockholders of record, and 3,198,881 shares of common stock outstanding.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The common stock of Texas Community Bancshares is listed on The Nasdaq Capital Market under the symbol “TCBS”. As of March 11, 2025, we had 553 stockholders of record, and 3,061,652 shares of common stock outstanding.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeWe have not recorded deferred loan fees, as we have determined them to be immaterial. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2023 ​ 2022 ​ ​ Average ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ ​ Outstanding ​ ​ ​ ​ Average ​ Outstanding ​ ​ ​ ​ Average ​ ​ ​ Balance Interest Yield/Rate Balance Interest Yield/Rate ​ ​ ​ (Dollars in thousands) Interest-earning assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans (excluding PPP loans) ​ $ 268,179 ​ $ 12,842 ​ 4.79 % $ 234,815 ​ $ 10,074 ​ 4.29 % Allowance for credit losses ​ ​ (2,642) ​ — — ​ (1,641) ​ — — ​ PPP loans ​ ​ — ​ — — % ​ 7 ​ — — % Securities ​ ​ 123,494 ​ 5,061 4.10 % ​ 104,650 ​ 2,316 2.21 % Restricted stock ​ ​ 3,096 ​ 159 5.14 % ​ 2,104 ​ 38 1.81 % Interest-bearing deposits in banks ​ ​ 8,787 ​ 452 5.14 % ​ 4,475 ​ 39 0.87 % Federal funds sold ​ ​ 3,661 ​ 187 5.11 % ​ 10,792 ​ 99 0.92 % Financial derivative ​ ​ 559 ​ ​ 277 ​ 49.55 % ​ — ​ ​ — ​ — % Total interest-earning assets ​ ​ 405,134 ​ 18,978 4.68 % ​ 355,202 ​ 12,566 3.54 % Noninterest-earning assets ​ ​ 24,667 ​ ​ ​ ​ 21,628 ​ ​ Total assets ​ $ 429,801 ​ ​ ​ ​ $ 376,830 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing demand deposits ​ $ 60,271 ​ 247 0.41 % $ 74,519 ​ 264 0.35 % Regular savings and other deposits ​ 55,509 ​ 171 0.31 % 78,866 ​ 277 0.35 % Money market deposits ​ 32,626 ​ 1,055 3.23 % 13,715 ​ 107 0.78 % Certificates of deposit ​ 108,011 ​ 3,871 3.58 % 71,598 ​ 848 1.18 % Total interest-bearing deposits ​ 256,417 ​ 5,344 2.08 % 238,698 ​ 1,496 0.63 % Advances from the Federal Home Loan Bank ​ 71,198 ​ 2,561 3.60 % 32,822 ​ 777 2.37 % Other liabilities ​ 608 ​ 9 1.48 % 488 ​ 10 2.05 % Total interest-bearing liabilities ​ 328,223 ​ 7,914 2.41 % 272,008 ​ 2,283 0.84 % Noninterest-bearing demand deposits ​ 54,943 ​ ​ ​ ​ 57,280 ​ ​ ​ ​ Other noninterest-bearing liabilities ​ 4,652 ​ ​ ​ ​ 3,805 ​ ​ ​ ​ Total liabilities ​ 387,818 ​ ​ ​ ​ 333,093 ​ ​ ​ ​ Total shareholders' equity ​ 41,983 ​ ​ ​ ​ 43,737 ​ ​ ​ ​ Total liabilities and shareholders' equity ​ $ 429,801 ​ ​ ​ ​ $ 376,830 ​ ​ ​ ​ Net interest income ​ ​ ​ $ 11,064 ​ ​ ​ ​ $ 10,283 ​ Net interest rate spread (1) ​ ​ ​ ​ ​ 2.27 % ​ ​ ​ 2.70 % Net interest-earning assets (2) ​ $ 76,911 ​ ​ ​ ​ ​ $ 83,194 ​ ​ ​ ​ Net interest margin (3) ​ ​ ​ ​ ​ 2.73 % ​ ​ ​ 2.89 % Average interest-earning assets to interest-bearing liabilities ​ ​ ​ ​ ​ 123.43 % ​ ​ ​ 130.59 % (1) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
Biggest changeWe have not recorded deferred loan fees, as we have determined them to be immaterial. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2024 ​ 2023 ​ ​ Average ​ ​ ​ ​ ​ ​ Average ​ ​ ​ ​ ​ ​ ​ Outstanding ​ ​ ​ ​ Average ​ Outstanding ​ ​ ​ ​ Average ​ ​ ​ Balance Interest Yield/Rate Balance Interest Yield/Rate ​ ​ ​ (Dollars in thousands) Interest-earning assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Loans ​ $ 282,894 ​ $ 15,923 ​ 5.63 % $ 268,179 ​ $ 12,842 ​ 4.79 % Allowance for credit losses ​ ​ (3,044) ​ ​ ​ ​ (2,642) ​ ​ ​ ​ Securities ​ ​ 110,893 ​ 4,464 4.03 % ​ 123,494 ​ 5,061 4.10 % Restricted stock ​ ​ 3,584 ​ 221 6.17 % ​ 3,096 ​ 159 5.14 % Interest-bearing deposits in banks ​ ​ 13,271 ​ 723 5.45 % ​ 8,787 ​ 452 5.14 % Federal funds sold ​ ​ 12,465 ​ 671 5.38 % ​ 3,661 ​ 187 5.11 % Financial derivative ​ ​ 380 ​ ​ 450 ​ ​ ​ ​ 559 ​ ​ 277 ​ ​ ​ Total interest-earning assets ​ ​ 420,443 ​ 22,452 5.34 % ​ 405,134 ​ 18,978 4.68 % Noninterest-earning assets ​ ​ 28,720 ​ ​ ​ ​ 24,667 ​ ​ Total assets ​ $ 449,163 ​ ​ ​ ​ $ 429,801 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest-bearing demand deposits ​ $ 69,237 ​ 454 0.66 % $ 60,271 ​ 247 0.41 % Regular savings and other deposits ​ 45,652 ​ 134 0.29 % 55,509 ​ 171 0.31 % Money market deposits ​ 44,526 ​ 1,453 3.26 % 32,626 ​ 1,055 3.23 % Certificates of deposit ​ 121,986 ​ 5,252 4.31 % 108,011 ​ 3,871 3.58 % Total interest-bearing deposits ​ 281,401 ​ 7,293 2.59 % 256,417 ​ 5,344 2.08 % Advances from the Federal Home Loan Bank ​ 68,224 ​ 2,599 3.81 % 71,198 ​ 2,561 3.60 % Other liabilities ​ 724 ​ 10 1.38 % 608 ​ 9 1.48 % Total interest-bearing liabilities ​ 350,349 ​ 9,902 2.83 % 328,223 ​ 7,914 2.41 % Noninterest-bearing demand deposits ​ 51,760 ​ ​ ​ ​ 54,943 ​ ​ ​ ​ Other noninterest-bearing liabilities ​ 4,641 ​ ​ ​ ​ 4,652 ​ ​ ​ ​ Total liabilities ​ 406,750 ​ ​ ​ ​ 387,818 ​ ​ ​ ​ Total shareholders' equity ​ 42,413 ​ ​ ​ ​ 41,983 ​ ​ ​ ​ Total liabilities and shareholders' equity ​ $ 449,163 ​ ​ ​ ​ $ 429,801 ​ ​ ​ ​ Net interest income ​ ​ ​ $ 12,550 ​ ​ ​ ​ $ 11,064 ​ Net interest rate spread (1) ​ ​ ​ ​ ​ 2.51 % ​ ​ ​ 2.27 % Net interest-earning assets (2) ​ $ 70,094 ​ ​ ​ ​ ​ $ 76,911 ​ ​ ​ ​ Net interest margin (3) ​ ​ ​ ​ ​ 2.98 % ​ ​ ​ 2.73 % Average interest-earning assets to interest-bearing liabilities ​ ​ ​ ​ ​ 120.01 % ​ ​ ​ 123.43 % (1) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities.
