10-Q - BPRN - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20429

FORM 10-Q

(Mark one)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission File Number: 001-41589

PRINCETON BANCORP, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania	88-4268702
(State or other jurisdiction of<br> <br>incorporation or organization)	(I.R.S. Employer<br> <br>Identification No.)

183 Bayard Lane, Princeton, New Jersey 08540

(Address of principal executive offices) (Zip Code)

(609) 921-1700

(Registrant’s telephone number, including area code)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class	Trading<br>Symbol(s)	Name of each exchange<br>on which registered
Common stock, no par value	BPRN	The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated<br> filer	☐	Smaller reporting company	☒
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. As of May 5, 2025, there were 6,929,130 outstanding shares of the issuer’s common stock, no par value.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION
Item 1	Financial Statements
	Unaudited Consolidated Statements of Financial Condition - March 31, 2025 and December 31, 2024	3
	Unaudited Consolidated Statements of Income - Three Months Ended March 31, 2025 and 2024	4
	Unaudited Consolidated Statements of Comprehensive Income - Three Months Ended March 31, 2025 and 2024	5
	Unaudited Consolidated Statements of Changes in Stockholders’ Equity - Three Months Ended March 31, 2025 and 2024	6
	Unaudited Consolidated Statements of Cash Flows - Three Months Ended March 31, 2025 and 2024	7
	Notes to Unaudited Consolidated Financial Statements	8
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3	Quantitative and Qualitative Disclosure about Market Risk	38
Item 4	Controls and Procedures	38
PART II OTHER INFORMATION
Item 1	Legal Proceedings	39
Item 1A	Risk Factors	39
Item 2	Unregistered Sale of Equity Securities and Use of Proceeds	39
Item 3	Defaults Upon Senior Securities	39
Item 4	Mine Safety Disclosures	39
Item 5	Other Information	39
Item 6	Exhibits	40

PART I–FINANCIAL INFORMATION

Item 1. Financial Statements.

PRINCETON BANCORP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Dollars in thousands, except share data)

			December 31,
			2024
ASSETS
Cash and due from banks	20,193		$	16,915
Interest-earning bank balances	2,587			16,729
Federal funds sold	44,894			83,704
Total cash and cash equivalents	67,674			117,348
Securities available-for-sale, at fair value	239,234			247,171
Securities held-to-maturity (fair value 160 and 162, at March 31, 2025 and December 31, 2024, respectively)	159			161
Loans receivable, net of deferred fees and costs	1,856,539			1,818,875
Less: allowance for credit losses	(23,942	)		(23,657	)
Loan receivable, net	1,832,597			1,795,218
Bank-owned life insurance	72,581			72,111
Premises and equipment, net	17,560			17,804
Accrued interest receivable	8,146			7,975
Restricted investment in bank stock	2,138			2,075
Deferred taxes, net	19,563			20,276
Goodwill	14,381			14,381
Core deposit intangible	3,403			3,632
Other real estate owned	—			295
Operating lease right-of-use asset	21,189			21,903
Other assets	19,472			19,883
TOTAL ASSETS	2,318,097		$	2,340,233
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Deposits:
Non-interest-bearing	290,496		$	300,972
Interest-bearing	1,720,170			1,731,653
Total deposits	2,010,666			2,032,625
Accrued interest payable	12,510			15,401
Operating lease liability	22,241			22,941
Other liabilities	5,693			7,226
TOTAL LIABILITIES	2,051,110			2,078,193
STOCKHOLDERS’ EQUITY:
Preferred stock, no par value; 2,000,000 shares authorized and none outstanding at March 31, 2025 and none authorized at December 31, 2024	—			—
Common stock, no par value; 15,000,000 shares authorized, 6,956,880 shares issued and 6,924,130 outstanding at March 31, 2025; 6,910,693 shares issued and 6,883,193 outstanding at December 31, 2024	—			—
Paid-in capital	120,452			119,908
Treasury stock, at cost; 32,750 shares at March 31, 2025 and 27,500 shares at December 31, 2024	(1,005	)		(842	)
Retained earnings	155,170			151,915
Accumulated other comprehensive loss	(7,630	)		(8,941	)
TOTAL STOCKHOLDERS’ EQUITY	266,987			262,040
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	2,318,097		$	2,340,233

All values are in US Dollars.

See accompanying notes to unaudited consolidated financial statements.

