JSB Financial Inc. (OTCID: JFWV) reported unaudited net income of $1.1 million for the quarter ended September 30, 2025, representing a decrease of $835 thousand when compared to $2.0 million for the quarter ended September 30, 2024. Basic and diluted earnings per common share were $4.40 and $7.64 for the third quarter of 2025 and 2024, respectively. The 2024 third quarter results included the recognition of an interest recovery totaling $1.3 million, a recovery to the allowance for credit losses on loans totaling $252 thousand and a recovery of legal fees totaling $17 thousand on prior nonperforming loans. Excluding the impact of these notable items, pre-tax income for the third quarter of 2025 increased $457 thousand to $1.4 million from $960 thousand for the third quarter of 2024.

Net income for the nine months ended September 30, 2025 totaled $2.8 million, representing a decrease of $587 thousand when compared to $3.4 million for the same period in 2024. Basic and diluted earnings per common share were $11.05 and $13.33 for the nine months ended September 30, 2025 and 2024, respectively. Annualized return on average assets and average equity for September 30, 2025 were 0.70% and 11.92%, respectively, and 0.87% and 17.65%, respectively, for September 30, 2024.

When adjusted for the income recoveries noted in the third quarter of 2024, pre-tax income for the nine months ended September 30, 2024 was $2.7 million, compared to $3.5 million for the nine months ended September 30, 2025. This represents an increase of $791 thousand year-over-year.

“We are proud to deliver another quarter of consistent earnings, driven by organic loan growth and stable core deposits,” said President and Chief Executive Officer, Cindy Kitner. “Credit quality is well managed with metrics including past dues, nonaccruals, charge offs and nonperforming loans remaining at historically low levels. This quarter’s results continue to reflect our team’s ability to deliver on our strategic priorities and strengthen customer relationships, both of which reinforce our commitment to creating value for our shareholders.”

Income Statement Highlights

Net interest income totaled $4.0 million for the third quarter of 2025, representing a decrease of $545 thousand, or 12.0%, from $4.5 million for the third quarter of 2024. Total interest income for the third quarter of 2025 was $6.6 million, representing a decrease of $1.0 million or 13.4%, when compared to $7.6 million for the third quarter of 2024.

Excluding the interest recovery of $1.3 million in 2024, net interest income increased $718 thousand, or 22.0%, when comparing the third quarter 2025 to the same period in 2024. This increase was due in part to higher average balances and yields on the loan portfolio, which led to an increase of $463 thousand in interest and fees on loans when comparing the third quarter of 2025 to the same period in 2024. This change was offset in part by a decline in dividends and other interest income of $165 thousand and a decline in interest income on the investment securities, excluding restricted securities, of $57 thousand.

Total interest expense was $2.6 million for the third quarter of 2025, representing a decline of $476 thousand, or 15.4%, from $3.1 million for the third quarter of 2024. This was primarily due to a decrease in interest expense on borrowings and interest-bearing deposits of $347 thousand and $129 thousand, respectively.

Noninterest income for the third quarter of 2025 totaled $634 thousand, compared to $586 thousand for the third quarter of 2024. Noninterest expense for the third quarter of 2025 and 2024 was $3.1 million and $2.9 million, respectively. The increase of $185 thousand in noninterest expense was primarily related to expenses for salaries and employee benefits.

For the first nine months of 2025, net interest income totaled $11.3 million, representing an increase of $380 thousand, or 3.5%, when compared to $11.0 million for the same period in 2024. Total interest income for the nine months ended September 30, 2025 was $19.3 million, representing an increase of $185 thousand when compared to $19.1 million for the nine months ended September 30, 2024. Interest and fees on loans increased $287 thousand year-over-year.

Excluding the interest recovery of $1.3 million in 2024, net interest income increased $1.6 million, or 16.9%, when comparing the nine months ended September 30, 2025 to the same period in 2024. Total interest income increased $1.4 million, or 8.1%, when comparing the first nine months ended September 30, 2025 to the same period in 2024. This change was attributed to an increase in interest and fees on loans of $1.5 million, or 10.4%. Dividends and other interest income increased $97 thousand, while interest income on the investment securities, excluding restricted securities, declined $199 thousand.

