What changed in BV Financial, Inc.'s 10-K — 2023 vs 2024
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Paragraph-level year-over-year comparison of BV Financial, 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.
+263 added−508 removedSource: 10-K (2025-03-27) vs 10-K (2024-03-22)
Top changes in BV Financial, Inc.'s 2024 10-K
263 paragraphs added · 508 removed · 231 edited across 2 sections
- Item 6. [Reserved]+249 / −496 · 221 edited
- Item 1C. Cybersecurity+14 / −12 · 10 edited
Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
10 edited+4 added−2 removed5 unchanged
Item 1C. Cybersecurity
Cybersecurity — threats and controls disclosure
10 edited+4 added−2 removed5 unchanged
2023 filing
2024 filing
Biggest changeAccordingly, the Company engages third-party consultants and independent auditors to conduct penetration tests, external audits, program enhancement where applicable and review of cybersecurity risk assessments. Cybersecurity Governance The Company has established an Information Technology Steering Committee consisting of department leaders. The committee focuses on strategic and tactical delivery as well as policy oversight.
Biggest changeCybersecurity Governance The Company has established an Information Technology Steering Committee consisting of department leaders. The committee focuses on strategic and tactical delivery as well as policy oversight. All such policies are approved by the board of directors. All Information Security activity is led by the Information Security Officer . It em 2. Properties.
At 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. It em 4. Mine Safety Disclosures. Not applicable. 36 PART II It em 5.
At 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. It em 4. Mine Safety Disclosures. Not applicable. 37 PART II It em 5.
The common stock of BV Financial is listed on The Nasdaq Capital Market under the symbol “BVFL.” As of March 19, 2024, we had 330 stockholders of record (excluding the number of persons or entities holding stock in street name through various brokerage firms), and 11,375,803 shares of common stock outstanding.
The common stock of BV Financial is listed on The Nasdaq Capital Market under the symbol “BVFL.” As of March 14, 2025, we had 318 stockholders of record (excluding the number of persons or entities holding stock in street name through various brokerage firms), and 10,594,044 shares of common stock outstanding.
Notable technologies include firewalls, intrusion detection systems, security automation and response capabilities, user behavior analytics, multi-factor authentication, data backups to immutable storage and business continuity applications. Notable services include 24/7 security monitoring and response, vulnerability scanning, third-party monitoring, and threat intelligence. Like many companies, the Company relies on third-party vendor solutions to support its operations.
Our employees are supported with solutions designed to identify, prevent, detect, respond to, and recover from incidents. Notable technologies include firewalls, intrusion detection systems, security automation and response capabilities, user behavior analytics, multi-factor authentication, data backups to immutable storage and business continuity applications. Notable services include 24/7 security monitoring and response, vulnerability scanning, third-party monitoring, and threat intelligence.
We own our main office and 11 of our branch offices and lease the remaining three branch offices. At December 31, 2023, the net book value of our premises and equipment was $14.3 million. Ite m 3. Legal Proceedings.
At December 31, 2024, the net book value of our premises and equipment was $13.2 million. Ite m 3. Legal Proceedings.
All such policies are approved by the board of directors. All Information Security activity is led by the Information Security Officer. It em 2. Properties. We conduct our operations from our main office, 14 branch offices and one standalone ITM, all of which are located in Baltimore City, Anne Arundel, Baltimore, Dorchester, Harford and Talbot Counties, Maryland.
We conduct our operations from our main office, 13 branch offices and one standalone ITM, all of which are located in Baltimore City, Anne Arundel, Baltimore, Dorchester, Harford and Talbot Counties, Maryland. We own our main office and 9 of our branch offices and lease the remaining four branch offices.
To prepare and respond to incidents, the Company has implemented a multi-layered “defense-in-depth” cybersecurity strategy, integrating people, technology, and processes. This includes advanced employee training, innovative technologies, and policies and procedures in the areas of Information Security, Data Governance, Business Continuity and Disaster Recovery, Privacy, Third Party Risk Management, and Incident Response.
This includes advanced employee training, innovative technologies, and policies and procedures in the areas of Information Security, Data Governance, Business Continuity and Disaster Recovery, Privacy, Third Party Risk Management, and Incident Response. 36 Core activities supporting our strategy include cybersecurity training, technology optimization, threat intelligence, vulnerability and patch management and the testing of incident response, business continuity and disaster recovery capabilities.
Many of these vendors have access to sensitive and proprietary information. Third-party vendors continue to be a notable source of operational and informational risk. Accordingly, the Company has implemented a Third-Party Risk Management program, which includes a detailed onboarding process and periodic reviews of vendors with access to sensitive Company data.
Like many companies, the Company relies on third-party vendor solutions to support its operations . Many of these vendors have access to sensitive and proprietary information. Third-party vendors continue to be a notable source of operational and informational risk.
Core activities supporting our strategy include cybersecurity training, technology optimization, threat intelligence, vulnerability and patch management and the testing of incident response, business continuity and disaster recovery capabilities. Employees are the first line of defense against cybersecurity measures. Every employee is responsible for protecting Bank and client information. Accordingly, employees complete formal training and acknowledge security policies annually.
Employees are the first line of defense against cybersecurity measures. Every employee is responsible for protecting Bank and client information. Accordingly, employees complete formal training and acknowledge security policies annually. In addition, employees are subjected to regular simulated phishing assessments, designed to sharpen threat detection and reporting capabilities.
As indicated above, supporting our operations are incident response, business continuity, and disaster recovery programs. These programs identify and assess threats and evaluate risk. Further, these programs support a coordinated response when responding to incidents. Periodic exercises and tests verify these programs’ effectiveness. Validating solution and program effectiveness in relation to regulatory compliance and industry standards is important.
Further, these programs support a coordinated response when responding to incidents. Periodic exercises and tests verify these programs’ effectiveness. Validating solution and program effectiveness in relation to regulatory compliance and industry standards is important. Accordingly, the Company engages third-party consultants and independent auditors to conduct penetration tests, external audits, program enhancement where applicable and review of cybersecurity risk assessments.
Removed
In 35 addition, employees are subjected to regular simulated phishing assessments, designed to sharpen threat detection and reporting capabilities. Our employees are supported with solutions designed to identify, prevent, detect, respond to, and recover from incidents.
Added
To prepare and respond to incidents, the Company has implemented a multi-layered “defense-in-depth” cybersecurity strategy, integrating people, technology, and processes.
Removed
BV Financial did not purchase any shares of its common stock during the year ended December 31, 2023.
Added
Accordingly, the Company has implemented a Third-Party Risk Management program, which includes a detailed onboarding process and periodic reviews of vendors with access to sensitive Company data . As indicated above, supporting our operations are incident response, business continuity, and disaster recovery programs. These programs identify and assess threats and evaluate risk.
Added
The following table provides information on repurchases by the Company of its common stock under the Company's Board approved program during the quarter ended December 31, 2024.