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PRINCETON BANCORP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except share data)

	Three Months <br>Ended
	March 31,
	2025		2024
INTEREST AND DIVIDEND INCOME
Loans receivable, including fees	$	29,624	$	24,940
Securities <br>available-for-sale:
Taxable		2,616		564
Tax-exempt		284		286
Securities <br>held-to-maturity		2		2
Other interest and dividend income		769		2,274
TOTAL INTEREST AND DIVIDEND INCOME		33,295		28,066
INTEREST EXPENSE
Deposits		14,538		12,618
Borrowings		—		—
TOTAL INTEREST EXPENSE		14,538		12,618
NET INTEREST INCOME		18,757		15,448
Provision for credit losses		268		186
NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES		18,489		15,262
NON-INTEREST<br> INCOME
Income from bank-owned life insurance		471		381
Fees and service charges		511		432
Loan fees, including preypayment penalties		675		724
Other		533		448
TOTAL <br>NON-INTEREST<br> INCOME		2,190		1,985
NON-INTEREST<br> EXPENSE
Salaries and employee benefits		7,172		6,520
Occupancy and equipment		2,285		2,029
Professional fees		761		524
Data processing and communications		1,626		1,160
Federal deposit insurance		533		273
Advertising and promotion		171		142
Office expense		110		119
Other real estate expenses		27		—
Core deposit intangible		229		120
Other		878		949
TOTAL <br>NON-INTEREST<br> EXPENSE		13,792		11,836
INCOME BEFORE INCOME TAX EXPENSE		6,887		5,411
INCOME TAX EXPENSE		1,509		1,066
NET INCOME	$	5,378	$	4,345
Earnings per common share-basic	$	0.78	$	0.69
Earnings per common share-diluted	$	0.77	$	0.68

See accompanying notes to unaudited consolidated financial statements.

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PRINCETON BANCORP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollars in thousands)

	Three Months Ended
	March 31,
	2025			2024
NET INCOME	$	5,378		$	4,345
Other comprehensive income (loss)
Unrealized losses arising during period on securities <br>available-for-sale		1,828			(434	)
Net unrealized (loss) income		1,828			(434	)
Tax effect		(517	)		143
Total other comprehensive (loss) income		1,311			(291	)
COMPREHENSIVE INCOME	$	6,689		$	4,054

See accompanying notes to unaudited consolidated financial statements.

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PRINCETON BANCORP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Dollars in thousands, except share data)

											Accumulated
											Other
		Paid-in			Treasury			Retained			Comprehensive
		Capital			Stock			Earnings			Loss			Total
Three Months Ended March 31, 2025 and 2024
Balance, December 31, 2023	—	$	98,291		$	—		$	149,414		$	(7,494	)	$	240,211
Net income	—		—			—			4,345			—			4,345
Other comprehensive loss	—		—			—			—			(291	)		(291	)
Treasury stock repurchases (19,000 shares)	—		—			(579	)		—			—			(579	)
Stock options exercised (2,450 shares)	—		34			—			—			—			34
Share redemption for tax withholding on restricted stock vesting	—		(249	)		—			—			—			(249	)
Dividends declared 0.30 per share	—		—			—			(1,866	)		—			(1,866	)
Dividend reinvestment plan (1,018 shares)	—		33			—			(33	)		—			—
Stock-based compensation expense	—		203			—			—			—			203
Balance, March 31, 2024	—	$	98,312		$	(579	)	$	151,860		$	(7,785	)	$	241,808
Balance, December 31, 2024	—	$	119,908		$	(842	)	$	151,915		$	(8,941	)	$	262,040
Net income (loss)	—		—			—			5,378			—			5,378
Other comprehensive income	—		—			—			—			1,311			1,311
Treasury stock repurchases (5,250 shares)	—		—			(163	)		—			—			(163	)
Stock options exercised (21,300 shares)	—		443			—			—			—			443
Share redemption for tax withholding on restricted stock vesting	—		(231	)		—			—			—			(231	)
Dividends declared 0.30 per share	—		—			—			(2,092	)		—			(2,092	)
Dividend reinvestment plan (994 shares)	—		31			—			(31	)		—			—
Stock-based compensation expense	—		301			—			—			—			301
Balance, March 31, 2025	—	$	120,452		$	(1,005	)	$	155,170		$	(7,630	)	$	266,987

All values are in US Dollars.

See accompanying notes to unaudited consolidated financial statements.

