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What changed in Ponce Financial Group, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Ponce Financial Group, Inc.'s 2024 and 2025 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 2025 report.

+596 added−533 removedSource: 10-K (2026-03-13) vs 10-K (2025-03-13)

Top changes in Ponce Financial Group, Inc.'s 2025 10-K

596 paragraphs added · 533 removed · 376 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

158 edited+95 added−72 removed100 unchanged
Biggest changeAt December 31, 2024 2023 2022 Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 4,148 18.43 % 14.30 % $ 4,415 16.89 % 17.89 % $ 3,863 11.16 % 22.54 % Owner-occupied 1,784 7.93 % 6.17 % 2,012 7.69 % 7.93 % 1,723 4.98 % 8.84 % Multifamily residential 5,004 22.24 % 29.04 % 4,365 16.69 % 28.65 % 8,021 23.19 % 32.42 % Nonresidential properties 2,697 11.99 % 16.89 % 3,176 12.14 % 17.81 % 2,724 7.87 % 20.19 % Construction and land 7,710 34.26 % 31.79 % 4,807 18.38 % 26.22 % 2,683 7.76 % 12.13 % Total mortgage loans 21,343 94.85 % 98.19 % 18,775 71.79 % 98.50 % 19,014 54.96 % 96.12 % Nonmortgage loans: Business 1,113 4.95 % 1.77 % 531 2.03 % 1.03 % 120 0.35 % 2.62 % Consumer 46 0.20 % 0.04 % 6,848 26.18 % 0.47 % 15,458 44.69 % 1.26 % Total nonmortgage loans 1,159 5.15 % 1.81 % 7,379 28.21 % 1.50 % 15,578 45.04 % 3.88 % Total $ 22,502 100.00 % 100.00 % $ 26,154 100.00 % 100.00 % $ 34,592 100.00 % 100.00 % At December 31, 2021 2020 Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 3,540 21.65 % 24.01 % $ 3,850 25.90 % 27.27 % Owner-occupied 1,178 7.20 % 7.33 % 1,260 8.47 % 8.43 % Multifamily residential 5,684 34.76 % 26.34 % 5,214 35.06 % 26.23 % Nonresidential properties 2,165 13.24 % 18.13 % 2,194 14.75 % 18.68 % Construction and land 2,024 12.38 % 10.19 % 1,820 12.24 % 9.03 % Total mortgage loans 14,591 89.23 % 86.00 % 14,338 96.42 % 89.64 % Nonmortgage loans: Business 306 1.87 % 11.38 % 254 1.71 % 8.10 % Consumer 1,455 8.90 % 2.62 % 278 1.87 % 2.26 % Total nonmortgage loans 1,761 10.77 % 14.00 % 532 3.58 % 10.36 % Total $ 16,352 100.00 % 100.00 % $ 14,870 100.00 % 100.00 % At December 31, 2024, ACL represented 0.97% of total gross loans and 97.98% of nonperforming loans compared to 1.36% of total gross loans and 205.52% of nonperforming loans at December 31, 2023.
Biggest changeAt December 31, 2025 2024 2023 Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 2,786 10.95 % 11.70 % $ 4,148 18.43 % 14.30 % $ 4,415 16.89 % 17.89 % Owner-occupied 1,087 4.27 % 4.84 % 1,784 7.93 % 6.17 % 2,012 7.69 % 7.93 % Multifamily residential 9,041 35.54 % 28.83 % 5,004 22.24 % 29.04 % 4,365 16.69 % 28.65 % Nonresidential properties 4,353 17.10 % 20.05 % 2,697 11.99 % 16.89 % 3,176 12.14 % 17.81 % Construction and land 6,149 24.16 % 32.54 % 7,710 34.26 % 31.79 % 4,807 18.38 % 26.22 % Total mortgage loans 23,416 92.02 % 97.96 % 21,343 94.85 % 98.19 % 18,775 71.79 % 98.50 % Nonmortgage loans: Business 2,017 7.92 % 2.02 % 1,113 4.95 % 1.77 % 531 2.03 % 1.03 % Consumer 16 0.06 % 0.02 % 46 0.20 % 0.04 % 6,848 26.18 % 0.47 % Total nonmortgage loans 2,033 7.98 % 2.04 % 1,159 5.15 % 1.81 % 7,379 28.21 % 1.50 % Total $ 25,449 100.00 % 100.00 % $ 22,502 100.00 % 100.00 % $ 26,154 100.00 % 100.00 % At December 31, 2022 2021 Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans Allowance for Credit Losses Percent of Allowance in Each Category to Total Allocated Allowance Percent of Loans in Each Category to Total Loans (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 3,863 11.16 % 22.54 % $ 3,540 21.65 % 24.01 % Owner-occupied 1,723 4.98 % 8.84 % 1,178 7.20 % 7.33 % Multifamily residential 8,021 23.19 % 32.42 % 5,684 34.76 % 26.34 % Nonresidential properties 2,724 7.87 % 20.19 % 2,165 13.24 % 18.13 % Construction and land 2,683 7.76 % 12.13 % 2,024 12.38 % 10.19 % Total mortgage loans 19,014 54.96 % 96.12 % 14,591 89.23 % 86.00 % Nonmortgage loans: Business 120 0.35 % 2.62 % 306 1.87 % 11.38 % Consumer 15,458 44.69 % 1.26 % 1,455 8.90 % 2.62 % Total nonmortgage loans 15,578 45.04 % 3.88 % 1,761 10.77 % 14.00 % Total $ 34,592 100.00 % 100.00 % $ 16,352 100.00 % 100.00 % At December 31, 2025, ACL represented 0.97% of total gross loans and 94.74% of nonperforming loans compared to 0.97% of total gross loans and 97.98% of nonperforming loans at December 31, 2024.
The Bank’s typical construction loan has a term of up to 36 months and contains: • an approximate 50% of the loan value down payment by the borrower; • a minimum of 5% contingency; • a minimum of 5% retainage; • a loan-to-cost ratio of 70% or less; • a loan-to-value ratio of 65% or less; • an interest reserve; • guarantees of all owners / partners / shareholders of a closely held organization owning 20% or more of company stock or entity ownership; • a conditional option to convert to a permanent mortgage loan upon completion of the project, at which time the interest rate is generally adjusted based on the five-year FHLBNY rates plus 300 basis points for loans without cash out to the borrower; and • debt service coverage using projected rental net income must be at least 1.2x the estimated debt service when operating at stabilized levels.
The Bank’s typical construction loan has a term of up to 36 months and contains: • an approximate 50% of the loan value down payment by the borrower; • a minimum of 5% contingency; • a minimum of 5% retainage; • a loan-to-cost ratio of 70% or less; • a loan-to-stabilized-value ratio of 65% or less; • an interest reserve; • guarantees of all owners / partners / shareholders of a closely held organization owning 20% or more of company stock or entity ownership; • a conditional option to convert to a permanent mortgage loan upon completion of the project, at which time the interest rate is generally adjusted based on the five-year FHLBNY rates plus 300 basis points for loans without cash out to the borrower; and • debt service coverage using projected rental net income must be at least 1.2x the estimated debt service when operating at stabilized levels.
The federal system of regulation and supervision establishes a comprehensive framework of activities in which the Bank is engaging and is intended primarily for the protection of depositors and the FDIC’s Deposit Insurance Fund. The Bank is regulated to a lesser extent by the Federal Reserve Board which governs the reserves to be maintained against deposits and other matters.
The federal system of regulation and supervision establishes a comprehensive framework for activities in which the Bank is engaging and is intended primarily for the protection of depositors and the FDIC’s Deposit Insurance Fund. The Bank is regulated to a lesser extent by the Federal Reserve Board which governs the reserves to be maintained against deposits and other matters.
Capital. The Dodd-Frank Act required the Federal Reserve Board to establish minimum consolidated capital requirements that are as stringent as those required for the insured depository subsidiaries.
The Dodd-Frank Act required the Federal Reserve Board to establish minimum consolidated capital requirements that are as stringent as those required for the insured depository subsidiaries.
These qualitative risk factors include: (1) changes in lending policies, procedures and strategies including changes in underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses; (2) economic conditions such as the Bank’s market area, customer demographics, portfolio composition, along with national indicators considered impactful to the model; (3) changes in the nature and volume of the portfolio; (4) credit and lending staff/administration; (5) changes with loan trends; (6) concentrations; (7) loan review results; (8) collateral values and (9) regulatory and business environment.
These qualitative risk factors include: (1) changes in lending policies, procedures and strategies including changes in underwriting standards and collection, charge-off, and recovery practices not considered elsewhere in estimating credit losses; (2) economic conditions such as the Bank’s market area, customer demographics, portfolio composition, along with national indicators considered impactful to the model; (3) changes in the nature and volume of the portfolio; (4) credit and lending staff/administration quality; (5) changes in loan trends; (6) portfolio concentrations; (7) loan review results; (8) collateral values and (9) regulatory and business environment.
Management’s criteria for determining an appropriate segmentation (1) groups loans based on similar risk characteristics; (2) allows for mapping and utilization/application of publicly available external information (Call Report Filings); (3) allows for mapping and utilization/application of publicly available external information; (4) federal call code is granular enough to accommodate enough to accommodate a “like-kind” notion, yet broad enough to maintain statistical relevance and/or a meaningful number of loan observations within material segments and (5) federal call code designation is identifiable throughout historical data sets, which is critical component of segmentation selection.
Management’s criteria for determining an appropriate segmentation (1) groups loans based on similar risk characteristics; (2) allows for mapping and utilization/application of publicly available external information (Call Report Filings); (3) allows for mapping and utilization/application of publicly available external information; (4) using federal call code is granular enough to accommodate a “like-kind” notion, yet broad enough to maintain statistical relevance and/or a meaningful number of loan observations within material segments and (5) using federal call code designation is identifiable throughout historical data sets, which is critical component of segmentation selection.
Also included in Tier 2 capital is the allowance for credit losses limited to a maximum of 1.25% of risk-weighted assets and, for institutions that have exercised an opt-out election regarding the treatment of Accumulated Other Comprehensive Income (“AOCI”), up to 45% of net unrealized gains on available-for-sale equity securities with readily determinable fair market values.
Also included in Tier 2 capital is the allowance for credit losses limited to a maximum of 1.25% of risk-weighted 22 assets and, for institutions that have exercised an opt-out election regarding the treatment of Accumulated Other Comprehensive Income (“AOCI”), up to 45% of net unrealized gains on available-for-sale equity securities with readily determinable fair market values.
Full or partial charge-offs on collateral-dependent individually analyzed loans are generally recognized when the collateral is deemed to be insufficient to support the carrying value of the loan. According to ASC 326-20-30-9, estimating expected credit losses is highly judgmental and generally will require Ponce Bank to make specific judgments.
Full or partial charge-offs on collateral-dependent individually analyzed loans are generally recognized when the collateral is deemed to be insufficient to support the carrying value of the loan. According to ASC 326-20-30-9, estimating expected credit losses is highly judgmental and generally will require the Bank to make specific judgments.
The Bank offers a variety of deposit accounts, including demand, savings, money markets and certificates of deposit accounts. 1 Business Strategy The Company’s goal is to provide long-term value to our stockholders, customers, employees and the communities we serve (collectively our “stakeholders”) by executing a safe and sound business strategy that produces increasing value.
The Bank offers a variety of deposit accounts, including demand, savings, money markets and certificates of deposit accounts. Business Strategy The Company’s goal is to provide long-term value to our stockholders, customers, employees and the communities we serve (collectively our “stakeholders”) by executing a safe and sound business strategy that produces increasing value.
The Company’s common stock is traded on The NASDAQ Stock Market, LLC under the symbol “PDLB.” Ponce Bank Ponce Bank is a federally-chartered stock savings association headquartered in the Bronx, New York. Ponce Bank was originally chartered in 1960 as a federally-chartered mutual savings and loan association under the name Ponce De Leon Federal Savings and Loan Association.
The Company’s common stock is traded on The Nasdaq Stock Market, LLC under the symbol “PDLB.” Ponce Bank Ponce Bank is a national bank headquartered in the Bronx, New York. Ponce Bank was originally chartered in 1960 as a federally-chartered mutual savings and loan association, under the name Ponce De Leon Federal Savings and Loan Association.
The salable programs give the Bank the option to offer FHA, conventional, and non-qualified loans to its consumers. These programs are underwritten specifically to the Government agencies guidelines, such as Freddie Mac, Fannie Mae, Federal Housing Administration/ HUD and the designated investors requirements.
The salable programs give the Bank the option to offer FHA, conventional, and non-qualified loans to its consumers. These programs are underwritten specifically to the Government agencies guidelines, such as Freddie Mac, Fannie Mae, Federal Housing Administration/ HUD and the designated investors requirements. Multifamily Loans.
Deposit account terms vary, with the primary differences being the minimum balance required, the amount of time the funds must remain on deposit and the interest rate. Interest rates paid, maturity terms, service fees and premature withdrawal penalties are established on a periodic basis.
Deposit account terms vary, with the primary differences being the minimum balance required, the amount of time the funds must remain on deposit and the interest rate. 19 Interest rates paid, maturity terms, service fees and premature withdrawal penalties are established on a periodic basis.
The Bank’s principal lending activity is originating real estate-secured loans, including one-to-four family investor-owned and owner-occupied residential loans, multifamily residential loans, nonresidential property loans, construction and land loans, and commercial and industrial (“C&I”) business loans and consumer loans.
The Bank’s principal lending activity is originating real estate-secured loans, including one-to-four family investor-owned and owner-occupied residential loans, multifamily residential loans, nonresidential property loans, construction and land loans, and commercial and industrial (“C&I”) business loans, SBA loans and consumer loans.
Ponce Bank will make or obtain reasonable and supportable forecasts of expected credit losses. Ponce Bank uses Federal Open Market Committee to obtain various forecasts for unemployment rate, national gross domestic product and the National Consumer Price Index.
The Bank will make or obtain reasonable and supportable forecasts of expected credit losses. The Bank uses Federal Open Market Committee to obtain various forecasts for unemployment rate, national gross domestic product and the National Consumer Price Index.
Ponce Bank has elected to forecast the first four quarters of the credit loss estimate and revert to a long-run average of each considered economic factor as permitted in ASC 326-20-30-9.
The Bank has elected to forecast the first four quarters of the credit loss estimate and revert to a long-run average of each considered economic factor as permitted in ASC 326-20-30-9.
The primary concern in this type of lending is the borrower’s creditworthiness and the viability and cash flow potential of 6 the property. Payments on loans secured by income-producing properties often depend on successful operation and management of the properties.
The primary concern in this type of lending is the borrower’s creditworthiness and the viability and cash flow potential of the property. Payments on loans secured by income-producing properties often depend on successful operation and management of the properties.
In 1985, the Bank changed its name to “Ponce De Leon Federal Savings Bank.” In 1997, the Bank changed its name again to “Ponce De Leon Federal Bank.” In 2017, the Bank adopted its current name. The assets and liabilities of Ponce De Leon Federal Bank were transferred to and assumed by the Bank.
In 1985, the Bank changed its name to “Ponce De Leon Federal Savings Bank.” In 1997, the Bank changed its name again to “Ponce De Leon Federal Bank.” In 2017, the Bank adopted the name Ponce Bank and assets and liabilities of Ponce De Leon Federal Bank were transferred to and assumed by the Bank.
When evaluating the qualifications of the borrower, the Bank considers the financial resources of the borrower, the experience of the underlying principal(s) of the borrower in owning or managing similar properties and the borrower’s payment history with the Bank and other financial institutions.
When evaluating the qualifications of the borrower, the Bank considers the financial resources of the borrower, the experience of the underlying principal(s) of the borrower in owning or managing similar properties and 6 the borrower’s payment history with the Bank and other financial institutions.
As a member of FHLBNY, the Bank is required to purchase stock from the FHLBNY which is carried at cost and classified as restricted equity securities. Securities Portfolio Composition .
As a member of FHLBNY and FRBNY, the Bank is required to purchase stock from the FHLBNY and FRBNY which is carried at cost and classified as restricted equity securities. Securities Portfolio Composition .
Additionally, the Bank has two unsecured lines of credit in the amount of $75.0 million with a correspondent bank, under which there was nothing outstanding at December 31, 2024 and 2023, respectively. The following table sets forth information concerning balances and interest rates on borrowings at the dates and for the periods indicated.
Additionally, the Bank has two unsecured lines of credit in the amount of $75.0 million with a correspondent bank, under which there was nothing outstanding at December 31, 2025 and 2024, respectively. The following table sets forth information concerning balances and interest rates on borrowings at the dates and for the periods indicated.
In addition, the Bank is a member of and owns stock in the FHLBNY, which is one of the 11 regional banks in the Federal Home Loan Bank System.
The Bank is a member of and owns stock in the FRBNY. .In addition, the Bank is a member of and owns stock in the FHLBNY, which is one of the 11 regional banks in the Federal Home Loan Bank System.
The following table sets forth the contractual maturities of the Bank’s total loan portfolio, excluding mortgage loans held for sale, 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.
The following table sets forth the contractual maturities of the Bank’s total loan portfolio, excluding mortgage loans held for sale, at December 31, 2025. Demand loans, loans having no stated repayment schedule or maturity, and overdraft loans are reported as being due in one year or less.
Other Regulations Interest and other charges collected or contracted for by the Bank are subject to state usury laws and federal laws concerning interest rates.
Interest and other charges collected or contracted for by the Bank are subject to state usury laws and federal laws concerning interest rates.
The Company is authorized to pursue other business activities permitted by applicable laws and regulations for savings and loan holding companies, which may include the acquisition of banking and financial services companies. The Company’s cash flow is dependent on earnings from investments and any dividends received from Ponce Bank.
The Company is authorized to pursue other business activities permitted by applicable laws and regulations for financial holding companies, which may include the acquisition of banking and financial services companies. The Company’s cash flow is dependent on earnings from investments and any dividends received from Ponce Bank.
The regulatory guidance also states that a savings and loan holding company should inform Federal Reserve Bank supervisory staff prior to redeeming or repurchasing common stock or perpetual preferred stock if the savings and loan holding company is experiencing financial weaknesses or the repurchase or redemption would result in a net reduction, at the end of a quarter, in the amount of such equity instruments outstanding compared with the beginning of the quarter in which the redemption or repurchase occurred.
The regulatory guidance also states that a bank holding company should inform Federal Reserve Bank supervisory staff prior to redeeming or repurchasing common stock or perpetual preferred stock if the bank holding company is experiencing financial weaknesses or the repurchase or redemption would result in a net reduction, at the end of a quarter, in the amount of such equity instruments outstanding compared with the beginning of the quarter in which the redemption or repurchase occurred.
Although the Bank continues to rely primarily on community deposits from its market areas to fund investments and loans, an increasing portion of deposits have come from internet sources and large banks and corporations that are supportive of the mission of the Bank.
Although the Bank continues to rely primarily on community deposits from its market areas to fund investments and loans, an increasing portion of deposits have come from internet sources and large banks, non-profits and corporations that are supportive of the mission of the Bank.
Current prepayment speeds determine whether prepayment estimates require modification that could cause amortization or accretion adjustments. Portfolio Maturities and Yields . The composition and maturities of the investment securities portfolio at December 31, 2024 are summarized in the following table.
Current prepayment speeds determine whether prepayment estimates require modification that could cause amortization or accretion adjustments. Portfolio Maturities and Yields . The composition and maturities of the investment securities portfolio at December 31, 2025 are summarized in the following table.
Non-accrual loans include non-accruing previously existing troubled debt restructured loans, prior to ASU 2022-02, of $0.4 million, $0.4 million, $2.3 million, $2.5 million, and $3.1 million at December 31, 2024, 2023, 2022, 2021 and 2020, respectively. There were no accruing loans past due 90 days or more at the dates indicated.
Non-accrual loans include non-accruing previously existing troubled debt restructured loans, prior to ASU 2022-02, of $0.4 million, $0.4 million, $0.4 million, $2.3 million and $2.5 million at December 31, 2025, 2024, 2023, 2022 and 2021, respectively. There were no accruing loans past due 90 days or more at the dates indicated.
The following table provides a breakdown of the Bank’s loan portfolio by product type and principal balance outstanding at December 31, 2024, excluding mortgage loans held for sale.
The following table provides a breakdown of the Bank’s loan portfolio by product type and principal balance outstanding at December 31, 2025, excluding mortgage loans held for sale.