Added
Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs October 1 - 31, 2024 127,000 15.38 127,000 982,272 November 1 - 30, 2024 782,029 15.97 782,029 200,243 December 1 - 31, 2024 142,205 17.24 142,205 58,038 Total 1,051,234 $ 16.07 1,051,234
Item 6. [Reserved]
Selected Financial Data — reserved (removed by SEC in 2021)
221 edited+28 added−275 removed139 unchanged
Item 6. [Reserved]
Selected Financial Data — reserved (removed by SEC in 2021)
221 edited+28 added−275 removed139 unchanged
2023 filing
2024 filing
Biggest change(dollars in thousands) Term Loans Amortized Cost Basis by Origination Year Balance at December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Total One to four family - owner occupied Pass $ 6,387 $ 7,906 $ 13,727 $ 9,974 $ 9,707 $ 71,463 $ 10,492 $ 129,656 Special Mention — — — — — — — — Substandard — — — — — 331 39 370 Doubtful — — — — — — — — Loss — — — — — — — — Total One to four family - owner occupied $ 6,387 $ 7,906 $ 13,727 $ 9,974 $ 9,707 $ 71,794 $ 10,531 $ 130,026 Current Period Gross Write-off $ — $ — $ — $ — $ — $ ( 2 ) $ — $ ( 2 ) One to four family - non owner occupied Pass $ 13,810 $ 30,603 $ 20,582 $ 10,742 $ 7,611 $ 22,795 $ — $ 106,143 Special Mention — — — — — — — — Substandard — — — — — 1,947 — 1,947 Doubtful — — — — — — — — Loss — — — — — — — — Total One to four family - non owner occupied $ 13,810 $ 30,603 $ 20,582 $ 10,742 $ 7,611 $ 24,742 $ — $ 108,090 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — Commercial owner occupied Pass $ 20,967 $ 16,071 $ 16,642 $ 5,998 $ 5,071 $ 31,536 $ — $ 96,285 Special Mention — — — — — — — — Substandard — — — 943 1,502 3,782 — 6,227 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial owner occupied $ 20,967 $ 16,071 $ 16,642 $ 6,941 $ 6,573 $ 35,318 $ — $ 102,512 Current Period Gross Write-off $ — $ — $ — $ — $ — $ ( 3 ) $ — $ ( 3 ) Commercial investor Pass $ 68,682 $ 89,812 $ 65,624 $ 16,205 $ 9,991 $ 28,823 $ — $ 279,137 Special Mention — — — — — — — — Substandard — — — 6,907 — 1,150 — 8,057 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial investor $ 68,682 $ 89,812 $ 65,624 $ 23,112 $ 9,991 $ 29,973 $ — $ 287,194 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — Construction and land Pass $ 6,901 $ 9,650 $ 2,271 $ 650 $ — $ 704 $ — $ 20,176 Special Mention — — — — — — — — Substandard — — — 1,400 — 289 — 1,689 Doubtful — — — — — — — — Loss — — — — — — — — Total Construction and land $ 6,901 $ 9,650 $ 2,271 $ 2,050 $ — $ 993 $ — $ 21,865 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — Farm loans Pass $ — $ 4,141 $ 2,281 $ 261 $ 2,641 $ 5,553 $ — $ 14,877 Special Mention — — — — — — — — Substandard — — — — — — — — Doubtful — — — — — — — — Loss — — — — — — — — Total Farm loans $ — $ 4,141 $ 2,281 $ 261 $ 2,641 $ 5,553 $ — $ 14,877 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — Marine loans Pass $ 3,227 $ 2,044 $ 6,293 $ 1,751 $ 207 $ 2,864 $ — $ 16,386 Special Mention — — — — — — — — Substandard — — — — — — — — Doubtful — — — — — — — — Loss — — — — — — — — Total Marine loans $ 3,227 $ 2,044 $ 6,293 $ 1,751 $ 207 $ 2,864 $ — $ 16,386 Current Period Gross Write-off $ — $ — $ — $ — $ — $ ( 58 ) $ — $ ( 58 ) Other consumer Pass $ 315 $ 143 $ 124 $ 37 $ 189 $ 1,081 $ — $ 1,889 Special Mention — — — — — — — — Substandard — — — — — 4 — 4 Doubtful — — — — — — — — Loss — — — — — — — — Total Other consumer $ 315 $ 143 $ 124 $ 37 $ 189 $ 1,085 $ — $ 1,893 Current Period Gross Write-off $ — $ — $ — $ — $ — $ ( 22 ) $ — $ ( 22 ) Guaranteed by U.S.
Biggest changeGovernment $ — $ — $ — $ — $ 20 $ 2,882 $ — $ 2,902 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — Commercial Pass $ 5,847 $ 360 $ 2,738 $ 4,214 $ 6,151 $ 2,836 $ — $ 22,146 Special Mention — — — — — — — — Substandard — — 380 — — 668 — 1,048 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial $ 5,847 $ 360 $ 3,118 $ 4,214 $ 6,151 $ 3,504 $ — $ 23,194 Current Period Gross Write-off $ — $ — $ — $ — $ — $ — $ — $ — 73 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements (dollars in thousands) Term Loans Amortized Cost Basis by Origination Year Balance at December 31, 2024 2024 2023 2022 2021 2020 Prior Revolving Total Total Loans Pass $ 110,522 $ 109,162 $ 156,265 $ 119,729 $ 47,432 $ 175,341 $ 11,872 $ 730,323 Special Mention — — — — — — — — Substandard — — 380 338 2,493 4,226 — 7,437 Doubtful — — — — — — — — Loss — — — — — — — — Total loans $ 110,522 $ 109,162 $ 156,645 $ 120,067 $ 49,925 $ 179,567 $ 11,872 $ 737,760 (dollars in thousands) Term Loans Amortized Cost Basis by Origination Year Balance at December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Total One to four family - owner occupied Pass $ 6,387 $ 7,906 $ 13,727 $ 9,974 $ 9,707 $ 71,463 $ 10,492 $ 129,656 Special Mention — — — — — — — — Substandard — — — — — 331 39 370 Doubtful — — — — — — — — Loss — — — — — — — — Total One to four family - owner occupied $ 6,387 $ 7,906 $ 13,727 $ 9,974 $ 9,707 $ 71,794 $ 10,531 $ 130,026 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ ( 2 ) $ — $ ( 2 ) One to four family - non owner occupied Pass $ 13,810 $ 30,603 $ 20,582 $ 10,742 $ 7,611 $ 22,795 $ — $ 106,143 Special Mention — — — — — — — — Substandard — — — — — 1,947 — 1,947 Doubtful — — — — — — — — Loss — — — — — — — — Total One to four family - non owner occupied $ 13,810 $ 30,603 $ 20,582 $ 10,742 $ 7,611 $ 24,742 $ — $ 108,090 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ — $ — $ — Commercial owner occupied Pass $ 20,967 $ 16,071 $ 16,642 $ 5,998 $ 5,071 $ 31,536 $ — $ 96,285 Special Mention — — — — — — — — Substandard — — — 943 1,502 3,782 — 6,227 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial owner occupied $ 20,967 $ 16,071 $ 16,642 $ 6,941 $ 6,573 $ 35,318 $ — $ 102,512 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ ( 3 ) $ — $ ( 3 ) Commercial investor Pass $ 68,682 $ 89,812 $ 65,624 $ 16,205 $ 9,991 $ 28,823 $ — $ 279,137 Special Mention — — — — — — — — Substandard — — — 6,907 — 1,150 — 8,057 Doubtful — — — — — — — — Loss — — — — — — — — Total Commercial investor $ 68,682 $ 89,812 $ 65,624 $ 23,112 $ 991 $ 29,973 $ — $ 287,194 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ — $ — $ — Construction and land Pass $ 6,901 $ 9,650 $ 2,271 $ 650 $ — $ 704 $ — $ 20,176 Special Mention — — — — — — — — Substandard — — — 1,400 — 289 — 1,689 Doubtful — — — — — — — — Loss — — — — — — — — Total Construction and land $ 6,901 $ 9,650 $ 2,271 $ 2,050 $ — $ 993 $ — $ 21,865 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ — $ — $ — Farm loans Pass $ — $ 4,141 $ 2,281 $ 261 $ 2,641 $ 5,553 $ — $ 14,877 Special Mention — — — — — — — — Substandard — — — — — — — — Doubtful — — — — — — — — Loss — — — — — — — — Total Farm loans $ — $ 4,141 $ 2,281 $ 261 $ 2,641 $ 5,553 $ — $ 14,877 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ — $ — $ — Marine and other consumer loans Pass $ 3,542 $ 2,187 $ 6,417 $ 1,788 $ 396 $ 3,945 $ — $ 16,386 Special Mention — — — — — — — — Substandard — — — — — 4 — — Doubtful — — — — — — — — Loss — — — — — — — — Total Marine and other consumer loans $ 3,227 $ 2,044 $ 6,293 $ 1,751 $ 207 $ 3,949 $ — $ 16,386 Current Period Gross Write-Off $ — $ — $ — $ — $ — $ ( 80 ) $ — $ ( 58 ) Guaranteed by U.S.
