PFSB 10-K & 10-Q changes, risk factors and insider trading

Total Assets. Total assets were $207.0 million at December 31, 2025, an increase of $9.4 million, or 4.8%, compared to $197.6 million at December 31, 2023, an increase of $4.2 million, or 2.1%, compared to $193.5 million at December 31, 2023.2024. This increase was primarily due to an increase of $5.5$12.7 million in loans funded with $3.4$6.9 million in new deposits.deposits and decrease in cash and cash equivalents of $762,000.

Cash and Due From Banks. Cash and due from banks decreased by $3.9 million,$762,000, or 19.3%,4.7%, to $15.5 million at December 31, 2025 from $16.3 million at December 31, 2023 from $20.2 million at December 31, 2023.2024. The decrease was a result of investing funds in new loans and available-for-sale securities.

Available-For-Sale Investment Securities. Investment securities increased $3.2,$272,000, or 5.0%,0.4%, to $66.9 million at December 31, 2025 from $66.7 million at December 31, 20242024. fromMortgage-backed $63.5securities increased $2.0 million, or 5.1%, to $40.9 million at December 31, 2023.2025 Mortgage-backed securities increased $4.4 million, or 12.8%, tofrom $38.9 million at December 31, 20242024. fromU.S. $34.5government agency securities decreased by $686,000, or 8.6%, to $7.3 million at December 31, 2023.2025 U.S. government agency securities increase by $148,000, or 1.9%, tofrom $8.0 million at December 31, 20242024. fromMunicipal $7.8securities decreased $1.1 million, or 5.6%, to $18.7 million at December 31, 2023.2025 Municipal securities decreased $1.4 million, or 6.6%, tofrom $19.8 million at December 31, 2024 from $21.2 million at December 31, 2023.2024. Aggregate securities purchases of $11.8$7.1 million during the year ended December 31, 20242025 were partially offset by sales, calls, maturities and repayments of $8.3$9.4 million.

Held-To-Maturity Investment Securities. Investment securities decreased by $779,000,$2.0 million, or 8.7%,24.4%, to $6.2 million at December 31, 2025 from $8.2 million at December 31, 20242024. fromCertificates $8.9of deposit decreased $1.8 million, or 24.3%, to $5.6 million at December 31, 2023.2025 Certificates of deposit decreased $733,000, or 9.6%, tofrom $7.4 million at December 31, 2024 from $8.1 million at December 31, 2023.2024. U.S. government agency securities decreasedecreased by $46,000,$115,000, or 5.3%,14.1%, to $700,000 at December 31, 2025 from $815,000 at December 31, 2024 from $861,000 at December 31, 2023.2024. There were sales, calls, maturities and repayments of $774,000$2.0 million during the year ended December 31, 2024.2025. There were no purchases of held-to maturity securities during the year ended December 31, 2024.2025.

Loans, Net. Loans, net, increased by $5.5$12.7 million, or 6.1%,13.2%, to $108.9 million at December 31, 2025 from $96.2 million at December 31, 2024 from $90.7 million at December 31, 2023.2024. During the year ended December 31, 2024,2025, loan originations totaled $19.5$30.1 million, comprised of $9.4$10.0 million of one-to-four family residential mortgage loans, $1.1 construction and land development loans, $5.9$14.5 million of commercial real estate loans, $1.0$2.5 million of commercial loans, and $2.1$3.1 million of consumer loans.