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PRINCETON BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Three Months Ended March 31,
	2025			2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,378		$	4,345
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		268			186
Depreciation and amortization		444			409
Stock-based compensation expense		301			203
Amortization of premiums and accretion of discounts on securities, net		7			6
Accretion of net deferred loan fees and costs		(1,246	)		(37	)
Increase in cash surrender value of bank-owned life insurance		(470	)		(380	)
Deferred income tax		713			98
Amortization of core deposit intangible		229			121
Increase (decrease) in accrued interest receivable and other assets		751			(152	)
(Decrease) increase in accrued interest payable and other liabilities		(5,124	)		28
NET CASH PROVIDED BY OPERATING ACTIVITIES		1,251			4,827
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of <br>available-for-sale<br> securities		(2,564	)		(28,898	)
Maturities, calls and principal repayments of securities <br>available-for-sale		12,320			1,254
Maturities, calls and principal repayments of securities <br>held-to-maturity		2			26
Net (increase) in loans		(36,418	)		(22,859	)
Purchases of premises and equipment		(200	)		(71	)
(Purchases) redemption of restricted bank stock		(63	)		12
NET CASH USED IN INVESTMENT ACTIVITIES		(26,923	)		(50,536	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net (decrease) increase in deposits		(21,959	)		69,879
Cash dividends		(2,092	)		(1,866	)
Share redemption for tax witholding on restricted stock vesting		(231	)		(249	)
Purchase of treasury stock		(163	)		(579	)
Proceeds from exercise of stock options		443			34
NET CASH (USED) PROVIDED BY FINANCING ACTIVITIES		(24,002	)		67,219
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS		(49,674	)		21,510
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		117,348			150,557
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	67,674		$	172,067
SUPPLEMENTARY CASH FLOWS INFORMATION:
Interest paid	$	17,429		$	9,949
Income taxes paid	$	1,094		$	724
Increase in ROU leases	$	—		$	1,808

See accompanying notes to unaudited consolidated financial statements.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 1 – Summary of Significant Accounting Policies

Organization and Nature of Operations

The Bank of Princeton (the “Bank”) was incorporated on March 5, 2007, under the laws of the State of New Jersey and is a New Jersey state-chartered banking institution. The Bank was granted its bank charter on April 17, 2007, commenced operations on April 23, 2007, and is a full-service bank providing personal and business lending and deposit services. As a state-chartered bank, the Bank is subject to regulation by the New Jersey Department of Banking and Insurance and the Federal Deposit Insurance Corporation (“FDIC”). The area served by the Bank, through its 35 branches, is generally an area within an approximate 50-mile radius of Princeton, NJ, including parts of Burlington, Camden, Gloucester, Hunterdon, Mercer, Middlesex, Ocean, and Somerset Counties in New Jersey, and additional areas in portions of Philadelphia, Montgomery, and Bucks Counties in Pennsylvania. The Bank also has two retail branches and conducts loan origination activities in select areas of New York.

The Bank offers traditional retail banking services, one-to-four-family residential mortgage loans, multi-family and commercial mortgage loans, construction loans, commercial business loans and consumer loans, including home equity loans and lines of credit.

On January 10, 2023, Princeton Bancorp, Inc., a Pennsylvania corporation formed by the Bank (the “Company”), acquired all the outstanding stock of the Bank in a corporate reorganization. As a result, the Bank became the sole direct subsidiary of the Company, the Company became the holding company for the Bank and the stockholders of the Bank became stockholders of the Company. As of March 31, 2025, the Company and its subsidiaries had 245 total employees and 242 full-time equivalent employees.

On August 23, 2024, the Company completed the acquisition of Cornerstone Financial Corporation (“CFC”), the holding company for Cornerstone Bank, a New Jersey chartered state bank headquartered in Mt. Laurel, New Jersey that primarily served the South Jersey market. On that date, the Company acquired 100% of the outstanding common stock of CFC in exchange for the Company’s stock, CFC was merged into the Company, and Cornerstone Bank was merged with and into the Bank.

Basis of Financial Statement Presentation

The unaudited consolidated financial statements include the accounts of the Company, its wholly owned subsidiary, the Bank, and the Bank’s wholly owned subsidiaries: Bayard Lane, LLC, Bayard Properties, LLC, 112 Fifth Avenue, LLC, TBOP Delaware Investment Company and TBOP REIT, Inc. All significant inter-company accounts and transactions have been eliminated in consolidation.