Change in Accounting Principle As discussed in Note 1 to the consolidated financial statements, the Company changed its method of accounting for credit losses effective January 1, 2023, due to the adoption of Accounting Standard Codification Topic 326 Financial Instruments – Credit Losses. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management.
Change in Accounting Principle As discussed in Note 1 to the consolidated financial statements, the Company changed its method of accounting for credit losses effective January 1, 2023, due to the adoption of Accounting Standard Codification Topic 326 Financial Instruments – Credit Losses. Basis for Opinion These financial statements are the responsibility of the Company’s management.
Highlights of our current business strategy include the following: • Pursue opportunistic acquisitions and partnerships. We intend to continue to prudently pursue opportunities to acquire banks that offer opportunities for solid financial returns. Our primary focus will be on franchises that enhance our funding profile, product capabilities or geographic density or footprint, while maintaining an acceptable risk profile.
Highlights of our current business strategy include the following: 38 • Pursue opportunistic acquisitions and partnerships. We intend to continue to prudently pursue opportunities to acquire banks that offer opportunities for solid financial returns. Our primary focus will be on franchises that enhance our funding profile, product capabilities or geographic density or footprint, while maintaining an acceptable risk profile.
No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense.
No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average 43 balances are daily average balances. Non-accrual loans were included in the computation of average balances. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense.
These judgments require us to make projections of future taxable income. The judgments and estimates we make in determining our deferred tax assets are inherently subjective and are reviewed on a regular basis 39 as regulatory or business factors change. Any reduction in estimated future taxable income may require us to record a valuation allowance against our deferred tax assets.
These judgments require us to make projections of future taxable income. The judgments and estimates we make in determining our deferred tax assets are inherently subjective and are reviewed on a regular basis as regulatory or business factors change. Any reduction in estimated future taxable income may require us to record a valuation allowance against our deferred tax assets.
Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services. Ite m 7A. Quantitative and Qualitative Disclosures About Market Risk. The information regarding this Item is contained in Item 7 under the heading “Management of Market Risk.” 49 Ite m 8.
Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services. Ite m 7A. Quantitative and Qualitative Disclosures About Market Risk. The information regarding this Item is contained in Item 7 under the heading “Management of Market Risk.” Ite m 8.
A high level of new loan growth at higher market rates would be required to help offset the delay in the repricing of the current loan portfolio. The model also assumes that the non-maturing deposit portfolio will quickly reprice to a calculated percentage of the increase in market rates. 47 Economic Value of Equity .
A high level of new loan growth at higher market rates would be required to help offset the delay in the repricing of the current loan portfolio. The model also assumes that the non-maturing deposit portfolio will quickly reprice to a calculated percentage of the increase in market rates. Economic Value of Equity .
Most of the securities with unrealized losses in the portfolio have modest duration risk, low credit risk, and minimal unrealized losses when compared to total amortized cost. The unrealized losses on debt securities that exist are the result of market changes in interest rates since original purchase and are not related to credit concerns.
Most of the securities with unrealized losses in the portfolio have modest duration risk, low credit risk, and minimal unrealized losses when compared to total amortized cost. The unrealized losses on debt securities that exist are the result of changes in interest rates since original purchase and are not related to credit concerns.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
The Company is a registered bank holding company subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”). The Company conducts its operations primarily through its wholly owned subsidiary, the Bank, a Maryland-chartered commercial bank.
The Company is a registered bank holding company subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”). The Company conducts its operations primarily through its wholly owned subsidiary, the BayVanguard Bank (the "Bank"), a Maryland-chartered commercial bank.
We believe in the need to make significant technological investments and the importance of scale in banking. 37 • Grow our loan portfolio with an emphasis on commercial real estate and residential mortgage lending .
We believe in the need to make significant technological investments and the importance of scale in banking. • Grow our loan portfolio with an emphasis on commercial real estate and residential mortgage lending .
A basis point equals one-hundredth of one percent, and 100 basis points equals one percent. An increase in interest rates from 3% to 4% would mean, for example, a 100 basis point increase in the “Change in Interest Rates” column below.
A basis point equals 47 one-hundredth of one percent, and 100 basis points equals one percent. An increase in interest rates from 3% to 4% would mean, for example, a 100 basis point increase in the “Change in Interest Rates” column below.
Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards. The following represent our critical accounting policies: Allowance for Credit Losses .
Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards. The following represent our critical accounting policies: 39 Allowance for Credit Losses .
During the three months ended December 31, 2023, none of BV Financial’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as that term is used in Securities and Exchange Commission regulations.
During the three months ended December 31, 2024, none of BV Financial’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as that term is used in Securities and Exchange Commission regulations.
As of December 31, 2023, we have recognized no credit losses on AFS securities. For HTM debt securities, an allowance will be recognized when lifetime credit losses are expected, in an amount that reflects the expected contractual credit losses, even when the risk of such loss is remote. Any security, either explicitly or implicitly guaranteed by the U.S.
As of December 31, 2024, we have recognized no credit losses on AFS securities. For HTM debt securities, an allowance will be recognized when lifetime credit losses are expected, in an amount that reflects the expected contractual credit losses, even when the risk of such loss is remote. Any security, either explicitly or implicitly guaranteed by the U.S.
At December 31, 2023, BayVanguard Bank exceeded all of its regulatory capital requirements, and was categorized as well capitalized at December 31, 2023. Management is not aware of any conditions or events since the most recent notification that would change our category. Off-Balance Sheet Arrangements and Aggregate Contractual Obligations Commitments.