Overview Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings from the Federal Home Loan Bank of Dallas, in residential real estate loans and commercial real estate loans and, to a lesser extent, commercial loans, construction and land loans, and consumer and other loans.
Overview Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings from the Federal Home Loan Bank of Dallas, in residential real estate loans, commercial real estate loans, construction and land loans and, to a lesser extent, commercial loans and consumer and other loans.
We intend to grow our assets organically on a managed basis, and the capital we raised in the offering has enabled us to increase our lending and investment capacity. In addition to organic growth, we may also consider expansion opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns.
We intend to grow our assets organically on a managed basis, and the capital raised in the offering has enabled us to increase our lending and investment capacity. In addition to organic growth, we may also consider expansion opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns.
We also invest in securities, which have 32 Table of Contents historically consisted primarily of mortgage-backed securities and obligations issued by U.S. government sponsored enterprises, state and municipal securities, collateralized mortgage obligations, corporate bonds, and Federal Home Loan Bank stock. We offer a variety of deposit accounts, including checking accounts, savings accounts and certificate of deposit accounts.
We also invest in securities, which 32 Table of Contents have historically consisted primarily of mortgage-backed securities and obligations issued by U.S. government sponsored enterprises and others, state and municipal securities, collateralized mortgage obligations, corporate bonds, and Federal Home Loan Bank stock. We offer a variety of deposit accounts, including checking accounts, savings accounts and certificate of deposit accounts.
We have implemented the following strategies to manage our interest rate risk: ● maintaining capital levels that exceed the thresholds for well-capitalized status under federal regulations; ● maintaining a high level of liquidity; ● growing our volume of core deposit accounts; ● managing our investment securities portfolio so as to reduce the average maturity and effective life of the portfolio; ● continuing to diversify our investment securities portfolio by continuing to add collateralized mortgage obligations (CMOs) and subordinated debt; ● managing our borrowings from the Federal Home Loan Bank of Dallas; ● managing our loan services by adding wholesale lending products to continue to offer these services while reducing interest rate risk in the loan portfolio; ● continuing to diversify our loan portfolio by adding more commercial-related loans, which typically have shorter maturities, adjustable rates, and fee income; and ● Derivatives.
We have implemented the following strategies to manage our interest rate risk: ● maintaining capital levels that exceed the thresholds for well-capitalized status under federal regulations; ● maintaining a high level of liquidity; ● growing our volume of core deposit accounts; 44 Table of Contents ● managing our investment securities portfolio so as to reduce the average maturity and effective life of the portfolio; ● continuing to diversify our investment securities portfolio by continuing to add collateralized mortgage obligations (CMOs) and subordinated debt; ● managing our borrowings from the Federal Home Loan Bank of Dallas; ● managing our loan services by adding wholesale lending products to continue to offer these services while reducing interest rate risk in the loan portfolio; ● continuing to diversify our loan portfolio by adding more commercial-related loans, which typically have shorter maturities, adjustable rates, and fee income; and ● Derivatives.
For additional information, see the consolidated statements of cash flows for the years ended December 31, 2023 and 2022 included as part of the consolidated financial statements appearing elsewhere in this annual report. We are committed to maintaining a strong liquidity position. We monitor our liquidity position on a daily basis.
For additional information, see the consolidated statements of cash flows for the years ended December 31, 2024 and 2023 included as part of the consolidated financial statements appearing elsewhere in this annual report. We are committed to maintaining a strong liquidity position. We monitor our liquidity position on a daily basis.
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. (3) Net interest margin represents net interest income divided by average total interest-earning assets. 41 Table of Contents Rate/Volume Analysis The following tables present the effects of changing rates and volumes on our net interest income for the periods indicated.
(2) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. (3) Net interest margin represents net interest income divided by average total interest-earning assets. 40 Table of Contents Rate/Volume Analysis The following tables present the effects of changing rates and volumes on our net interest income for the periods indicated.
Management is not aware of any conditions or events since the most recent notification of well-capitalized status that would change our category. See Note 19 of the notes to consolidated financial statements. Off-Balance Sheet Arrangements Commitments.
Management is not aware of any conditions or events since the most recent notification of well-capitalized status that would change our category. See Note 17 of the notes to consolidated financial statements. Off-Balance Sheet Arrangements Commitments.
The Company entered into an interest rate swap agreement in the year ended December 31, 2023 to convert a portion of its interest rate exposure from fixed rates to floating rates to help manage the interest rate risk position.
The Company entered into an interest rate swap agreement in the year ended December 31, 2024 to convert a portion of its interest rate exposure from fixed rates to floating rates to help manage the interest rate risk position.
As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We determined not to take advantage of the benefits of this extended transition period. The following represent our critical accounting policies: Allowance for Credit Losses .
As an “emerging growth company” we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We determined not to take advantage of the benefits of this extended transition period. 34 Table of Contents The following represent our critical accounting policies: Allowance for Credit Losses .
Such obligations include data processing services, operating leases for premises and equipment, agreements with respect to borrowed funds and deposit liabilities. Recent Accounting Pronouncements For a discussion of the impact of recent accounting pronouncements, see Note 1 of the notes to our consolidated financial statements beginning on page F-1 of this annual report.
Such obligations include data processing services, operating leases for premises and equipment, agreements with respect to borrowed funds and deposit liabilities. 48 Table of Contents Recent Accounting Pronouncements For a discussion of the impact of recent accounting pronouncements, see Note 1 of the notes to our consolidated financial statements beginning on page F-1 of this annual report.
We run stress tests quarterly in multiple scenarios, 48 Table of Contents which include deposit runoff combined with the inability to access our available lines of credit and a reduction in the availability of FHLB advances. The scenarios indicate that we are able to maintain our operational liquidity with a designated buffer with our liquidity resources available.
We run stress tests quarterly in multiple scenarios, which include deposit runoff combined with the inability to access our available lines of credit and a reduction in the availability of FHLB advances. The scenarios indicate that we are able to maintain our operational liquidity with a designated buffer with our liquidity resources available.
We are monitoring housing supply and demand, primarily in our Mineola and Lindale markets where home sales and new home construction have been active, for indicators of a significant changes in the local housing markets. The decrease in mortgage demand has been offset by increases in commercial real estate lending.
We are monitoring housing supply and demand, primarily in our Mineola and Lindale markets where home sales and new home construction have been active, for indicators of a significant changes in the local housing markets. The decrease in mortgage demand has been offset by increases in commercial real estate and construction and land loan demand.
Bank owned life insurance provides us with non-interest income that is nontaxable. Federal regulations generally limit our investment in bank owned life insurance to 25% of our Tier 1 capital plus our allowance for credit losses. At December 31, 2023, our investment in bank owned life insurance was $6.2 million, which was within this investment limit.
Bank owned life insurance provides us with non-interest income that is nontaxable. Federal regulations generally limit our investment in bank owned life insurance to 25% of our Tier 1 capital plus our allowance for credit losses. At December 31, 2024, our investment in bank owned life insurance was $6.4 million, which was within this investment limit.