There were $5.2 million and $6.6 million in net charge-offs during the years ended December 31, 2024 and 2023, respectively. 16 Although the Bank believes that it uses the best information available to establish the ACL, future adjustments to the allowance may be necessary and results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations.
There were $1.5 million and $5.2 million in net charge-offs during the years ended December 31, 2025 and 2024, respectively. 16 Although the Bank believes that it uses the best information available to establish the ACL, future adjustments to the allowance may be necessary and results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations.
Deposits . Deposits are generated primarily from the Bank’s primary market area. The Bank offers a selection of deposit accounts, including demand accounts, NOW/IOLA accounts, money market accounts, reciprocal deposits, savings accounts and certificates of deposit to individuals, business entities, non-profit organizations and individual retirement accounts.
Deposits . Deposits are generated primarily from the Bank’s primary market area and through Internet services. The Bank offers a selection of deposit accounts, including demand accounts, NOW/IOLA accounts, money market accounts, reciprocal deposits, savings accounts and certificates of deposit to individuals, business entities, non-profit organizations and individual retirement accounts.
The PPP program ended on May 31, 2021. (2) For the years ended December 31, 2022, 2021 and 2020, consumer loans originated include $3.2 million, $59.3 million and $29.5 million, respectively, of microloans pursuant to the Bank's former arrangement with Grain. 9 Contractual Maturities.
The PPP program ended on May 31, 2021. (2) For the years ended December 31, 2022 and 2021, consumer loans originated include $3.2 million and $59.3 million, respectively, of microloans pursuant to the Bank's former arrangement with Grain. 9 Contractual Maturities.
The Bank also invests in securities, which have historically consisted of U.S. government and federal agency securities and securities issued by government-sponsored or owned enterprises, corporate securities, mortgage-backed securities and Federal Home Loan Bank of New York (the “FHLBNY”) stock.
The Bank also invests in securities, which have historically consisted of U.S. government and federal agency securities and securities issued by government-sponsored or owned enterprises, corporate securities, mortgage-backed securities, Federal 1 Home Loan Bank of New York (the “FHLBNY”) stock and Federal Reserve Bank of New York (the “FRBNY”) stock.
Under the Federal Change in Bank Control Act, a notice must be submitted to the Federal Reserve Board if any person (including a company), or group acting in concert, seeks to acquire direct or indirect “control” of a savings and loan holding company.
Under the Federal Change in Bank Control Act, a notice must be submitted to the Federal Reserve Board if any person (including a company), or group acting in concert, seeks to acquire direct or indirect “control” of a bank holding company.
The rest of this category, less than 3.7%, is spread out in other counties and no other concentration exceeded $1.1 million, or 0.8%. It is the Bank’s policy to underwrite loans secured by one-to-four family owner-occupied residential real estate in a manner that ensures strict compliance with Federal and State regulations, including Dodd-Frank requirements.
The rest of this category, less than 2.1%, is spread out in other counties and no other concentration exceeded $1.0 million, or 0.6%. It is the Bank’s policy to underwrite loans secured by one-to-four family owner-occupied residential real estate in a manner that ensures strict compliance with Federal and State regulations, including Dodd-Frank requirements.
At December 31, 2024 2023 2022 2021 2020 Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value (Dollars in thousands) Available-for-Sale Securities: U.S.
At December 31, 2025 2024 2023 2022 2021 Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value Amortized Cost Fair Value (Dollars in thousands) Available-for-Sale Securities: U.S.
Federal law prohibits a savings and loan holding company, including the Company, directly or indirectly, or through one or more subsidiaries, from acquiring more than 5.0% (“control”) of another savings institution or savings and loan holding company, without prior Federal Reserve Board approval.
Federal law prohibits a bank holding company, including the Company, directly or indirectly, or through one or more subsidiaries, from acquiring more than 5.0% (“control”) of another savings institution or bank holding company, without prior Federal Reserve Board approval.
Tier 2 capital is comprised of capital instruments and related surplus meeting specified requirements, and may include cumulative preferred stock and long-term perpetual preferred stock, mandatory convertible securities, intermediate preferred stock and subordinated debt.
Total capital includes Tier 1 capital and Tier 2 capital. Tier 2 capital is comprised of capital instruments and related surplus meeting specified requirements, and may include cumulative preferred stock and long-term perpetual preferred stock, mandatory convertible securities, intermediate preferred stock and subordinated debt.
No other loan or loans-to-one borrower, individually or cumulatively, exceeded $44.0 million, or 57.8% of the lending limit. 10 The Bank’s real estate lending is subject to written policies, underwriting standards and operating procedures.
No other loan or loans-to-one borrower, individually or cumulatively, exceeded $44.0 million, or 54.1% of the lending limit. 10 The Bank’s real estate lending is subject to written policies, underwriting standards and operating procedures.
Mortgage Loans Held for Sale, at Fair Value. At December 31, 2024 and 2023, mortgage loans held for sale, at fair value, was $10.7 million and $10.0 million, respectively, including residential mortgages that were originated in accordance with secondary market pricing and underwriting standards. The Bank’s intent was to sell these loans on the secondary market.
Mortgage Loans Held for Sale, at Fair Value. At December 31, 2025 and 2024, mortgage loans held for sale, at fair value, were $3.4 million and $10.7 million, respectively, including residential mortgages that were originated in accordance with secondary market pricing and underwriting standards. The Bank’s intent was to sell these loans on the secondary market.
The Bank 20 had one overnight line of credit advance in the amount of $25.0 million from the FHLBNY at December 31, 2024 and no overnight line of credit advance from the FHLBNY at December 31, 2023.
The Bank had one overnight line of credit advance in the amount of $25.0 million from the FHLBNY at December 31, 2024 and no overnight line of credit advance from the FHLBNY at December 31, 2025.
Set forth below are certain material regulatory requirements that are applicable to the Company and the Bank. This description of statutes and regulations is not intended to be a complete description of such statutes and regulations and their effects on the Company and the Bank.
Set forth below are certain material regulatory requirements that are applicable to the Company and the Bank. This description of statutes and regulations is not intended to be a complete description of all statutes and regulations that affect the Company and the Bank or their effects on the Company and the Bank.
In evaluating applications by holding companies to acquire savings institutions, the Federal Reserve Board considers factors such as the financial and managerial resources, future prospects of the company and institution involved, the effect of the acquisition on the risk to the Federal Deposit Insurance Fund, the convenience and needs of the community and competitive factors.
In evaluating applications by holding companies to make such acquisition, the Federal Reserve Board considers factors such as the financial and managerial resources, future prospects of the company and institution involved, the effect of the acquisition on the risk to the Federal Deposit Insurance Fund, the convenience and needs of the community and competitive factors. Capital.
The market share of bank deposits in the New York area can be difficult to quantify, as some “mega” banks will include large scale deposits from around the world as held at headquarters. However, in Bronx County, New York, where the Bank maintains four branches, it holds 1.67% (as of June 30, 2024) of the market’s deposits.
The market share of bank deposits in the New York area can be difficult to quantify, as some “mega” banks will include large scale deposits from around the world as held at headquarters. However, in Bronx County, New York, where the Bank maintains four branches, it holds 2.08% (as of June 30, 2025) of the market’s deposits.
As a savings and loan holding company, the Company is subject to examination and supervision by, and is required to file certain reports with, the Federal Reserve Board. The Company is subject to the rules and regulations of the SEC under the federal securities laws.
As a bank holding company, the Company is subject to examination and supervision by, and is required to file certain reports with, the Federal Reserve Board. The Company is also subject to the rules and regulations of the SEC under the federal securities laws.
The rest of this category, 2.4%, is spread out in other counties and no other concentration exceeded $2.5 million, or 0.8%.
The rest of this category, 2.1%, is spread out in other counties and no other concentration exceeded $2.0 million, or 0.8%.
There were no commitments to lend additional funds to borrowers whose loans have been modified in a troubled debt restructuring. Allowance for Credit Losses The Allowance for Credit Losses ("ACL") on loans is management's estimate of expected credit losses over the expected life of the loans at the reporting date.
There were no commitments to lend additional funds to borrowers whose loans have been modified in a TDR. 13 Allowance for Credit Losses The Allowance for Credit Losses ("ACL") on loans is management's estimate of expected credit losses over the expected life of the loans at the reporting date.
The Bank’s operations are also subject to federal laws applicable to credit transactions, such as the: • Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers; • Home Mortgage Disclosure Act, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; • Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit; • Fair Credit Reporting Act, governing the use and provision of information to credit reporting agencies; • Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; • Truth in Savings Act, mandating certain disclosures to depositors; and • Rules and regulations of the various federal agencies charged with the responsibility of implementing such federal laws.
The Bank’s operations are also subject to a number of federal and state consumer protection laws, such as the: • Truth-In-Lending Act and Real Estate Settlement Procedures Act, which both govern disclosures of credit terms to borrowers, among other matters; • Home Mortgage Disclosure Act, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves; • Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit; • Fair Credit Reporting Act, governing the use and provision of information to credit reporting agencies; • Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; • Truth in Savings Act, mandating certain disclosures to depositors; • Rules and regulations of the various federal agencies charged with the responsibility of implementing such federal laws; and • Applicable State law counterparts.
The Bank’s lending limit as of December 31, 2024 was $76.1 million, with the ability to lend additional amounts up to 10% if the loans or extensions of credit are fully secured by readily-marketable collateral. At December 31, 2024, the Bank complied with these loans-to-one borrower limitations.
The Bank’s lending limit as of December 31, 2025 was $81.5 million, with the ability to lend additional amounts up to 10% if the loans or extensions of credit are fully secured by readily-marketable collateral. At December 31, 2025, the Bank complied with these loans-to-one borrower limitations.
The operations of the Bank are subject to the: • Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; • Electronic Funds Transfer Act and Regulation E promulgated thereunder, which govern automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services; • Check Clearing for the 21st Century Act (also known as “Check 21”), which gives “substitute checks,” such as digital check images and copies made from that image, the same legal standing as the original paper check; 25 • The USA PATRIOT Act, which requires financial institutions to, among other things, establish broadened anti-money laundering compliance programs, and due diligence policies and controls to ensure the detection and reporting of money laundering.
We cannot currently predict the nature and timing of future developments that may potentially impact CFPB rules, proposals, enforcement and supervision. 25 The operations of the Bank are subject to the: • Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records; • Electronic Funds Transfer Act and Regulation E promulgated thereunder, which govern automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services; • Check Clearing for the 21st Century Act (also known as “Check 21”), which gives “substitute checks,” such as digital check images and copies made from that image, the same legal standing as the original paper check; • The USA PATRIOT Act, which requires financial institutions to, among other things, establish broadened anti-money laundering compliance programs, and due diligence policies and controls to ensure the detection and reporting of money laundering.
All other concentrations by county, which account for 0.4% of this category, have balances of $1.2 million or less.
All other concentrations by county, which account for 0.9% of this category, have balances of $2.2 million or less.
The OCC has primary enforcement responsibility over federal savings associations and has authority to bring enforcement action against all “institution-affiliated parties,” including directors, officers, stockholders, attorneys, appraisers and accountants who knowingly or recklessly participate in wrongful action likely to have an adverse effect on a federal savings association.
The OCC has primary enforcement responsibility over national banks and has authority to bring enforcement action against all “institution-affiliated parties,” including directors, officers, stockholders, attorneys, appraisers and accountants who knowingly or recklessly participate in wrongful action likely to have an adverse effect on a national bank.
The $14.8 million increase was primarily attributable to increases of $7.2 million in multifamily loans, $3.4 million in 1-4 family loans, $3.2 million in construction and land loans and $1.2 million in business loans, offset by a decrease of and $0.1 million in nonresidential loans. Loan Modifications to Borrowers Experiencing Financial Difficulties.
The $1.4 million increase was primarily attributable to increases of $3.0 million in multifamily loans, $1.4 million in construction and land loans and $0.2 million in nonresidential loans, offset by decreases of $2.7 million in 1-4 family loans and $0.6 million in business loans. Loan Modifications to Borrowers Experiencing Financial Difficulties.
For the Years Ended December 31, 2024 2023 2022 2021 2020 (Dollars in thousands) Allowance at beginning of year $ 26,154 $ 34,592 $ 16,352 $ 14,870 $ 12,329 Provision for loan losses 1,516 1,237 24,046 2,717 2,443 Adoption of CECL — (3,090 ) Charge-offs: Mortgage loans: 1-4 family residential Investor-owned — — — — — Owner-occupied — — — — — Multifamily residential — — — (38 ) — Nonresidential properties (7 ) — — — — Construction and land — — — — — Nonmortgage loans: Business (734 ) (63 ) — — — Consumer (1) (5,148 ) (7,227 ) (6,659 ) (1,342 ) (6 ) Total charge-offs (5,889 ) (7,290 ) (6,659 ) (1,380 ) (6 ) Recoveries: Mortgage loans: 1-4 family residential Investor-owned — — 156 8 — Owner-occupied — — 39 45 — Multifamily residential — — — — — Nonresidential properties — — — — 4 Construction and land — — — — — Nonmortgage loans: Business 9 3 94 84 95 Consumer (1) 712 702 564 8 5 Total recoveries 721 705 853 145 104 Net recoveries (charge-offs) (5,168 ) (6,585 ) (5,806 ) (1,235 ) 98 Allowance at end of year $ 22,502 $ 26,154 $ 34,592 $ 16,352 $ 14,870 Allowance for credit losses as a percentage for nonperforming loans 97.98 % 205.52 % 252.33 % 142.90 % 127.28 % Allowance for credit losses as a percentage of total loans 0.97 % 1.36 % 2.27 % 1.24 % 1.27 % Net recoveries (charge-offs) to average loans outstanding during the year (0.25 %) (0.38 %) (0.42 %) (0.09 %) 0.01 % (1) At December 31, 2024, 2023, 2022 and 2021, includes $5.1 million, $7.2 million, $6.7 million and $1.2 million of charge-offs and $0.7 million, $0.7 million, $0.6 million and $0.1 million of recoveries related to loans associated with Grain, respectively. 15 Allowance for Credit Losses .
For the Years Ended December 31, 2025 2024 2023 2022 2021 (Dollars in thousands) Allowance at beginning of year $ 22,502 $ 26,154 $ 34,592 $ 16,352 $ 14,870 Provision for loan losses 4,469 1,516 1,237 24,046 2,717 Adoption of CECL — — (3,090 ) Charge-offs: Mortgage loans: 1-4 family residential Investor-owned (69 ) — — — — Owner-occupied — — — — — Multifamily residential — — — — (38 ) Nonresidential properties — (7 ) — — — Construction and land — — — — — Nonmortgage loans: — Business (1,444 ) (734 ) (63 ) — — Consumer (1) (48 ) (5,148 ) (7,227 ) (6,659 ) (1,342 ) Total charge-offs (1,561 ) (5,889 ) (7,290 ) (6,659 ) (1,380 ) Recoveries: Mortgage loans: 1-4 family residential Investor-owned — — — 156 8 Owner-occupied — — — 39 45 Multifamily residential — — — — — Nonresidential properties — — — — — Construction and land — — — — — Nonmortgage loans: Business 39 9 3 94 84 Consumer (1) — 712 702 564 8 Total recoveries 39 721 705 853 145 Net recoveries (charge-offs) (1,522 ) (5,168 ) (6,585 ) (5,806 ) (1,235 ) Allowance at end of year $ 25,449 $ 22,502 $ 26,154 $ 34,592 $ 16,352 Allowance for credit losses as a percentage for nonperforming loans 94.74 % 97.98 % 205.52 % 252.33 % 142.90 % Allowance for credit losses as a percentage of total loans 0.97 % 0.97 % 1.36 % 2.27 % 1.24 % Net recoveries (charge-offs) to average loans outstanding during the year (0.06 %) (0.25 %) (0.38 %) (0.42 %) (0.09 %) (1) At December 31, 2024, 2023, 2022 and 2021, includes $5.1 million, $7.2 million, $6.7 million and $1.2 million of charge-offs and $0.7 million, $0.7 million, $0.6 million and $0.1 million of recoveries related to loans associated with microloans pursuant to the Bank's former arrangement with Grain, respectively. 15 Allowance for Credit Losses .
As a member of the FHLBNY, the Bank is required to acquire and hold shares of the capital stock of the FHLBNY. As of December 31, 2024, the Bank was in compliance with this requirement. The Bank may also utilize advances from the FHLBNY as a source of investable funds.
As a member of the FHLBNY, the Bank is required to acquire and hold shares of the capital stock of the FHLBNY. As of December 31, 2025, the Bank was in compliance with this requirement. The Bank may also utilize advances from the FHLBNY as a source of investable funds. Other Regulations Consumer Protection .
Investment Activities General . The Bank’s investment policy was adopted and is reviewed annually by the Board of Directors. The Chief Financial Officer (designated as the Chief Investment Officer) will plan and execute investment strategies consistent with the policies approved by the Board of Directors.
Investment Activities General . The Bank’s investment policy was adopted and is reviewed annually by the Board of Directors. The Chief Financial Officer (designated as the Chief Investment Officer) plans and executes investment strategies consistent with the policies approved by the Board of Directors.
Deposits have traditionally been the Bank’s primary source of funds for use in lending and investment activities. The Bank receives funds from large deposits made from corporations, nonprofits, and large banks.
Sources of Funds General . Deposits have traditionally been the Bank’s primary source of funds for use in lending and investment activities. The Bank receives funds from retail deposits, Internet deposits, non-retail deposits made from corporations, nonprofits, and large banks.
One-to-four family owner-occupied loans totaled $142.4 million, or 6.2% of the Bank’s total loan portfolio at December 31, 2024. The three largest loans outstanding in this category had outstanding balances of $2.5 million, $2.1 million and $1.9 million. There are 25 loans with an outstanding balance in excess of $1.0 million, totaling $34.8 million, or approximately 24.5% of this category.
One-to-four family owner-occupied loans totaled $127.1 million, or 4.8% of the Bank’s total loan portfolio at December 31, 2025. The three largest loans outstanding in this category had outstanding balances of $2.5 million, $2.0 million and $1.8 million. There are 17 loans with an outstanding balance in excess of $1.0 million, totaling $24.0 million, or approximately 18.9% of this category.
Item 1. Business Ponce Financial Group, Inc. Ponce Financial Group, Inc. (hereafter referred to as “we,” “our,” “us,” “Ponce Financial Group, Inc.,” or the “Company”), is the holding company of Ponce Bank (“Ponce Bank” or the “Bank”), a federally chartered stock savings association.
Item 1. Business Ponce Financial Group, Inc. Ponce Financial Group, Inc. (hereafter referred to as “we,” “our,” “us,” “Ponce Financial Group, Inc.,” or the “Company”), is a financial holding company and the holding company of Ponce Bank, National Association (“Ponce Bank” or the “Bank”), a national bank.
Included in the mix of community deposits are demand and money market funds of consumer, commercial and not-for-profit entities, with a decreasing reliance on time deposits. Additionally, the Bank has been using alternative funding sources such as brokered deposits, FHLBNY and Federal Reserve Bank of New York ("FRBNY") advances to support loan growth.
Included in the mix of community deposits are demand and money market funds of consumer, commercial and not-for-profit entities, with a decreasing reliance on time deposits. Additionally, the Bank uses alternative funding sources such as brokered deposits, FHLBNY advances and FRBNY borrowings to support loan growth.
Tier 1 capital is generally defined as common equity Tier 1 and Additional Tier 1 capital. Additional Tier 1 capital generally includes certain noncumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries. Total capital includes Tier 1 capital (common equity Tier 1 capital plus Additional Tier 1 capital) and Tier 2 capital.
Common equity Tier 1 capital is generally defined as common stockholders’ equity and retained earnings. Tier 1 capital is generally defined as common equity Tier 1 and Additional Tier 1 capital. Additional Tier 1 capital generally includes certain noncumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries.
The Company believes there is a significant opportunity for an immigrant community-focused, minority-directed bank to provide a full range of financial services to business and consumer customers in our market area and other similar communities. Our current business strategy consists of the following: • Maximize Balance Sheet Efficiency.
The Company believes there is a significant opportunity for an immigrant community-focused, minority-directed bank to provide a full range of financial services to business and consumer customers in our market area and other similar communities.
As such, we maintain strong non-discrimination and anti-harassment policies. . 2 Market Area The Bank is headquartered in the Bronx, New York, with a primary market in the other boroughs of New York City (excluding Staten Island), Hudson and Bergen Counties, New Jersey. The Bank recently opened a representative office in Coral Gables, Florida.