During the year ended December 31, 2024,2025, one-to-four family residential mortgage loans increased $2.9$3.5 million, or 4.6%,5.3%, to $69.2 million at December 31, 2025 from $65.7 million at December 31, 2024 from $62.8 million at December 31, 2023,2024, commercial real estate loans increased $3.7,$8.0 million, or 20.9%,37.4%, to $21.4$29.4 million from $17.7$21.4 million at December 31, 2023,2024, construction and land development loans decreased $1.2 million$104,000 or 42.9%,6.5%, to $1.6$1.5 million from $2.8$1.6 million at December 31, 2023,2024, commercial loans decreasedincreased by $344,000,$1.0 million, or 6.9%,21.3%, to $5.7 million at December 31, 2025 from $4.7 million at December 31, 2024 from $5.0 million at December 31, 2023 and consumer loans increased by $450,000,$258,000, or 14.9%,7.4%, to $3.7 million at December 31, 2025 from $3.5 million at December 31, 2024 from $3.0 million at December 31, 2023.2024.

Deposits. Deposits increased by $3.4$6.9 million, or 2.2%,4.3%, to $159.6$166.5 million at December 31, 20242025 from $156.2$159.6 at December 31, 2023.2024. Core deposits (defined as deposits other than certificates of deposit) decreasedincreased by $5.5 million,$420,000, or 5.7%,1.5%, to $92.5 million at December 31, 2025 from $91.0 million at December 31, 20242024. fromCertificates $96.5of deposit increased $6.4 million, or 9.3%, to $75.0 million at December 31, 2023.2025 Certificates of deposit increased $8.9 million, or 14.9%, tofrom $68.6 million at December 31, 2024 from $59.7 million at December 31, 2023.2024. The increase in deposits was primarily due to organic growth. The increase in certificates of deposit was due to the shift from core deposits to higher yielding certificates of deposit due to the increase in market interest rates.

Total Stockholders’ Equity. Total equity capital increased by $756,000,$2.4, or 2.1%,6.5%, to $39.1 million at December 31, 2025 from $36.7 million at December 31, 2024 from $35.9 million at December 31, 2023.2024. The increase resulted from net income during the year ended December 31, 20242025, partiallya offset by an increasedecrease in accumulated other comprehensive loss (as a result of market value adjustment of available-for-sale securities due to the increase in market interest rates during the year). partially offset by treasury stock purchases.

General. Net income for the year ended December 31, 20242025 was $905,000,$1.7 amillion, decreasean increase of $103,000,$766,000, or 10.2%,84.6%, compared to $1.0 million$905,000 for the year ended December 31, 2023.2024. The decreaseincrease in net income was primarily due to an increase in net interest income of $611,000, and a decrease in noninterest expense of $635,000 which included a one-time consulting fee related to negotiated future savings on data processing expenses.$298,000.

Interest and Dividend Income. Interest and dividend income increased by $1.4$925,000 or 11.6%, to $8.9 million orat 21.2%,December to31, 2025 from $8.0 million at December 31, 2024 from $6.6 million at December 31, 2023.2024. The increase in interest income is attributed to a $953,000,$1.1 million, or 25.2%,22.3%, increase in loan interest and a $606,000,$160,000, or 40.7%7.6% increase in interest from available-for-saledebt securities partially offset by a decrease of $103,000,$290,000, or 9.1%24.9% in other interest and dividend income.

The average balance of available-for-sale investment securities increased $9.3$297,000 to $69.1 million tofor the year ended December 31, 2025 from $68.8 million for the year ended December 31, 2024 from $59.5 million for the year ended December 31, 2023.2024. The average yield on available-for-sale investment securities increased to 3.27% for the year ended December 31, 2025 from 3.05% for the year ended December 31, 2024 from 2.50% for the year ended December 31, 2023.2024. The increase in the average yield on available-for-sale investment securities was primarily due to the rising market interest rate environment. Interest income on cash and cash equivalents, comprised primarily of deposits in other financial institutions and overnight deposits, decreased by $202,000,$215,000, or 21.0%,28.3%, for the year ended December 31, 2024,2025, due to a decrease in average balance of $4.5$1.6 million and ana increasedecrease in the average yield to 3.63% for the year ended December 31, 2025 from 4.57% for the year ended December 31, 2024 from 4.55% for the year ended December 31, 2023.2024. The increase in average yield was due to the rise in market interest rates.