The unaudited consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission and the FDIC. Accordingly, they do not include all the information and disclosures required by GAAP for annual financial statements. In management’s opinion, the unaudited consolidated financial statements contain all adjustments, which include normal and recurring adjustments necessary for a fair presentation of the financial position and results of operations for the interim periods presented. The results of operations reported for interim periods are not necessarily indicative of the results of operations for the entire year or any subsequent interim period. These unaudited consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 1 – Summary of Significant Accounting Policies (continued)

Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Because of uncertainties associated with estimating the amounts, timing and likelihood of possible outcomes, actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for credit losses, the valuation of acquired assets and liabilities, and evaluation of the potential impairment of goodwill.

Management believes that the allowance for credit losses is adequate as of March 31, 2025. While management uses current information to recognize losses on loans, future additions to the allowance for credit losses may be necessary based on changes in economic conditions in the market area or other factors.

In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for credit losses. Such agencies may require the Company to effect certain changes that result in additions to the allowance based on their judgments about information available to them at the time of their examinations.

Reclassifications

Certain amounts in the prior year consolidated financial statements have been reclassified to conform to the current year’s presentation.

Recent Accounting Pronouncements Adopted

Segment Reporting

The Company adopted Accounting Standards Updat e (ASU) 2023-07 “ Segment Reporting (Topic 280)—Improvement to Reportable Segment Disclosures ” on January 1, 2024. The Company has determined that all of its banking divisions and subsidiaries meet the aggregation criteria of Accounting Standards Codification (ASC) 280, Segment Reporting, as its current operating model is structured whereby banking divisions and subsidiaries serve a similar customer base utilizing a company-wide offering of similar products and services managed through similar processes and platforms that are collectively reviewed by the Company’s Chief Executive Officer, who has been identified as the chief operating decision maker (“CODM”).

The CODM regularly assesses performance of the aggregated single operating and reporting segment and decides how to allocate resources based on net income calculated on the same basis as is net income reported in the Company’s consolidated statements of income. The CODM is also regularly provided with expense information at a level consistent with that disclosed in the Company’s consolidated statements of income.

Improvements to Income Tax Disclosures

In December 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023-09,

“Income Taxes (Topic 740): Improvements to Income Tax Disclosures” , which enhances the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation, as well as additional information about income taxes paid. The ASU also removes certain disclosures that are no longer considered cost beneficial or relevant .

The Company adopted ASU 2023-09 on January 1, 2025, on a prospective basis, as permitted by the guidance. The adoption did not impact on the Company’s consolidated financial condition, results of operations, or cash flows, but it will result in enhanced income tax disclosures beginning with the Company’s annual report for the fiscal year ended December 31, 2025.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 1 – Summary of Significant Accounting Policies (concluded)

Recent Accounting Pronouncements Not Yet Adopted

ASU 2023-06, “ Disclosure improvements ” amends disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification. The effective dates will depend, in part, on whether an entity is already subject to the SEC’s current disclosure requirements. This ASU is not expected to have a material impact on the Company’s consolidated financial statements.

Note 2 – Earnings Per Share

Basic earnings per share (“EPS”) is calculated by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is calculated by dividing net income by the weighted average number of common shares outstanding for the period adjusted to include the effect of outstanding stock options, if dilutive, using the treasury stock method. Shares issued during any period are weighted for the portion of the period they were outstanding.

The following schedule presents earnings per share data for the three-month periods ended March 31, 2025, and 2024 (in thousands, except per share data):

	Three months ended
	March 30,
	2025		2024
Net income applicable to common stock	$	5,378	$	4,345
Weighted average number of common shares outstanding		6,905		6,328
Basic earnings per share	$	0.78	$	0.69
Net income applicable to common stock	$	5,378	$	4,345
Weighted average number of common shares outstanding		6,905		6,328
Dilutive effect on common shares outstanding		59		90
Weighted average number of diluted common shares outstanding		6,964		6,418
Diluted earnings per share	$	0.77	$	0.68

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 2 – Earnings Per Share (concluded)

The following schedule presents stock options granted but not exercised and the amount of share that were anti-dilutive because the weighted average exercise price equaled or exceeded the average estimated fair value of our common stock for the three-month periods ended March 31, 2025 and 2024.