Total interest expense was $7.9 million for the nine months ended September 30, 2025, representing a decrease of $195 thousand, or 2.4%, when compared to $8.1 million for the nine months ended September 30, 2024. This decline was primarily related to lower expenses related to borrowings of $1.2 million, offset in part by an increase in expense related to interest-bearing deposits of $1.0 million.

Net interest margin was 2.91% for the nine months ended September 30, 2025, compared to 2.90% for the nine months ended September 30, 2024. When adjusting for the interest recovery in 2024, the net interest margin was 2.59% for the nine months ended September 30, 2024. This resulted in a 32 basis point change year-over-year.

Noninterest income totaled $1.8 million and $1.7 million for the nine months ended September 30, 2025 and 2024, respectively. Noninterest expense totaled $9.3 million and $8.5 million for the nine months ended September 30, 2025 and 2024, respectively. The increase of $825 thousand in noninterest expense was primarily related to an increase in expenses for salaries and employee benefits, professional services and data processing.

Balance Sheet Highlights

Total assets were $554.8 million as of September 30, 2025, an increase of $17.9 million, or 3.3%, from $536.9 million at December 31, 2024. Year-over-year total assets decreased $22.6 million, or 3.9%, from $577.3 million as of September 30, 2024. The decline in total assets was driven by a reduction in cash and cash equivalents year-over-year as a result of the paydown of borrowings through the Federal Reserve’s Bank Term Funding Program (BTFP), which totaled $28.0 million as of September 30, 2024.

Cash and cash equivalents increased $3.3 million, or 12.4% to $30.3 million at September 30, 2025 from $26.9 million at December 31, 2024. The increase in cash and cash equivalents was the result of an increase in funding from deposits. Year-over-year cash and cash equivalents decreased $32.0 million from $62.3 million at September 30, 2024.

Loans, net of the allowance for credit losses, were $394.4 million at September 30, 2025, an increase of $16.2 million, or 4.3%, from $378.2 million at December 31, 2024. This increase was primarily attributed to organic loan growth in the residential real estate portfolio. Year-over-year net loans grew $17.7 million, or 4.7%, from $376.7 million as of September 30, 2024.

Investment securities, excluding restricted securities, were $105.6 million as of September 30, 2025, a decrease of $1.4 million, from $107.0 million as of December 31, 2024. Changes in the investment portfolio included the purchase of an available for sale mortgage-backed security totaling $2.0 million, a decline in unrealized losses on available for sale securities totaling $2.6 million and amortization of unrealized holding losses on held to maturity securities of $496 thousand. These changes were offset in part by maturities, calls and principal paydowns totaling $6.2 million. Year-over-year investment securities declined $9.1 million, or 8.0%, from $114.7 million as of September 30, 2024.

Total deposits were $513.3 million as of September 30, 2025, an increase of $18.6 million, or 3.8%, from $494.7 million as of December 31, 2024. Noninterest bearing deposits represent 24.7% of total deposits at September 30, 2025, which increased from 23.9% at December 31, 2024. Year-over-year total deposits decreased $1.4 million, or 0.3%, from $514.7 million as of September 30, 2024. The Company continues to leverage brokered deposits which totaled $25.1 million at September 30, 2025, representing no change from December 31, 2024 and September 30, 2024.

Borrowings totaled $2.6 million, representing a decline of $5.3 million from December 31, 2024 and $25.4 million from September 30, 2024. The Company maintains on and off-balance sheet liquidity through cash and cash equivalents, unpledged securities at fair value, Federal Home Loan Bank (FHLB) and Federal Reserve borrowing capacities and unsecured correspondent bank lines of credit. In total, on and off-balance sheet liquidity sources exceeded $300.0 million at September 30, 2025.

Shareholders’ equity at September 30, 2025 was $34.5 million, representing an increase of $4.5 million, or 14.9%, from December 31, 2024. Book value per share of $134.09 at September 30, 2025 increased from $116.68 at December 31, 2024. Year-to-date earnings contributed $2.8 million to the increase in shareholders’ equity. Accumulated other comprehensive loss decreased $2.3 million, which was related to changes in unrealized losses on available for sale securities of $1.9 million and amortization of unrealized holding losses on held to maturity securities of $372 thousand as of September 30, 2025. During the third quarter 2025, the Company declared a regular semi-annual dividend of $1.35 per share payable on September 12, 2025. This dividend was an increase from the previous semi-annual dividend resulting in an annual dividend of $2.60 per share and total dividends paid of $669 thousand in 2025. Year-over-year shareholders’ equity increased $5.0 million, or 17.0%, from $29.5 million as of September 30, 2024.