As such, the Company maintains strong non-discrimination and anti-harassment policies. . 2 Market Area The Bank is headquartered in the Bronx, New York, with a primary market in other boroughs of New York City, Hudson and Bergen Counties, New Jersey and a representative office in Coral Gables, Florida.
In this category, loans totaling $129.2 million, or 39.1%, are secured by properties located in Queens County, $107.3 million, or 32.5%, in Kings County, $41.7 million, or 12.6%, in Bronx County, $11.8 million, or 3.6%, in New York County, $8.0 million, or 2.4%, in Westchester County, $7.2 million, or 2.2%, in Hudson County, $7.1 million, or 2.1% in Bergen County, $5.6 million, or 1.7% in Suffolk County, and $4.3 million, or 1.3%, in Nassau County.
In this category, loans totaling $121.1 million, or 39.4%, are secured by properties located in Queens County, $101.1 million, or 32.9%, in Kings County, $36.4 million, or 11.8%, in Bronx County, $11.2 million, or 3.6%, in New York County, $6.5 million, or 2.1%, in Westchester County, $7.0 million, or 2.3%, in Hudson County, $6.6 million, or 2.2% in Bergen County, $5.5 million, or 1.8% in Suffolk County, $3.0 million, or 1.0%, in Nassau County and $$2.4 million, or 0.8% in Fairfield County .
At December 31, 2024, one-to-four family investor-owned loans were $330.1 million, or 14.3% of the Bank’s total loans. Investor-owned mortgage loans secured by non-owner-occupied one-to-four family residential property represents the Bank’s fourth largest lending concentration.
At December 31, 2025, one-to-four family investor-owned loans were $307.3 million, or 11.7% of the Bank’s total loans. Investor-owned mortgage loans secured by non-owner-occupied one-to-four family residential property represents the Bank’s fourth largest lending concentration.
Such classifications are used by the FDIC and other bank regulatory agencies to determine matters ranging from each institution’s quarterly FDIC deposit insurance premium assessments, to approvals of applications authorizing institutions to grow their asset size or otherwise expand business activities.
Such classifications are used by the FDIC and other bank regulatory agencies to determine matters ranging from each institution’s quarterly FDIC deposit insurance premium assessments, to approvals of applications authorizing institutions to grow their asset size or otherwise expand business activities. At December 31, 2025 and 2024, the Bank and the Company exceeded each of their four regulatory capital requirements.
On the basis of this review of loans, the Bank’s classified and special mention loans at the dates indicated were as follows: At December 31, 2024 2023 2022 2021 2020 (in thousands) Classified Loans: Substandard $ 27,290 $ 17,851 $ 21,499 $ 17,317 $ 20,508 Total classified loans 27,290 17,851 21,499 17,317 20,508 Special mention loans 20,580 5,786 9,735 13,798 19,546 Total classified and special mention loans $ 47,870 $ 23,637 $ 31,234 $ 31,115 $ 40,054 Substandard loans increased $9.4 million, or 52.9%, to $27.3 million at December 31, 2024 compared to $17.9 million at December 31, 2023.
On the basis of this review of loans, the Bank’s classified and special mention loans at the dates indicated were as follows: At December 31, 2025 2024 2023 2022 2021 (in thousands) Classified Loans: Substandard $ 32,153 $ 27,290 $ 17,851 $ 21,499 $ 17,317 Total classified loans 32,153 27,290 17,851 21,499 17,317 Special mention loans 21,933 20,580 5,786 9,735 13,798 Total classified and special mention loans $ 54,086 $ 47,870 $ 23,637 $ 31,234 $ 31,115 Substandard loans increased $4.9 million, or 17.8%, to $32.2 million at December 31, 2025 compared to $27.3 million at December 31, 2024.
At December 31, 2024 2023 2022 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due (in thousands) Mortgages: 1-4 Family residential Investor-owned $ 2,275 $ 2,790 $ 436 $ — $ — $ 793 $ 1,530 $ 78 $ 1,865 Owner-occupied 1,670 909 1,858 — — 2,130 2,553 — 815 Multifamily residential 5,119 2,502 10,271 1,109 — 2,979 4,643 — — Nonresidential properties 890 2,402 — — — — 4,246 607 — Construction and land — 3,180 10,058 — — 6,659 — 4,100 7,567 Nonmortgage Loans: Business 123 1,037 343 366 8 165 1,466 7,869 2,973 Consumer — 3 — 536 1,007 — 1,267 1,119 — Total $ 10,077 $ 12,823 $ 22,966 $ 2,011 $ 1,015 $ 12,726 $ 15,705 $ 13,773 $ 13,220 11 At December 31, 2021 2020 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due (in thousands) Mortgages: 1-4 Family residential Investor-owned $ 321 $ 2,969 $ 1,096 $ 2,222 $ 1,507 $ 1,907 Owner-occupied 2,961 471 1,947 1,572 348 1,100 Multifamily residential 1,704 187 — 1,140 — 946 Nonresidential properties 934 1,168 — — — 3,272 Construction and land — — — — — — Nonmortgage Loans: Business 4,036 544 13 100 — — Consumer 2,570 1,759 5 497 316 175 Total $ 12,526 $ 7,098 $ 3,061 $ 5,531 $ 2,171 $ 7,400 Non-Performing Assets.
At December 31, 2025 2024 2023 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due (in thousands) Mortgages: 1-4 Family residential Investor-owned $ 5,356 $ 959 $ 2,870 $ 2,275 $ 2,790 $ 436 $ — $ — $ 793 Owner-occupied 1,480 1,151 1,967 1,670 909 1,858 — — 2,130 Multifamily residential 3,208 — 13,112 5,119 2,502 10,271 1,109 — 2,979 Nonresidential properties 1,764 — — 890 2,402 — — — — Construction and land — — 8,247 — 3,180 10,058 — — 6,659 Nonmortgage Loans: Business 118 — 667 123 1,037 343 366 8 165 Consumer — — — — 3 — 536 1,007 — Total $ 11,926 $ 2,110 $ 26,863 $ 10,077 $ 12,823 $ 22,966 $ 2,011 $ 1,015 $ 12,726 11 At December 31, 2022 2021 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due 30-59 Days Past Due 60-89 Days Past Due 90 Days or More Past Due (in thousands) Mortgages: 1-4 Family residential Investor-owned $ 1,530 $ 78 $ 1,865 $ 321 $ 2,969 $ 1,096 Owner-occupied 2,553 — 815 2,961 471 1,947 Multifamily residential 4,643 — — 1,704 187 — Nonresidential properties 4,246 607 — 934 1,168 — Construction and land — 4,100 7,567 — — — Nonmortgage Loans: Business 1,466 7,869 2,973 4,036 544 13 Consumer 1,267 1,119 — 2,570 1,759 5 Total $ 15,705 $ 13,773 $ 13,220 $ 12,526 $ 7,098 $ 3,061 Non-Performing Assets.
For the Years Ended December 31, 2024 2023 2022 2021 2020 (in thousands) Total loans at beginning of year $ 1,921,572 $ 1,525,668 $ 1,322,098 $ 1,172,053 $ 966,096 Loans originated: Mortgage loans: 1-4 family residential Investor-owned 9,780 28,999 58,333 42,631 36,522 Owner-occupied 44,012 24,137 54,001 15,346 15,090 Multifamily residential 146,558 88,464 181,227 73,128 90,481 Nonresidential properties 92,818 55,649 89,370 65,463 34,154 Construction and land 580,662 700,904 231,334 109,294 81,465 Total mortgage loans 873,830 898,153 614,265 305,862 257,712 Nonmortgage loans: Business (1) 13,724 14,285 6,325 122,254 89,110 Consumer (2) 674 737 3,898 59,760 30,050 Total nonmortgage loans 14,398 15,022 10,223 182,014 119,160 Total loans originated 888,228 913,175 624,488 487,876 376,872 Loans purchased: Mortgage loans: 1-4 family residential Investor-owned — — — 5,845 — Multifamily residential — — — 5,540 — Total mortgage loans — — — 11,385 — Nonmortgage loans: Business 5,955 — — — — Total nonmortgage loans 5,955 — — — — Total loans purchased 5,955 — — 11,385 — Loans sold and transferred to held-for-sale: Mortgage loans: 1-4 family residential Investor-owned — (2,129 ) (3,040 ) (5,661 ) (781 ) Owner-occupied — — (311 ) — — Multifamily residential — (1,435 ) — (2,299 ) (2,748 ) Nonresidential properties (824 ) — (767 ) (2,713 ) (510 ) Construction and land (22,557 ) (5,017 ) (5,734 ) (3,500 ) — Total loans sold and transferred to held-for-sale (23,381 ) (8,581 ) (9,852 ) (14,173 ) (4,039 ) Principal repayments and other (484,354 ) (508,690 ) (411,066 ) (335,043 ) (166,876 ) Net loan activity 386,448 395,904 203,570 150,045 205,957 Total loans at end of year $ 2,308,020 $ 1,921,572 $ 1,525,668 $ 1,322,098 $ 1,172,053 (1) For the years ended December 31, 2021 and 2020, business loans originated include $117.3 million and $85.3 million, respectively, of PPP loans .
For the Years Ended December 31, 2025 2024 2023 2022 2021 (in thousands) Total loans at beginning of year $ 2,308,020 $ 1,921,572 $ 1,525,668 $ 1,322,098 $ 1,172,053 Loans originated: Mortgage loans: 1-4 family residential Investor-owned 3,735 9,780 28,999 58,333 42,631 Owner-occupied 3,375 44,012 24,137 54,001 15,346 Multifamily residential 180,407 146,558 88,464 181,227 73,128 Nonresidential properties 177,768 92,818 55,649 89,370 65,463 Construction and land 692,863 580,662 700,904 231,334 109,294 Total mortgage loans 1,058,148 873,830 898,153 614,265 305,862 Nonmortgage loans: Business (1) 108,586 13,724 14,285 6,325 122,254 Consumer (2) 324 674 737 3,898 59,760 Total nonmortgage loans 108,910 14,398 15,022 10,223 182,014 Total loans originated 1,167,058 888,228 913,175 624,488 487,876 Loans purchased: Mortgage loans: 1-4 family residential Investor-owned — — — — 5,845 Multifamily residential — — — — 5,540 Total mortgage loans — — — — 11,385 Nonmortgage loans: Business — 5,955 — — — Total nonmortgage loans — 5,955 — — — Total loans purchased — 5,955 — — 11,385 Loans sold and transferred to held-for-sale: Mortgage loans: 1-4 family residential Investor-owned — — (2,129 ) (3,040 ) (5,661 ) Owner-occupied — — — (311 ) — Multifamily residential — — (1,435 ) — (2,299 ) Nonresidential properties — (824 ) — (767 ) (2,713 ) Construction and land 4,100 (22,557 ) (5,017 ) (5,734 ) (3,500 ) Total loans sold and transferred to held-for-sale 4,100 (23,381 ) (8,581 ) (9,852 ) (14,173 ) Principal repayments and other (854,268 ) (484,354 ) (508,690 ) (411,066 ) (335,043 ) Net loan activity 316,890 386,448 395,904 203,570 150,045 Total loans at end of year $ 2,624,910 $ 2,308,020 $ 1,921,572 $ 1,525,668 $ 1,322,098 (1) For the year ended December 31, 2021, business loans originated include $117.3 million of PPP loans .
(2) As of December 31, 2023, 2022, 2021 and 2020, consumer loans include $8.0 million, $18.2 million, $33.9 million and $25.5 million, respectively, of microloans. At December 31, 2024, these microloans were fully charged-off. 4 Loan Products Offered by the Bank.
(2) As of December 31, 2023, 2022 and 2021, consumer loans include $8.0 million, $18.2 million and $33.9 million, respectively, of microloans pursuant to the Bank’s former arrangement with Grain. At December 31, 2024, these microloans were fully charged-off. 4 Loan Products Offered by the Bank.
Government Bonds $ 2,994 $ 2,873 $ 2,990 $ 2,784 $ 2,985 $ 2,689 $ 2,981 $ 2,934 $ — $ — Corporate Bonds 21,762 20,404 25,790 23,668 25,824 23,359 21,243 21,184 10,381 10,463 Mortgage-Backed Securities Collateralized Mortgage Obligations (1) 34,526 28,535 39,375 33,148 44,503 37,777 18,845 18,348 — — FHLMC Certificates 9,028 7,662 10,163 8,681 11,310 9,634 — — 3,201 3,196 FNMA Certificates 56,010 45,408 61,359 51,517 67,199 55,928 71,930 70,699 3,506 3,567 GNMA Certificates 88 88 104 104 122 118 175 181 263 272 Total available-for-sale securities $ 124,408 $ 104,970 $ 139,781 $ 119,902 $ 151,943 $ 129,505 $ 115,174 $ 113,346 $ 17,351 $ 17,498 Held-to-Maturity Securities: U.S.
Government Bonds $ 2,999 $ 2,979 $ 2,994 $ 2,873 $ 2,990 $ 2,784 $ 2,985 $ 2,689 $ 2,981 $ 2,934 Corporate Bonds 13,501 12,763 21,762 20,404 25,790 23,668 25,824 23,359 21,243 21,184 Mortgage-Backed Securities Collateralized Mortgage Obligations (1) 30,839 26,346 34,526 28,535 39,375 33,148 44,503 37,777 18,845 18,348 FHLMC Certificates 7,915 7,125 9,028 7,662 10,163 8,681 11,310 9,634 — — FNMA Certificates 50,620 42,906 56,010 45,408 61,359 51,517 67,199 55,928 71,930 70,699 GNMA Certificates 76 77 88 88 104 104 122 118 175 181 Total available-for-sale securities $ 105,950 $ 92,196 $ 124,408 $ 104,970 $ 139,781 $ 119,902 $ 151,943 $ 129,505 $ 115,174 $ 113,346 Held-to-Maturity Securities: U.S.
At December 31, 2024 2023 2022 2021 2020 Amount Percent Amount Percent Amount Percent Amount Percent Amount Percent (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 330,053 14.30 % $ 343,689 17.89 % $ 343,968 22.54 % $ 317,304 24.01 % $ 319,596 27.27 % Owner-occupied 142,363 6.17 % 152,311 7.93 % 134,878 8.84 % 96,947 7.33 % 98,795 8.43 % Multifamily residential 670,159 29.04 % 550,559 28.65 % 494,667 32.42 % 348,300 26.34 % 307,411 26.23 % Nonresidential properties 389,898 16.89 % 342,343 17.81 % 308,043 20.19 % 239,691 18.13 % 218,929 18.68 % Construction and land 733,660 31.79 % 503,925 26.22 % 185,018 12.13 % 134,651 10.19 % 105,858 9.03 % Total mortgage loans 2,266,133 98.19 % 1,892,827 98.50 % 1,466,574 96.12 % 1,136,893 86.00 % 1,050,589 89.64 % Nonmortgage loans: Business loans (1) 40,849 1.77 % 19,779 1.03 % 39,965 2.62 % 150,512 11.38 % 94,947 8.10 % Consumer loans (2) 1,038 0.04 % 8,966 0.47 % 19,129 1.26 % 34,693 2.62 % 26,517 2.26 % Total nonmortgage loans 41,887 1.81 % 28,745 1.50 % 59,094 3.88 % 185,205 14.00 % 121,464 10.36 % Total loans, gross 2,308,020 100.00 % 1,921,572 100.00 % 1,525,668 100.00 % 1,322,098 100.00 % 1,172,053 100.00 % Net deferred loan origination costs 1,081 468 2,051 (668 ) 1,457 Allowance for credit losses (22,502 ) (26,154 ) (34,592 ) (16,352 ) (14,870 ) Loans receivable, net $ 2,286,599 $ 1,895,886 $ 1,493,127 $ 1,305,078 $ 1,158,640 (1) As of December 31, 2024, 2023, 2022, 2021 and 2020, business loans include $0.5 million, $1.0 million, $20.0 million, $136.8 million and $85.3 million, respectively, of SBA Paycheck Protection Program (“PPP”) loans.
At December 31, 2025 2024 2023 2022 2021 Amount Percent Amount Percent Amount Percent Amount Percent Amount Percent (Dollars in thousands) Mortgage loans: 1-4 family residential Investor-owned $ 307,267 11.70 % $ 330,053 14.30 % $ 343,689 17.89 % $ 343,968 22.54 % $ 317,304 24.01 % Owner-occupied 127,107 4.84 % 142,363 6.17 % 152,311 7.93 % 134,878 8.84 % 96,947 7.33 % Multifamily residential 756,542 28.83 % 670,159 29.04 % 550,559 28.65 % 494,667 32.42 % 348,300 26.34 % Nonresidential properties 526,210 20.05 % 389,898 16.89 % 342,343 17.81 % 308,043 20.19 % 239,691 18.13 % Construction and land 854,096 32.54 % 733,660 31.79 % 503,925 26.22 % 185,018 12.13 % 134,651 10.19 % Total mortgage loans 2,571,222 97.96 % 2,266,133 98.19 % 1,892,827 98.50 % 1,466,574 96.12 % 1,136,893 86.00 % Nonmortgage loans: Business loans (1) 53,063 2.02 % 40,849 1.77 % 19,779 1.03 % 39,965 2.62 % 150,512 11.38 % Consumer loans (2) 625 0.02 % 1,038 0.04 % 8,966 0.47 % 19,129 1.26 % 34,693 2.62 % Total nonmortgage loans 53,688 2.04 % 41,887 1.81 % 28,745 1.50 % 59,094 3.88 % 185,205 14.00 % Total loans, gross 2,624,910 100.00 % 2,308,020 100.00 % 1,921,572 100.00 % 1,525,668 100.00 % 1,322,098 100.00 % Deferred loan origination costs, net of fees (203 ) 1,081 468 2,051 (668 ) Allowance for credit losses (25,449 ) (22,502 ) (26,154 ) (34,592 ) (16,352 ) Loans receivable, net $ 2,599,258 $ 2,286,599 $ 1,895,886 $ 1,493,127 $ 1,305,078 (1) As of December 31, 2025, 2024, 2023, 2022 and 2021, business loans include $0.3 million, $0.5 million, $1.0 million, $20.0 million and $136.8 million, respectively, of SBA Paycheck Protection Program (“PPP”) loans.
All other concentrations by county, which account for 0.7% of this category, have balances of $1.0 million or less. Nonresidential Loans. Nonresidential loans totaled $389.9 million, or 16.9% of the Bank’s total loan portfolio at December 31, 2024. Loans secured by nonresidential properties that represent the Bank’s third largest concentration.
All other concentrations by county, which account for 0.5% of this category, have balances of $1.2 million or less. Nonresidential Loans. Nonresidential loans totaled $526.2 million, or 20.0% of the Bank’s total loan portfolio at December 31, 2025. Loans secured by nonresidential properties represent the Bank’s third largest concentration.
At December 31, 2024, there was one loan in the amount of $0.2 million with modifications to borrowers experiencing financial difficulty. At December 31, 2023, there were no loans with modifications to borrowers experiencing financial difficulty.
At both December 31, 2025 and 2024, there was one loan in the amount of $0.2 million with modifications to borrowers experiencing financial difficulty.
Agency Bonds $ 25,000 $ 24,960 $ 25,000 $ 24,819 $ 35,000 $ 34,620 $ — $ — $ — $ — Corporate Bonds 32,500 31,977 82,500 79,809 82,500 78,738 — — — — Mortgage-Backed Securities: Collateralized Mortgage Obligations (1) 186,634 179,582 212,093 207,027 235,479 230,113 — — — — FHLMC Certificates 3,229 3,006 3,897 3,653 4,120 3,852 934 914 1,743 1,722 FNMA Certificates 105,417 100,303 118,944 114,856 131,918 126,691 — — — — SBA Certificates 15,374 15,466 19,712 19,878 21,803 21,837 — — — — Allowance for Credit Losses (216 ) — (398 ) — — — — — — — Total held-to-maturity securities $ 367,938 $ 355,294 $ 461,748 $ 450,042 $ 510,820 $ 495,851 $ 934 $ 914 $ 1,743 $ 1,722 (1) Comprised of Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Ginnie Mae (“GNMA”) issued securities. 17 At December 31, 2024 and 2023, there were no securities of which the amortized cost or estimated value exceeded 10% of total equity .