	Three months ended March 31,
	2025				2024
			Weighted Ave				Weighted Ave
	Options		Exercise Price		Options		Exercise Price
Options to purchase		260,698	$	24.52		245,633	$	21.38
Anti-dilutive		—	$	—		86,431	$	33.19

Note 3 – Investment Securities

The following summarizes the amortized cost and fair value of securities available-for-sale at March 31, 2025 and December 31, 2024 with gross unrealized gains and losses therein:

	March 31, 2025
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
			(In thousands)
Available-for-sale
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	190,425	$	818	$	(6,277	)	$	184,966
U.S. government agency securities		11,260		21		(914	)		10,367
Obligations of state and political subdivisions		43,607		1		(4,305	)		39,303
Small business association (SBA) securities		1,717		7		(5	)		1,719
U.S. treasury securities		2,884		—		(5	)		2,879
Total	$	249,893	$	847	$	(11,506	)	$	239,234

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 3 – Investment Securities (continued)

	December 31, 2024
			Gross		Gross
	Amortized		Unrealized		Unrealized
	Cost		Gains		Losses			Fair Value
			(In thousands)
Available-for-sale
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	197,792	$	422	$	(7,669	)	$	190,545
U.S. government agency securities		11,260		17		(1,077	)		10,200
Obligations of state and political subdivisions		43,895		1		(4,166	)		39,730
Small business association (SBA) securities		1,856		5		(4	)		1,857
U.S. treasury securities		4,855		1		(17	)		4,839
Total	$	259,658	$	446	$	(12,933	)	$	247,171

The unrealized losses, categorized by the length of time of continuous loss position, and the fair value of related securities available-for-sale at March 31, 2025 and December 31, 2024 are as follows:

	Less than 12 Months					More than 12 Months					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(In thousands)
March 31, 2025
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	50,826	$	(411	)	$	28,767	$	(5,866	)	$	79,593	$	(6,277	)
U.S. government agency securities		232		—			5,346		(914	)		5,578		(914	)
Obligations of state and political subdivisions		3,419		(32	)		34,175		(4,273	)		37,594		(4,305	)
Small business association (SBA) securities		549		(3	)		289		(2	)		838		(5	)
U.S. Treasuries		1,910		(5	)		—		—			1,910		(5	)
Total	$	56,936	$	(451	)	$	68,577	$	(11,055	)	$	125,513	$	(11,506	)
	Less than 12 Months					More than 12 Months					Total
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses			Value		Losses			Value		Losses
	(In thousands)
December 31, 2024
Mortgage-backed securities - U.S. government sponsored enterprises (GSEs)	$	122,763	$	(1,157	)	$	29,229	$	(6,512	)	$	151,992	$	(7,669	)
U.S. government agency securities		129		—			5,183		(1,077	)		5,312		(1,077	)
Obligations of state and political subdivisions		3,664		(39	)		34,320		(4,127	)		37,984		(4,166	)
Small business association (SBA) securities		447		(1	)		449		(3	)		896		(4	)
U.S. Treasuries		2,846		(17	)		—		—			2,846		(17	)
	$	129,849	$	(1,214	)	$	69,181	$	(11,719	)	$	199,030	$	(12,933	)

The amortized cost and fair value of securities available-for-sale at March 31, 2025 by contractual maturity are shown below. Expected maturities will differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties:

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 3 – Investment Securities (concluded)

	Amortized
	Cost		Fair Value
	(In thousands)
Due in one year or less	$	2,093	$	2,094
Due after one year through five years		9,693		9,541
Due after five years through ten years		42,297		38,143
Due after ten years		5,385		4,490
Mortgage-backed securities (GSEs)		190,425		184,966
	$	249,893	$	239,234

Proceeds from calls and maturities of securities available-for-sale were not significant for the three-month period ended March 31, 2025 or 2024.

The Company uses a defined methodology for allowance for credit losses on its investment securities available-for-sale. The Company did not have an allowance for credit losses on its investment securities available-for-sale as of March 31, 2025 or 2024.

The Company’s securities primarily consist of the following types of instruments; U.S. guaranteed mortgage-backed securities, U.S. guaranteed agency bonds, state and political subdivision issued bonds, mortgage related securities guaranteed by the SBA and U.S. treasury notes. We believe it is reasonable to expect that the securities with a credit guarantee of the U.S. government will have a zero-credit loss. Therefore, no reserve was recorded for U.S. guaranteed securities or bonds at March 31, 2025. The state and political subdivision securities carry a minimum investment rating of A by either Moody’s or Standard and Poor’s. Some of the smaller municipalities also have insurance to cover the Company in the event of default. Therefore, the Company did not project a credit loss and no reserve was recorded as of March 31, 2025.