The Bank’s regulatory capital ratios remain above applicable regulatory requirements for well-capitalized institutions. T he Tier 1 leverage ratio increased to 8.02% at September 30, 2025 from 7.62% at December 31, 2024 and 7.47% at September 30, 2024. The ratio of Common Equity Tier 1 capital and Tier 1 capital to risk weighted assets was 12.45%, 12.66% and 12.45% at September 30, 2025, December 31, 2024 and September 30, 2024, respectively. The total risk-based capital ratio was 13.70%, 13.91% and 13.70% at September 30, 2025, December 31, 2024 and September 30, 2024, respectively. Management maintains regular monitoring of capital planning strategies to support and maintain adequate capital levels.

Provision for Credit Losses and Asset Quality

The provision for credit losses totaled $128 thousand for the third quarter of 2025 compared to a release of provisioning for credit losses of $266 thousand for the third quarter of 2024. The current quarter provision for credit losses was comprised of provisions for loan losses totaling $114 thousand and provisions for off-balance sheet credit exposures of $14 thousand. Provision for credit losses increased due to loan growth and not due to a deterioration in asset quality.

For the nine months ended September 30, 2025, the provision for credit losses totaled $278 thousand compared to a release of provisioning for credit losses of $86 thousand for the same period in 2024. The provision for credit losses for the first nine months of 2025 included a provision for loan losses of $231 thousand and a provision for off-balance sheet credit exposures of $47 thousand.

The credit quality of the loan portfolio remained strong with nonaccrual loans totaling $40 thousand, or 0.01% of total loans at September 30, 2025, compared to $47 thousand, or 0.01% of total loans, at December 31, 2024 and $47 thousand, or 0.01% of total loans, at September 30, 2024. As of September 30, 2025, total past due loans increased to $282 thousand, or 0.07% of total loans, compared to $134 thousand, or 0.04%, of total loans at December 31, 2024 and decreased when compared to $349 thousand, or 0.09% of total loans, as of September 30, 2024.

For the third quarter of 2025, the Company had recoveries of $9 thousand and no charged off loans. Through the first nine months ended September 30, 2025, the Company had net charge offs totaling $72 thousand, compared to net recoveries of $237 thousand for the nine months ended September 30, 2024 and the year-ended December 31, 2024.

The allowance for credit losses for loans totaled $4.3 million, or 1.07% of total loans, at September 30, 2025, compared to $4.1 million, or 1.07%, at December 31, 2024 and $4.0 million, or 1.06%, as of September 30, 2024.

About JSB Financial Inc.

JSB Financial Inc. (OTCID: JFWV) is the holding company for Jefferson Security Bank, an independent community bank operating six banking offices located in Berkeley County and Jefferson County, West Virginia and Washington County, Maryland. Founded in 1869, Jefferson Security Bank serves individuals, businesses, municipalities and community organizations through a comprehensive suite of banking services delivered by an exceptional team who put customers first. Jefferson Security Bank has received industry recognition by American Banker magazine five years in a row. Most recently, as a Top 100 Community Bank in 2024 and prior as a Top 200 Community Bank for four consecutive years. Operating for over 155 years, Jefferson Security Bank is the oldest, independent, locally owned and managed bank in West Virginia. Visit www.jsb.bank for more information.

This press release may contain forward-looking statements, as defined by federal securities laws, which may involve significant risks and uncertainties. The statements are based on estimates and assumptions made by management in conjunction with other factors deemed appropriate under the circumstances. Actual results could differ materially from current projections.

Offices:

105 East Washington Street, Shepherdstown, WV (304-876-9000)

7994 Martinsburg Pike, Shepherdstown, WV (304-876-2800)

873 East Washington Street, Charles Town, WV (304-725-9752)

277 Mineral Drive, Inwood, WV (304-229-6000)

1861 Edwin Miller Boulevard, Martinsburg, WV (304-264-0900)

103 West Main Street, Sharpsburg, MD (301-432-3900)

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