Interest Expense. Total interest expense increased $1.1 million,$314,000, or 57.9%,10.5%, to $3.3 million for the year ended December 31, 2025 from $3.0 million for the year ended December 31, 2024 from $1.9 million for the year ended December 31, 2023.2024. The increase was primarily due to the increase in the average cost of deposits to 2.18% for the year ended December 31, 2025 from 2.12% for the year ended December 31, 2024 from 1.34% for the year ended December 31, 2023,2024, reflecting the rising market interest rate environment. The average balance of deposits increased by $1.5$10.4 million, or 1.1%,7.4%, to $151.0 million for the year ended December 31, 2025 from $140.6 million for the year ended December 31, 2024 from $139.1 million for the year ended December 31, 2023.2024.

Net Interest Income. Net interest income increased $345,000,$611,000, or 7.4%,12.1%, to $5.6 million for the year ended December 31, 2025 compared to $5.0 million for the year ended December 31, 20242024. comparedThe increase reflects the increase in the interest rate spread to $4.7 million2.54% for the year ended December 31, 2023.2025 The increase reflects the decrease in the interest rate spread tofrom 2.16% for the year ended December 31, 20242024, fromwhile 2.44%average net interest-earning assets decreased $2.0 million year-to-year. The net interest margin increased to 2.88% for the year ended December 31, 2023,2025 while average net interest-earning assets increased $12.5 million year-to-year. The net interest margin decreased tofrom 2.69% for the year ended December 31, 2024 from 2.70% for the year ended December 31, 2023.2024. Both the interest rate spread and net interest margin decreasedincreased due to a greater increase in yield on interest-bearing assets (0.44%) primary due to higher yielding loans compared to the risingincrease interestin ratethe environment.cost of interest-bearing liabilities (0.06%).

Provision(Credit) for Credit Losses. The provision for credit losses increaseddecreased by $66,000,$17,000, to $148,000 for the year ended December 31, 2025 from a provision of $165,000 for the year ended December 31, 2024 from a provision of $99,000 for the year ended December 31, 2023.2024. The allowance for credit losses increased by $25,000,$142,000, or 3.7%,20.3%, to $842,000 at December 31, 2025 from $700,000 at December 31, 2024 from $675,000 at December 31, 2023.2024. The allowance for credit losses represented 0.72%0.77% of total loans at December 31, 20242025 and 0.74%0.72% of total loans as of December 31, 2023.2024. The determination of the adequacy of the allowance for credit losses was based primarily on the low balances of nonperforming loans, delinquent loans and net charge offs in both periods.

Total non-accrual loans were $212,000 at December 31, 2025, compared to $348,000 at December 31, 2024,2024. comparedClassified toloans $333,000totaled $722,000 at December 31, 2023.2025, Classifiedcompared loansto totaled $1.5 million$844,000 at December 31, 2024, compared to $1.9 million at December 31, 2023, and total past due greater than 30 days were $1.0$1.1 million and $1.4$1.0 million at those respective dates. As a percentage of nonperforming loans, the allowance for credit losses was 110.5% at December 31, 2025 compared to 82.9% at December 31, 2024 compared to 93.49% at December 31, 2023.2024.

Noninterest Income. Noninterest income totaled $928,000 for the year ended December 31, 2025, an increase of $43,000, or 4.9%, from $885,000 for the year ended December 31, 2024, an increase of $215,000, or 32.1%, from $670,000 for the year ended December 31, 2023.2024. The increase was primarily due to a $199,000$43,000 increase in other non-interest income and a $13,000 increase in the unrealizedcustomer gainservice onfees equitypartially securities.offset by a decrease of commission income of $5,000.