Agency Bonds $ — $ — $ 25,000 $ 24,960 $ 25,000 $ 24,819 $ 35,000 $ 34,620 $ — $ — Corporate Bonds 7,500 7,398 32,500 31,977 82,500 79,809 82,500 78,738 — — Mortgage-Backed Securities: Collateralized Mortgage Obligations (1) 160,786 158,010 186,634 179,582 212,093 207,027 235,479 230,113 — — FHLMC Certificates 3,133 3,036 3,229 3,006 3,897 3,653 4,120 3,852 934 914 FNMA Certificates 90,868 89,468 105,417 100,303 118,944 114,856 131,918 126,691 — — SBA Certificates 10,931 10,963 15,374 15,466 19,712 19,878 21,803 21,837 — — Allowance for Credit Losses (236 ) — (216 ) — (398 ) — — — — — Total held-to-maturity securities $ 272,982 $ 268,875 $ 367,938 $ 355,294 $ 461,748 $ 450,042 $ 510,820 $ 495,851 $ 934 $ 914 17 (1) Comprised of Federal Home Loan Mortgage Corporation (“FHLMC”), Federal National Mortgage Association (“FNMA”) and Ginnie Mae (“GNMA”) issued securities.
The Company encourages and supports the growth and development of our employees. Continual learning and career development is advanced through ongoing performance and development conversations with employees, internally developed training programs and educational reimbursement programs. The Company believes that its business is strengthened by a diverse workforce that reflects the communities in which it operates.
Continual learning and career development is advanced through ongoing performance and development conversations with employees, internally developed training programs and educational reimbursement programs. The Company believes that its business is strengthened by a diverse workforce that reflects the communities in which it operates and all of its team members should be treated with respect and equality.
Competition The Company faces significant competition within its market area both in originating loans and attracting deposits. There is a high concentration of financial institutions in the market area, including national, regional and other locally-operated commercial banks, savings banks, savings associations and credit unions whose activities include banking as well as mortgage lending.
There is a high concentration of financial institutions in the market area, including national, regional and other locally-operated commercial banks, savings banks, savings associations and credit unions whose activities include banking as well as mortgage lending.
In addition to establishing the minimum regulatory capital requirements, the regulations limit capital distributions and certain discretionary bonus payments to management if the institution does not hold a “capital conservation buffer” consisting of 2.5% of common equity Tier 1 capital to risk-weighted assets above the amount necessary to meet its minimum risk-based capital requirements.
In addition to establishing the minimum regulatory capital requirements, the regulations limit capital distributions and certain discretionary bonus payments to management if the institution does not hold a “capital conservation buffer” of 2.5% above the minimum risk-based capital requirements.
The Deposit Insurance Fund of the FDIC insures deposits at FDIC insured financial institutions such as the Bank. Deposit accounts in the Bank are insured by the FDIC generally up to a maximum of $250,000 per separately insured depositor and up to a maximum of $250,000 for self-directed retirement accounts.
Deposit accounts in the Bank are insured by the FDIC generally up to a maximum of $250,000 per separately insured depositor and up to a maximum of $250,000 for self-directed retirement accounts.
At December 31, 2024, approximately $48.5 million, or 34.1%, of this category was secured by properties located in Queens County, $33.7 million, or 23.7%, in Kings County, $14.7 million, or 10.3%, in Nassau County, $9.4 million, or 6.6%, in Bronx County, $6.6 million, or 4.6%, in New York County, $6.2 million, or 4.4%, in Westchester County, $6.0 million, or 4.2%, in Richmond County, $5.3 million, or 3.7%, in Suffolk County, $3.3 million, or 2.3%, in Bergen County, $2.2 million, or 1.5%, in Monmouth County and $1.2 million, or 0.9%, in Hudson County.
At December 31, 2025, approximately $44.8 million, or 35.2%, of this category was secured by properties located in Queens County, $29.4 million, or23.1%, in Kings County, $14.0 million, or 11.0%, in Nassau County, $8.0 million, or 6.3%, in Bronx County, $5.8 million, or 4.5%, in Westchester County, $4.9 million, or 3.9%, in Richmond County, $4.7 million, or 3.7%, in Suffolk County, $4.0 million, or 3.2%, in New York County, $3.0 million, or 2.4%, in Bergen County and $2.2 million, or 1.7%, in Monmouth County.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeYou should read this entire document carefully, including the Risk Factors below that discusses the above risks in further detail. 28 Risks Related to CDFI and MDI Status. We may lose the ability to obtain grants and awards available to CDFIs and/or MDIs institutions.
Biggest changeRisks Related to CDFI and MDI Status. We may lose the ability to obtain grants and awards available to CDFIs and/or MDIs institutions. The Bank and the Company are certified as CDFIs by the United States Department of the Treasury ("Treasury") and the Bank is also designated as an MDI by the OCC.
The Threshold Conditions are as follows: during the ten years that follow the Original Closing Date (the “ECIP Period”) either (1) over any sixteen consecutive quarters, an average of at least 60% of the Company’s Total Originations, as defined pursuant to the terms of the ECIP, qualifies as “Deep Impact Lending,” as defined pursuant to the terms of the ECIP (the “Deep Impact Condition”); (2) over any twenty-four consecutive quarters, an average of at least 85% of the Company’s Total Originations qualifies as “Qualified Lending,” as defined pursuant to the terms of the ECIP (the “Qualified Lending Condition”); or (3) the Preferred 33 Stock has a dividend rate of no more than 0.5%, which dividend rate is calculated pursuant to the ECIP and the terms thereof, at each of six consecutive Reset Dates, as defined in the ECIP.
The Threshold Conditions are as follows: during the ten years that follow the Original Closing Date (the “ECIP Period”) either (1) over any sixteen consecutive quarters, an average of at least 60% of the Company’s Total Originations, as defined pursuant to the terms of the ECIP, qualifies as “Deep Impact Lending,” as defined pursuant to the terms of the ECIP (the “Deep Impact Condition”); (2) over any twenty-four consecutive quarters, an average of at least 85% of the Company’s Total Originations qualifies as “Qualified Lending,” as defined pursuant to the terms of the ECIP (the “Qualified Lending Condition”); or (3) the Preferred Stock has a dividend rate of no more than 0.5%, which dividend rate is calculated pursuant to the ECIP and the terms thereof, at each of six consecutive Reset Dates, as defined in the ECIP.
Loans on land under development or held for future construction also pose additional risk ‎because of the lack of income being produced by the property and the potential illiquid nature of the collateral.‎ 32 Additionally, as discussed under “Risks Related to Laws and Regulations” – “We may be limited in our ability to originate new construction loans in our market area due to legislative changes.”‎ and – “Imposition of limits by the bank regulators on construction lending activities could curtail our growth and adversely affect our ‎earnings.‎” below, we be limited in our ability to make such loans in the future.
Loans on land under development or held for future construction also pose additional risk ‎because of the lack of income being produced by the property and the potential illiquid nature of the collateral.‎ Additionally, as discussed under “Risks Related to Laws and Regulations” – “We may be limited in our ability to originate new construction loans in our market area due to legislative changes.”‎ and – “Imposition of limits by the bank regulators on construction lending activities could curtail our growth and adversely affect our ‎earnings.‎” below, we be limited in our ability to make such loans in the future.
Any deterioration in economic conditions could have the following consequences, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations: • demand for our products and services may decline; • loan delinquencies, problem assets and foreclosures may increase; • collateral for loans, especially real estate, may decline in value, thereby reducing customers’ future borrowing power, and reducing the value of assets and collateral associated with existing loans; and • the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us.
Any deterioration in economic conditions could have the following consequences, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations: • demand for our products and services may decline; • loan delinquencies, problem assets and foreclosures may increase; 32 • collateral for loans, especially real estate, may decline in value, thereby reducing customers’ future borrowing power, and reducing the value of assets and collateral associated with existing loans; and • the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us.
Our policies, which require us to perform an environmental review before initiating any foreclosure action on non-residential real property, may not be sufficient to detect all potential environmental hazards. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on us. 31 Risks Related to our Business Strategy.
Our policies, which require us to perform an environmental review before initiating any foreclosure action on non-residential real property, may not be sufficient to detect all potential environmental hazards. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on us. Risks Related to our Business Strategy.
Operational risk is the risk of loss resulting from our operations, 39 including but not limited to, the risk of fraud by employees or persons outside our company, the execution of unauthorized transactions by employees, errors relating to transaction processing and technology, systems failures or interruptions, breaches of our internal control systems and compliance requirements, and business continuation and disaster recovery.
Operational risk is the risk of loss resulting from our operations, including but not limited to, the risk of fraud by employees or persons outside our company, the execution of unauthorized transactions by employees, errors relating to transaction processing and technology, systems failures or interruptions, breaches of our internal control systems and compliance requirements, and business continuation and disaster recovery.
A key component of our business strategy is to rely on our reputation for customer service and knowledge of local markets to expand our presence by capturing new business opportunities from existing and prospective customers in our market area and contiguous areas. As such, we strive to conduct our business in a manner that enhances our reputation.
A key component of our business strategy is to rely on our reputation for customer service and knowledge of local markets to expand our presence by 45 capturing new business opportunities from existing and prospective customers in our market area and contiguous areas. As such, we strive to conduct our business in a manner that enhances our reputation.
A loss of CDFI and/or MDI status, and the resulting inability to obtain certain grants and awards received in the past, could have an adverse effect on our financial condition, results of operations or business. Additionally, such grants and awards are offered at the discretion of the Treasury.
A loss of CDFI and/or MDI status, and the resulting inability to obtain certain grants, deposits and awards received in the past, could have an adverse effect on our financial condition, results of operations or business. Additionally, such grants and awards are offered at the discretion of the Treasury.
Changes in laws and regulations and the cost of regulatory compliance with new laws and regulations may adversely affect our operations and/or increase our costs of operations. 36 The Bank is subject to extensive regulation, supervision and examination by the OCC, and the Company is subject to extensive regulation, supervision and examination by the Federal Reserve Board.
Changes in laws and regulations and the cost of regulatory compliance with new laws and regulations may adversely affect our operations and/or increase our costs of operations. The Bank is subject to extensive regulation, supervision and examination by the OCC, and the Company is subject to extensive regulation, supervision and examination by the Federal Reserve Board.
We attempt to manage our risk from changes in market interest rates by adjusting the rates, maturity, repricing characteristics, and balances of the different types of our interest-earning assets and interest-bearing liabilities. Interest rate 35 risk management techniques are not exact.
We attempt to manage our risk from changes in market interest rates by adjusting the rates, maturity, repricing characteristics, and balances of the different types of our interest-earning assets and interest-bearing liabilities. Interest rate risk management techniques are not exact.
In recent periods, we have relied on non-core funding sources, primarily borrowings from the FHLBNY and FRBNY, to fund a portion of our lending activities when we do not have sufficient core deposits.
In recent periods, we have relied on non-core funding sources, primarily advances from the FHLBNY and borrowings from the FRBNY, to fund a portion of our lending activities when we do not have sufficient core deposits.
Our management is and will be required under applicable rules and regulations to make estimates and assumptions as of a specified date to file periodic reports under the Securities and Exchange Act of 1934, including our consolidated financial statements.
Our management is and will be required under applicable rules and regulations to make estimates and assumptions as of a specified date to file periodic reports under the Securities and Exchange Act, including our consolidated financial statements.
We may not be able to influence the activities of companies in which we invest and may suffer additional losses in the future due to these activities. New lines of business or new products and services may subject us to additional risks.
We may not be able to influence the activities of companies in which we invest and may suffer additional losses in the future due to these activities. 33 New lines of business or new products and services may subject us to additional risks.
Moreover, bankruptcy law provides that claims based on any such commitment will be entitled to a priority of payment over the claims of the institution’s general unsecured creditors, including the holders of its note obligations.
Moreover, bankruptcy law provides that claims based on any such commitment will be entitled to priority of payment over the claims of the institution’s general unsecured creditors, including the holders of its note obligations.
Our historical markets, minority and immigrant individuals, may be threatened by gentrification and adverse political developments, which could decrease our growth and profitability. We believe that our historical strength has been our focus on the minority and immigrant markets.
Our historical markets, minority and immigrant individuals, may be threatened by gentrification and adverse political developments, which could decrease our growth and profitability. 46 We believe that our historical strength has been our focus on the minority and immigrant markets.
In the 2015 Statement, the Agencies, among other things, indicate the intent to continue “to pay special attention” to commercial real estate lending activities and concentrations going forward.
In the 2015 Statement, the Agencies, among other things, indicate the intent to continue “to pay special attention” to 40 commercial real estate lending activities and concentrations going forward.
Federal regulation of interest rates could also impair the ‎future cash flows of such properties that have variable- or adjustable-rate mortgages or whose existing mortgages ‎are maturing. ‎ The State of New York, on June 14, 2019, enacted legislation increasing the restrictions on rent increases in ‎a rent-regulated apartment building, including, among other provisions, (i) repealing the vacancy bonus and ‎longevity bonus, which allowed a property owner to raise rents as much as 20% each time a rental unit became ‎vacant, (ii) eliminating high-rent vacancy deregulation and high-income deregulation, which allowed a rental unit to ‎be removed from rent stabilization once it crossed a statutory high-rent threshold and became vacant, or the ‎tenant’s income exceeded the statutory amount in the preceding two years, and (iii) eliminating an exception that ‎allowed a property owner who offered preferential rents to tenants to raise the rent to the full legal rent upon ‎renewal.
Increases in interest rates could also impair the ‎future cash flows of such properties that have variable- or adjustable-rate mortgages or whose existing mortgages ‎are maturing. ‎ The State of New York, on June 14, 2019, enacted legislation increasing the restrictions on rent increases in ‎a rent-stabilized apartment building, including, among other provisions, (i) repealing the vacancy bonus and ‎longevity bonus, which allowed a property owner to raise rents as much as 20% each time a rental unit became ‎vacant, (ii) eliminating high-rent vacancy deregulation and high-income deregulation, which allowed a rental unit to ‎be removed from rent stabilization once it crossed a statutory high-rent threshold and became vacant, or the ‎tenant’s income exceeded the statutory amount in the preceding two years, and (iii) eliminating an exception that ‎allowed a property owner who offered preferential rents to tenants to raise the rent to the full legal rent upon ‎renewal.
Although economic conditions have improved in most of our markets, we continue to focus on growing earning assets, we believe that it is possible we will continue to experience an uncertain and volatile economic environment during 2025, including as a result of issues of national security, international conflicts, inflation and supply chain disruptions.
Although economic conditions have improved in most of our markets, we continue to focus on growing earning assets, and we believe that it is possible we will continue to experience an uncertain and volatile economic environment during 2026, including as a result of issues of national security, international conflicts, inflation and supply chain disruptions.
Our business and our customers are impacted by inflationary pressures. Although inflationary pressures have begun to stabilize, inflation may increase again during 2025 or thereafter. Small to medium-sized businesses may be impacted more during periods of high inflation as they are not as able to leverage economics of scale to mitigate cost pressures compared to larger businesses.
Our business and our customers are impacted by inflationary pressures. Although inflationary pressures have begun to stabilize, inflation may increase again during 2026 or thereafter. Small to medium-sized businesses may be impacted more during periods of high inflation as they are not as able to leverage economics of scale to mitigate cost pressures compared to larger businesses.
We expect competition to increase in the future as a result of legislative, regulatory and 34 technological changes and the continuing trend of consolidation in the financial services industry. For additional information see “Business —Market Area and—Competition.” Our small size makes it more difficult for us to compete.
We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. For additional information see “Business —Market Area and—Competition.” 36 Our small size makes it more difficult for us to compete.
We monitor interest rate risk through the use of simulation models, including estimates of the amounts by which the economic value of our assets and liabilities (the Economic Value of Equity Model “EVE”) and our net interest income would change in the event of a range of assumed changes in market interest rates.
For example, we monitor interest rate risk through the use of simulation models, including estimates of the amounts by which the economic value of our assets and liabilities (the Economic Value of Equity Model “EVE”) and our net interest income would change in the event of a range of assumed changes in market interest rates.
Our ability to originate loans could be restricted by recently adopted federal regulations. The CFPB has a rule intended to clarify how lenders can avoid legal liability under the Dodd-Frank Act, which holds lenders accountable for ensuring a borrower’s ability to repay a mortgage loan.
Our ability to originate loans could be restricted by federal regulations. The CFPB has a rule intended to clarify how lenders can avoid legal liability under the Dodd-Frank Act, which holds lenders accountable for ensuring a borrower’s ability to repay a mortgage loan.
The capital requirements also establish a “capital conservation buffer” of 2.5%, which results in the following minimum ratios: (i) a common equity Tier 1 capital ratio of 7.0%; (ii) a Tier 1 to risk-based assets capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%.
The capital requirements also establish a “capital conservation buffer” of 2.5%, which results in the following minimum ratios: (i) a common equity Tier 1 capital ratio of 7.0%; (ii) a Tier 1 to risk-weighted assets capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%.
Because the repayment of multifamily, nonresidential and construction and land loans depends on the successful management and operation of the borrower’s properties or related businesses, repayment of such loans can be affected by adverse conditions in the local real estate market or economy.
Because the repayment of multifamily, nonresidential and construction and land loans depends on the successful management and operation of the borrower’s properties or related businesses, or their sale, repayment of such loans can be affected by adverse conditions in the local real estate market or economy.
Multi-family real estate loans generally involve a greater risk than 1-4 family residential real estate loans in ‎part because of legislation and government regulations involving rent regulation, such as rent control and rent ‎stabilization, which are outside the control of the borrower or the Bank and could impair the value of the security ‎for the loan or the future cash flow of such properties.
Multi-family real estate loans generally involve a greater risk than 1-4 family residential real estate loans in ‎part because of legislation and government regulations involving rent regulation, such as rent control and rent ‎stabilization, which are outside the control of the borrower or the Bank and could adversely impact the value of the security ‎for the loan or the future cash flow of such properties.
Construction and land loans represented 145.0% of the Bank’s total risk-based capital at December 31, 2024, and our multifamily, mixed-use and nonresidential real estate loan portfolio represented 196.8% of the Bank’s total risk-based capital on that same date. In December 2015, the Agencies released a new statement on prudent risk management for commercial real estate lending (the “2015 Statement”).
Construction and land loans represented 145.0% of the Bank’s total risk-based capital at December 31, 2025, and our multifamily, mixed-use and nonresidential real estate loan portfolio represented 196.8% of the Bank’s total risk-based capital on that same date. In December 2015, the Agencies released a statement on prudent risk management for commercial real estate lending (the “2015 Statement”).
The Bank’s minimum capital requirements are: (i) a common equity Tier 1 capital ratio of 4.5%; (ii) a Tier 1 to risk-based assets capital ratio of 6.0%; (iii) a total capital ratio of 8.0%; and (iv) a Tier 1 leverage ratio of 4.0%.
The Bank’s minimum capital requirements are: (i) a common equity Tier 1 capital ratio of 4.5%; (ii) a Tier 1 to risk-weighted assets capital ratio of 6.0%; (iii) a total capital ratio of 8.0%; and (iv) a Tier 1 leverage ratio of 4.0%.
In addition to being affected by general economic conditions, our earnings and growth are affected by the policies of the Federal Reserve Board. An important function of the Federal Reserve Board is to regulate the money supply and credit conditions.
In addition to being affected by general economic conditions, our earnings and growth are affected by the policies of the Federal Reserve Board. An important function of the Federal Reserve Board is to regulate the money supply and credit conditions in the United States.
To the extent our borrowers cannot implement rent ‎increases that are sufficient to cover expenses, including increased mortgage rates, there will be an increased risk of ‎default for these loans.‎ We may be limited in our ability to originate new construction loans in our market area due to legislative changes.
To the extent our borrowers cannot implement rent ‎increases that are sufficient to cover expenses, there will be an increased risk of ‎default for these loans.‎ We may be limited in our ability to originate new construction loans in our market area due to legislative changes.
Borrowings from the FHLBNY and FRBNY are generally higher cost as compared to core deposits, which will generally lead to decreases in our net interest margin and lower net revenues. Additionally, the Bank’s FHLBNY and FRBNY membership does not represent a legal commitment to extend credit to the Bank.
Such advances and borrowings are generally higher cost as compared to core deposits, which will generally lead to decreases in our net interest margin and lower net revenues. Additionally, the Bank’s FHLBNY and FRBNY membership does not represent a legal commitment to extend credit to the Bank.