At December 31, 2023, the Bank entered into interest rate swap agreements with a total notional amount of $25 million to hedge the risk of changes in the fair value of fixed rate AFS securities for changes in the SOFR benchmark rate.
During 2023, the Bank entered into interest rate swap agreements with a total notional amount of $25 million to hedge the risk of changes in the fair value of fixed rate AFS securities for changes in the SOFR benchmark rate.
These losses are the result of market interest rate increases and we continue to monitor the portfolio for credit and other risks. The net unrealized loss on AFS securities and derivative combined, and the corresponding other comprehensive loss, net of tax, was $5.6 million, or 9.4% of Tier 1 capital.
These losses are the result of market interest rate increases and we continue to monitor the portfolio for credit and other risks. The net unrealized loss on AFS securities and derivative combined, and the corresponding other comprehensive loss, net of tax, was $4.8 million, or 9.9% of capital.
(2) EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts. (3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets.
(2) EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts. (3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets. (4) EVE Ratio represents EVE divided by the present value of assets.
Such commitments are subject to the same credit policies and approval process accorded to loans we make. At December 31, 2023, we had outstanding commitments to originate loans of $37.4 million. We anticipate that we will have sufficient funds available to meet our current lending commitments.
Such commitments are subject to the same credit policies and approval process accorded to loans we make. At December 31, 2024, we had outstanding commitments to originate loans of $18.0 million. We anticipate that we will have sufficient funds available to meet our current lending commitments.
We believe strong asset quality remains a key to our long-term financial success . Our total nonperforming assets to total assets ratio was 0.30% and 0.28% at December 31, 2023 and 2022, respectively.
We believe strong asset quality remains a key factor to our long-term financial success . Our total nonperforming assets to total assets ratio was 0.62% and 0.30% at December 31, 2024 and 2023, respectively.
Refer to additional detail regarding the fair value hedge in Note 21 – Derivatives of the accompanying consolidated financial statements. 43 Table of Contents Interest Expense.
Refer to additional detail regarding the fair value hedge in Note 19 – Derivatives of the accompanying consolidated financial statements. 42 Table of Contents Interest Expense.
The following are the various liquidity sources we had available at December 31, 2023 that we could use as needed: ● FHLB borrowing capacity of $72.6 million ● $15 million in credit lines with 2 correspondent banks ● Federal Reserve discount window ● Qwickrate CD Program ● Brokered deposits 49 Table of Contents ● The ability to sell securities. ● The ability to sell a group of loans in the secondary market on an as needed basis ● The ability to sell some of our BOLI assets At December 31, 2023, Broadstreet Bank exceeded all of its regulatory capital requirements, and was categorized as well-capitalized at that date.
The following are the various liquidity sources we had available at December 31, 2024 that we could use as needed: ● FHLB borrowing capacity of $102.4 million ● $18 million in credit lines with 2 correspondent banks ● Federal Reserve discount window ● Qwickrate (listed) CD Program ● Brokered deposits ● The ability to sell securities. ● The ability to sell a group of loans in the secondary market on an as needed basis ● The ability to sell a portion of our BOLI assets At December 31, 2024, Broadstreet Bank exceeded all of its regulatory capital requirements, and was categorized as well-capitalized at that date.
Time deposits that are scheduled to mature in less than one year from December 31, 2023 totaled $81.8 million. Management expects that a substantial portion of these time deposits will be retained.
Time deposits that are scheduled to mature in less than one year from December 31, 2024 totaled $96.2 million. Management expects that a substantial portion of these time deposits will be retained.
At December 31, 2023, the unallocated ESOP contra equity account was $2.2 million. At December 31, 2023, Broadstreet Bank opted to use the community bank leverage ratio framework (Tier 1 capital to average assets) for regulatory capital purposes.
At December 31, 2024, the unallocated ESOP contra equity account was $2.0 million. 39 Table of Contents At December 31, 2024, Broadstreet Bank opted to use the community bank leverage ratio framework (Tier 1 capital to average assets) for regulatory capital purposes.
Although we intend to continue our historical focus on the origination of residential mortgage loans, we intend to prudently increase our commercial real estate lending and construction and land lending so as to continue to diversify our loan portfolio and income sources.
As we continue our historical focus on the origination of residential mortgage loans, we have increased our focus on commercial real estate lending and construction and land lending to continue to diversify our loan portfolio and income sources.
Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, and proceeds from maturities of securities. We are also able to borrow from the Federal Home Loan Bank of Dallas.
Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, and proceeds from maturities of securities and loans.
Core deposits totaled $198.5 million, or 62.6% of total deposits, as of December 31, 2023, compared to $206.7 million, or 69.8% of total deposits, as of December 31, 2022. ● Continue to manage credit risk to maintain a low level of nonperforming assets. Historically, we have been able to maintain a high level of asset quality.
Core deposits totaled $205.9 million, or 61.3% of total deposits, as of December 31, 2024, compared to $198.5 million, or 62.6% of total deposits, as of December 31, 2023. ● Continue to manage credit risk to maintain a low level of nonperforming assets. Historically, we have been able to maintain a high level of asset quality.
Unrecognized tax benefits represent the differences between a tax position taken or expected to be taken in a tax return and the benefit recognized and measured in the consolidated financial statements. Penalties related to unrecognized tax benefits are classified as income tax expense.
Unrecognized tax benefits represent the differences between a tax position taken or expected to be taken in a tax return and the benefit recognized and measured in the consolidated financial statements.
We currently utilize a third-party modeling program, prepared on a quarterly basis, to evaluate our sensitivity to changing interest rates, given our business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the board of directors. 45 Table of Contents We have sought to manage our interest rate risk in order to minimize the exposure of our earnings and capital to changes in interest rates.
We currently utilize a third-party modeling program, prepared on a quarterly basis, to evaluate our sensitivity to changing interest rates, given our business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the board of directors.
See the CECL discussion in the accompanying consolidated financial statements for further explanation of the Bank’s transition to the new methodology. ​ 44 Table of Contents Noninterest Income. Noninterest income decreased $1.5 million, or 78.9%, to $352,000 for the year ended December 31, 2023 from $1.9 million for the year ended December 31, 2022.
See the CECL discussion in the accompanying consolidated financial statements for further explanation of the Bank’s transition to the new methodology. ​ 43 Table of Contents Noninterest Income. Noninterest income decreased $2.3 million, or 641.0%, to a loss of $1.9 million for the year ended December 31, 2024 from $352,000 for the year ended December 31, 2023.
The amount of dividends that Broadstreet Bank may declare and pay to Texas Community Bancshares, Inc. is governed by applicable banking laws and regulations. At December 31, 2023, Texas Community Bancshares, Inc. (on an unconsolidated basis) had cash and cash equivalents totaling $10.3 million. Liquidity management and asset quality continue to be high priorities.
The amount of dividends that Broadstreet Bank may declare and pay to Texas Community Bancshares, Inc. is governed by applicable banking laws and regulations. At December 31, 2024, Texas Community Bancshares, Inc. (on a stand-alone unconsolidated basis) had liquid assets totaling $7.8 million. Liquidity management and asset quality continue to be high priorities.
In addition, at December 31, 2023, we had a $10.0 million line of credit with Texas Independent Bankers Bank, and a $5.0 million line of credit with First Horizon Bank. At December 31, 2023, there was no outstanding balance with any of these facilities.