Noninterest Expense. Noninterest expense increaseddecreased $635,000,$298,000, or 15.8%,6.4%, to $4.3 million for the year ended December 31, 2025, compared to $4.6 million for the year ended December 31, 2024, compared to $4.0 million for the year ended December 31, 2023.2024. The increasedecrease was due primarily to a $140,000,$92,000, or 57.6%,16.9%, increasedecrease in professionaldata feesprocessing (reflecting a full year of expenses as a public company)costs and a $413,000,$393,000, or 254.9%68.3% increasedecrease in other non-interest expense related to a one-time consulting fee that will benefit the company in the2024 futurewhile fromsalaries reducedand serviceemployee bureaubenefits expenses.increased $154,000 primarily due to stock incentive plan costs.

Provision for Income Taxes. The provision for income taxes decreasedincreased by $38,000,$203,000, or 15.8%,100.5%, to $405,000 for the year ended December 31, 2025, compared to $202,000 for the year ended December 31, 2024, compared to $240,000 for the year ended December 31, 2023.2024. The increase was due primarily to a $141,000,$969,000, or 11.3%,87.5%, decreaseincrease in pretax income. The effective tax rates were 18.2%19.5% and 19.2%18.2% for the years ended December 31, 20242025 and 2023,2024, respectively. The increase in the effective tax rate was primarily due to the lower level of tax-exempt income from municipal securities during 2024.2025.

The table above indicates that at December 31, 2024,2025, we would experience a 18.67%17.5% decrease in EVE in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 4.23 %1.64% increase in EVE in the event of an instantaneous 200 basis point decrease in interest rates.

Our cash flows are comprised of three primary classifications: cash flows from operating activities, cash flows from investing activities, and cash flows from financing activities. For the year ended December 31, 2024,2025, cash flows from operations, investing, and financing activities resulted in a net decrease in cash and cash equivalents of $3.9 million.$762,000. Net cash provided by operating activities amounted to $1.4$2.1 million, primarily due to net income from operations. Net cash used in investing activities amounted to $8.7$8.5 million, primarily due to purchases of debt securities $11.8of $7.1 million, an increase in loans of $5.7$12.7 million and partially offset by proceeds from the maturities of available-for-sale securities of $8.3$9.4 million. Net cash provided by financing activities amounted to $3.4$5.6 million, primarily due to the increase of deposits.

Off-Balance Sheet Arrangements. At December 31, 2024,2025, we had $7.7$5.1 million of outstanding commitments to originate loans, $465,000$466,000 of which represents the balance of remaining funds to be disbursed on construction loans in process, $2.9$3.4 million in unused commercial line of credit commitments, $2.9 million$119,000 in commitments to fund new closed-end commercialresidential real estate loans, and $1.2$1.0 of unfunded home equity loans. At December 31, 2024,2025, certificates of deposit that are scheduled to mature on or before December 31, 20252026 totaled $58.9$63.1 million. Management expects that a substantial portion of the maturing certificates of deposit will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize Federal Home Loan Bank of Chicago advances or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.

Comparison of Financial Condition at MarchJune 31,30, 2026 and December 31, 2025

Total Assets. Total assets increased $3.8$1.1 million, or 1.8%,0.5%, from $206.9 million at December 31, 2025 to $210.7$208.0 million at MarchJune 31,30, 2026. The increase was primarily comprised of an increaseincreases in cash and cash equivalents of $6.6$4.0 million and in loans of $2.7 million while available-for-sale securities decreased by $2.1$3.7 million and held-to-maturity securities decreased $986,000.$2.0 million.

Cash and Due from Banks. Cash and due from banks increased by $6.6$4.0 million, or 42.6%,25.8%, to $22.1$19.5 million at MarchJune 31,30, 2026 compared to $15.5 million at December 31, 2025. This increase was primarily due to the increase in savings, NOW and money market deposits.deposits of $4.0 million while time deposits decreased by $2.6 million.