Our Equity Incentive Plans have increased our expenses and reduced our income, and may dilute your ownership interests. The Company maintains a Long-Term Incentive Plan.
Our Equity Incentive Plans have increased our expenses and reduced our income, and may dilute our stockholders' ownership interests. The Company maintains a Long-Term Incentive Plan.
During the years ended December 31, 2024 and 2023, the Company recognized in $2.1 million and $1.8 million, respectively, in non-interest expense relating to its stock benefit plans, and we will recognize additional expenses in the future as additional grants are made and awards vest.
During the years ended December 31, 2025 and 2024, the Company recognized in $1.9 million and $2.1 million, respectively, in non-interest expense relating to its stock benefit plans, and we will recognize additional expenses in the future as additional grants are made and awards vest.
We operate in diverse markets and rely on the ability of our employees and systems to process a high number of transactions and to collect, process, transmit and store significant amounts of confidential information regarding our customers, employees and others and concerning our own business, operations, plans and strategies.
We rely on the ability of our employees and systems to process a high number of transactions and to collect, process, transmit and store significant amounts of confidential information regarding our customers, employees and others and concerning our own business, operations, plans and strategies.
Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends will accrue or be due for the first two years after issuance.
Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding 34 companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends accrued or were due for the first two years after issuance.
Treasury, in exchange for the issuance of senior perpetual preferred stock, which preferred stock has certain rights and preferences as compared to shares of our common stock. We are subject to certain contractual and regulatory restrictions under the ECIP which may hinder our operations.
We have received an investment under the ECIP from the Treasury, in exchange for the issuance of senior perpetual preferred stock, which preferred stock has certain rights and preferences as compared to shares of our common stock. We are subject to certain contractual and regulatory restrictions under the ECIP which may hinder our operations.
Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria in the future. We may be dependent on borrowings from the FHLBNY and FRBNY to grow our lending activities, which may negatively impact our results of operations.
Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria, or any amended or additional criteria that may be imposed, in the future. 35 We may be dependent on advances from the FHLBNY and borrowings from the FRBNY to grow our lending activities, which may negatively impact our results of operations.
In addition, we outsource some of our data processing to certain third-party providers. If these third-party providers encounter difficulties, including as a result of cyber-attacks or information security breaches, or if we have difficulty communicating with them, our ability to adequately process and account for transactions could be affected, and our business operations could be adversely affected.
If these third-party providers encounter difficulties, including as a result of cyber-attacks or information security breaches, or if we have difficulty communicating with them, our ability to adequately process and account for transactions could be affected, and our business operations could be adversely affected.
We are also subject to risks related to the cyber vulnerabilities of our partners. We may experience negative impacts to our financial condition and results of operations if our partners are subject to cyber fraud or other security breaches.
We may experience negative impacts to our financial condition and results of operations if our partners are subject to cyber fraud or other security breaches.
The continuing displacement of minorities due to gentrification of our communities may adversely affect us unless we are able to adapt and increase the acceptance of our products and services by non-minority customers. We may also be unfavorably impacted by political developments unfavorable to markets that are dependent on immigrant populations. 42 Item 1B. Unresolve d Staff Comments. Not applicable.
The continuing displacement of minorities due to gentrification of our communities may adversely affect us unless we are able to adapt and increase the acceptance of our products and services by non-minority customers. We may also be unfavorably impacted by political developments unfavorable to markets that are dependent on immigrant populations.
Additionally, the current Presidential Administration is seeking to enact significant changes that may impact economic conditions, ‎including changes to the size and scope of the federal government. These changes, if implemented and taken as a whole, may have ‎varied effects on the economy that are difficult to predict.
Additionally, the current presidential administration has been, and continues to, seek to enact significant changes that may impact economic conditions, ‎including changes to the size and scope of the federal government and changes to internal relations. These changes, if implemented and taken as a whole, may have ‎varied effects on the economy that are difficult to predict.
CECL requires financial institutions to determine periodic estimates of lifetime expected credit losses on loans, and recognize the expected credit losses as allowances for credit losses. 30 In addition, our regulators, as an integral part of their examination process, periodically review the allowance for credit losses and, as a result of such reviews, we may determine that it is appropriate to increase the allowance for credit losses by recognizing additional provisions for loan losses charged to income, or to charge off loans, which, net of any recoveries, would decrease the allowance for credit losses.
In addition, our regulators, as an integral part of their examination process, periodically review the allowance for credit losses and, as a result of such reviews, we may determine that it is appropriate to increase the allowance for credit losses by recognizing additional provisions for loan losses charged to income, or to charge off loans, which, net of any recoveries, would decrease the allowance for credit losses.
Our efficiency ratio is high, and we anticipate that it may remain high, as a result of the ongoing implementation of our business strategy. Our non-interest expense totaled $66.7 million and $68.7 million for the years ended December 31, 2024 and 2023, respectively.
Our efficiency ratio is high, and we anticipate that it may remain high, as a result of the ongoing implementation of our business strategy. Our non-interest expense totaled $67.0 million and $67.5 million for the years ended December 31, 2025 and 2024, respectively.
Our efficiency ratio for the year ended December 31, 2024 improved compared with prior year due to increase in net interest income. If we are unable to successfully implement our business strategy and increase our revenues and decrease our total non-interest expense, our profitability could be adversely affected. We have received an investment under the ECIP from the U.S.
Our efficiency ratio for the year ended December 31, 2025 improved compared with prior year due to an increase in net interest income. If we are unable to successfully implement our business strategy and increase our revenues and decrease our total non-interest expense, our profitability could be adversely affected.
Although we continue to analyze our expenses and pursue efficiencies where available, our efficiency ratio remains high as a result of the implementation of our business strategy combined with operating in an expensive market. Our efficiency ratio was 79.66% and 90.96% for the years ended December 31, 2024 and 2023, respectively.
Although we continue to analyze our expenses and pursue efficiencies where available, our efficiency ratio remains high as a result of the implementation of our business strategy combined with operating in an expensive market. Our efficiency ratio was 61.35% and 80.60% for the years ended December 31, 2025 and 2024, respectively.
The securities portfolio as of December 31, 2024 and 2023 were classified as available-for-sale securities, at fair value, in the amount of $105.0 and $119.9 million and held-to-maturity securities, at amortized costs, in the amount of $367.9 million and $461.7 million, respectively.
The securities portfolio as of December 31, 2025 and 2024 were classified as available-for-sale securities, at fair value, in the amount of $92.2 and $105.0 million and held-to-maturity securities, at amortized costs, in the amount of $273.0 million and $367.9 million, respectively.
Moreover, a significant decline in general economic conditions caused by inflation, recession, acts of terrorism, an outbreak of hostilities, or other international or domestic calamities, unemployment or other factors beyond our control could further impact these local economic conditions and could further negatively affect the financial results of our banking operations.
Moreover, a significant decline in general economic conditions caused by inflation, recession, legislative and regulatory changes, changes in governmental monetary and fiscal policies, level and volatility of interest rates, acts of terrorism, an outbreak of hostilities, or other international or domestic calamities, unemployment or other factors beyond our control could further impact these local economic conditions and could further negatively affect the financial results of our banking operations.
At December 31, 2024 and 2023, one-to-four family residential real estate loans amounted to $472.4 million and $496.0 million, or 20.5% and 25.8%, respectively, of our total loan portfolio. Of these amounts, $330.1 million and $343.7 million, or 69.9% and 69.3%, respectively, is comprised of one-to-four family residential investor-owned properties.
At December 31, 2025 and 2024, one-to-four family residential real estate loans amounted to $434.4 million and $472.4 million, or 16.5% and 20.5%, respectively, of our total loan portfolio. Of these amounts, $307.3 million and $330.1 million, or 70.7% and 69.9%, respectively, is comprised of one-to-four family residential investor-owned properties.
As a ‎result of this legislation as well as previously existing laws and regulations, it is possible that rental income might not ‎rise sufficiently over time to satisfy increases in the loan rate at repricing or increases in overhead expenses (e.g., ‎utilities, taxes, maintenance, etc.). ‎ Additionally, the New York City Rent Guidelines Board established the maximum rent increase on certain ‎apartments at 3.0% for a one-year lease beginning on or after October 1, 2023 and on or after September 30, 2024, ‎while the overall inflation rate increased at a greater rate.
As a ‎result of this legislation as well as previously existing laws and regulations, it is possible that rental income might not ‎rise sufficiently over time to satisfy increases in the loan rate at repricing or increases in overhead expenses (e.g., ‎utilities, taxes, maintenance, etc.). ‎ Further, the New York City Rent Guidelines Board established maximum rent increases on certain rent‑stabilized apartments of 3.0% for one‑year leases beginning on or after October 1, 2025 and before October 1, 2026.
While we strive to ensure the accuracy of our modeled interest rate risk profile, there are inherent limitations and imprecisions in this determination and actual results may differ. Future changes in interest rates could reduce our profits and asset values.
While we strive to ensure the accuracy of our modeled interest rate risk profile, there are inherent limitations and imprecisions in this determination, and actual results may differ.
In some cases, we could be required to apply new or revised guidance retroactively. Changes in management’s estimates and assumptions may have a material impact on our consolidated financial statements and our financial condition or operating results.
These changes can be hard to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we could be required to apply new or revised guidance retroactively. Changes in management’s estimates and assumptions may have a material impact on our consolidated financial statements and our financial condition or operating results.
If our assumptions are incorrect, or if delinquencies or non-performing loans increase, our allowance for credit losses may not be sufficient to cover losses inherent in our loan portfolio, which would require additions to our allowance, which in turn, could materially decrease our net income. On January 1, 2023, the Company adopted Current Expected Credit Loss, or CECL.
If our assumptions are incorrect, or if delinquencies or non-performing loans increase, our allowance for credit losses may not be sufficient to cover losses inherent in our loan portfolio, which would require additions to our allowance, which in turn, could materially decrease our net income.
In addition, any future rate increases can affect the average life of loans and mortgage-backed and related securities. A rise in interest rates may result in lower demand for loans and mortgage-backed and related securities as borrowers may reduce their debts due to the higher costs of borrowings.
A rise in interest rates may result in lower demand for loans and mortgage-backed and related securities as borrowers may reduce their debts due to the higher costs of borrowings.
Our ability to successfully grow will depend on a variety of factors, including our ability to attract and retain experienced bankers, the continued availability of desirable business opportunities, competition from other financial institutions in our market area and our ability to manage our growth.
Our ability to successfully grow will depend on a variety of factors, including our ability to attract and retain experienced bankers, the continued availability of desirable business opportunities, competition from other financial institutions in our market area, our ability to manage our growth, and economic conditions in the markets in which we operate as well as in the U.S. and globally.
At December 31, 2024, $1.79 billion, or 77.7%, of our loan portfolio consisted of multifamily, nonresidential and construction and land loans as compared to $1.40 billion, or 72.7%, of our loan portfolio at December 31, 2023.
At December 31, 2025, $2.14 billion, or 81.4%, of our loan portfolio consisted of multifamily, nonresidential and construction and land loans as compared to $1.79 billion, or 77.7%, of our loan portfolio at December 31, 2024.
These regulations, along with existing tax, accounting, securities, insurance and monetary laws, rules, standards, policies, and interpretations, control the methods by which financial institutions conduct business, implement strategic initiatives and tax compliance, and govern financial reporting and disclosures.
These regulations, along with existing tax, accounting, securities, insurance and monetary laws, rules, standards, policies, and interpretations, control the methods by which financial institutions conduct business, implement strategic initiatives and tax compliance, and govern financial reporting and disclosures. Failure to comply with these laws and regulations could result in financial, structural and operational penalties, including receivership.
The ‎Company began paying dividends on its Preferred Stock in the amount of $0.6 million for the year ended December 31, 2024. On December 20, 2024, the Company entered into an ECIP Securities Purchase Option Agreement (the “Repurchase Agreement”) with Treasury.
In June 2024, the Company began paying dividends on its Preferred Stock, which dividends were $1.1 million and $0.6 million for the years ended December 31, 2025 and 2024, respectively. On December 20, 2024, the Company entered into an ECIP Securities Purchase Option Agreement (the “Repurchase Agreement”) with Treasury.
The effects of such policies upon our business, financial condition and results of operations cannot be predicted. Risk Related to our Operations. We face significant operational risks because the financial services business involves a high volume of transactions and increased reliance on technology, including risk of loss related to cyber security breaches.
We face significant operational risks because the financial services business involves a high volume of transactions and increased reliance on technology, including risk of loss related to cyber security breaches.
We are dependent upon the services of the members of our senior management team who direct our strategy and operations. Members of our senior management team, or lending personnel who possess expertise in our markets and key business relationships, could be difficult to replace.
Members of our senior management team, or lending personnel who possess expertise in our markets and key business relationships, could be difficult to replace.
We reinvest the proceeds from such grants and awards back into the communities we serve. While we believe we will be able to meet the certification criteria required to continue our CDFI and MDI status, there is no certainty that we will be able to do so.
While we believe we will be able to meet the certification criteria required to continue our CDFI and MDI status, there is no certainty that we will be able to do so.
Negative developments in the U.S. in our primary markets may adversely impact our results in the future. Our financial performance is highly dependent on the business environment in the markets where we operate and in the U.S. as a whole.
Either of these outcomes could have a material adverse impact on our financial condition and results of operations. 43 Negative developments in the U.S. or in our primary markets may adversely impact our results in the future. Our financial performance is highly dependent on the business environment in the markets where we operate and in the U.S. as a whole.
There are current proposals from the Federal Housing Finance Agency (“FHFA”), the regulatory of the Federal Home Loan Bank (“FHLB”) system, to adopt certain changes to its eligibility criteria for borrowing to refocus on the FHLB’s housing mission.
There are current proposals from the Federal Housing Finance Agency (“FHFA”), the regulatory of the Federal Home Loan Bank (“FHLB”) system, to adopt certain changes to its eligibility criteria for borrowing to refocus on the FHLB’s housing mission. Additionally, the Company must maintain a satisfactory rating pursuant to the CRA to maintain its ability to access FHLB funding.
Given their larger balances and the complexity of the underlying collateral, multifamily, nonresidential and construction and land loans generally expose a lender to greater credit risk than loans secured by one-to-four family real estate.
As our multifamily, nonresidential and construction and land loan portfolios increase, the corresponding risks and potential for losses from these loans may also increase. Given their larger balances and the complexity of the underlying collateral, multifamily, nonresidential and construction and land loans generally expose a lender to greater credit risk than loans secured by one-to-four family real estate.
At December 31, 2024, 1,492 loans with an aggregate balance of $2.16 billion are to borrowers with only one loan. Another 164 loans are to borrowers with two loans each with a corresponding aggregate balance of $123.6 million. In addition, 30 loans are to borrowers with three loans each with a corresponding aggregate balance of $26.1 million.
At December 31, 2025, 1,427 loans with an aggregate balance of $2.39 billion are to borrowers with only one loan. Another 172 loans are to borrowers with two loans each with a corresponding aggregate balance of $210.7 million. In addition, 15 loans are to borrowers with three loans each with a corresponding aggregate balance of $26.1 million.
Our multifamily, nonresidential and construction and land loan portfolio has increased approximately $396.9 million, or 28.4%, to $1.79 billion at December 31, 2024 from $1.40 billion at December 31, 2023.
Our multifamily, nonresidential and construction and land loan portfolio has increased approximately $343.1 million, or 19.1%, to $2.14 billion at December 31, 2025 from $1.79 billion at December 31, 2024.
At December 31, 2024 and 2023, our securities portfolio totaled $472.9 million and $581.7 million, which represented 15.6% and 21.1% of total assets, respectively.
At December 31, 2025 and 2024, our securities portfolio totaled $365.2 million and $472.9 million, which represented 11.3% and 15.6% of total assets, respectively.
In addition, overhead (including maintenance) expenses ‎often increase significantly during inflationary periods. Finally, if the cash flow from a collateral property is reduced ‎‎(e.g., if leases are not obtained or renewed), the borrower’s ability to repay the loan and the value of the security for ‎the loan may be impaired.
If the cash flow from a collateral property is reduced ‎‎(e.g., if leases are not obtained or renewed at sufficient rates), the borrower’s ability to repay the loan and the value of the security for ‎the loan may be impaired.
A decline in the fair value of our available-for-sale securities could cause a material decline in our reported equity and/or net income.
A decline in the fair value of our available-for-sale securities could cause a material decline in our reported equity and/or net income. Increases in market interest rates have in the past, and may in the future, cause the market value of our securities portfolio to decline significantly.
As a result, our construction loan portfolio has increased to $733.7 million, net of loans-in-process of $359.2 million, or 31.79% of total loans, at December 31, 2024 from $503.9 million, net of loans-in-process of $520.3 million, or 26.22% of total loans, at December 31, 2023.
As a result, our construction loan portfolio has increased to $854.1 million, net of loans-in-process of $132.7 million, or 32.5% of total loans, at December 31, 2025 from $733.7 million, net of loans-in-process of $359.2 million, or 31.8% of total loans, at December 31, 2024.
However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met. At present, the Company has reported 9 consecutive quarters for which it has met both the Deep Impact and Qualified Lending Conditions.
However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met.
Areas requiring significant estimates and assumptions by management include our evaluation of the adequacy of our allowance for credit losses, the valuation of loans held for sale, the valuation of deferred tax assets and investment securities, the estimates relating to the valuation for share-based awards, and our determinations with respect to amounts owed for income taxes.
Areas requiring significant estimates and assumptions by management include our evaluation of the adequacy of our allowance for credit losses, the valuation of loans held for sale, the valuation of deferred tax assets and investment securities, the estimates relating to the valuation for share-based awards, and our determinations with respect to amounts owed for income taxes. 44 Other Risks Related to Our Business and Industry Generally Financial challenges at other banking institutions could lead to depositor concerns that spread within the banking industry causing disruptive deposit outflows and other destabilizing results.
Ponce Bank’s ability to pay dividends to the Company will be limited if it does not have the capital conservation buffer required by the capital rules, which may further limit the Company’s ability to pay dividends to stockholders. See “Regulation and Supervision—Federal Banking Regulation—Capital Requirements.” The Federal Reserve Board may require us to commit capital resources to support Ponce Bank.
Ponce 41 Bank’s ability to pay dividends to the Company will be limited if it does not have the capital conservation buffer required by the capital rules, which may further limit the Company’s ability to pay dividends to stockholders.
Federal law requires that a holding company act as a source of financial and managerial strength to its subsidiary bank and to commit resources to support such subsidiary bank.
See “Regulation and Supervision—Federal Banking Regulation—Capital Requirements.” The Federal Reserve Board may require us to commit capital resources to support Ponce Bank. Federal law requires that a holding company act as a source of financial and managerial strength to its subsidiary bank and to commit resources to support such subsidiary bank.
We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for many of our loans.
At December 31, 2025 and 2024, our ACL totaled $25.4 million and $22.5 million, which represented 0.97%, and 0.97% of total loans, respectively. We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for many of our loans.
At December 31, 2024, in the event of an instantaneous 100 basis point increase in interest rates, we estimate that we would experience a 5.67% decrease in EVE and a 4.63% decrease in net interest income.
At December 31, 2025, in the event of an instantaneous 100 basis point increase in interest rates, we estimate that we would experience a 4.24% decrease in EVE and a 0.57% decrease in net interest income. However, these 38 models inherently involve the use of assumptions, judgments and estimates.
Consequently, the ability of many of our business customers to repay their loans may deteriorate, and in some cases this deterioration may occur quickly, which would adversely impact our results of operations and financial condition. 29 The unseasoned nature of our multifamily, nonresidential and construction and land loans portfolio may result in changes to our estimates of collectability, which may lead to additional provisions or charge-offs, which could hurt our profits.
Consequently, the ability of many of our business customers to repay their loans may deteriorate, and in some cases this deterioration may occur quickly, which would adversely impact our results of operations and financial condition.
The Bank and the Company are certified as CDFIs and MDIs by the United States Department of the Treasury. Such status increases a financial institution’s potential for receiving grants and awards that, in turn, enable the financial institution to increase the level of community development financial services that it provides to communities.
Such status increases a financial institution’s potential for receiving grants, deposits and awards that, in turn, enable the financial institution to increase the level of community development financial services that it provides to communities. We reinvest the proceeds from such grants, deposits and awards back into the communities we serve.