In addition, at December 31, 2024, we had three unused lines of credit which included an unsecured $10.0 million and a secured $3.0 million line of credit with Texas Independent Bankers Bank and an unsecured $5.0 million line of credit with First Horizon Bank. At December 31, 2024, there was no outstanding balance with any of these facilities.
Over the next 24 months from December 31, 2023, we anticipate $43.4 million in incoming cash flow from the securities portfolio with $21.9 million in 2024 and 21.5 million in 2025. See the Securities section of the management discussion and analysis for more information.
Over the next 24 months from December 31, 2024, we anticipate $42.7 million in incoming cash flow from the securities portfolio with $22.4 million in 2025 and 20.3 million in 2026. See the Securities section of the management discussion and analysis for more information.
Dividends on restricted investments including stock in the Federal Home Loan Bank and Texas Independent Bank (TIB) increased $121,000, or 318.4%, from $38,000 for the year ended December 31, 2022 to $159,000 for the year ended December 31, 2023.
Dividends on restricted investments including stock in the Federal Home Loan Bank and Texas Independent Bank (TIB) increased $62,000, or 39.0%, from $159,000 for the year ended December 31, 2023 to $221,000 for the year ended December 31, 2024.
The fed funds were used to fund asset growth. The increase in yields on deposits in banks and fed funds is reflective of the increase in market interest rates. Interest income from the fair value hedge was $277,000 for the year ended December 31, 2023.
The increase in yields on deposits in banks and fed funds is reflective of the increase in market interest rates. Interest income from the fair value hedge was $450,000 for the year ended December 31, 2024.
Interest expense on deposit accounts increased $3.8 million, or 257.2%, to $5.3 million for the year ended December 31, 2023 from $1.5 million for the year ended December 31, 2022, due to an increase in the average deposit cost of 145 basis points, or 231.4%, from 0.63% for the year ended December 31, 2022 to 2.08% for the year ended December 31, 2023 and an increase in average interest-bearing deposits of $17.7 million, or 7.4%, from $238.7 million for the year ended December 31, 2022 to $256.4 million for the year ended December 31, 2023, with the increase being in higher yielding certificates of deposit and money market deposits, offset by a decrease in lower cost interest-bearing transaction and savings accounts.
Interest expense on deposit accounts increased $2.0 million, or 37.8%, to $7.3 million for the year ended December 31, 2024 from $5.3 million for the year ended December 31, 2023, due to an increase in the average deposit cost of 51 basis points, or 24.4%, from 2.08% for the year ended December 31, 2023 to 2.59% for the year ended December 31, 2024 and an increase in average interest-bearing deposits of $25.0 million, or 9.8%, from $256.4 million for the year ended December 31, 2023 to $281.4 million for the year ended December 31, 2024, with the increase being primarily in higher cost certificates of deposit and money market deposits, offset by a decrease in lower cost savings accounts.
The Bank has raised in-house mortgage rates while continuing to offer secondary market options to moderate loan funding and we have seen a decrease in mortgage demand due to higher market interest rates.
Housing supply and demand are monitored for indicators of a significant change in the local housing markets. The Bank has raised in-house mortgage rates while continuing to offer secondary market options to moderate loan funding and we have seen a decrease in mortgage demand due to higher market interest rates.
With continued volatility in the market, recent banking sector events and market interest rate increases, liquidity management and analysis is a key factor in daily asset and liability management and strategic planning. We are monitoring deposit runoff and threats of deposit runoff daily.
With continued volatility in the market and market interest rate uncertainty, liquidity management and analysis is a key factor in daily asset and liability management and strategic planning. We are monitoring deposit balances daily.
The table above indicates that at December 31, 2023, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 2.27% decrease in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 0.40% increase in net interest income.
The table above indicates that at December 31, 2024, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 0.78% increase in EVE, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 8.65% decrease in EVE.
Originations consisted primarily of $29.6 million in one-to-four family residential mortgage loans, $9.1 million in multifamily loans, construction loans of $46.2 million (when fully funded upon completion), $13.5 million in commercial real estate loans, $4.4 million in consumer loans, $6.1 million in commercial and industrial loans, $2.0 million in land & development loans, $2.0 million in farmland loans and $1.4 million in municipal loans.
Originations consisted primarily of $11.1 million in one-to-four family residential mortgage loans, $2.7 million in multifamily loans, interim construction loans of $25.2 million (when fully funded upon completion), $19.5 million in commercial real estate loans, $5.1 million in consumer loans, $5.0 million in commercial and industrial loans, $17.7 million in land and development loans, $3.2 million in farmland loans and $8.5 million in municipal loans.
The total construction loan portfolio consisting of 82 loans had funded balances of $31.5 million at December 31, 2023 compared to 98 loans at December 31, 2022 with funded balances of $30.7 million. Construction loans continue to be a large segment of our loan portfolio with the majority of the loans being originated in our primary market.
The total interim construction loan portfolio consisted of 55 loans with funded balances of $33.1 million at December 31, 2024 compared to 82 loans at December 31, 2023 with funded balances of $31.5 million. Construction loans continue to be a large segment of our loan portfolio with the majority of the loans being originated in our primary market. Deposits.
Interest income from interest bearing deposits in banks increased $413,000, or 1,059.0%, from $39,000 for the year ended December 31, 2022 to $452,000 for the year ended December 31, 2023, resulting primarily from the increase in average yield of 427 basis points, or 490.2%, from 0.87% for the year ended December 31, 2022 to 5.14% for the year ended December 31, 2023 and an increase in average interest bearing deposits of $4.3 million, or 95.6% from $4.5 million for the year ended December 31, 2022 to $8.8 million for the year ended December 31, 2023.
Interest income from interest bearing deposits in banks increased $271,000, or 60.0%, from $452,000 for the year ended December 31, 2023 to $723,000 for the year ended December 31, 2024, resulting primarily from the increase in average yield of 31 basis points, or 6.1%, from 5.14% for the year ended December 31, 2023 to 5.45% for the year ended December 31, 2024 and an increase in average interest bearing deposits of $4.5 million, or 51.0% from $8.8 million for the year ended December 31, 2023 to $13.3 million for the year ended December 31, 2024.
Interest expense increased $5.6 million, or 243.5%, to $7.9 million for the year ended December 31, 2023 from $2.3 million for the year ended December 31, 2022 due primarily to an increase in the average yield on interest bearing liabilities of 157 basis points, or 187.3%, from 0.84% for the year ended December 31, 2022 to 2.41% for the year ended December 31, 2023 and an increase in the average balance of interest-bearing liabilities of $56.2 million, or 20.7%, from $272.0 million for the year ended December 31, 2022 to $328.2 million for the year ended December 31, 2023 primarily due to an increase in deposit and funding costs.
Interest expense increased $2.0 million, or 25.3%, to $9.9 million for the year ended December 31, 2024 from $7.9 million for the year ended December 31, 2023 due primarily to an increase in the average yield on interest bearing liabilities of 42 basis points, or 17.2%, from 2.41% for the year ended December 31, 2023 to 2.83% for the year ended December 31, 2024 and an increase in the average balance of interest-bearing liabilities of $22.1 million, or 6.7%, from $328.2 million for the year ended December 31, 2023 to $350.3 million for the year ended December 31, 2024 primarily due to an increase in deposit and funding costs.
At December 31, 2023, the derivatives were highly effective and offset the unrealized loss on AFS securities by $94,000 bringing the accumulated other comprehensive loss from $5.7 million to $5.6 million. Our asset quality remains strong.