Available-for-Sale Investment Securities. Available-for-sale investment securities decreased by $2.1$3.7 million, or 3.0%,5.5%, to $64.9$63.2 million at MarchJune 31,30, 2026 from $66.9 million at December 31, 2025. The decrease was a result of principal payments on mortgage-backed securities and collateralized mortgage obligation securities and by maturities. The market value adjustment on available-for-sale investment securities declined by $362,000$439,000 during the threesix months ended MarchJune 31,30, 2026 due to fluctuationan increase in market interest rates.

Held-to-Maturity Investment Securities. Held-to-maturity investment securities decreased by 986,000,$2.0 million, or 15.9%,32.2%, to $5.2$4.2 million at MarchJune 31,30, 2026 from $6.2 million at December 31, 2025, due to maturities. ThereThe decline was a result of maturities while there were no purchases of held-to-maturity securities during the threesix months ended MarchJune 31,30, 2026.

Loans, Net. Loans, net, increased $235,000$2.7 million or 0.2%,2.5%, to $109.1$111.6 million at MarchJune 31,30, 2026 compared to $108.9 million at December 31, 2025. One-to four-family residential mortgage loans decreasedincreased $540,000,$794,000, or 0.8%,1.1%, from $69.2 million at December 31, 2025 to $68.7$70.0 million at MarchJune 31,30, 2026. Commercial real estate loans increased $826,000,$2.2 million, or 2.8%,7.5%, from $29.4 million at December 31, 2025 to $30.3$31.6 million at MarchJune 31,30, 2026. Construction and land development loans increaseddecreased by $362,000,$140,000, or 23.6%,9.3%, from $1.5 million at December 31, 2025 to $1.9$1.4 million at MarchJune 31,30, 2026. Commercial loans decreasedincreased $108,000,$214,000, or 1.9%,3.8%, from $5.7 million at December 31, 2025 to $5.6$5.9 million at MarchJune 31,30, 2026. Consumer loans decreased $324,000,$380,000, or 8.7%,10.3%, from $3.7 million at December 31, 2025 to $3.4 million at MarchJune 31,30, 2026.

During the threesix months ended MarchJune 31,30, 2026, the Company originated $5.1$15.9 million in loans consisting of $3.2$8.3 million in one-to four-family residential mortgage loans, $1.3$3.4 million in commercial real estate loans, $321,000$3.4 million in commercial loans and $309,000$794,000 in consumer loans.

Deposits. Deposits increased $3.6$1.0 million, or 2.2%,0.6%, from $166.5 million at December 31, 2025 to $170.1$167.5 million at MarchJune 31,30, 2026. Non-maturity deposits increased $3.0$3.6 million, or 3.3%,3.9%, from $91.5 million at December 31, 2025 to $94.5$95.1 million at MarchJune 31,30, 2026. Time deposits increaseddecreased by $613,000,$2.6 million, or 0.8%3.5% from $75.0 million at December 31, 2025 to $75.6$72.4 at MarchJune 31,30, 2026. The majority of the time deposit increase was into certificates of deposit with maturities of less than one year.

Total Stockholders’ Equity. Total stockholders’ equity was $39.0$39.4 million at MarchJune 31,30, 2026, aan decreaseincrease of $79,000$334,000 or 0.2%,0.9%, from $39.1 million at December 31, 2025. The decreaseincrease is due to anet negativeincome of $755,000 partially offset by the change in accumulated other comprehensive loss of $259,000,$314,000, and the purchase of $201,000$252,000 of treasury shares during the threesix months ended MarchJune 31,30, 2026 partially offset by net income of $318,000.2026.

Comparison of Operating Results for the Three Months Ended MarchJune 31,30, 2026 and 2025

General. Net income for the three months ended MarchJune 31,30, 2026 was $318,000,$437,000, ana increasedecrease of $33,000,$1,000, or 11.6%,0.2%, compared to $285,000$438,000 for the three months ended MarchJune 31,30, 2025.