At March 31, 2025, the Company’s available-for-sale securities portfolio consisted of approximately 273 securities, of which 165 available-for-sale securities were in an unrealized loss position for more than twelve months and 37 available-for-sale securities were in an unrealized loss position for less than twelve months. The available-for-sale securities in an unrealized loss position for more than twelve months consisted of 106 municipal securities aggregating $34.2 million with a loss of $4.3 million, 52 mortgage-backed securities-GSE aggregating $28.8 million with a loss of $5.9 million, 3 agency securities aggregating $5.3 million with a loss of $914 thousand and 4 SBA securities aggregating $289 thousand with a loss of $2 thousand. The Company does not intend to sell these securities, and it is not more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. Unrealized losses primarily relate to interest rate fluctuations and not credit concerns.

There are no securities pledged as of March 31, 2025, and December 31, 2024.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 4 – Loans Receivable

Loans receivable, net at March 31, 2025 and December 31, 2024 were comprised of the following:

	March 31,			December 31,
	2025			2024
	(In thousands)
Commercial real estate	$	1,404,108		$	1,385,085
Commercial and industrial		89,941			92,857
Construction		249,187			257,169
Residential first-lien mortgage		97,255			68,030
Home equity/consumer		18,532			18,133
Total loans		1,859,023			1,821,274
Deferred fees and costs		(2,484	)		(2,399	)
Loans, net	$	1,856,539		$	1,818,875

The Company purchased approximately $30.0 million in residential loans and $1.0 million in consumer loans during the three-months ended March 31, 2025. Besides the acquisition of Cornerstone Bank in the third quarter of 2024, the Company did not purchase any loans during the year ended December 31, 2024.

The Company uses the discounted cash flow methodology in determining the appropriate quantitative adjustments, which projects future losses, based on historical and peer loss data, as part of the allowance for credit losses (“ACL”) reserve. Qualitative adjustments include and consider changes in national, regional, and local economic and business conditions, an assessment of the lending environment, including underwriting standards, and other factors affecting credit quality. There were no significant changes to the Company’s ACL methodology for the quarter ended March 31, 2025.

The following table presents the components of the allowance for credit losses:

	March 31,<br> 2025			December 31,<br> 2024
	(In thousands)
Allowance for credit losses - loans	$	(23,942	)	$	(23,657	)
Allowance for credit losses - off balance sheet		(404	)		(361	)
	$	(24,346	)	$	(24,018	)

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 4 – Loans Receivable (continued)

The following table presents nonaccrual loans by segment of the loan portfolio as of March 31, 2025 and December 31, 2024:

	March 31, 2025				December 31, 2024
	With a		Without a		With a		Without a
	Related		Related		Related		Related
	Allowance		Allowance		Allowance		Allowance
	(In thousands)
Commercial real estate	$	18,323	$	7,578	$	18,502	$	6,939
Commercial and industrial		22	$	488		109		1,178
Construction		—		—		—		—
Residential first-lien mortgage		—		112		—		94
Home equity/consumer		—		—		—		19
Total nonaccrual loans	$	18,345	$	8,178	$	18,611	$	8,230

The calculation of the allowance for credit losses does not include any accrued interest receivable. The Company’s policy is to write off any interest not collected after 90 days or when the ability to collect principal and interest according to the contractual terms in doubt. During the three-month period ended March 31, 2025, the Company wrote off $422 thousand in accrued interest receivable for loans, compared to $310 thousand for the three-month period ended March 31, 2024. Accrued interest receivable related to loans, at March 31, 2025, and December 31, 2024, was $6.8 million and $6.5 million, respectively. The performance and credit quality of the loan portfolio is also monitored by analyzing the age of the loan receivables by the length of time a recorded payment is past due. The following table presents the segments of the loan portfolio, summarized by the past due status a s of March 31, 2025:

													Loans
	30-59		60-89		>90								Receivable
	Days		Days		Days		Total				Total		>90 Days
	Past		Past		Past		Past				Loans		and
	Due		Due		Due		Due		Current		Receivable		Accruing
	(In thousands)
Commercial real estate	$	7,024	$	—	$	25,901	$	32,925	$	1,371,183	$	1,404,108	$	—
Commercial and industrial		24		—		510		534		89,407		89,941		—
Construction		—		—		—		—		249,187		249,187		—
Residential first-lien mortgage		1,243		—		112		1,355		95,900		97,255		—
Home equity/consumer		—		—		—		—		18,532		18,532		—
Total	$	8,291	$	—	$	26,523	$	34,814	$	1,824,209	$	1,859,023	$	—

The following table presents the segments of the loan portfolio summarized by the past due status as of December 31, 2024:

													Loans
	30-59		60-89		>90								Receivable
	Days		Days		Days		Total				Total		>90 Days
	Past		Past		Past		Past				Loans		and
	Due		Due		Due		Due		Current		Receivable		Accruing
	(In thousands)
Commercial real estate	$	—	$	—	$	25,441	$	25,441	$	1,359,644	$	1,385,085	$	—
Commercial and industrial		36		—		421		457		92,400		92,857		32
Construction		—		—		—		—		257,169		257,169		—
Residential first-lien mortgage		700		94		—		794		67,236		68,030		—
Home equity/consumer		—		—		—		—		18,133		18,133		—
Total	$	736	$	94	$	25,862	$	26,692	$	1,794,582	$	1,821,274	$	32

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 4 – Loans Receivable (continued)

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as: current financial information, historical payment experience, credit documentation and current economic trends, among other factors. The Company evaluates risk ratings on an ongoing basis and assigns one of the following ratings: pass, special mention, substandard and doubtful. The Company engages a third party to review its assessment on a semiannual basis. The Company classifies residential and consumer loans as either performing or nonperforming based on payment status.

The following table summarizes total loans by year of origination, internally assigned credit grades and risk characteristics as of March 31, 2025. Gross charge-offs are included for the three-months ended March 31, 2025.

	2025		2024		2023		2022		2021		Prior		Revolving<br> Loans		Total
	(Dollars in thousands)
Commercial real estate
Pass	$	27,959	$	146,350	$	168,360	$	303,563	$	130,669	$	592,539	$	6,218	$	1,375,658
Special mention		—		—		—		—		—		2,549		—		2,549
Substandard		—		—		—		—		—		25,901		—		25,901
Total commercial real estate		27,959		146,350		168,360		303,563		130,669		620,989		6,218		1,404,108
Current period gross charge-offs												—				—
Commercial and industrial
Pass		1,352		5,621		7,025		19,963		12,169		15,178		26,844		88,152
Special mention		—		—		—		—		—		1,279		—		1,279
Substandard		—		—		—		—		—		510		—		510
Total commercial and industrial		1,352		5,621		7,025		19,963		12,169		16,967		26,844		89,941
Current period gross charge-offs												84				84
Construction
Pass		5,000		4,146		5,040		3,380		46,922		11,952		172,747		249,187
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Total construction		5,000		4,146		5,040		3,380		46,922		11,952		172,747		249,187
Current period gross charge-offs												—				—
Residential first-lien mortgage
Performing		1,495		27,968		3,842		6,706		6,074		51,058		—		97,143
Nonperforming		—		—		—		—		—		112		—		112
Total residential first-lien mortgage		1,495		27,968		3,842		6,706		6,074		51,170		—		97,255
Home equity/consumer
Performing		1,112		1,089		930		1,307		1,067		910		12,099		18,514
Nonperforming		—		—		19		—		—		—		—		19
Total home equity/consumer		1,112		1,089		949		1,307		1,067		910		12,099		18,533
Total
Pass		36,918		185,174		185,197		334,919		196,901		671,637		217,908		1,828,653
Special mention		—		—		—		—		—		3,828		—		3,828
Substandard		—		—		19		—		—		26,523		—		26,542
Total loans	$	36,918	$	185,174	$	185,216	$	334,919	$	196,901	$	701,988	$	217,908	$	1,859,023

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 4 – Loans Receivable (continued)

The following table summarizes total loans by year of origination, internally assigned credit grades and risk characteristics as of December 31, 2024. Gross charge-offs are included for the year-ended December 31, 2024.

	2024		2023		2022		2021		2020		Prior		Revolving<br> Loans		Total
	(Dollars in thousands)
Commercial real estate
Pass	$	143,453	$	168,828	$	309,379	$	136,509	$	58,755	$	537,532	$	2,600	$	1,357,056
Special mention		—		—		—		—		—		2,588		—		2,588
Substandard		—		—		—		—		6,938		18,503		—		25,441
Total commercial real estate		143,453		168,828		309,379		136,509		65,693		558,623		2,600		1,385,085
Current period gross charge-offs												236				236
Commercial and industrial
Pass		—		3,022		10,876		11,183		—		16,440		48,143		89,664
Special mention		—		—		—		—		—		1,906		—		1,906
Substandard		—		—		—		—		—		1,287		—		1,287
Total commercial and industrial		—		3,022		10,876		11,183		—		19,633		48,143		92,857
Current period gross charge-offs												516				516
Construction
Pass		17,765		22,109		46,558		92,841		16,431		242		61,223		257,169
Special mention		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—
Total construction		17,765		22,109		46,558		92,841		16,431		242		61,223		257,169
Current period gross charge-offs												—				—
Residential first-lien mortgage
Performing		596		1,895		6,789		6,134		2,860		49,662		—		67,936
Nonperforming		—		—		—		—		—		94		—		94
Total residential first-lien mortgage		596		1,895		6,789		6,134		2,860		49,756		—		68,030
Home equity/consumer
Performing		1,234		967		556		—		—		—		15,357		18,114
Nonperforming		—		—		19		—		—		—		—		19
Total home equity/consumer		1,234		967		575		—		—		—		15,357		18,133
Total
Pass		163,048		196,821		374,158		246,667		78,046		603,876		127,323		1,789,939
Special mention		—		—		—		—		—		4,494		—		4,494
Substandard		—		—		19		—		6,938		19,884		—		26,841
Total loans	$	163,048	$	196,821	$	374,177	$	246,667	$	84,984	$	628,254	$	127,323	$	1,821,274