At 47 Table of Contents December 31, 2024, the derivatives were highly effective and offset the unrealized loss on AFS securities by $329,000 bringing the accumulated other comprehensive loss from $5.1 million to $4.8 million. Our asset quality remains strong.
We consider our core deposits to include statement savings accounts, money market accounts, negotiable orders of withdrawal (NOW) accounts, other savings deposits and checking accounts . We will continue our efforts to increase our core deposits to provide a stable source of funds to support loan growth at costs consistent with improving our interest rate spread and net interest margin.
We will continue our efforts to increase our core deposits to provide a stable source of funds to support loan growth at costs consistent with improving our interest rate spread and net interest margin.
Selected Financial Data The following selected consolidated financial data sets forth certain financial highlights of the Company and should be read in conjunction with the audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2023 2022 ​ ​ (In thousands) Selected Financial Condition Data: ​ ​ ​ ​ Total assets ​ $ 452,044 ​ $ 417,346 Cash and cash equivalents ​ ​ 13,060 ​ ​ 8,927 Interest bearing deposits in banks ​ 12,298 ​ 2,055 Securities available for sale ​ 93,327 ​ 107,153 Securities held to maturity ​ 26,020 ​ 27,827 Loans and leases receivable, net ​ 279,932 ​ 251,338 Premises and equipment, net ​ 11,609 ​ 6,299 Bank owned life insurance ​ 6,238 ​ 6,125 Foreclosed assets ​ 162 ​ — Restricted investments carried at cost ​ 3,909 ​ 2,805 Core deposit intangible ​ 265 ​ 397 Total deposits ​ 317,241 ​ 296,077 Advances from the Federal Home Loan Bank ​ 76,896 ​ 62,494 Total shareholders' equity ​ 53,689 ​ 55,870 ​ 36 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ 2023 2022 ​ ​ (In thousands) Selected Operating Data: ​ ​ ​ ​ Interest income ​ $ 18,978 ​ ​ 12,566 Interest expense ​ ​ 7,914 ​ ​ 2,283 Net interest income ​ ​ 11,064 ​ 10,283 Provision for credit losses ​ ​ 356 ​ 208 Net interest income after provision for credit losses ​ ​ 10,708 ​ 10,075 Noninterest income ​ ​ 352 ​ 1,868 Noninterest expense ​ ​ 11,997 ​ 9,766 (Loss) income before income taxes ​ ​ (937) ​ 2,177 Income tax (benefit) expense ​ ​ (204) ​ 423 Net (loss) income $ (733) ​ $ 1,754 ​ ​ ​ ​ ​ ​ ​ ​ At or For the Years Ended ​ ​ December 31, ​ ​ 2023 2022 ​ ​ ​ ​ ​ Performance Ratios: ​ ​ Return on average assets ​ (0.17) % 0.47 % Return on average equity ​ (1.75) % 4.01 % Interest rate spread (1) ​ 2.27 % 2.70 % Net interest margin (2) ​ 2.73 % 2.89 % Noninterest expense to average assets 2.79 % 2.59 % Efficiency ratio (3) 105.09 % 80.37 % Average interest-earning assets to average interest-bearing liabilities 123.43 % 130.59 % ​ ​ ​ ​ ​ ​ Capital Ratios: ​ Average equity to average assets 9.77 % 11.61 % Total capital to risk-weighted assets (4) 16.73 % 20.09 % Tier 1 capital to risk-weighted assets (4) 15.65 % 19.39 % Common equity tier 1 capital to risk-weighted assets (4) 15.65 % 19.39 % Tier 1 capital to average assets 10.76 % 12.31 % ​ ​ ​ ​ ​ ​ Asset Quality Ratios: ​ Allowance for credit losses as a percentage of total loans 1.09 % 0.69 % Allowance for credit losses as a percentage of nonperforming loans 267.59 % 148.60 % Allowance for credit losses as a percentage of nonaccrual loans 340.59 % 148.60 % Nonaccrual loans as a percentage of total loans 0.32 % 0.47 % Net (charge-offs) recoveries to average outstanding loans during the year (0.02) % (0.01) % Nonperforming loans as a percentage of total loans 0.41 % 0.47 % Nonperforming loans as a percentage of total assets 0.26 % 0.28 % Total nonperforming assets as a percentage of total assets 0.30 % 0.28 % ​ ​ ​ ​ ​ ​ Other Data: ​ Number of offices ​ 6 6 ​ Number of full-time employees ​ 62 61 ​ Number of part-time employees ​ 5 5 ​ (1) Represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
Penalties related to unrecognized tax benefits are classified as income tax expense. 35 Table of Contents Selected Financial Data The following selected consolidated financial data sets forth certain financial highlights of the Company and should be read in conjunction with the audited consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. ​ ​ ​ ​ ​ ​ ​ ​ ​ At December 31, ​ 2024 2023 ​ ​ (In thousands) Selected Financial Condition Data: ​ ​ ​ ​ Total assets ​ $ 443,457 ​ $ 452,044 Cash and cash equivalents ​ ​ 13,290 ​ ​ 13,060 Interest bearing deposits in banks ​ 9,720 ​ 12,298 Securities available for sale ​ 75,189 ​ 93,327 Securities held to maturity ​ 22,096 ​ 26,020 Loans and leases receivable, net ​ 293,708 ​ 279,932 Premises and equipment, net ​ 11,526 ​ 11,609 Bank owned life insurance ​ 6,370 ​ 6,238 Other real estate owned ​ 480 ​ 162 Restricted investments carried at cost ​ 4,252 ​ 3,909 Core deposit intangible ​ 132 ​ 265 Total deposits ​ 335,828 ​ 317,241 Advances from the Federal Home Loan Bank ​ 49,878 ​ 76,896 Total shareholders' equity ​ 52,108 ​ 53,689 ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Years Ended December 31, ​ 2024 2023 ​ ​ (In thousands) Selected Operating Data: ​ ​ ​ ​ Interest income ​ $ 22,452 ​ ​ 18,978 Interest expense ​ ​ 9,902 ​ ​ 7,914 Net interest income ​ ​ 12,550 ​ 11,064 Provision for credit losses ​ ​ 158 ​ 356 Net interest income after provision for credit losses ​ ​ 12,392 ​ 10,708 Noninterest (loss) income ​ ​ (1,903) ​ 352 Noninterest expense ​ ​ 12,270 ​ 11,997 Loss before income taxes ​ ​ (1,781) ​ (937) Income tax benefit ​ ​ (476) ​ (204) Net loss $ (1,305) ​ $ (733) ​ 36 Table of Contents ​ ​ ​ ​ ​ ​ ​ At or For the Years Ended ​ ​ December 31, ​ ​ 2024 2023 ​ ​ ​ ​ ​ Performance Ratios: ​ ​ Return on average assets ​ (0.29) % (0.17) % Return on average equity ​ (3.08) % (1.75) % Interest rate spread (1) ​ 2.51 % 2.27 % Net interest margin (2) ​ 2.98 % 2.73 % Noninterest expense to average assets 2.73 % 2.79 % Efficiency ratio (3) 115.24 % 105.09 % Average interest-earning assets to average interest-bearing liabilities 120.01 % 123.43 % ​ ​ ​ ​ ​ ​ Capital Ratios: ​ Average equity to average assets 9.44 % 9.77 % Total capital to risk-weighted assets (4) 15.60 % 16.73 % Tier 1 capital to risk-weighted assets (4) 14.59 % 15.65 % Common equity tier 1 capital to risk-weighted assets (4) 14.59 % 15.65 % Tier 1 capital to average assets 10.84 % 10.76 % ​ ​ ​ ​ ​ ​ Asset Quality Ratios: ​ Allowance for credit losses as a percentage of total loans 1.09 % 1.09 % Allowance for credit losses as a percentage of nonperforming loans 142.57 % 267.59 % Allowance for credit losses as a percentage of nonaccrual loans 151.62 % 340.59 % Nonaccrual loans as a percentage of total loans 0.72 % 0.32 % Net (charge-offs) recoveries to average outstanding loans during the year (0.05) % (0.02) % Nonperforming loans as a percentage of total loans 0.76 % 0.41 % Nonperforming loans as a percentage of total assets 0.51 % 0.26 % Total nonperforming assets as a percentage of total assets 0.62 % 0.30 % ​ ​ ​ ​ ​ ​ Other Data: ​ Number of offices ​ 7 6 ​ Number of full-time employees ​ 60 62 ​ Number of part-time employees ​ 8 5 ​ (1) Represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
Interest income on net loans and leases increased $2.7 million, or 26.7%, to $12.8 million for the year ended December 31, 2023 from $10.1 million for the year ended December 31, 2022 primarily due to an increase of $33.4 million, or 14.2%, in the average balance of the loan portfolio from $234.8 million for the year ended December 31, 2022 to $268.2 million for the year ended December 31, 2023, and an increase of 50 basis points, or 11.6%, in the average yield on loans from 4.29% for the year ended December 31, 2022 to 4.79% for the year ended December 31, 2023.