We adopt internal policies and procedures to guide management and employees regarding the operation and conduct of our business. We may not always achieve absolute compliance with all of our policies and procedures. Any deviation or non-adherence to these internal policies and procedures, whether intentional or unintentional, could have a detrimental effect on our management, operations or financial condition.
We adopt internal policies and procedures to guide management and employees regarding the operation and conduct of our business. We may not always achieve absolute compliance with all of our policies and procedures.
From time to time, we reposition a portion of our investment securities portfolio in an effort to better position our balance sheet for potential changes in short-term rates. We employ the use of models and modeling techniques to quantify the levels of risks to net interest income, which inherently involve the use of assumptions, judgments, and estimates.
From time to time, we reposition a portion of our investment securities portfolio in an effort to better position our balance sheet for potential changes in short-term rates.
Declines in real estate values could cause some of our one-to-four family residential mortgages to be inadequately collateralized, which would expose us to a greater risk of loss if we seek to recover on defaulted loans by selling the real estate collateral.
Declines in real estate values could cause some of our one-to-four family residential mortgages to be inadequately collateralized, which would expose us to a greater risk of loss if we seek to recover on defaulted loans by selling the real estate collateral. 31 One-to-four family residential mortgage lending, whether owner-occupied or non-owner-occupied, with higher combined loan-to-value ratios are more sensitive to declining property values than those with lower combined loan-to-value ratios and therefore may experience a higher incidence of default and severity of losses.
As of December 31, 2024, 23.1% of our deposits are estimated to be above FDIC-insurance limits. Ineffective liquidity management could adversely affect our financial results and condition. Effective liquidity management is essential for the operation of our business.
Ineffective liquidity management could adversely affect our financial results and condition. Effective liquidity management is essential for the operation of our business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeShe has held senior management positions in information technology, management information systems and information security for over 30 years. She reports regularly to the risk and audit committees of the Board of Directors about the prevention, detection, mitigation, and remediation of cybersecurity incidents.
Biggest changeInternally, the cybersecurity program is managed by the Company’s Senior Vice President and Chief Information Officer. She has held senior management positions in information technology, management information systems and information security for over 30 40 years.
See Item 1A. “Risk Factors.” – “We face significant operational risks because the financial services business involves a high volume of transactions and ‎increased reliance on technology, including risk of loss related to cyber security breaches.‎”‎ for further ‎discussion of potential risks related to cybersecurity incidents.‎ 43
See Item 1A. “Risk Factors.” – “We face significant operational risks because the financial services business involves a high volume of transactions and ‎increased reliance on technology, including risk of loss related to cyber security breaches.‎”‎ for further ‎discussion of potential risks related to cybersecurity incidents.‎ 48
The Company’s Senior Vice President and Chief Information Officer also regularly reports to the Company’s executive risk management (“ERM”) committee, which oversees Company-wide risk at the management level, regarding cybersecurity risks. Members of the ERM committee include our President and Chief Executive Officer.
The Company’s Senior Vice President and Chief Information Officer also regularly reports to the Company’s IT Steering Committee and executive risk management (“ERM”) committee, which oversees Company-wide risk at the management level, regarding cybersecurity risks. Members of the ERM committee include our President and Chief Executive Officer.
Item 1C. Cybersecurity. The Company’s cybersecurity program is integrated within its overall risk management function. The Company engages third parties, including an outsourced cybersecurity team and additional vendors that conduct cybersecurity testing. All critical vendors of the Company, including its cybersecurity vendors, are subject to the requirements of its vendor management policy and processes.
Item 1C. Cybersecurity. Cybersecurity Risk, Management and Strategy The Company’s cybersecurity program is integrated within its overall risk management function. The Company engages third parties, including an outsourced cybersecurity team and additional vendors that conduct cybersecurity testing, 24/7 scanning, monitoring and tracking.
Additionally, the full board annually assesses all critical risks of the Company, including cybersecurity risks, and also receives periodic updates relating to key cybersecurity issues as part of their oversight.
She reports regularly to the risk and audit committees of the Board of Directors about the prevention, detection, mitigation, 47 and remediation of cybersecurity activities and incidents. Additionally, the full board annually assesses all critical risks of the Company, including cybersecurity risks, and also receives periodic updates relating to key cybersecurity issues as part of their oversight.
The Company is a regulated entity and undergoes regulatory reviews to ensure the Bank remains in compliance with all appropriate standards, including related to its management of third-party vendors. Internally, the cybersecurity program is managed by the Company’s Senior Vice President and Chief Information Officer.
All critical vendors of the Company, including its cybersecurity vendors, are subject to the requirements of its vendor management policy and processes. The Company is a regulated entity and undergoes regulatory reviews to ensure the Bank remains in compliance with all appropriate standards, including related to its management of third-party vendors.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLeased 1990 596 Bronx, NY 10459 37-60 82nd Street Leased 2021 37 Jackson Heights, NY 11372 51 East 170th Street Leased 2018 615 Bronx, NY 10452 169 Smith Street Leased 2021 102 Brooklyn, NY 11201 207 East 106th Street Leased 2006 1,235 New York, NY 10029 2244 Westchester Avenue Leased 2021 485 Bronx, NY 10462 5560 Broadway Leased 2021 1,359 Bronx, NY 10463 34-05 Broadway Leased 2001 693 Astoria, NY 11106 3821 Bergenline Avenue Leased 2021 38 Union City, NJ 07087 1900 Ralph Avenue Leased 2007 405 Brooklyn, NY 11234 20-47 86th Street Owned 2010 3,249 Brooklyn, NY 11214 100-20 Queens Boulevard Leased 2010 75 Forest Hills, NY 11375 319 1st Avenue Leased 2010 292 New York, NY 10003 32-75 Steinway Street Leased 2020 70 Astoria, NY 11103 2612 East 16th Street Leased 2020 — Brooklyn, NY 11235 42 South Washington Avenue Leased 2020 — Bergenfield, NJ 07621 135-14 Northern Blvd.
Biggest changeLeased 1990 439 Bronx, NY 10459 37-60 82nd Street Leased 2021 — Jackson Heights, NY 11372 51 East 170th Street Leased 2018 552 Bronx, NY 10452 169 Smith Street Leased 2021 26 Brooklyn, NY 11201 207 East 106th Street Leased 2006 1,097 New York, NY 10029 2244 Westchester Avenue Leased 2021 503 Bronx, NY 10462 5560 Broadway Leased 2021 1,242 Bronx, NY 10463 34-05 Broadway Leased 2001 625 Astoria, NY 11106 3821 Bergenline Avenue Leased 2021 — Union City, NJ 07087 1900 Ralph Avenue Leased 2007 367 Brooklyn, NY 11234 20-47 86th Street Owned 2010 3,158 Brooklyn, NY 11214 100-20 Queens Boulevard Leased 2010 8 Forest Hills, NY 11375 319 1st Avenue Leased 2010 167 New York, NY 10003 3876 9th Avenue Leased 2025 851 New York, NY 10034 2612 East 16th Street (1) Leased 2020 — Brooklyn, NY 11235 135-14 Northern Blvd.
Item 2. Pro perties. As of December 31, 2024, the net book value of the Company’s office properties including leasehold improvements was $12.9 million, and the net book value of its furniture, fixtures and other equipment and software was $3.9 million. The Company’s and Bank’s executive offices are located at 2244 Westchester Avenue, Bronx, New York.
Item 2. Pro perties. As of December 31, 2025, the net book value of the Company’s office properties including leasehold improvements was $12.7 million, and the net book value of its furniture, fixtures and other equipment and software was $2.9 million. The Company’s and Bank’s executive offices are located at 2244 Westchester Avenue, Bronx, New York.
The following table sets forth information regarding the Company’s offices as of December 31, 2024. Location Leased or Owned Year Acquired or Leased Net Book Value of Real Property (in thousands) Main Office: 2244 Westchester Avenue Leased 2021 $ 272 Bronx, NY 10462 Other Properties: 980 Southern Blvd.
The following table sets forth information regarding the Company’s offices as of December 31, 2025. Location Leased or Owned Year Acquired or Leased Net Book Value of Real Property (in thousands) Main Office: 2244 Westchester Avenue Leased 2021 $ 242 Bronx, NY 10462 Other Properties: 980 Southern Blvd.
Removed
Owned 2020 3,412 Flushing, NY 11354 1600 Ponce de Leon Boulevard Leased 2024 — Coral Gables, FL 33134 $ 12,935 44
Added
Owned 2020 3,320 Flushing, NY 11354 297 South Washington Avenue Leased 2025 57 Bergenfield, NJ 07621 1600 Ponce de Leon Boulevard Leased 2024 — Coral Gables, FL 33134 $ 12,654 (1) On May 1, 2025, the Company sublet its 2612 East 16th Street Brooklyn mortgage loan office. The sublease will expire on August 31, 2028. 49

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe are 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 Saf ety Disclosures. Not applicable. 45 PAR T II
Biggest changeWe are 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 Saf ety Disclosures. Not applicable. 50 PAR T II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 45 PART II 46 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 46 Item 6. Reserved 46 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 47 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 66 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 50 PART II 51 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 51 Item 6. [Reserved] 51 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 52 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 69 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe number of record-holders may not reflect the number of persons or entities holding stock in nominee name through banks, brokerage firms and other nominees. To date, the Company has not paid any dividends to its common stockholders. We have no current plan or intention to pay cash dividends to our common stockholders.
Biggest changeThe number of stockholders of record of the Company’s common stock as of March 11, 2026 was 249 The number of record-holders may not reflect the number of persons or entities holding stock in nominee name through banks, brokerage firms and other nominees. To date, the Company has not paid any dividends to its common stockholders.
For a further discussion concerning the payment of dividends on our shares of common stock, see “Regulation and Supervision—Holding Company Regulations—Dividends and Stock Repurchases.” Dividends we can declare and pay will depend, in part, upon receipt of dividends from Ponce Bank, because currently we will have no source of income other than dividends from Ponce Bank and earnings from the investment of funds held by the Company and interest payments received in connection with the loan to the employee stock ownership plan.
For a further discussion concerning regulations that would impact the payment of dividends on our shares of common stock, see “Regulation and Supervision—Holding Company Regulations—Dividends and Stock Repurchases.” Dividends we can declare and pay will depend, in part, upon receipt of dividends from Ponce Bank, because currently we will have no source of income other than dividends from Ponce Bank and earnings from the investment of funds held by the Company and interest payments received in connection with the loan to the employee stock ownership plan.
Item 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. The Company’s shares of common stock are traded on the NASDAQ Stock Market, LLC under the symbol “PDLB”. The number of stockholders of record of the Company’s common stock as of March 11, 2025 was 327.
Item 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. The Company’s shares of common stock are traded on the Nasdaq Stock Market, LLC under the symbol “PDLB”.
Regulations of the Federal Reserve Board and the OCC impose limitations on “capital distributions” by savings institutions. See “Regulation and Supervision—Federal Bank Regulation—Capital Requirements.” We will file a consolidated federal tax return.
Regulations of the OCC and FDIC impose limitations on dividends that the Bank may pay to the Company. See “Regulation and Supervision—Federal Bank Regulation—Capital Requirements.” Pursuant to our charter, we are authorized to issue preferred stock.
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Accordingly, it is anticipated that any cash distributions that we make to our stockholders would be treated as cash dividends and not as a non-taxable return of capital for federal and state tax purposes. Pursuant to our charter, we are authorized to issue preferred stock.
Added
We have no current plan or intention to pay cash dividends to our common stockholders.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThe following table presents non-interest expense for the periods indicated: For the Years Ended December 31, Change 2024 2023 Amount Percent (Dollars in thousands) Compensation and benefits $ 30,910 $ 30,699 $ 211 0.7 % Occupancy and equipment 14,880 14,568 312 2.1 % Data processing expenses 4,382 5,083 (701 ) (13.8 %) Direct loan expenses 2,555 1,623 932 57.4 % (Benefit) provision for contingencies (783 ) 2,311 (3,094 ) (133.9 %) Insurance and surety bond premiums 1,101 1,018 83 8.2 % Office supplies, telephone and postage 998 1,483 (485 ) (32.7 %) Professional fees 6,146 7,092 (946 ) (13.3 %) Microloans recoveries (201 ) (1,481 ) 1,280 (86.4 %) Marketing and promotional expenses 714 825 (111 ) (13.5 %) Federal deposit insurance and regulatory assessment (1) 1,627 1,472 155 10.5 % Other operating expenses (1) 4,345 3,970 375 9.4 % Total non-interest expense $ 66,674 $ 68,663 $ (1,989 ) (2.9 %) (1) For the year ended December 31, 2023, $1.2 million of federal deposit insurance was reclassified from other operating expenses to federal deposit insurance and regulatory assessments and $0.4 million was reclassified from federal deposit insurance and regulatory assessments to other operating expenses.
Biggest changeThe $0.4 million decrease in non-interest expense was mainly attributable to decreases of $1.7 million in direct loan expenses, $0.6 million in professional fees, $0.3 million in federal deposit insurance and regulatory assessment, and $0.3 million in office supplies, telephone and postage, partially offset by increases of $0.9 million in occupancy and equipment, $0.5 million in compensation and benefits, $0.5 million in data processing expenses and $0.2 million in other operating expense. 60 The following table presents non-interest expense for the periods indicated: For the Years Ended December 31, Change 2025 2024 Amount Percent (Dollars in thousands) Compensation and benefits $ 31,388 $ 30,910 $ 478 1.5 % Occupancy and equipment 15,787 14,880 907 6.1 % Data processing expenses 4,859 4,382 477 10.9 % Direct loan expenses 900 2,555 (1,655 ) (64.8 %) Insurance and surety bond premiums 1,254 1,101 153 13.9 % Office supplies, telephone and postage 700 998 (298 ) (29.9 %) Professional fees 5,532 6,146 (614 ) (10.0 %) Microloans recoveries — (201 ) 201 (100.0 %) Marketing and promotional expenses 627 714 (87 ) (12.2 %) Federal deposit insurance and regulatory assessment 1,370 1,627 (257 ) (15.8 %) Other operating expenses 4,592 4,345 247 5.7 % Total non-interest expense $ 67,009 $ 67,457 $ (448 ) (0.7 %) Income Tax Provision.
The amounts of assets and liabilities shown which reprice or mature during a particular period were determined in accordance with the earlier of term to repricing or the contractual maturity of the asset or liability.
The amounts of assets and liabilities shown which reprice or mature during a particular period were determined in accordance with the earlier of term to repricing or the contractual maturity of the asset or liability.
The loan amounts in the table reflect principal balances expected to be redeployed and/or repriced as a result of contractual amortization and as a result of contractual rate adjustments on adjustable-rate loans.
The loan amounts in the table reflect principal balances expected to be redeployed and/or repriced as a result of contractual amortization and as a result of contractual rate adjustments on adjustable-rate loans.
Banking regulations have established guidelines relating to the amount of construction and land mortgage loans and investor- owned commercial real estate mortgage loans of 100% and 300% of total risk-based capital, respectively. Should a bank’s ratios be in excess of these guidelines, banking regulations generally require an increased level of monitoring in these lending areas by bank management.
Banking regulations have established guidelines relating to the amount of construction and land loans and investor- owned commercial real estate loans of 100% and 300% of total risk-based capital, respectively. Should a bank’s ratios be in excess of these guidelines, banking regulations generally require an increased level of monitoring in these lending areas by bank management.
New York State’s BDD Program, administered by the Department of Financial Services ("DFS"), supports the establishment of bank and credit union branches in areas across New York State where there is a demonstrated need for banking services. To encourage participation, approved BDD branches receive access to subsidized and market rate deposits from New York State.
New York State’s BDD Program, administered by the Department of Financial Services ("DFS"), supports the establishment of bank and credit union branches in areas across New York State where there is a demonstrated need for banking services. To encourage participation, approved BDD branches receive access to subsidized and market 53 rate deposits from New York State.
Economic values are determined by discounting 61 expected cash flows from assets, liabilities and off-balance sheet items, which establishes a base case EVE. Rates are then shocked as prescribed by the Interest Rate Risk Policy to measure the sensitivity in EVE values for each of those shocked rate scenarios versus the base case.
Economic values are determined by discounting expected cash flows from assets, liabilities and off-balance sheet items, which establishes a base case EVE. Rates are then shocked as prescribed by the Interest Rate Risk Policy to measure the sensitivity in EVE values for each of those shocked rate scenarios versus the base case.
The preparation of these consolidated financial statements requires 49 management to make estimates and assumptions affecting the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of income and expenses. The estimates and assumptions used are based on historical experience and various other factors and are believed to be reasonable under the circumstances.
The preparation of these consolidated financial statements requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of income and expenses. The estimates and assumptions used are based on historical experience and various other factors and are believed to be reasonable under the circumstances.
(2) Securities include available-for-sale securities and held-to-maturity securities. 60 Management of Market Risk General . The most significant form of market risk is interest rate risk because, as a financial institution, the majority of the Bank’s assets and liabilities are sensitive to changes in interest rates.
(2) Securities include available-for-sale securities and held-to-maturity securities. Management of Market Risk General . The most significant form of market risk is interest rate risk because, as a financial institution, the majority of the Bank’s assets and liabilities are sensitive to changes in interest rates.
Pursuant to the Repurchase Agreement, Treasury has granted the Company an option to purchase all of the Preferred 47 Stock during the Option Period, which is the first fifteen years following the Original Closing Date.
Pursuant to the Repurchase Agreement, Treasury has granted the Company an option to purchase all of the Preferred Stock during the Option Period, which is the first fifteen years following the Original Closing Date.
The projected impact on net interest income in the table above assumes no change in deposit portfolio size or mix from the baseline forecast in alternative rate environments. In higher rate scenarios, any customer activity resulting in the replacement of low-cost or noninterest-bearing deposits with higher-yielding deposits or market-based funding would reduce the benefit in those scenarios.
The projected impact on net interest income in the table above assumes no change in deposit portfolio size or mix from the baseline forecast in alternative rate environments. In higher rate scenarios, any customer activity resulting in the replacement of low-cost or non-interest-bearing deposits with higher-yielding deposits or market-based funding would reduce the benefit in those scenarios.
The following table sets forth the Company’s interest-earning assets and its interest-bearing liabilities at December 31, 2024, which are anticipated to reprice or mature in each of the future time periods shown based upon certain assumptions.
The following table sets forth the Company’s interest-earning assets and its interest-bearing liabilities at December 31, 2025, which are anticipated to reprice or mature in each of the future time periods shown based upon certain assumptions.
For example, decreases in market interest rates can increase the fair values of loans, deposits and borrowings. 64 Liquidity and Capital Resources Liquidity describes the ability to meet the financial obligations that arise in the ordinary course of business.
For example, decreases in market interest rates can increase the fair values of loans, deposits and borrowings. 67 Liquidity and Capital Resources Liquidity describes the ability to meet the financial obligations that arise in the ordinary course of business.
Discussion and analysis of our 2023 fiscal year specifically, as well as the year-over-year comparison of our 2023 financial performance to 2022, are located under Part II, Item 7 — Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed with the SEC on March 19, 2024, which is available on our investor relations website at poncebank.gcs-web.com and the SEC's website at sec.gov.
Discussion and analysis of our 2024 fiscal year specifically, as well as the year-over-year comparison of our 2024 financial performance to 2023, are located under Part II, Item 7 — Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 filed with the SEC on March 13, 2025 (the "2024 Form 10-K") , which is available on our investor relations website at poncebank.gcs-web.com and the SEC's website at sec.gov.
At December 31, 2024, the EVE model indicated that the Bank was in compliance with the Board of Directors approved Interest Rate Risk Policy. Most Likely Earnings Simulation Models .
At December 31, 2025, the EVE model indicated that the Bank was in compliance with the Board of Directors approved Interest Rate Risk Policy. Most Likely Earnings Simulation Models .
At December 31, 2024, the earnings simulation model indicated that the Bank was in compliance with the Board of Directors approved Interest Rate Risk Policy. Economic Value of Equity Model .
At December 31, 2025, the earnings simulation model indicated that the Bank was in compliance with the Board of Directors approved Interest Rate Risk Policy. Economic Value of Equity Model .
The table sets forth an approximation of the projected repricing of assets and liabilities at December 31, 2023, on the basis of contractual maturities, anticipated prepayments and scheduled rate adjustments.
The table sets forth an approximation of the projected repricing of assets and liabilities at December 31, 2025, on the basis of contractual maturities, anticipated prepayments and scheduled rate adjustments.
