Second Quarter Report June 30, 2025

Dear Shareholders:

Net income totaled $505,000, or $0.98 per share, for the quarter ended June 30, 2025 compared with $450,000, or $0.87 per share, for the second quarter of 2024. Higher net income between periods was primarily due to a $206,000 increase in net interest income attributed to both growth and stronger yields in the loan portfolio. Offsetting this increase were higher noninterest expenses of $94,000 and provision for credit losses of $27,000 compared with the same quarter last year. There have been various ongoing enhancements to banking services and technology infrastructure during 2025 in addition to the core system migration to a service center in January.

For the six-month period ended June 30, 2025, net income totaled $965,000 compared with $817,000 for the first six months of 2024. Annualized return on average assets was 0.95% and return on equity was 8.00% in 2025.

Balance sheet growth has also increased at a faster pace in 2025. The loan portfolio has grown $5.1 million, or 2.9%, year-to-date which is greater than $2.5 million, or 1.5%, at the mid-point of 2024.

A dividend of $0.57 per share was paid July 1 which approximates a 5.8% current yield. Please do not hesitate to contact me if you have any questions.

Sincerely,

Nelson L. Person
President & CEO