Interest income on net loans and leases increased $3.1 million, or 24.0%, to $15.9 million for the year ended December 31, 2024 from $12.8 million for the year ended December 31, 2023 primarily due to an increase of $14.7 million, or 5.5%, in the average balance of the loan portfolio from $268.2 million for the year ended December 31, 2023 to $282.9 million for the year ended December 31, 2024, and an increase of 84 basis points, or 17.5%, in the average yield on loans from 4.79% for the year ended December 31, 2023 to 5.63% for the year ended December 31, 2024.
(2) Represents net interest income as a percentage of average interest-earning assets. (3) Represents noninterest expenses divided by the sum of net interest income and noninterest income. (4) Update to risk-weighted assets in 2022 due to calculation error. 37 Table of Contents Comparison of Financial Condition at December 31, 2023 and December 31, 2022 Total Assets .
(2) Represents net interest income as a percentage of average interest-earning assets. (3) Represents noninterest expenses divided by the sum of net interest income and noninterest income. ​ Comparison of Financial Condition at December 31, 2024 and December 31, 2023 Total Assets.
The Bank utilizes the Qwickrate listing service, which is a resource where banks can purchase and sell Certificates of Deposit (CDs) with other banks, to invest excess funds easily in CDs at a competitive rate. At December 31, 2023, there was $3.2 million in short-term (3-6 months) Qwickrate CDs with other banks. Securities Available for Sale.
The decrease was primarily the result of a reduction of $3.2 million in Qwickrate Certificates of Deposit (CDs). The Bank utilizes the Qwickrate listing service, which is a resource where banks can purchase and sell Certificates of Deposit (CDs) with other banks to invest excess funds in CDs at a competitive rate.
At December 31, 2023, there were 171 accounts with balances in excess of the $250,000 FDIC insurance limit with a total balance of $79.9 million, or 25.2% of deposits. The amount that was over $250,000 was $37.2 million, or 11.8%, that was potentially uninsured, including certificates of deposit of $8.6 million and $28.6 million in checking, MMDA and savings accounts.
At December 31, 2024, there were 191 accounts with balances in excess of the $250,000 FDIC insurance limit with a total balance of $98.0 million, or 29.2% of deposits. The amount that was over $250,000 was $50.3 million, or 15.0%, that was potentially uninsured, including certificates of deposit of $10.7 million and $39.6 million in checking, MMDA and savings accounts.
This was primarily the result of increased interest income on securities and loans resulting from an increase in the average balance and average yield on both for the year ended December 31, 2023.
Interest income increased $3.5 million, or 18.4%, to $22.5 million for the year ended December 31, 2024 from $19.0 million at December 31, 2023. This was primarily the result of increased interest income on loans resulting from an increase in the average balance and average yield for the year ended December 31, 2024.
At December 31, 2023, there were 171 accounts with balances in excess of $250,000 with a total of $79.9 million, or 25.2% of deposits. The amount that was over $250,000 was $37.2 million, or 11.7%, that was potentially uninsured, including certificates of deposit of $8.6 million and $28.6 million in checking, MMDA and savings accounts.
At December 31, 2024, there were 191 accounts with balances in excess of $250,000 with a total of $98.0 million, or 29.2% of deposits. The amount that was over $250,000 was $50.3 million, or 15.0%, that was potentially uninsured, including certificates of deposit of $10.7 million and $39.6 million in checking, MMDA and savings accounts.
This increase resulted primarily from an increase in yield of 333 basis points, or 184.4%, from 1.81% for the year ended December 31, 2022 to 5.14% for the year ended December 31, 2023 and an increase in average balance of $1.0 million, or 47.6%, from $2.1 million for the year ended December 31, 2022 to $3.1 million for the year ended December 31, 2023.
This increase resulted primarily from an increase in yield of 103 basis points, or 20.1%, from 5.14% for the year ended December 31, 2023 to 6.17% for the year ended December 31, 2024 and an increase in average balance of $488,000, or 15.8%, from $3.1 million for the year ended December 31, 2023 to $3.6 million for the year ended December 31, 2024.
Core deposits (defined as all deposits other than certificates of deposit) decreased $8.2 million, or 4.0%, to $198.5 million at December 31, 2023 from $206.7 million at December 31, 2022. Retail certificates of deposit increased $29.3 million, or 37.9%, to $106.7 million at December 31, 2023 from $77.4 million at December 31, 2022.
Deposits increased $18.6 million, or 5.9%, to $335.8 million at December 31, 2024 from $317.2 million at December 31, 2023. Core deposits (defined as all deposits other than certificates of deposit) increased $7.4 million, or 3.7%, to $205.9 million at December 31, 2024 from $198.5 million at December 31, 2023.
There was also an increase of $88,000 in fed funds interest income for the year ended December 31, 2023 primarily from an increase of 419 basis points, or 456.8%, in average yield on fed funds sold from 0.92% for the year ended December 31, 2022 to 5.11% for the year ended December 31, 2023, partially offset by a $7.1 million, or 65.7%, decrease in average fed funds sold from $10.8 million for the year ended December 31, 2022 to $3.7 million for the year ended December 31, 2023.
There was also an increase of $484,000 in fed funds interest income for the year ended December 31, 2024 primarily from an increase of 27 basis points, or 5.3%, in average yield on fed funds sold from 5.11% for the year ended December 31, 2023 to 5.38% for the year ended December 31, 2024 and a $8.8 million, or 237.8%, increase in average fed funds sold from $3.7 million for the year ended December 31, 2023 to $12.5 million for the year ended December 31, 2024.
The total gross unrealized losses are $9.8 million, or 7.8% of the $126.5 million securities portfolio and are 16.5% of Tier 1 capital. The securities portfolio includes $60.2 million, or 47.5%, that are agency issued and guaranteed by the U.S. government.
The total gross unrealized losses are $9.0 million, or 8.7% of the $103.7 million securities portfolio and are 18.8% of capital. The securities portfolio includes $42.4 million, or 41.0%, that are agency issued and guaranteed by the U.S. government.