At December 31, 2024, BayVanguard Bank exceeded all of its regulatory capital requirements, and was categorized as well capitalized at December 31, 2024. Management is not aware of any conditions or events since the most recent notification that would change our category. Off-Balance Sheet Arrangements and Aggregate Contractual Obligations Commitments.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America .
The Company recognized compensation expense related to these plans of $ 185,000 and $ 182,000 during the years ended December 31, 2023 and December 31, 2022, respectively. Accounting standards require the recognition of a liability and related compensation costs for endorsement split-dollar life insurance policies that provide a benefit to an employee that extends to post-retirement periods.
The Company recognized compensation expense related to these plans of $ 185,000 and $ 182,000 during the years ended December 31, 2024 and December 31, 2023, respectively. Accounting standards require the recognition of a liability and related compensation costs for endorsement split-dollar life insurance policies that provide a benefit to an employee that extends to post-retirement periods.
The Bank's deposits are insured up to the applicable legal limits by the Federal Deposit Insurance Corporation's Deposit Insurance Fund. BayVanguard Bank is a member of the Federal Home Loan Bank System. Principles of Consolidation The consolidated financial statements include the accounts of the Company and the Bank. All intercompany balances and transactions have been eliminated in consolidation.
The Bank's deposits are insured up to the applicable legal limits by the Federal Deposit Insurance Corporation's Deposit Insurance Fund. BayVanguard Bank is a member of the Federal Home Loan Bank System. Principles of Consolidation The consolidated financial statements include the accounts of the Company, the Bank and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Recent Accounting Pronouncements Please refer to Note 1 to the consolidated financial statements of BV Financial for the years ended December 31, 2023 and 2022 included with this document for a description of recent accounting pronouncements that may affect our financial condition and results of operations.
Recent Accounting Pronouncements Please refer to Note 1 to the consolidated financial statements of BV Financial for the years ended December 31, 2024 and 2023 included with this document for a description of recent accounting pronouncements that may affect our financial condition and results of operations.
(2) Represents the net interest income as a percentage of average interest-earning assets. (3) Represents non-interest expenses divided by the sum of net interest income and non-interest income. (4) BayVanguard Bank only. Comparison of Financial Condition at December 31, 2023 and December 31, 2022 Total Assets .
(2) Represents the net interest income as a percentage of average interest-earning assets. (3) Represents non-interest expenses divided by the sum of net interest income and non-interest income. (4) BayVanguard Bank only. Comparison of Financial Condition at December 31, 2024 and December 31, 2023 Total Assets .
Retained earnings at December 31, 2023 and December 31, 2022 included $ 1.5 million for which no provision for income tax has been provided. The unrecorded deferred income tax liability on the above amount was approximately $ 413,000 .
Retained earnings at December 31, 2024 and December 31, 2023 included $ 1.5 million for which no provision for income tax has been provided. The unrecorded deferred income tax liability on the above amount was approximately $ 413,000 .
Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately. F- 12 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements Note 1 – Summary Of Significant Accounting Policies (Continued) Investment in Life Insurance Investment in life insurance is reflected at the net cash surrender value to the Company.
Lease agreements that include lease and non-lease components, such as common area maintenance charges, are accounted for separately. 62 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements Note 1 – Summary Of Significant Accounting Policies (Continued) Investment in Life Insurance Investment in life insurance is reflected at the net cash surrender value to the Company.
As of the years ended December 31, 2023, and 2022, there were no unvested restricted stock or performance stock unit awards which were excluded from the calculation as their effect would be anti-dilutive.
As of the years ended December 31, 2024, and 2023, there were no unvested restricted stock or performance stock unit awards which were excluded from the calculation as their effect would be anti-dilutive.
The table below sets forth, as of December 31, 2023, the calculation of the estimated changes in our net interest income that would result from the designated immediate changes in the United States Treasury yield curve.
The table below sets forth, as of December 31, 2024, the calculation of the estimated changes in our net interest income that would result from the designated immediate changes in the United States Treasury yield curve.
The Federal Deposit Insurance Corporation (the "FDIC") and the Maryland Office of the Commissioner of Financial Regulation, as an integral part of their examination process, periodically review the allowance for credit losses for reasonableness and, as a result of such reviews, we may be required to increase our ACL or recognize loan charge-offs.
The Federal Deposit Insurance Corporation (the "FDIC") and the Maryland Office of the Commissioner of Financial Regulation, as an integral part of their examination process, periodically review the ACL for reasonableness and, as a result of such reviews, we may be required to increase our ACL or recognize loan charge-offs.
Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific F- 41 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements capital guidelines that involve quantitative measures of the Bank's assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices.
Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities, and certain off-balance sheet 85 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements items as calculated under regulatory accounting practices.
Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
The information at and for the years ended December 31, 2023 and 2022 is derived in part from the audited consolidated financial statements that appear elsewhere in this annual report.
The information at and for the years ended December 31, 2024 and 2023 is derived in part from the audited consolidated financial statements that appear elsewhere in this annual report.
The Company does not have the entitlement or ability to repurchase the mortgage loans or unilaterally cause third party investors to put the mortgage loans back to the Company. Foreclosed Real Estate Foreclosed real estate and repossessed assets are composed of property acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure.
The Company does not have the entitlement or ability to repurchase the mortgage loans or unilaterally cause third party investors to put the mortgage loans back to the Company. Other Real estate Owned Other real estate owned and repossessed assets are composed of property acquired through a foreclosure proceeding or acceptance of a deed in lieu of foreclosure.
The primary differentiating factor is that an explicit guarantee is provided by the government therefore substantially mitigating any risk of loss given default in the event of credit deterioration. Guaranteed by the U.S. Government loans in the table above include $ 25 thousand and $ 488 thousand of Paycheck Protection Program (PPP) loans at December 31, 2023 and 2022, respectively.
The primary differentiating factor is that an explicit guarantee is provided by the government therefore substantially mitigating any risk of loss given default in the event of credit deterioration. Guaranteed by the U.S. Government loans in the table above include $ 20 thousand and $ 25 thousand of Paycheck Protection Program ("PPP") loans at December 31, 2024 and 2023, respectively.
Series 2020 Notes 2030 35,000 4.88 % 35,000 4.88 % Easton Capital Trust I 2034 3,093 SOFR+ 2.85 % 3,093 LIBOR+ 2.85 % Total borrowings, gross $ 38,093 $ 50,093 Less: debt issuance costs ( 272 ) ( 427 ) Add: net fair value adjustments on acquired borrowings ( 570 ) ( 627 ) Total borrowings, net $ 37,251 $ 49,039 The Bank has an agreement under a blanket floating lien with the FHLB providing the Bank a line of credit of up to 25 % of its total assets limited to the lendable collateral value of qualified assets the Bank has to pledge to support its borrowings.
Series 2020 Notes 2030 35,000 4.88 % 35,000 4.88 % Easton Capital Trust I 2034 — — % 3,093 SOFR + 2.85 % Total borrowings, gross $ 50,000 $ 38,093 Less: debt issuance costs ( 117 ) ( 272 ) Add: net fair value adjustments on acquired borrowings — ( 570 ) Total borrowings, net $ 49,883 $ 37,251 The Bank has an agreement under a blanket floating lien with the FHLB providing the Bank a line of credit of up to 25 % of its total assets limited to the lendable collateral value of qualified assets the Bank has to pledge to support its borrowings.