Interest and Dividend Income. Interest and dividend income for the three months ended MarchJune 31,30, 2026 increased by $174,000,$99,000, or 8.2%,4.3%, from $2.1 million for the three months ended March 31, 2025 to $2.3 million for the three months ended MarchJune 31,30, 2025 to $2.4 million for the three months ended June 30, 2026. This increase is a result of a $229,000,$182,000, or 17.4%,12.8%, increase in loan interest and fees, partially offset by a $6,000,$44,000, or 1.1%,7.6%, decrease in interest from available-for-sale investments, a $23,000,$8,000, or 14.3%,4.7%, decrease in interest on cash and cash equivalents, and a $25,000,$31,000, or 26.9%,34.8%, decrease in interest from held-to-maturity investments.

The average balance of loans during the three months ended MarchJune 31,30, 2026, increased by $9.8$8.1 million or 9.9%,8.0%, from the average balance for the three months ended MarchJune 31,30, 2025, while the average yield on loans increased to 5.69%5.83% for the three months ended MarchJune 31,30, 2026, from 5.32%5.58% for the three months ended MarchJune 31,30, 2025. The increase in average yield on loans was due to higher market interest rates and increases in higher yielding commercial loans.

The average balance of available-for-sale debt securities decreased by $1.9$6.1 million, or 2.8%,8.6%, to $66.3$64.2 million for the three months ended MarchJune 31,30, 2026, from $68.2$70.3 million for the three months ended MarchJune 31,30, 2025, while the average yield on available-for-sale debt securities increased to 3.24%3.32% for the three months ended MarchJune 31,30, 2026 from 3.19%3.20% for the three months ended MarchJune 31,30, 2025. This increase in yield was due to higher market interest rates.

The average balance of held-to-maturity debt securities decreased by $2.2$2.6 million, or 26.3%,33.8%, to $5.9$5.1 million for the three months ended MarchJune 31,30, 2026, from $8.1$7.7 million for the three months ended MarchJune 31,30, 2025, while the average yield on held-to-maturity debt securities decreased to 4.55%4.61% for the three months ended MarchJune 31,30, 2026, from 4.60%4.62% for the three months ended MarchJune 31,30, 2025. This decrease in yield was due to maturities of higher yielding investments during the current period.

Interest Expense. Interest expense for the three months ended MarchJune 31,30, 2026 decreased by $7,000,$41,000, or 0.9%,5.0%, to $806,000$772,000 for the three months ended MarchJune 31,30, 2026 from $813,000 for the three months ended MarchJune 31,30, 2025. This decrease is a result of lower rates on interest bearing deposit balances. The Company experienced a small increase in the average rate for money market deposits while the average rate for regular savingssavings, NOW savingssavings, and time deposits decreased as market interest rates began to declinedeclined during the period for these deposit products.

The average balance of regular savings deposits increased by $5.8$1.9 million, or 19.8%,5.5%, to $35.1$36.5 million for the three months ended MarchJune 31,30, 2026, from $29.3$34.6 million for the three months ended MarchJune 31,30, 2025, while the average rate on regular savings deposits decreased to 0.13% for the three months ended MarchJune 31,30, 2026, from 0.17%0.14% for the three months ended MarchJune 31,30, 2025.

The average balance of NOW savings deposits decreased by $2.1$2.9 million, or 10.7%,13.7%, to $17.6$18.3 million for the three months ended MarchJune 31,30, 2026, from $19.7$21.2 million for the three months ended MarchJune 31,30, 2025, while the average rate on NOW savings deposits decreased to 0.17%0.21% for the three months ended MarchJune 31,30, 2026, from 0.23%0.24% for the three months ended MarchJune 31,30, 2025.