Net Economic Value . We also compute amounts by which the net present value of our assets and liabilities (net economic value of equity or “EVE”) would change in the event of a range of assumed changes in market interest rates.
We also compute amounts by which the net present value of our assets and liabilities (net economic value of equity or “EVE”) would change in the event of a range of assumed changes in market interest rates. This model uses a discounted cash flow analysis and an option-based pricing approach to measure the interest rate sensitivity of net portfolio value.
During 2023, we opened a loan production office in Canton, Texas and opened a full-service branch in Tyler in February of 2024. Summary of Critical Accounting Policies and Critical Accounting Estimates The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared in conformity with U.S. GAAP.
Summary of Critical Accounting Policies and Critical Accounting Estimates The discussion and analysis of the financial condition and results of operations are based on our consolidated financial statements, which are prepared in conformity with U.S. GAAP.
The Company also repurchased 174,842 shares of its common stock for a decrease of $2.2 million and paid quarterly dividends totaling $368,000, partially offset by a decrease in the net other comprehensive loss of $1.4 million, an increase in equity of $193,000 for the 2023 funding of the Broadstreet Bank leveraged ESOP with the release of 14,844 additional ESOP shares to participants and $528,000 related to the partial vesting of the 2022 Equity Incentive Plan for the year ended December 31, 2023.
The Company also repurchased 107,431 shares of its common stock for a decrease of $1.6 million and paid quarterly dividends totaling $504,000, partially offset by a decrease in the accumulated other comprehensive loss of $826,000, an increase in equity of $223,000 for the 2024 funding of the Broadstreet Bank leveraged ESOP with the release of 15,862 ESOP shares to participants and $757,000 related to accruals for the equity incentive plan for the year ended December 31, 2024.
Based on management’s analysis of the adequacy of the allowance for credit losses , the provision for credit losses was $356,000 for the year ended December 31, 2023, compared to $208,000 for the year ended December 31, 2022, an increase of $148,000, or 71.2%, primarily due to an increase in loans and leases and the adoption of ASC 326 on January 1, 2023.
Based on management’s analysis of the adequacy of the allowance for credit losses , the provision for credit losses was $158,000 for the year ended December 31, 2024, compared to $356,000 for the year ended December 31, 2023, a decrease of $198,000, or 55.6%, primarily due to significant loan growth in 2023, and the adoption of ASC 326 on January 1, 2023.
Gross unrealized losses on the AFS portfolio consisting of 81 securities decreased from $8.9 million, or 7.7% of the portfolio’s amortized cost of $116.0 million at December 31, 2022, to $7.2 million, or 7.2% of the amortized cost of $100.5 million at December 31, 2023. These unrealized losses are due to increases in market interest rates.
Gross unrealized losses on the available for sale portfolio consisting of 77 securities decreased from $7.2 million, or 7.2% of the portfolio’s amortized cost of $100.5 million at December 31, 2023, to $6.5 million, or 8.0% of the amortized cost of $81.6 million at December 31, 2024.
Net interest income increased $781,000, or 7.6%, to $11.1 million for the year ended December 31, 2023 from $10.3 million for the year ended December 31, 2022, primarily due to an increase in interest-earning assets of $49.9 million, or 14.0%, to $405.1 million at December 31, 2023 from $355.2 million at December 31, 2022, partially offset by a decrease in net interest rate spread of 43 basis points, or 15.8%, from 2.70% for the year ended December 31, 2022 to 2.27% for the year ended December 31, 2023.
Net interest income increased $1.5 million, or 13.5%, to $12.6 million for the year ended December 31, 2024 from $11.1 million for the year ended December 31, 2023, primarily due to an increase in interest-earning assets of $15.3 million, or 3.8%, to $420.4 million at December 31, 2024 from $405.1 million at December 31, 2023, and an increase in net interest rate spread of 24 basis points, or 10.6%, from 2.27% for the year ended December 31, 2023 to 2.51% for the year ended December 31, 2024.
Net interest margin had a 16 basis point decrease to 2.73% for the year ended December 31, 2023 from 2.89% for the year ended December 31, 2022. Provision for Credit Losses.
Net interest margin increased 25 basis points to 2.98% for the year ended December 31, 2024 from 2.73% for the year ended December 31, 2023. Provision for Credit Losses.
During the year ended December 31, 2023, construction loans (when fully funded upon completion) increased by $307,000, or 0.57%, to $54.3 million at December 31, 2023 from $54.0 million at December 31, 2022.
During the year ended December 31, 2024, interim construction loans (when fully funded upon completion) decreased by $11.8 million, or 21.7%, to $42.5 million at December 31, 2024 from $54.3 million at December 31, 2023.
The Bank had $206,000 in nonrecurring retirement and recruitment expenses related to the retirement of the former CEO. Increases for the year ended December 31, 2023 were primarily related to growth, including branch completion, bank name change, asset size, recruitment and leadership change and price increases in all types of services the Company incurred due to inflationary pressures.
Increases for the year ended December 31, 2024 were primarily related to growth, including branch completion, employee recruitment and price increases in all types of services the Company incurred due to inflationary pressures. Income Tax Benefit.
During the twelve months ended December 31, 2023, loan originations totaled $114.3 million of which $25.6 million were renewals, or refinancings of existing loans with Broadstreet Bank (including interim construction loans converting to a permanent loan), resulting in net originations of $88.7 million.
At December 31, 2024, $13.3 million in commercial real estate loans are outside of our primary market area. During the year ended December 31, 2024, loan originations totaled $98.1 million of which $9.1 million were renewals or refinancings of existing loans with Broadstreet Bank (including interim construction loans converting to a permanent loan), resulting in net originations of $88.3 million.
All average balances are daily average balances. Nonaccrual loans are included in the computation of average balances. Average yields for loans (excluding PPP loans) include loan fees of $631,000 and $399,000 for the years ended December 31, 2023 and 2022, respectively.
No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances. Nonaccrual loans are included in the computation of average balances. Average yields for loans include loan fees of $511,000 and $631,000 for the years ended December 31, 2024 and 2023, respectively.
Non-interest income currently consists primarily of service charges on deposit accounts, other service charges and fees, income from bank owned life insurance, and wholesale lending fees. Wholesale lending fees are generated from facilitating the origination of mortgage loans through the wholesale lender.
Non-interest income currently consists primarily of service charges on deposit accounts, other service charges and fees, income from bank owned life insurance, gains and losses on the sale or disposal of assets and other income.
At December 31, 2023, we had outstanding advances of $76.9 million from the Federal Home Loan Bank of Dallas. At December 31, 2023, we had unused borrowing capacity of $72.6 million with the Federal Home Loan Bank of Dallas.
We are also able to borrow from the Federal Home 46 Table of Contents Loan Bank of Dallas. At December 31, 2024, we had outstanding advances of $49.9 million from the Federal Home Loan Bank of Dallas. At December 31, 2024, we had unused borrowing capacity of $102.4 million with the Federal Home Loan Bank of Dallas.
Net loss was $733,000 for the year ended December 31, 2023, compared to net income of $1.8 million for the year ended December 31, 2022, a decrease of $2.5 million, or 138.9%.
The net loss was $1.3 million for the year ended December 31, 2024, compared to a net loss of $733,000 for the year ended December 31, 2023, an increased loss of $572,000, or 78.0%.