An evaluation was performed under the supervision and with the participation of the Company’s management, including the Co-President and Chief Executive Officers and the Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities and Exchange Act of 1934, as amended) as of December 31, 2023.
(a) Evaluation of Disclosure Controls and Procedures An evaluation was performed under the supervision and with the participation of the Company’s management, including the Co-President and Chief Executive Officers and the Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15)e) promulgated under the Securities and Exchange Act of 1934, as amended) as of December 31, 2024.
BV Financial performed its 2023 annual goodwill impairment qualitative assessment and determined BV Financial’s goodwill was not considered impaired. We monitor our performance and evaluate our goodwill for impairment annually or more frequently as needed. Deferred Income Taxes. At December 31, 2023, we had a net deferred tax asset totaling $9.0 million.
BV Financial performed its 2024 annual goodwill impairment qualitative assessment and determined BV Financial’s goodwill was not considered impaired. We monitor our performance and evaluate our goodwill for impairment annually or more frequently as needed. Deferred Income Taxes. At December 31, 2024, we had a net deferred tax asset totaling $8.9 million.
Bank-owned life insurance policies purchased for this purpose do not effectively settle the Company's obligation to the employee in this regard and thus the Company records a benefit cost and a related liability. As of December 31, 2023 and December 31, 2022, the Company has recorded a liability of $ 275,000 and $ 292,000 , respectively, for this benefit.
Bank-owned life insurance policies purchased for this purpose do not effectively settle the Company's obligation to the employee in this regard and thus the Company records a benefit cost and a related liability. As of December 31, 2024 and December 31, 2023, the Company has recorded a liability of $ 262,000 and $ 275,000 , respectively, for this benefit.
Accrued interest receivable on the HTM debt securities excluded from this analysis totaled $ 42,000 at December 31, 2023.
Accrued interest receivable on the HTM debt securities excluded from this analysis totaled $ 42,000 at December 31, 2024.
As of December 31, 2023 and December 31, 2022, the Company had 55,648 and 55,648 shares, resp ectively of unexercised stock options. Options with an exercise price greater than the average market price of the common shares are excluded from the calculation as their effect would be anti-dilutive.
As of December 31, 2024 and December 31, 2023, the Company had 933,033 and 55,648 shares, resp ectively of unexercised stock options. Options with an exercise price greater than the average market price of the common shares are excluded from the calculation as their effect would be anti-dilutive.
In particular, non-interest-bearing demand deposits were 22.4% of our total deposits at December 31, 2023. We continue to focus on expanding core deposits by leveraging our business development officers and commercial lending and retail relationships. We intend to continue to pursue these business strategies, subject to changes necessitated by future market conditions, regulatory restrictions and other factors.
In particular, non-interest-bearing demand deposits were 19.9% of our total deposits at December 31, 2024. We continue to focus on expanding core deposits by leveraging our business development officers and commercial lending and retail relationships. We intend to continue to pursue these business strategies, subject to changes necessitated by future market conditions, regulatory restrictions and other factors.
The AFS portfolio holds 95%, or $35.8 million of its portfolio in securities issued by Government Sponsored Enterprises ("GSE") backed by the full faith and credit of the United States Government. The remainder of the portfolio consists of bonds issued by bank holding companies.
The AFS portfolio holds 96%, or $35.7 million of its portfolio in securities issued by Government Sponsored Enterprises ("GSE") backed by the full faith and credit of the United States Government. The remainder of the portfolio consists of bonds issued by bank holding companies.
The following table presents share information held by the ESOP: (amounts in thousands, except fair value of unallocated shares) 2023 2022 Allocated shares — — Shares committed to be released 39,196 — Unallocated shares (suspense shares) 744,722 — Total shares 783,918 — Fair value of unallocated shares $ 10,560,158 $ — Note 11 – Regulatory Matters The Bank is subject to various regulatory capital requirements administered by the federal banking agencies.
The following table presents share information held by the ESOP: (amounts in thousands, except fair value of unallocated shares) 2024 2023 Allocated shares 39,196 — Shares committed to be released 39,196 39,196 Unallocated shares (suspense shares) 705,526 744,722 Total shares 783,918 783,918 Fair value of unallocated shares $ 12,149,158 $ 10,560,158 Note 10 – Regulatory Matters The Bank is subject to various regulatory capital requirements administered by the federal banking agencies.
Additionally, at December 31, 2023 and December 31, 2022, the Bank had a $ 20.0 million unsecured demand line of credit facility with a correspondent bank, which had no outstanding balance. BV Financial Inc. issued $ 35.0 million in Fixed-to-Floating Rate Subordinated Notes Due 2030 on October 21, 2020.
Additionally, at December 31, 2024 and December 31, 2023, the Bank had a $ 20.0 million unsecured demand line of credit facility with a correspondent bank, which had no outstanding balance. The Company issued $ 35.0 million in Fixed-to-Floating Rate Subordinated Notes Due 2030 on October 21, 2020.
Additionally, at December 31, 2023 and December 31, 2022, the Bank had unfunded letters of credit used to secure municipal deposits outstanding against the FHLB line of credit of $ 25.0 million and $ 40.0 million, respectively.
Additionally, at December 31, 2024 and December 31, 2023, the Bank had unfunded letters of credit used to secure municipal deposits outstanding against the FHLB line of credit of $ 23.0 million and $ 25.0 million, respectively.
As a result of the second step conversion, previously outstanding shares have been adjusted to reflect the 1.5309 exchange ratio. Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued.
As a result of the second step conversion, outstanding shares prior to July 31, 2023 have been adjusted to reflect the 1.5309 exchange ratio. Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued.
Net cash provided by (used in) financing activities, consisting primarily of changes in deposits and advances and the repayment of advances to the Federal Home Loan Bank, was $25.1 million and $(24.5) million for the years ended December 31, 2023 and 2022, respectively. We are committed to maintaining a strong liquidity position.
Net cash provided by (used in) financing activities, consisting primarily of changes in deposits and advances and the repayment of advances to the Federal Home Loan Bank, was $13.2 million and $25.1 million for the years ended December 31, 2024 and 2023, respectively. 49 We are committed to maintaining a strong liquidity position.
Our non-maturing deposits remain at historical low rates and with the level of rate decreases presented, the rates paid on these deposits could not be lowered very much. 6. Our certificate of deposit liabilities will take time to reprice to lower market rates.
Our non-maturing deposits remain at historical low rates and with the level of rate decreases presented, the rates paid on these deposits could not be lowered by a similar amount. 6. Our certificate of deposit liabilities will take time to reprice to lower market rates.
We monitor our liquidity position on a daily basis. We anticipate that we will have sufficient funds to meet our current funding commitments. Time deposits that are scheduled to mature in less than one year from December 31, 2023 totaled $111.4 million.
We monitor our liquidity position on a daily basis. We anticipate that we will have sufficient funds to meet our current funding commitments. Time deposits that are scheduled to mature in less than one year from December 31, 2024 totaled $107.5 million.
We monitor the credit quality of held-to-maturity ("HTM") debt securities through both internal analysis performed on a quarterly basis and credit ratings when available. The following table reflects the credit ratings for the HTM debt securities at December 31, 2023.