The average balance of money market deposits increased by $766,000, or 3.0%, to $26.3 million for the three months ended June 30, 2026, from $25.6 million for the three months ended June 30, 2025, while the average rate on money market deposits increased to 1.71% for the three months ended June 30, 2026, from 1.62% for the three months ended June 30, 2025. This increase in yield is due to higher balances into tiered money market accounts The average balance of time deposits increased by $5.5$1.5 million, or 7.9%,2.1%, to $75.2$73.5 million for the three months ended MarchJune 31,30, 2026, from $69.7$72.0 million for the three months ended MarchJune 31,30, 2025, while the average rate on time deposits decreased to 3.61%3.47% for the three months ended MarchJune 31,30, 2026, from 3.91%3.80% for the three months ended MarchJune 31,30, 2025. This decrease in rate resulted from lower market interest rates.

Net Interest Income. Net interest income for the three months ended MarchJune 31,30, 2026 was $1.5$1.6 million, an increase of $181,000,$140,000, or 13.8%,9.7%, from $1.3$1.4 million for the three months ended MarchJune 31,30, 2025. The increase was due to the net interest rate spread increasing to 2.50%2.71% for the three months ended MarchJune 31,30, 2026, from 2.15%2.44% for the three months ended MarchJune 31,30, 2025 despite a decrease inwhile average net interest earning assets ofincreased $2.5by million,$551,000, or 5.2%,1.2%, to $45.5$45.6 million for the three months ended MarchJune 31,30, 2026, from $48.0$45.0 million for the three months ended MarchJune 31,30, 2025.

Provision for Credit Losses. The provision for credit losses for the three months ended MarchJune 31,30, 2026, was $15,000$25,000 compared to $56,000$57,000 for the three months ended MarchJune 31,30, 2025. The decrease was due to a larger general reserve for the three months ended MarchJune 31,30, 2025 due to $4.1$9.5 million in commercial real estate loans originated during the three months ended MarchJune 31,30, 2025 compared to $1.3$1.8 million in commercial real estate loans originated during the three months ended MarchJune 31,30, 2026. The allowance for credit losses was $840,000,$860,000, or 0.76%0.77% of total loans, at MarchJune 31,30, 2026.

Noninterest Income. Noninterest income increaseddecreased $12,000,$25,000, or 7.9%,12.6%, to $164,000$174,000 for the three months ended MarchJune 31,30, 2026, compared to $152,000$199,000 for the three months ended MarchJune 31,30, 2025. The primary factor was customerother service feenoninterest income which increaseddecreased $12,000.$28,000 as a result of prior year gains on equity securities compared to a loss of $131,000 in the current year.

Noninterest Expense. Noninterest expense increased $209,000,$200,000, or 20.2%,19.3%, to $1.2 million for the three months ended MarchJune 31,30, 2026, from $1.0 million for the three months ended MarchJune 31,30, 2025. During the three months ended MarchJune 31,30, 2026, salaries and benefits increased $118,000$114,000 primarily due to stock incentive plan expenses, printing and office supplies increased by $15,000, professional fees increased $8,000$27,000 primarily due to additional auditing expenseexpense, and other non-interest expense increased by $115,000$25,000 due to a loss on FHLMC stock that is adjusted quarterly to market price, while occupancy expenses decreased $8,000, deposit insurance premiums decreasedincreased $2,000,by $13,000, data processing expense increased by $36,000 due to costs for new services and product implementation while depreciation decreased by $3,000, andmarketing data processing expenseexpenses decreased by $35,000$5,000 primarilyand dueprinting toand savingsoffice fromsupplies contractdecreased renegotiation.by $7,000.

Provision for Income Taxes. The provision for income taxes decreased $8,000,$52,000, or 9.5%,45.6%, to $76,000$62,000 for the three months ended MarchJune 31,30, 2026, compared to $84,000$114,000 for the three months ended MarchJune 31,30, 2025. The decrease was a primarily due to deferred tax adjustments greater in 2026 than 2025.

Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, and proceeds from maturities of securities. We also have the ability to borrow from the Federal Home Loan Bank of Chicago and from a correspondent bank. At MarchJune 31,30, 2026, we had no borrowings from the Federal Home Loan Bank of Chicago but had the capacity to borrow $51.1$50.7 million. At MarchJune 31,30, 2026, we had no borrowings from correspondent banks but had the capacity to borrow $9.0 million.

Our cash flows are comprised of three primary classifications: cash flows from operating activities, cash flows from investing activities, and cash flows from financing activities. For the threesix months ended MarchJune 31,30, 2026, cash flows from operations, investing, and financialfinancing activities resulted in a net increase in cash and cash equivalents of $6.6$4.0 million. Net cash provided from operating activities amounted to $704,000,$600,000, primarily due to net income of $318,000,$755,000, a decrease of interest receivable of $33,000, the change in fair value of equity securities of $131,000 and increase in accruals for stock-based compensation of $80,000, partially offset by earnings of $56,000 on cash surrender value of life insurance, an increase in interest payable and other liabilities of $122,000,$353,000 theand decreasean increase in deferred income taxes of interest$39,000. receivableNet cash provided by investing activities amounted to $2.6 million, primarily due to proceeds from maturities of $48,000,available-for-sale the change in fair value of equityinvestment securities of $114,000,$3.9 million and maturities of held-to-maturity debt securities of $2.0 million, partially offset bywith earningsan increase in loans of $28,000$2.7 on cash surrender value of life insurance.million. Net cash provided by financing activities amounted to $3.5 million,$789,000, primarily due to a net increase in demand deposits, money markets, NOW and savings accounts of $3.1$3.7 million partially offset by $252,000 of treasury stock purchased and ana increasedecrease in certificates of deposit of $613,000,$2.7 partially offset by $201,000 of treasury stock purchased. Net cash provided by investing activities amounted to $2.5 million, primarily due to proceeds from maturities of available-for-sale investment securities of $1.7 million and maturities of held-to-maturity debt securities of $985,000. partially offset with an increase in loans of $(232,000).million.

PFS Bancorp, Inc. is a separate legal entity from Peru Federal Savings Bank and must provide for its own liquidity to pay its operating expenses and other financial obligations. The Company’s primary source of income is dividends received from the Bank. The amount of dividends that the Bank may declare and pay to the Company is governed by applicable bank regulations. At MarchJune 31,30, 2026, the Company (on an unconsolidated basis) had liquid assets of $5.3 million.

At MarchJune 31,30, 2026, the Bank was categorized as well-capitalized under regulatory capital guidelines. Management is not aware of any conditions or events since the most recent notification that would change our category. For further information, see note 12 to the notes to consolidated financial statements appearing elsewhere in this report.

At MarchJune 31,30, 2026, we had $5.8$8.1 million of outstanding commitments to originate loans, $467,000$1.3 million of which represents the balance of remaining funds to be disbursed on construction loans in process, $2.3$4.1 million in unused commercial line of credit commitments, $1.1$1.2 million of unfunded home equity loans, $50,000 of unfunded consumer line of credit, $980,000 of commitments to fund new commercial real estate loans and $872,000$1.5 million of commitments to fund new closed-end residential real estate loans. At MarchJune 31,30, 2026, certificates of deposit that are scheduled to mature on or before MarchJune 31,30, 2027 totaled $63.1$61.1 million. Management expects that a substantial portion of the maturing certificates of deposit will be renewed.

The following table sets forth, as of MarchJune 31,30, 2026 the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve. The estimated changes presented in the table are within Board of Director-approved policy guidelines.

Change in Net Interest Income. The following table sets forth, at MarchJune 31,30, 2026, the calculation of the estimated changes in our net interest income (“NII”) that would result from the designated immediate changes in the United States Treasury yield curve. The estimated changes presented in the table are within Board of Director-approved policy guidelines.

EVE and net interest NII calculations also may not reflect the fair values of financial instruments. For example, decreases in market interest rates can increase the fair values of our loans, deposits and borrowings.