(8) Net interest margin represents net interest income divided by average total interest-earning assets. 59 Rate/Volume Analysis The following table presents the effects of changing rates and volumes on the Company’s net interest income for the periods indicated. The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate).
(7) Net interest margin represents net interest income divided by average total interest-earning assets. 62 Rate/Volume Analysis The following table presents the effects of changing rates and volumes on the Company’s net interest income for the periods indicated. The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate).
The overall reliance on wholesale funding and noncore funding were within those policy limitations as of December 31, 2024 and 2023. The Management Asset/Liability Committee generally meets on a weekly basis to review funding needs, if any, and to ensure the Company operates within the approved limitations. Borrowings.
The overall reliance on wholesale funding and noncore funding were within those policy limitations as of December 31, 2025 and 2024. The Management Asset/Liability Committee generally meets on a monthly basis to review funding needs, if any, and to ensure the Company operates within the approved limitations. Borrowings.
Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends will accrue or be due for the first two years after issuance.
Under the ECIP, Treasury provided investment capital directly to depository institutions that are CDFIs or MDIs or their holding companies, to provide loans, grants, and forbearance for small businesses, minority-owned businesses, and consumers, in low-income and underserved communities. No dividends accrued or were due for the first two years after issuance.
However, if a substantial portion of these deposits are not retained, the Company may utilize FHLBNY and FRBNY advances, unsecured credit lines with correspondent banks, or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense. Contractual Obligations .
However, if a substantial portion of these deposits are not retained, the Company may utilize FHLBNY advances and FRBNY borrowings, unsecured credit lines with correspondent banks, or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense. Lease commitments .
The Bank’s policy is to operate within the 150% guideline for construction and land mortgage loans and up to 450% for investor owned commercial real estate mortgage loans. Both ratios are calculated by dividing certain types of loan balances for each of the two categories by the Bank’s total risk-based capital.
The Bank’s policy is to operate up to 200% for construction and land loans and up to 450% for investor owned commercial real estate loans. Both ratios are calculated by dividing certain types of loan balances for each of the two categories by the Bank’s total risk-based capital.
The technology is a mobile application that digitizes the lending workflow from pre-approval to servicing and enables the Company to originate, close and fund small business loans within very short spans of time, without requiring a physical presence within banking offices and with automated underwriting using both traditional and non-traditional methods.
Company's Growth The Company has deployed a mobile application that digitizes the lending workflow from pre-approval to servicing and enables the Company to originate, close and fund small business loans within very short spans of time, without requiring a physical presence within banking offices and with automated underwriting using both traditional and non-traditional methods.
At December 31, 2024 and 2023, the Company had outstanding commitments to originate loans, and extend credit of $411.5 million and $591.5 million, respectively. It is anticipated that the Company will have sufficient funds available to meet its current lending commitments.
At December 31, 2025 and 2024, the Company had outstanding commitments to originate loans, and extend credit of $481.7 million and $411.5 million, respectively. It is anticipated that the Company will have sufficient funds available to meet its current lending commitments.
(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.
(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.
At December 31, 2024 and 2023, approximately 3.5% and 5.3%, respectively, of the outstanding principal balance of the Bank’s commercial real estate mortgage loans were secured by owner-occupied commercial real estate.
At December 31, 2025 and 2024, approximately 3.1% and 3.5%, respectively, of the outstanding principal balance of the Bank’s commercial real estate loans were secured by owner-occupied commercial real estate.
The Company also has material cash requirements for occupancy and equipment expenses, excluding depreciation and amortization of $2.0 million, related to rental expenses, general maintenance and cleaning supplies, guard services, software licenses and other miscellaneous expenses, which were $12.9 million the year ended December 31, 2024.
The Company also has material cash requirements for occupancy and equipment expenses, excluding depreciation and amortization of $2.1 million and $2.0 million, related to rental expenses, general maintenance and cleaning supplies, guard services, software licenses and other miscellaneous expenses, which were $13.7 million and $12.9 million for the years ended December 31, 2025 and 2024, respectively.
At 54 December 31, 2024, the Bank was above the 100% guidelines established by the banking regulations but under the 150% guidelines set by the Bank for construction and land mortgage loans and above the 300% guideline established by banking regulators but under the 450% guidelines set by the Bank for investor owned commercial real estate mortgage loans.
At December 31, 2025, the Bank was above the 100% guidelines established by the banking regulations but under the 200% guidelines set by the Bank for construction and land loans and above the 300% guideline established by banking regulators but under the 450% guidelines set by the Bank for investor owned commercial real estate loans.
Certificates of deposits that are scheduled to mature in less than one year from December 31, 2024 totaled $670.6 million. Management expects that a substantial portion of the maturing time deposits will be renewed.
Certificates of deposits that are scheduled to mature in less than one year from December 31, 2025 totaled $594.4 million. Management expects that a substantial portion of the maturing time deposits will be renewed.
In addition to contractual obligations, the Company’s material cash requirements also includes compensation and benefits expenses for its employees, which were $30.9 million the year ended December 31, 2024.
Other Material Cash Requirements. In addition to contractual obligations, the Company’s material cash requirements also includes compensation and benefits expenses for its employees, which were $31.4 million and $30.9 million for the years ended December 31, 2025 and 2024, respectively.
The obligations related to our uncertain tax positions, which are not considered material, have been excluded from the table above because of the uncertainty surrounding the timing and final amounts of settlement, if any. Other Material Cash Requirements.
The obligations related to our uncertain tax positions, which are not considered material, have been excluded from the table above because of the uncertainty surrounding the timing and final amounts of settlement, if any. Dividend on Preferred Stock .
Management believes that it has established the appropriate level of controls to monitor the Bank’s lending in these areas. Mortgage Loans Held For Sale . Mortgage loans held for sale, at fair value, at December 31, 2024 increased $0.8 million to $10.7 million from $10.0 million at December 31, 2023. Deposits .
Management believes that it has established the appropriate level of controls to monitor the Bank’s lending in these areas. Mortgage Loans Held For Sale . Mortgage loans held for sale, at fair value, at December 31, 2025 decreased $7.3 million to $3.4 million from $10.7 million at December 31, 2024. Deposits .
To limit interest rate risk, the Bank has policy guidelines for earnings risk which seek to limit the variance of net interest income in both gradual and instantaneous changes to interest rates.
To limit interest rate risk, the Bank has policy guidelines for earnings risk which seek to limit the variance of net interest income under instantaneous changes to interest rates.
The Bank had $571.1 million and $380.4 million of outstanding term advances from FHLBNY at December 31, 2024 and 2023, respectively. The Bank had one overnight line of credit advance in the amount of $25.0 million from the FHLBNY at December 31, 2024 and no overnight line of credit advance from the FHLBNY at December 31, 2023.
At December 31, 2025 and 2024, the Bank had outstanding borrowings of $596.1 million and $571.1 million, respectively, in term advances from the FHLBNY. The Bank also had no overnight line of credit advance at December 31, 2025 and had one overnight line of credit advance in the amount of $25.0 million from the FHLBNY at December 31, 2024.
Net income available to common stockholders for the year ended December 31, 2024 was $10.3 million compared to net income available to common stockholders of $3.4 million for the year ended December 31, 2023.
Net income available to common stockholders for the year ended December 31, 2025 was $27.6 million compared to net income available to common stockholders of $10.3 million for the year ended December 31, 2024.
The Bank currently utilizes a third-party modeling solution that is prepared on a quarterly basis, to evaluate its sensitivity to changing interest rates, given the Bank’s business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the Board of Directors. The Bank engages in hedging activities, such as swap transactions.
The Bank currently utilizes a third-party modeling solution that is prepared on a quarterly basis, to evaluate its sensitivity to changing interest rates, given the Bank’s business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the Board of Directors. Net Interest Income Simulation Models .
Net cash used in investing activities, which consists primarily of disbursements for loan originations, purchases of new securities, and purchase of equipment offset by principal collections on loans, proceeds from maturities, calls and principal repayments on securities was ($294.9) million and ($332.9) million for the years ended December 31, 2024 and 2023, respectively.
Net cash used in investing activities, which consists primarily of disbursements for loan originations, purchase of loans, net purchase and redemption of FHLBNY stock, net purchase of FRBNY stock and purchase of equipment offset by principal collections on loans and proceeds from maturities, calls and principal repayments on securities was ($219.7) million and ($294.9) million for the years ended December 31, 2025 and 2024, respectively.
At December 31, 2018, the Company had approximately $1.06 billion in assets, $918.5 million in loans receivable, net of allowance for credit losses of $12.7 million, and $809.8 million in deposits.
At December 31, 2018, the first year after our initial public offering, the Company had approximately $1.06 billion in assets, $918.5 million in loans, net of allowance for credit losses of $12.7 million, and $809.8 million in deposits.
Earnings per basic and diluted share was $0.46 for the year ended December 31, 2024 compared to earnings per basic and diluted share of $0.15 for the year ended December 31, 2023.
Earnings per basic share was $1.21 and diluted share was $1.20 for the year ended December 31, 2025 compared to earnings per basic and diluted share of $0.46 for the year ended December 31, 2024.
December 31, 2024 Time to Repricing Zero to 90 Days Zero to 180 Days Zero Days to One Year Zero Days to Two Years Zero Days to Five Years Five Years Plus Total Earning Assets & Costing Liabilities Non Earning Assets & Non Costing Liabilities Total (Dollars in thousands) Assets: Interest-bearing deposits in banks $ 104,361 $ 104,361 $ 104,361 $ 104,361 $ 104,361 $ — $ 104,361 $ 35,478 $ 139,839 Securities (1) 23,921 56,636 107,958 160,603 288,893 203,742 492,635 (19,727 ) 472,908 Placements with banks 249 249 249 249 249 — 249 — 249 Net loans (includes LHFS) 267,730 415,218 923,776 1,425,128 2,210,873 81,816 2,292,689 4,646 2,297,335 FHLBNY stock 29,182 29,182 29,182 29,182 29,182 — 29,182 — 29,182 Other assets — — — — — — — 100,425 100,425 Total $ 425,443 $ 605,646 $ 1,165,526 $ 1,719,523 $ 2,633,558 $ 285,558 $ 2,919,116 $ 120,822 $ 3,039,938 Liabilities: Non-maturity deposits $ 60,746 $ 121,499 $ 243,005 $ 486,011 $ 870,025 $ 60,680 $ 930,705 $ 173,855 $ 1,104,560 Certificates of deposit 315,709 507,093 670,619 728,383 780,304 — 780,304 — 780,304 Borrowings 75,000 75,000 125,000 325,000 596,100 — 596,100 — 596,100 Other liabilities - - - - - - - 53,474 53,474 Total liabilities 451,455 703,592 1,038,624 1,539,394 2,246,429 60,680 2,307,109 227,329 2,534,438 Capital — — — — — — — 505,500 505,500 Total liabilities and capital $ 451,455 $ 703,592 $ 1,038,624 $ 1,539,394 $ 2,246,429 $ 60,680 $ 2,307,109 $ 732,829 $ 3,039,938 Asset/liability gap $ (26,012 ) $ (97,946 ) $ 126,902 $ 180,129 $ 387,129 $ 224,878 $ 612,007 Gap/assets ratio 94.24 % 86.08 % 112.22 % 111.70 % 117.23 % 470.60 % 126.53 % (1) Includes available-for-sale securities and held-to-maturity securities. 63 The following table sets forth the Company’s interest-earning assets and its interest-bearing liabilities at December 31, 2023, which are anticipated to reprice or mature in each of the future time periods shown based upon certain assumptions.
December 31, 2024 Time to Repricing Zero to 90 Days Zero to 180 Days Zero Days to One Year Zero Days to Five Years Five Years Plus Total Earning Assets & Costing Liabilities Non Earning Assets & Non Costing Liabilities Total (Dollars in thousands) Assets: Interest-bearing deposits in banks $ 104,361 $ 104,361 $ 104,361 $ 104,361 $ — $ 104,361 $ 35,478 $ 139,839 Securities (1) 23,921 56,636 107,958 288,893 203,742 492,635 (19,727 ) 472,908 Placement with banks 249 249 249 249 — 249 — 249 Net loans (includes LHFS) 267,730 415,218 923,776 2,210,873 81,816 2,292,689 4,646 2,297,335 FHLBNY stock 29,182 29,182 29,182 29,182 — 29,182 — 29,182 Other assets — — — — — — 100,425 100,425 Total $ 425,443 $ 605,646 $ 1,165,526 $ 2,633,558 $ 285,558 $ 2,919,116 $ 120,822 $ 3,039,938 Liabilities: Non-maturity deposits $ 60,746 $ 121,499 $ 243,005 $ 870,025 $ 60,680 930,705 184,204 $ 1,114,909 Certificates of deposit 315,709 502,093 670,619 780,304 — 780,304 — 780,304 Borrowings 75,000 75,000 125,000 596,100 — 596,100 — 596,100 Other liabilities — — — — — — 43,125 43,125 Total liabilities 451,455 698,592 1,038,624 2,246,429 60,680 2,307,109 227,329 2,534,438 Capital — — — — — — 505,500 505,500 Total liabilities and capital $ 451,455 $ 698,592 $ 1,038,624 $ 2,246,429 $ 60,680 $ 2,307,109 $ 732,829 $ 3,039,938 Asset/liability gap $ (26,012 ) $ (92,946 ) $ 126,902 $ 387,129 $ 224,878 $ 612,007 Gap/assets ratio 94.24 % 86.70 % 112.22 % 117.23 % 470.60 % 126.53 % (1) Includes available-for-sale securities and held-to-maturity securities.
At December 31, 2024 and 2023, the Bank’s construction and land mortgage loans as a percentage of total risk-based capital was 145.0% and 102.5%, respectively. Investor owned commercial real estate mortgage loans as a percentage of total risk-based capital was 341.7% and 269.1% as of December 31, 2024 and 2023, respectively.
At December 31, 2025 and 2024, the Bank’s construction and land loans as a percentage of total risk-based capital were 156.7% and 145.0%, respectively. Investor owned commercial real estate loans as a percentage of total risk-based capital were 393.1% and 341.7% as of December 31, 2025 and 2024, respectively.
Although an instantaneous and severe shift in interest rates was used in this analysis to provide an estimate of exposure under these scenarios, management believes that a gradual shift in interest rates would have a more modest impact.
(4) EVE Ratio represents EVE divided by the present value of assets. 64 Although an instantaneous and severe shift in interest rates was used in this analysis to provide an estimate of exposure under these scenarios, management believes that a gradual shift in interest rates would have a more modest impact.
The increase in total assets is largely attributable to increases of $390.7 million in net loans receivable, $9.8 million in FHLBNY stock, $0.8 million in mortgage loans held for sale, $0.7 million in premises and equipment and $0.6 million in cash and cash equivalents, partially offset by decreases of $93.8 million in held-to-maturity securities, $14.9 million in available-for-sale securities, $2.3 million in deferred tax assets and $2.2 million in right of use assets.
The increase in total assets is largely attributable to increases of $312.7 million in net loans receivable and $10.7 million in purchases of FRBNY stock, partially offset by decreases of $95.0 million in held-to-maturity securities, $13.7 million in cash and cash equivalents, $12.8 million in available-for-sale securities, $7.6 million in other assets, $7.3 million in mortgage loans held for sale, $1.5 million in right of use assets, $1.2 million in premises and equipment, net and $0.6 million in deferred tax assets .
Our net interest income may also be positively impacted if the demand for loans increases due to the rate decreases, alone or in tandem with the concurrent inflationary pressures. We may be negatively impacted if we are unable to appropriately time adjustments to our funding costs and the rates we earn on our loans. GAP Analysis .
Our net interest income may be positively impacted if the demand for loans increases due to the lower rates, alone or in tandem with lower inflation, or it may be negatively impacted if we fail to appropriately time adjustments to our funding costs and the rates we earn on our loans. 65 GAP Analysis .
The ‎Company began paying dividends on its Preferred Stock in the amount of $0.6 million for the year ended December 31, 2024. On December 20, 2024, the Company entered into an ECIP Securities Purchase Option Agreement (the “Repurchase Agreement”) with Treasury.
In June 2024, 52 the Company began paying dividends on its Preferred Stock, which dividends were $1.1 million and $0.6 million for the years ended December 31, 2025 and 2024, respectively. On December 20, 2024, the Company entered into an ECIP Securities Purchase Option Agreement (the “Repurchase Agreement”) with Treasury.
The transformation relaunched a process aimed at reinforcing the role of each banking branch as a "community hub"’ that attracts new depositors and business customers, but anchors Ponce Bank branches as community-centric destinations.
The transformed Branch is the result of the State-of-the-art Banking Technologies combined with Community Centric Banking that is customer friendly and supportive. The transformation relaunched a process aimed at reinforcing the role of each banking branch as a "community hub" that attracts new depositors and business customers, but anchors Ponce Bank branches as community-centric destinations.
The $3.0 million decrease from the year ended December 31, 2023 was attributable to $4.2 million related to grants received in 2023 and a decrease of $1.2 million in late and prepayment charges, partially offset by increases of $1.8 million in other non-interest income, $0.5 million in income on sale of mortgage loans and $0.1 million in income on sale of SBA loans.
The $2.2 million increase from the year ended December 31, 2024 was primarily attributable to increases of $1.6 million in late and prepayment charges, $1.3 million in grant income, and $0.3 million in income on sale of SBA loans, partially offset by decreases of $0.6 million in other non-interest income and $0.4 million in income on the sale of mortgage loans.
Interest and dividend income on securities, FHLBNY stock and deposits due from banks increased $2.1 million, or 6.9%, to $32.1 million for the year ended December 31, 2024 from $30.1 million for the year ended December 31, 2023.
Interest and dividend income on securities, FHLBNY stock and deposits due from banks decreased $9.1 million, or 28.4%, to $23.0 million for the year ended December 31, 2025 from $32.1 million for the year ended December 31, 2024.
Now, the Company believes that it is poised to enhance its presence, locally and in similar communities outside New York, as a leading CDFI and MDI financial institution holding company.
The Company believes that it is poised to enhance its presence, locally and in similar communities outside New York, as a leading CDFI and MDI financial institution holding company. 55 Comparison of Financial Condition at December 31, 2025 and December 31, 2024 Total Assets .
Based on current internal loan reviews, the Company believes that the quality of our underwriting, our weighted average loan-to-value ratio of 57.0% and our customer selection processes have served us well and provided us with a reliable base with which to maintain a well-protected loan portfolio.
Based on current internal loan reviews, the Company believes that the quality of our underwriting, our weighted average loan-to-value ratio of 50.0% and our customer selection processes have served us well and provided us with a reliable base with which to maintain a well-protected loan portfolio. Multifamily residential loans increased $86.4 million, or 12.9%, when compared to December 31, 2024.
Interest income on loans receivable, which is the Bank’s primary source of income, increased $34.7 million, or 36.2% to $130.5 million for the year ended December 31, 2024 from $95.8 million for the year ended December 31, 2023.
Interest income on loans receivable, which is the Bank’s primary source of income, increased $32.0 million, or 24.5% to $162.5 million for the year ended December 31, 2025 from $130.5 million for the year ended December 31, 2024.
The Company has since grown to $3.04 billion in assets, $2.29 billion in loans receivable, net of allowance for credit losses of $22.5 million, and $1.88 billion in deposits at December 31, 2024, all while investing in infrastructure, implementing digital banking, adopting GPS, diversifying its product offering and partnering with Fintech companies.
The Company has since grown to $3.22 billion in assets, $2.60 billion in loans, net of allowance for credit losses of $25.4 million, and $2.05 billion in deposits at December 31, 2025, all while investing in infrastructure, implementing digital banking and diversifying its product offering.
The $7.0 million increase in net income was attributable to an increase of $11.2 million in net interest income and a decrease of $1.9 million in non-interest expense, partially offset by a decrease of $3.0 million in non-interest income, increases of $2.2 million in provision for income taxes, $0.6 million in dividends on preferred shares and $0.4 million in provision for loan losses.
The $17.2 million increase in net income available to common stockholders was attributable to increases of $23.3 million in net interest income and $2.2 million in non-interest income, and a decrease of $0.4 million in non-interest expense, partially offset by increases of $5.0 million in provision for income taxes, $3.2 million in provision for credit losses and $0.5 million in dividends on preferred shares. 58 Interest and Dividend Income.