We monitor the credit quality of HTM debt securities through both internal analysis performed on a quarterly basis and credit ratings when available. The following table reflects the credit ratings for the HTM debt securities at December 31, 2024.
The Bank is required to maintain qualified mortgage loans as collateral for its FHLB advances and letters of credit in an amount equal to 100% of the outstanding advances. As of December 31, 2023 and December 31, 2022, the Bank pledged $ 175.0 million and $ 148.9 million of gross loans to the FHLB for advances, respectively.
The Bank is required to maintain qualified mortgage loans as collateral for its FHLB advances and letters of credit in an amount equal to 100% of the outstanding advances. As of December 31, 2024 and December 31, 2023, the Bank pledged $ 157.6 million and $ 175.0 million of gross loans to the FHLB for advances, respectively.
Level 2: Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported with little or no market activity).
Level 2: Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability. 91 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported with little or no market activity).
Amount Year ending December 31, (dollars in thousands) 2024 $ 168 2025 173 2026 178 2027 183 2028 189 Thereafter 813 Total $ 1,704 Note 15 – Contingencies Various legal claims arise from time to time in the normal course of business, which, in the opinion of management, after consultation with legal counsel, will have no material effect on the Company's consolidated financial position or results of operations.
Amount Year ending December 31, (dollars in thousands) 2025 $ 173 2026 178 2027 183 2028 189 2029 194 Thereafter 619 Total $ 1,536 Note 14 – Contingencies Various legal claims arise from time to time in the normal course of business, which, in the opinion of management, after consultation with legal counsel, will have no material effect on the Company's consolidated financial position or results of operations.
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 extend credit of $49.4 million and $935,000 of letters of credit. See Note 4 to the consolidated financial statements for further information. Contractual Obligations.
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 extend credit of $51.3 million and $592,000 of letters of credit. See Note 4 to the consolidated financial statements for further information. Contractual Obligations.
Each outstanding share of Company common stock owned by the existing public stockholders of the Company were converted into new shares of Company common stock based on an exchange ratio of 1.5309 -to-1. The Company had 11,375,803 shares of Company common stock outstanding as a result of the stock offering and Conversion.
Each outstanding share of Company common stock owned by the existing public stockholders of the Company were converted into new shares of Company common stock based on an exchange ratio of 1.5309 -to-1. The Company had 11,375,803 shares of Company common stock outstanding following the Conversion.
Under the agreements, each director will receive a stated annual benefit in monthly installments for ten years following his or her separation from service after attaining a normal retirement age of 70.
The Company has supplemental retirement agreements with certain directors. Under the agreements, each director will receive a stated annual benefit in monthly installments for ten years following his or her separation from service after attaining a normal retirement age of 70.
For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. There were no out-of-period items or adjustments required to be excluded from the table below.
The total column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due 44 to rate and the changes due to volume. There were no out-of-period items or adjustments required to be excluded from the table below.
Interest paid on interest-bearing deposits increased by $4.3 million or 313.7% for the year ended December 31, 2023 compared to the year ended December 31, 2022. The impact of higher rates paid offset a lower average balance on these deposits.
Interest paid on interest-bearing deposits increased by $3.4 million or 61.1% for the year ended December 31, 2024 compared to the year ended December 31, 2023. The impact of higher rates paid offset a lower average balance on these deposits.
The accrued liabilities for the executive retirement agreements were $ 2.3 million and $ 2.3 million and for the director retirement agreements were $ 225,000 and $ 256,000 at December 31, 2023 and December 31, 2022, respectively.
The accrued liabilities for the executive retirement agreements were $ 2.2 million and $ 2.3 million and for the director retirement agreements were $ 194,000 and $ 225,000 at December 31, 2024 and December 31, 2023, respectively.
Any gain or loss is recorded in noninterest income. There were no mortgage loans held for sale as of December 31, 2023 and 2022. The Company occasionally sells its mortgage loans on a best effort basis to third-party investors on a servicing released basis.
Sales of loans are recorded when the proceeds are received. Any gain or loss is recorded in noninterest income. There were no mortgage loans held for sale as of December 31, 2024 or 2023. The Company occasionally sells its mortgage loans on a best effort basis to third-party investors on a servicing released basis.
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. 2. Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. 3.
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. 2. Netinterest-earning assets represent total interest-earning assets less total interest-bearing liabilities. 3. Net interest marghin represents net interest income divided by average total interest-earning assets.
Potential common shares that may have been issued by the Company related to outstanding unvested restricted stock unit and performance stock unit awards were determined using the treasury stock method and included in the calculation of dilutive common stock equivalents. The Company has not granted any stock options since 2017.
Potential common shares that may have been issued by the Company related to outstanding unvested restricted stock unit and performance stock unit awards were determined using the treasury stock method and included in the calculation of dilutive common stock equivalents.
In February 2019, the Company became a Maryland-chartered corporation and a bank holding company. Prior to consummation of its mutual to stock conversion in July 2023, BayVanguard, M.H.C., Inc. (the “MHC”) was the Maryland-chartered mutual holding company of the Company. The MHC’s only business was the ownership of 86.3 % of the outstanding common stock of the Company.
Prior to consummation of its mutual to stock conversion in July 2023, BayVanguard, M.H.C., Inc. (the “MHC”) was the Maryland-chartered mutual holding company of the Company. The MHC’s only business was the ownership of 86.3 % of the outstanding common stock of the Company.
Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits.
Our responsibility is to express an opinion on the Company’s financial statements based on our audit.
Net deferred loan fees totaled $1.8 million and $1.5 million for the years ended December 31, 2023 and 2022, respectively.
Net deferred loan fees totaled $2.2 million and $1.8 million for the years ended December 31, 2024 and 2023, respectively.
Basic and diluted earnings per share have been computed based on weighted-average common and common equivalent shares outstanding as follows: December 31, 2023 December 31, 2022 Basic Diluted Basic Diluted (dollars in thousands, except per share data) Net income $ 13,707 $ 13,707 $ 10,524 $ 10,524 Weighted average common shares outstanding 9,303 9,303 7,950 7,950 Dilutive securities stock options — 38 — 22 Adjusted weighted average shares outstanding 9,303 9,341 7,950 7,972 Earnings per share amount $ 1.47 $ 1.47 $ 1.32 $ 1.32 Stock Based Compensation The Company accounts for stock-based compensation under the fair value method of accounting.
Basic and diluted earnings per share have been computed based on weighted-average common and common equivalent shares outstanding as follows: December 31, 2024 December 31, 2023 Basic Diluted Basic Diluted (dollars in thousands, except per share data) Net income $ 11,723 $ 11,723 $ 13,707 $ 13,707 Weighted average common shares outstanding 10,679 10,679 9,303 9,303 Dilutive securities stock options — 31 — 38 Adjusted weighted average shares outstanding 10,679 10,710 9,303 9,341 Earnings per share amount $ 1.10 $ 1.09 $ 1.47 $ 1.47 Stock Based Compensation The Company accounts for stock-based compensation under the fair value method of accounting.