(4) EVE Ratio represents EVE divided by the present value of assets. 47 Table of Contents The table above indicates that at December 31, 2023, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience an 11.19% decrease in EVE, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 1.76% decrease in EVE.
The table above indicates that at December 31, 2024, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would experience a 7.50% increase in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would experience a 6.70% decrease in net interest income. 45 Table of Contents Net Economic Value .
Loans secured by residential real estate, multifamily and farmland comprise $189.8 million, or 67.1%, of total loans and commercial real estate loans total $41.8 million, or 14.8%, of total loans at December 31, 2023.
Loans secured by residential real estate, multifamily and farmland decreased $24.2 million, or 12.8%, to $165.6 million, or 55.8% of the loan portfolio, at December 31, 2024 from $189.8 million, or 67.1% of total loans at December 31, 2023 and commercial real estate loans increased $14.3 million, or 34.2%, to $56.1 million, or 18.9% of total loans at December 31, 2024 from $41.8 million, or 14.8% of total loans at December 31, 2023.
There was an increase in average interest earning assets of $49.9 million, or 14.0%, to $405.1 million at December 31, 2023 from $355.2 million at December 31, 2022 and an increase of 115 basis points, or 32.4%, in average yield on interest–earning assets from 3.54% at December 31, 2022 to 4.68% at December 31, 2023. 42 Table of Contents The interest income increase is partially due to an increase in the average balance of securities of $18.9 million, or 18.1%, from $104.6 million, for the year ended December 31, 2022 to $123.5 million for the year ended December 31, 2023 and an increase in the average yield on securities of 189 basis points, or 85.2%, from 2.21% for the year ended December 31, 2022 to 4.10% for the year ended December 31, 2023.
There was an increase in average interest earning assets of $15.3 million, or 3.8%, to $420.4 million at December 31, 2024 from $405.1 million at December 31, 2023 and an increase of 66 basis points, or 14.0%, in average yield on interest–earning assets from 4.68% at December 31, 2023 to 5.34% at December 31, 2024. 41 Table of Contents Interest income on the securities portfolio decreased $597,000, or 11.8% to $4.5 million for the year ended December 31, 2024, from $5.1 million for the year ended December 31, 2023.
At December 31, 2023, commercial real estate loans amounted to $41.8 million, or 14.8% of total loans, and construction and land loans amounted to $37.5 million, or 13.3% of total loans. Our commercial real estate loans and construction and land loans have higher credit risk than our residential mortgage loans. ● Continue to grow core deposits .
At December 31, 2024, commercial real estate loans amounted to $56.1 million, or 19.0% of total loans compared to $41.8 million, or 14.8% at December 31, 2023, and construction and land loans amounted to $54.1 million, or 18.4% of total loans compared to $37.5 million, or 13.3% at December 31, 2023.
Total assets were $452.0 million as of December 31, 2023, an increase of 34.7 million, or 8.3%, when compared to total assets of $417.3 million as of December 31, 2022.
Total assets were $443.5 million as of December 31, 2024, a decrease of $8.5 million, or 1.9%, when compared to total assets of $452.0 million as of December 31, 2023.
Net unrealized losses decreased on the available for sale portfolio by $1.3 million, or 18.6%, to $5.7 million, net of tax, from $7.0 million, net of tax, due primarily to decreases in unrealized losses from changes in market interest rates being partially offset by the realized loss related to the securities sold being removed from the total.
Net unrealized losses on the available for sale portfolio, including derivatives, decreased by $826,000, or 14.8%, to $4.8 million, net of tax, from $5.7 million, net of tax, due primarily to decreases in market interest rates.
Income Tax Expense. Income tax expense decreased by $627,000, or 148.2%, from a $423,000 expense for the year ended December 31, 2022 to a $204,000 tax benefit for the year ended December 31, 2023 due primarily to the decrease in taxable income. The effective tax rate was 21.77% and 19.43% for the years ended December 31, 2023 and 2022, respectively.
The i ncome tax benefit increased by $272,000, or 133.3%, from $204,000 for the year ended December 31, 2023 to $476,000 for the year ended December 31, 2024 due primarily to the increase in the taxable loss. The effective tax rate was 26.69% and 21.77% for the years ended December 31, 2024 and 2023, respectively.
Cash and Cash Equivalents. Total cash and cash equivalents (which includes fed funds sold) increased $4.1 million, or 46.1%, to $13.1 million (including $7.6 million in Fed Funds sold) at December 31, 2023 from $8.9 million (including $2.0 million in Fed Funds sold) at December 31, 2022.
Cash and Cash Equivalents. Total cash and cash equivalents (which includes fed funds sold) increased $230,000, or 1.5%, to $13.3 million (including $9.3 million in Fed Funds sold) at December 31, 2024 from $13.1 million (including $7.6 million in Fed Funds sold) at December 31, 2023. These accounts provided a favorable yield while maintaining a high level of liquidity.
There has been an influx of retirees and others from the Dallas metropolitan area and an influx in general into the state of Texas and our market area. Our more rural market area offers a lower-cost of living and many recreational amenities, while being within easy reach of the cities of Dallas and Tyler and the urban amenities they offer.
Our more rural market area offers a lower-cost of living and many recreational amenities, while being within easy reach of the cities of Dallas and Tyler and the urban amenities they offer. We believe this movement away from major cities like Dallas was accelerated by the work-from-home trend.
The gross unrealized losses on the AFS securities is $7.2 million, or 7.2% of the $100.5 million AFS portfolio and 12.1% of Tier 1 capital. Unrealized losses on the HTM securities were $2.6 million, or 10.1% of the $26.0 million HTM portfolio and 4.4% of Tier 1 capital.
At December 31, 2024, the weighted average life (WAL) of our securities portfolio is 4.5 years. The gross unrealized losses on the AFS securities is $6.5 million, or 8.0% of the $81.6 million AFS portfolio and 13.5% of capital. Unrealized losses on the HTM securities were $2.6 million, or 11.8% of the $22.1 million HTM portfolio and 5.4% of capital.
The increase was due primarily to an increase in net loans and leases of $28.6 million, or 11.4%, to $279.9 million at December 31, 2023 from $251.3 million at December 31, 2022, an increase in cash and interest bearing deposits in banks of 14.4 million, or 130.9%, to $25.4 million at December 31, 2023 from $11.0 million at December 31, 2022, an increase in net premises and equipment of $5.3 million, or 84.1%, to $11.6 million at December 31, 2023 from $6.3 million at December 31, 2022, and an increase in restricted investments carried at cost, which is primarily FHLB stock, of $1.1 million, or 39.3%, to $3.9 million at December 31, 2023 partially offset by a decrease in securities of $15.6 million, or 11.6% to $119.3 million at December 31, 2023 from $135.0 million at December 31, 2022.
The decrease was due primarily to a decrease in securities of $22.0 million, or 18.4%, to $97.3 million at December 31, 2024 from $119.3 million at December 31, 2023 and a decrease in interest bearing deposits in banks of $2.6 million, or 21.1%, to $9.7 million at December 31, 2024 from $12.3 million at December 31, 2023 partially offset by an increase in net loans and leases of $13.8 million, or 4.9%, to $293.7 million at December 31, 2024 from $279.9 million at December 31, 2023, an increase in other real estate owned of $318,000, or 196.3% to $480,000 at December 31, 2024 which consisted of two buildings the Company had purchased for expansion and had listed for sale, an increase of $343,000, or 8.8%, to $4.3 million at December 31, 2024 in restricted investments carried at cost, which includes $3.5 million in FHLB stock.

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