Net interest rate spread increased by 9 basis points to 1.83% for the year ended December 31, 2024 from 1.74% for the year ended December 31, 2023.
Net interest rate spread increased by 68 basis points to 2.50% for the year ended December 31, 2025 from 1.82% for the year ended December 31, 2024.
Multifamily residential loans increased $119.6 million, or 21.7%, and nonresidential properties loans increased $47.6 million, or 13.9%, when compared to December 31, 2023. The majority of the increases in multifamily residential loans and nonresidential properties loans that were refinanced from construction and land loans to a new permanent loan facility.
The majority of the increases in multifamily residential loans that were refinanced from construction and land loans to a new permanent loan facilities. Nonresidential properties loans increased $136.3 million, or 35.0%, when compared to December 31, 2024.
Non-interest expense decreased $2.0 million, or 2.9%, to $66.7 million for the year ended December 31, 2024 from $68.7 million for the year ended December 31, 2023.
Non-interest expense decreased $0.4 million, or 0.7%, to $67.0 million for the year ended December 31, 2025 from $67.5 million for the year ended December 31, 2024.
Net Interest Income. Net interest income increased $11.2 million, or 17.2%, to $76.5 million for the year ended December 31, 2024 from $65.3 million for the year ended December 31, 2023.
Net interest income increased $23.3 million, or 30.5%, to $99.8 million for the year ended December 31, 2025 from $76.5 million for the year ended December 31, 2024.
However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met. At present, the Company has reported 9 consecutive quarters for which it has met both the Deep Impact and Qualified Lending Conditions.
However, the Company does not currently meet any of the Threshold Conditions to exercise the purchase option, and there can be no assurance if and when the Threshold Conditions will be met.
The ALCO Committee reviews each of the above interest rate sensitivity analyses along with several different interest rate scenarios as part of its responsibility to provide a satisfactory, consistent level of profitability within the framework of established liquidity, loan, investment, borrowing and capital policies. 62 Management's model governance, model implementation and model validation processes and controls are subject to review in the Bank’s regulatory examinations to ensure they are in compliance with the most recent regulatory guidelines and industry and regulatory practices.
The ALCO Committee reviews each of the above interest rate sensitivity analyses along with several different interest rate scenarios as part of its responsibility to provide a satisfactory, consistent level of profitability within the framework of established liquidity, loan, investment, borrowing and capital policies.
The application has full loan origination and servicing capabilities and is integrated with Salesforce. All Commercial Relationship Officers and Business Development Managers will utilize these capabilities. The Company is seeking to establish loan origination partnerships with non-profit and community-based organizations to ensure penetration in underserved and underbanked markets.
The application was developed by Lending Front, a fintech in which the Company has acquired a financial interest. All Commercial Relationship Officers and Banking Branch Managers utilize these capabilities. The Company is seeking to establish loan origination partnerships with non-profit and community-based organizations to ensure penetration in underserved and underbanked markets.
It marked the first rate cut in over four years and signaled a shift in strategy aimed at bolstering the economy and preventing a rise in unemployment. In November 2024, the Federal Reserve lowered interest rates by 25 basis points to 4.50% to 4.75% and in December 2024 another 25 basis points to 4.25% to 4.50%.
The Federal Reserve announced that the target range for the federal funds rate decreased by 50 basis points to 4.75% to 5.00% effective on September 19, 2024. It marked the first rate cut in over four years and signaled a shift in strategy aimed at bolstering the economy and preventing a rise in unemployment.
Interest and Dividend Income. Interest and dividend income increased $36.8 million, or 29.2%, to $162.6 million for the year ended December 31, 2024 from $125.9 million for the year ended December 31, 2023.
Interest and dividend income increased $22.9 million, or 14.1%, to $185.5 million for the year ended December 31, 2025 from $162.6 million for the year ended December 31, 2024.
The increase in the net interest rate spread for the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily due to an increase in the average yields on interest-earning assets of 62 basis points to 5.74% for the year ended December 31, 2024 from 5.12% for the year ended December 31, 2023 and the average rates paid on interest-bearing liabilities of 53 basis points to 3.91% for the year ended December 31, 2024 from 3.38% for the year ended December 31, 2023.
The increase in the net interest rate spread for the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily due to an increase in the average yields on interest-earning assets of 37 basis points to 6.10% for the year ended December 31, 2025 from 5.74% for the year ended December 31, 2024 and a decrease in the average rates paid on interest-bearing liabilities of 30 basis points to 3.61% for the year ended December 31, 2025 from 3.91% for the year ended December 31, 2024. 59 Net interest margin increased 58 basis points for the year ended December 31, 2025, to 3.28% from 2.70%% for the year ended December 31, 2024, reflecting an increase in organic loan growth.
Interest expense increased $25.6 million, or 42.2%, to $86.2 million for the year ended December 31, 2024 from $60.6 million for the year ended December 31, 2023, primarily due to higher market interest rates.
Interest expense decreased $0.4 million, or 0.5%, to $85.7 million for the year ended December 31, 2025 from $86.2 million for the year ended December 31, 2024, primarily due to higher market interest rates.
The Bank had $304.0 million of outstanding term advances from the FRBNY at December 31, 2023. No amounts were outstanding at December 31, 2024. Net cash provided by operating activities was $7.2 million and $6.5 million for the years ended December 31, 2024 and 2023, respectively.
The Bank had a $25.0 million overnight line of credit advance from the FHLBNY at December 31, 2024. The Bank had no overnight line of credit advance from the FHLBNY at December 31, 2025. Net cash provided by operating activities was $55.6 million and $7.2 million for the years ended December 31, 2025 and 2024, respectively.
The majority of the $229.7 million growth in construction and land mortgage loans is related to funding of existing commitments prior to 2024 as opposed to new originations in 2024. Our commitments to grant new mortgage loans decreased by $170.6 million as of December 31, 2024 compared to December 31, 2023.
The $120.4 million growth in construction and land loans is related to funding of existing commitments prior to 2025 and new commitments, offset by loans that were refinanced from construction and land loans to new permanent loan facilities. Our commitments to grant new mortgage loans decreased by $212.6 million as of December 31, 2025 compared to December 31, 2024.
The increase in cash and cash equivalents was primarily attributable to an increase of $377.2 million in net deposits, $109.5 million in proceeds from maturities/calls of securities, $4.7 million in depreciation and amortization, $3.5 million in stock-based compensation, $2.2 million in deferred income tax and $1.3 million in provision for credit losses.
The decrease in cash and cash equivalents was partially offset by an increase of $151.4 million in net deposits, $113.5 million in proceeds from maturities/calls of securities, $12.6 million decrease in loans held for sale, $7.8 million in proceeds from the sale of loans, $7.6 million decrease in other assets, $4.8 million in depreciation and amortization, $4.2 million in stock-based compensation and $3.8 million in provision for credit losses.
The $11.2 million increase in net interest income for the year ended December 31, 2024 compared to the year ended December 31, 2023 was attributable to an increase of $36.8 million in total interest and dividend income primarily due to increases in average loans receivable, offset by an increase of $25.6 million in interest expense due primarily to a higher average cost of funds on interest bearing liabilities.
The $23.3 million increase in net interest income for the year ended December 31, 2025 compared to the year ended December 31, 2024 was attributable to an increase of $22.9 million in total interest and dividend income primarily due to increases in average loans receivable and a decrease of $0.4 million in interest expense.
Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria in the future. The Company believes that consummation of the repurchase of the Preferred Stock as contemplated by the Repurchase Agreement would be beneficial to its stockholders.
Although the Company currently meets the general eligibility criteria, other than satisfying one of the Threshold Conditions, there can be no assurance that the Company will meet such criteria, or any amended or additional criteria that may be imposed, in the future.
The Bank made a payment on January 14, 2025 in the amount of $0.9 million to terminate the swap that was set to terminate on November 1, 2026. Banking Development District The Ponce Bank Westchester Avenue Branch located at 2244 Westchester Avenue in the Castle Hill area of the Bronx was approved as a Banking Development District ("BDD").
Banking Development District The Ponce Bank Westchester Avenue Branch located at 2244 Westchester Avenue in the Castle Hill area of the Bronx was approved as a Banking Development District ("BDD").
Cash and Cash Equivalents . Cash and cash equivalents increased $0.6 million, or 0.5%, to $139.8 million at December 31, 2024, compared to $139.2 million at December 31, 2023.
Cash and Cash Equivalents . Cash and cash equivalents decreased $13.7 million, or 9.8% , to $126.2 million at December 31, 2025, compared to $139.8 million at December 31, 2024.
(5) Includes $1.3 million of interest expense reclassified from money market to NOW/IOLA for the year ended December 31, 2023. (6) 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. (7) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
(5) 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. (6) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.
The $14.1 million increase in stockholders’ equity was largely attributable to $11.0 million in net income, $2.1 million impact to additional paid in capital as a result of share-based compensation and $1.4 million from release of ESOP shares and $0.3 million in other comprehensive income, offset by $0.6 million in dividend on preferred shares. 55 Comparison of Results of Operations for the Years Ended December 31, 2024 and 2023 The discussion of the Company’s results of operations for the years ended December 31, 2024 and 2023 are presented below.
The $36.0 million increase in stockholders’ equity was largely attributable to $28.7 million in net income, $4.5 million in other comprehensive income, $1.9 million impact to additional paid in capital as a result of share-based compensation, $1.9 million from release of ESOP shares and $0.1 million from exercise of stock options, offset by $1.1 million in dividends on preferred shares.
Additionally, the Bank had two unsecured lines of credit in the amount of $75.0 million with two correspondent banks for both periods at December 31, 2024 and 2023. Stockholders’ Equity. The Company’s consolidated stockholders’ equity increased $14.1 million, or 2.9%, to $505.5 million at December 31, 2024, from $491.4 million at December 31, 2023.
Additionally, the Bank had two unsecured lines of credit in the amount of $75.0 million with two correspondent banks for both periods at December 31, 2025 and 2024. The Bank did not have any term and overnight line of credit advances from the FRBNY at both December 31, 2025 and 2024. Stockholders’ Equity.
On July 30, 2024, Ponce Bank received total program deposits of $35.0 million. On February 27, 2025, Ponce Bank officers and administrators and members of the public celebrated the Bank’s transformed Westchester Avenue Branch at its grand reopening. The transformed Branch is the result of the State-of-the-art Banking Technologies combined with Community Centric Banking that is customer friendly and supportive.
On February 4, 2026, the Bank received approval for additional program deposits of $35.0 million. Westchester Avenue Branch Re-Design On February 27, 2025, Ponce Bank officers and administrators and members of the public celebrated the Bank’s transformed Westchester Avenue Branch at its grand reopening.
The following table presents interest income on loans receivable for the periods indicated: For the Years Ended December 31, Change 2024 2023 Amount Percent (Dollars in thousands) 1-4 Family residential $ 29,715 $ 28,937 $ 778 2.7 % Multifamily residential 29,996 26,772 3,224 12.0 % Nonresidential properties 19,387 15,934 3,453 21.7 % Construction and land 48,476 21,122 27,354 129.5 % Business loans 2,271 1,599 672 42.0 % Consumer loans 667 1,441 (774 ) (53.7 %) Total interest income on loans receivable $ 130,512 $ 95,805 $ 34,707 36.2 % 56 The following table presents interest and dividend income on securities and FHLBNY stock and deposits due from banks for the periods indicated: For the Years Ended December 31, Change 2024 2023 Amount Percent (Dollars in thousands) Interest on deposits due from banks $ 8,666 $ 4,973 $ 3,693 74.3 % Interest on securities 21,289 23,343 (2,054 ) (8.8 %) Dividend on FHLBNY stock 2,170 1,746 424 24.3 % Total interest and dividend income $ 32,125 $ 30,062 $ 2,063 6.9 % Interest Expense.
The following table presents interest income on loans receivable for the periods indicated: For the Years Ended December 31, Change 2025 2024 Amount Percent (Dollars in thousands) 1-4 Family residential $ 27,720 $ 29,715 $ (1,995 ) (6.7 %) Multifamily residential 38,212 29,996 8,216 27.4 % Nonresidential properties 31,941 19,387 12,554 64.8 % Construction and land 59,192 48,476 10,716 22.1 % Business loans 5,372 2,271 3,101 136.5 % Consumer loans 75 667 (592 ) (88.8 %) Total interest income on loans receivable $ 162,512 $ 130,512 $ 32,000 24.5 % The following table presents interest and dividend income on securities and FHLBNY stock and deposits due from banks for the periods indicated: For the Years Ended December 31, Change 2025 2024 Amount Percent (Dollars in thousands) Interest on deposits due from banks $ 4,663 $ 8,666 $ (4,003 ) (46.2 %) Interest on securities 16,050 21,289 (5,239 ) (24.6 %) Dividend on FHLBNY stock 2,300 2,170 130 6.0 % Total interest and dividend income $ 23,013 $ 32,125 $ (9,112 ) (28.4 %) Interest Expense.
In November 2024, the Federal Reserve lowered interest rates by 25 basis points to 4.50% to 4.75% and in December 2024 another 25 basis points to 4.25% to 4.50%. Our net interest income may be positively impacted if the demand for loans increases due to the lower rates, alone or in tandem with lower inflation. 57 Non-Interest Income.
Our net interest income may be positively impacted if the demand for loans increases due to the lower rates, alone or in tandem with lower inflation. Non-Interest Income. Non-interest income increased $2.2 million, or 30.5%, to $9.4 million for the year ended December 31, 2025 from $7.2 million for the year ended December 31, 2024.
Income Tax Provision. The Company had a provision for income taxes of $4.7 million and $2.5 million for the year ended December 31, 2024 and 2023, respectively. 58 Average Balance Sheets The following table sets forth average outstanding balances, average yields and rates, and certain other information for the periods indicated.
During the year ended December 31, 2024, a credit loss provision of $0.8 million on loans was recorded, consisting of $1.5 million charged on the funded portion on loans and a benefit of $0.7 million on unfunded portion on loans. 61 Average Balance Sheets The following table sets forth average outstanding balances, average yields and rates, and certain other information for the periods indicated.
The following table presents non-interest income for the periods indicated: For the Years Ended December 31, Change 2024 2023 Amount Percent (Dollars in thousands) Service charges and fees $ 1,973 $ 1,986 $ (13 ) (0.7 %) Brokerage commissions 61 80 (19 ) (23.8 %) Late and prepayment charges 1,180 2,365 (1,185 ) (50.1 %) Income on sale of mortgage loans 1,048 598 450 75.3 % Income on sale of SBA loans 148 — 148 100.0 % Grant income — 4,156 (4,156 ) (100.0 %) Other 2,803 1,038 1,765 170.0 % Total non-interest income $ 7,213 $ 10,223 $ (3,010 ) (29.4 %) Non-Interest Expense.
The following table presents non-interest income for the periods indicated: For the Years Ended December 31, Change 2025 2024 Amount Percent (Dollars in thousands) Service charges and fees $ 2,117 $ 1,973 $ 144 7.3 % Brokerage commissions 35 61 (26 ) (42.6 %) Late and prepayment charges 2,785 1,180 1,605 136.0 % Income on sale of mortgage loans 622 1,048 (426 ) (40.6 %) Income on sale of SBA loans 404 148 256 173.0 % Grant income 1,285 — 1,285 — % Other 2,164 2,803 (639 ) (22.8 %) Total non-interest income $ 9,412 $ 7,213 $ 2,199 30.5 % Non-Interest Expense.
The discussion and analysis of the financial condition and results of operations are based on the Company’s consolidated financial statements, which are prepared in conformity with GAAP.
Likewise, if our loss rate factor was to decrease 10 basis points, our reserve would decrease by approximately $2.6 million. The discussion and analysis of the financial condition and results of operations are based on the Company’s consolidated financial statements, which are prepared in conformity with GAAP.
For the Years Ended December 31, 2024 2023 Average Average Outstanding Average Outstanding Average Balance Interest Yield/Rate Balance Interest Yield/Rate (1) (Dollars in thousands) Interest-earning assets: Loans (1) $ 2,094,820 130,512 6.23 % $ 1,730,275 $ 95,805 5.54 % Securities (2) 548,641 21,289 3.88 % 606,815 23,342 3.85 % Other (3) 192,403 10,836 5.63 % 119,923 6,720 5.60 % Total interest-earning assets 2,835,864 162,637 5.74 % 2,457,013 125,867 5.12 % Non-interest-earning assets 107,017 115,760 Total assets $ 2,942,881 $ 2,572,773 Interest-bearing liabilities: NOW/IOLA (4) (5) $ 74,796 $ 662 0.89 % $ 70,993 $ 1,314 1.85 % Money market (5) 654,521 30,148 4.61 % 424,160 17,132 4.04 % Savings 111,028 107 0.10 % 121,550 116 0.10 % Certificates of deposit 676,306 27,768 4.11 % 528,999 16,571 3.13 % Total deposits 1,516,651 58,685 3.87 % 1,145,702 35,133 3.07 % Advance payments by borrowers 14,034 7 0.05 % 14,869 8 0.05 % Borrowings 670,982 27,465 4.09 % 633,116 25,460 4.02 % Total interest-bearing liabilities 2,201,667 86,157 3.91 % 1,793,687 60,601 3.38 % Non-interest-bearing liabilities: Non-interest-bearing demand (4) 191,155 — 241,510 — Other non-interest-bearing liabilities 50,259 — 45,858 — Total non-interest-bearing liabilities 241,414 — 287,368 — Total liabilities 2,443,081 86,157 2,081,055 60,601 Total equity 499,800 491,718 Total liabilities and total equity $ 2,942,881 3.91 % $ 2,572,773 3.38 % Net interest income $ 76,480 $ 65,266 Net interest rate spread (6) 1.83 % 1.74 % Net interest-earning assets (7) $ 634,197 $ 663,326 Net interest margin (8) 2.70 % 2.66 % Average interest-earning assets to interest-bearing liabilities 128.81 % 136.98 % (1) Loans include loans and mortgage loans held for sale, at fair value.
For the Years Ended December 31, 2025 2024 Average Average Outstanding Average Outstanding Average Balance Interest Yield/Rate Balance Interest Yield/Rate (1) (Dollars in thousands) Interest-earning assets: Loans (1) $ 2,472,805 162,512 6.57 % $ 2,094,820 $ 130,512 6.23 % Securities (2) 427,033 16,050 3.76 % 548,641 21,289 3.88 % Other (3) 141,438 6,963 4.92 % 192,403 10,836 5.63 % Total interest-earning assets 3,041,276 185,525 6.10 % 2,835,864 162,637 5.74 % Non-interest-earning assets 100,790 107,017 Total assets $ 3,142,066 $ 2,942,881 Interest-bearing liabilities: NOW/IOLA $ 73,102 $ 483 0.66 % $ 74,796 $ 662 0.89 % Money market 901,692 36,119 4.01 % 654,521 30,148 4.61 % Savings (4) 119,335 112 0.09 % 125,062 114 0.09 % Certificates of deposit 744,497 28,395 3.81 % 676,306 27,768 4.11 % Total deposits 1,838,626 65,109 3.54 % 1,530,685 58,692 3.83 % Borrowings 534,183 20,605 3.86 % 670,982 27,465 4.09 % Total interest-bearing liabilities 2,372,809 85,714 3.61 % 2,201,667 86,157 3.91 % Non-interest-bearing liabilities: Non-interest-bearing demand 207,288 — 191,155 — Other non-interest-bearing liabilities 38,431 — 50,259 — Total non-interest-bearing liabilities 245,719 — 241,414 — Total liabilities 2,618,528 85,714 2,443,081 86,157 Total equity 523,538 499,800 Total liabilities and total equity $ 3,142,066 3.61 % $ 2,942,881 3.91 % Net interest income $ 99,811 $ 76,480 Net interest rate spread (5) 2.50 % 1.82 % Net interest-earning assets (6) $ 668,467 $ 634,197 Net interest margin (7) 3.28 % 2.70 % Average interest-earning assets to interest-bearing liabilities 128.17 % 128.81 % (1) Loans include loans and mortgage loans held for sale, at fair value.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeItem 7A. Quantitative and Qualitati ve Disclosures About Market Risk. Information regarding quantitative and qualitative disclosures about market risk appears under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Management of Market Risk.” 66
Biggest changeItem 7A. Quantitative and Qualitati ve Disclosures About Market Risk. Information regarding quantitative and qualitative disclosures about market risk appears under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Management of Market Risk.” 69

Other PDLB 10-K year-over-year comparisons