The Bank held approximately $ 626,000 and $ 976,600 of FHLB restricted stock at December 31, 2023 and December 31, 2022, respectively. The restricted stock is carried at cost. Management evaluates whether this investment is impaired based on their assessment of the ultimate recoverability of the investment rather than by recognizing temporary declines in value.
The Bank held approximately $ 1.4 million and $ 626,000 of FHLB restricted stock at December 31, 2024 and December 31, 2023, respectively. The restricted stock is carried at cost. Management evaluates whether this investment is impaired based on its assessment of the ultimate recoverability of the investment rather than by recognizing temporary declines in value.
We have implemented the following strategies to manage our interest rate risk: 1. growing our volume of core deposit accounts; 2. holding higher levels of cash and cash equivalents; 3. continuing the diversification of our loan portfolio by adding more commercial-related loans, which typically have variable rates and shorter maturities; and 4. purchasing short-term and adjustable rate securities. 46 By following these strategies, we believe that we are better positioned to react to increases and decreases in market interest rates.
We have implemented the following strategies to manage our interest rate risk: 1. growing our volume of core deposit accounts; 2. holding higher levels of cash and cash equivalents; 3. continuing the diversification of our loan portfolio by adding more commercial-related loans, which typically have variable rates and shorter maturities; and 4. purchasing short-term and adjustable rate securities.
The following table shows the operating lease right of use assets and operating lease liabilities as of December 31, 2023 and 2022: Consolidated Balance Sheet classification December 31, 2023 December 31, 2022 (dollars in thousands) Operating lease right of use asset Other assets $ 1,128 $ 617 Operating lease liabilities Other liabilities $ 1,162 $ 645 Other information related to leases: Weighted average remaining lease term of operating leases 5.5 years 3.9 years Weighted average discount rate of operating leases 4.26 % 3.74 % Cash paid for amounts included in the measurement of lease liabilities $ 197,000 $ 220,000 Operating lease costs included in occupancy expense in the Consolidated Statement of Income for the years ended December 31, 2023 and December 31, 2022 were $ 259,000 and $ 273,000 , respectively.
The following table shows the operating lease right of use assets and operating lease liabilities as of December 31, 2024 and 2023: Consolidated Balance Sheet classification December 31, 2024 December 31, 2023 (dollars in thousands) Operating lease right of use asset Other assets $ 926 $ 1,128 Operating lease liabilities Other liabilities $ 967 $ 1,162 Other information related to leases: Weighted average remaining lease term of operating leases 4.7 years 5.5 years Weighted average discount rate of operating leases 4.40 % 4.26 % Cash paid for amounts included in the measurement of lease liabilities $ 231,000 $ 197,000 Operating lease costs included in occupancy expense in the Consolidated Statement of Income for the years ended December 31, 2024 and December 31, 2023 were $ 302,000 and $ 259,000 , respectively.
Changes in the balance of foreclosed real estate and repossessed assets during the years ended December 31, 2023 and December 31, 2022, were as follows: December 31, 2023 December 31, 2022 (dollars in thousands) Beginning of period balance $ 1,987 $ 1,987 Improvements and additions 57 — Proceeds from sale ( 2,583 ) — Gain (loss) on sale 709 — End of period balance $ 170 $ 1,987 At December 31, 2023 and December 31, 2022, the Company had $ 174,000 and $ 114,000 in residential mortgages in the process of foreclosure.
Changes in the balance of other real estate owned assets during the years ended December 31, 2024 and December 31, 2023, were as follows: December 31, 2024 December 31, 2023 (dollars in thousands) Beginning of period balance $ 170 $ 1,987 Improvements and additions — 57 Proceeds from sale — ( 2,583 ) Principal payments ( 11 ) — Gain (loss) on sale — 709 End of period balance $ 159 $ 170 At December 31, 2024 and December 31, 2023, the Company had $ 84,000 and $ 174,000 in residential mortgages in the process of foreclosure.
Non-interest bearing deposits decreased in the year as customers took advantage of higher market interest rates to redeploy their excess cash into interest-bearing products. Interest expense on advances from the FHLB increased by $1.4 million in the year from a de minimus amount in the previous year as the Bank had advances outstanding for the majority of the year.
Non-interest bearing deposits decreased in the year as customers took advantage of higher market interest rates to redeploy their excess cash into interest-bearing products. Interest expense on advances from the FHLB decreased by $1.4 million for the year ended December 31, 2024 as the Bank had a no advances outstanding for the majority of the year.
The held-to-maturity ("HTM") portfolio consists of $7.0 million in securities issued by GSEs and $1.7 million in securities issued by bank holding companies. At December 31, 2023 and 2022, the securities in the HTM portfolio not issued by a GSE has an allowance for credit loss of $6,000 and $0, respectively.
The held-to-maturity ("HTM") portfolio consists of $2.8 million in securities issued by GSEs and $3.2 million in securities issued by bank holding companies. At December 31, 2024 and 2023, the securities in the HTM portfolio not issued by a GSE has an allowance for credit loss of $4,000 and $6,000, respectively.
Net interest margin represents net interest income divided by average total interest-earning assets. 43 Rate/Volume Analysis The following table presents the effects of changing rates and volumes on our net interest income for the years indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume).
Rate/Volume Analysis The following table presents the effects of changing rates and volumes on our net interest income for the years indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate).
Our total non-performing loans to total loans ratio was 1.50% at December 31, 2023. • Increase core deposits with an emphasis on non-interest-bearing deposits. Deposits are our primary source of funds for lending and investment. Core deposits (which we define as all deposits except for time deposits) were 72.6% of total deposits at December 31, 2023.
Our total non-performing loans to total loans ratio was 0.54% at December 31, 2024. • Increase core deposits with an emphasis on non-interest-bearing deposits. Deposits are our primary source of funds for lending and investment. Core deposits (which we define as all deposits except for time deposits) were 70.8% of total deposits at December 31, 2024.
Note 10 – Employee Benefit Plans Stock Options On December 14, 2017, the Company granted 79,607 stock options to officers and employees of the Company of which 55,648 and 36,350 were exercisable at December 31, 2023 and December 31, 2022, respectively.
Note 9 – Employee Benefit Plans Stock Options On December 14, 2017, the Company granted 79,607 stock options to officers and employees of the Company of which 54,117 and 55,648 were exercisable at December 31, 2024 and December 31, 2023, respectively.
The options were granted with an exercise price at the then fair market value of the stock of $ 5.65 , scheduled to vest over five years and expire ten years from the date of grant.
The options were granted with an exercise price at the then fair market value of the stock of $ 5.65 , scheduled to vest over five years and expire ten years from the date of grant. On September 6, 2024, the Company granted 293,968 stock options to directors of the Company.
The Company entered into an operating lease agreement with a related party and paid $ 20,000 in lease payments in the year ended December 31, 2023. The following table shows the future operating lease payments due by year.
The Company has an operating lease agreement with a related party and paid $ 48,000 in lease payments in the year ended December 31, 2024. The following table shows the future operating lease payments due by year.
F- 35 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements The activity in core deposit intangible assets related to the mergers for the years ended December 31, 2023 and ended December 31, 2022 is as follows: December 31, 2023 December 31, 2022 (dollars in thousands) Net carrying amount at beginning of period $ 1,195 $ 1,293 Core deposit intangible from the mergers — 85 Amortization ( 183 ) ( 183 ) Net carrying amount at end of the period $ 1,012 $ 1,195 At December 31, 2023 future estimated annual amortization expense is as follows: Year ending (in thousands) 2024 $ 180 2025 180 2026 180 2027 180 2028 180 Thereafter 112 Total Estimated Amortization Expense $ 1,012 Goodwill and other intangible assets are presented in the tables below.
Note 5 – Goodwill and Intangible Assets The activity in core deposit intangible assets for the years ended December 31, 2024 and ended December 31, 2023 is as follows: December 31, 2024 December 31, 2023 (dollars in thousands) Net carrying amount at beginning of period $ 1,012 $ 1,195 Amortization ( 181 ) ( 183 ) Net carrying amount at end of the period $ 831 $ 1,012 79 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements At December 31, 2024 future estimated annual amortization expense is as follows: Year ending (in thousands) 2025 $ 180 2026 180 2027 180 2028 180 2029 72 Thereafter 39 Total Estimated Amortization Expense $ 831 Goodwill and other intangible assets are presented in the tables below.
Amount Year ending December 31, (dollars in thousands) 2024 $ 48 2025 50 2026 51 2027 53 2028 55 Thereafter 271 Total $ 528 Note 14 – Leasing Arrangements The Company leases real estate properties for a portion of its network of bank branches. All of the Company’s leases are currently classified as operating.
Amount Year ending December 31, (dollars in thousands) 2025 $ 50 2026 51 2027 53 2028 54 2029 56 Thereafter 215 Total $ 479 Note 13 – Leasing Arrangements The Company leases real estate properties for a portion of its network of bank branches. All of the Company’s leases are currently classified as operating.
The increase was due primarily to a $4.3 million increase in net interest income, and a $1.0 million decrease in the provision for credit losses partially offset by a decrease of $1.9 million in noninterest income. Business Strategy We have focused primarily on continuing and enhancing our community-oriented retail banking strategy.
The decrease was due primarily to an increase of $2.1 million in noninterest expense and a $1.2 million decrease in noninterest income, partially offset by a $1.0 million increase in net interest income. Business Strategy We have focused primarily on continuing and enhancing our community-oriented retail banking strategy.
The PPP loans are 100 % guaranteed by the Small Business Administration (SBA). Due to the guarantee from the Federal government and nature of the PPP initiative, there is no allowance for credit losses recorded for PPP loans. Commercial – Commercial loans are secured or unsecured loans for business purposes.
The PPP loans are 100 % guaranteed by the Small Business Administration (SBA). Due to the guarantee from the Federal government, there is no allowance for credit losses recorded for these loans. Commercial – Commercial loans are secured or unsecured loans for business purposes. Loans are typically secured by accounts receivable, inventory, equipment and/or other assets of the business.
Note 12– Income Taxes The income tax provision consisted of the following for the years ended December 31, 2023 and December 31, 2022: December 31, 2023 December 31, 2022 (dollars in thousands) Current expense Federal $ 3,185 $ 2,466 State 1,523 1,255 Total Current Expense 4,708 3,721 Deferred expense 207 308 Income tax expense $ 4,915 $ 4,029 F- 44 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements Note 12– Income Taxes (Continued ) The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and December 31, 2022 are presented below: December 31, 2023 December 31, 2022 (dollars in thousands) Deferred tax assets Deferred compensation $ 689 $ 715 Allowance for credit losses 2,425 1,061 Merger fair value adjustments 1,587 2,497 Goodwill impairment — — Foreclosed real estate write-downs and deferred gain 7 273 Stock grants 78 — Net operating loss carryover 6,556 7,011 Non-accrual interest 260 66 Other 1,377 1,526 Total deferred tax assets 12,979 13,149 Deferred tax liabilities Prepaid expenses 220 145 Core deposit intangible 278 329 Depreciation 3,512 3,562 Total deferred tax liabilities 4,010 4,036 Total deferred tax assets, net $ 8,969 $ 9,113 The amount computed by applying the statutory federal income tax rate to income before income tax provision is different than the taxes provided for the following reasons: December 31, 2023 December 31, 2022 Percent of Percent of Amount pretax income Amount pretax income (dollars in thousands) Statutory federal income tax rate $ 3,909 21.0 % $ 3,262 22.4 % State tax, net of federal income tax provision 1,261 6.8 1,018 7.0 Tax exempt income ( 142 ) ( 0.8 ) ( 787 ) ( 5.4 ) Nondeductible merger expenses ( 3 ) 0.0 373 2.6 Other ( 110 ) ( 0.6 ) 163 1.1 Income Tax Expense $ 4,915 26.4 % $ 4,029 27.7 % Note 13 – Related-Party Transactions The Bank has had, and may be expected to have in the future, banking transactions in the ordinary course of business with directors, officers, their immediate families and affiliated companies (commonly referred to as related parties), on the same terms including interest rates and collateral, as those prevailing at the time for comparable transactions with others.
Note 11– Income Taxes The income tax provision consisted of the following for the years ended December 31, 2024 and December 31, 2023: December 31, 2024 December 31, 2023 (dollars in thousands) Current expense Federal $ 3,273 $ 3,185 State 1,468 1,523 Total Current Expense 4,741 4,708 Deferred expense ( 58 ) 207 Income tax expense $ 4,683 $ 4,915 88 BV Financial, Inc. and Subsidiaries Notes to Consolidated Financial Statements Note 11– Income Taxes (Continued ) The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2024 and December 31, 2023 are presented below: December 31, 2024 December 31, 2023 (dollars in thousands) Deferred tax assets Deferred compensation $ 660 $ 689 Allowance for credit losses 2,455 2,425 Merger fair value adjustments 1,938 1,587 Goodwill impairment — — Foreclosed real estate write-downs and deferred gain 7 7 Stock grants 294 78 Non-qualified stock options 60 — Net operating loss carryover 6,123 6,556 Non-accrual interest 265 260 Other 1,181 1,377 Total deferred tax assets 12,983 12,979 Deferred tax liabilities Prepaid expenses 176 220 Core deposit intangible 229 278 Depreciation 3,679 3,512 Total deferred tax liabilities 4,084 4,010 Total deferred tax assets, net $ 8,899 $ 8,969 The amount computed by applying the statutory federal income tax rate to income before income tax provision is different than the taxes provided for the following reasons: December 31, 2024 December 31, 2023 Percent of Percent of Amount pretax income Amount pretax income (dollars in thousands) Statutory federal income tax rate $ 3,445 21.0 % $ 3,909 21.0 % State tax, net of federal income tax provision 1,154 7.0 1,261 6.8 Tax exempt income ( 113 ) ( 0.7 ) ( 142 ) ( 0.8 ) Nondeductible expenses 142 0.9 ( 3 ) 0.0 Other 55 0.3 ( 110 ) ( 0.6 ) Income Tax Expense $ 4,683 28.5 % $ 4,915 26.4 % Note 12 – Related-Party Transactions The Bank has had, and may be expected to have in the future, banking transactions in the ordinary course of business with directors, officers, their immediate families and affiliated companies (commonly referred to as related parties), on the same terms including interest rates and collateral, as those prevailing at the time for comparable transactions with others.
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