The following table presents the allowance for credit losses on loans receivable at and for the three months ended March 31, 2025:

			Commercial						Residential
	Commercial		and						first-lien		Home equity/
	real estate		industrial			Construction			mortgage		consumer		Total
	(In thousands)
Allowance for credit losses:
Beginning balance	$	20,821	$	1,173		$	609		$	893	$	161	$	23,657
Provision (reversal)<br>1		149		(118	)		(209	)		395		8		225
Charge-offs		—		(84	)		—			—		—		(84	)
Recoveries		11		133			—			—		—		144
Total	$	20,981	$	1,104		$	400		$	1,288	$	169	$	23,942
1	The provision for credit losses on the Consolidated Statement of Income is $268 thousand comprising of an increase of $225 thousand to the allowance for loan loss and a $43 thousand increase to the reserve for unfunded liabilities.
---	---

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 4 – Loans Receivable (concluded)

The following table presents the allowance for credit losses on loans receivable at and for the three months ended March 31, 2024:

				Commercial						Residential
	Commercial			and						first-lien			Home equity/
	real estate			industrial			Construction			mortgage			consumer			Total
	(In thousands)
Allowance for credit losses:
Beginning balance	$	16,047		$	488		$	1,145		$	725		$	87		$	18,492
Provision (reversal)<br>1		631			(31	)		(124	)		(153	)		(21	)		302
Charge-offs		(237	)		(46	)		—			—			—			(283	)
Recoveries		5			102			—			—			—			107
Total	$	16,446		$	513		$	1,021		$	572		$	66		$	18,618
1	The provision for credit losses on the Consolidated Statement of Income is $186 thousand comprising of an increase of $302 thousand to the allowance for loan loss and a decrease of $116 thousand to the reserve for unfunded liabilities.
---	---

As of March 31, 2025, the Company had nine loans totaling $26.5 million that were individually analyzed for potential credit loss and all the loans have real estate as credit support. As of December 31, 2024, the Company had nine loans totaling $26.8 million that were individually analyzed for potential credit loss and all the loans have real estate credit support.

Occasionally, the Company will modify the contractual terms of loans to a borrower experiencing financial difficulties as a way to mitigate loss, proactively work with borrowers in financial difficulty, or to comply with regulations regarding the treatment of certain bankruptcy filing and discharge situations. Typically, such concessions may consist of a reduction in interest rate to a below market rate, taking into account the credit quality of the note, extension of additional credit base on receipt of adequate collateral, or a deferment or reduction of payments (principal or interest) which materially alters the Company’s position or significantly extends the note’s maturity date, such that the present value of cash flows to be received is materially less than those contractually established at the loan’s origination. When principal forgiveness is provided, the amount forgiven is charged off against the allowance for credit losses on loans. There were no modifications to borrowers with financial difficulties and no previously modified loans that defaulted for the three-month periods ended March 31, 2025, and December 31, 2024.

Note 5 – Deposits

The components of deposits were as follows:

				December 31,<br><br> <br>2024

Demand, non-interest-bearing checking	290,496	14.45	%	$	300,972	14.81	%
Demand, interest-bearing checking	331,032	16.46	%		300,559	14.79	%
Savings	172,546	8.58	%		170,880	8.41	%
Money market	464,012	23.08	%		490,543	24.13	%
Time deposits, 250,000 and over	220,968	10.99	%		284,272	13.99	%
Time deposits, other	531,612	26.44	%		485,399	23.88	%
	2,010,666	100.00	%	$	2,032,625	100.00	%

All values are in US Dollars.

Note 6 – Borrowings

At March 31, 2025, and December 31, 2024, the Company had no borrowings outstanding.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 7 – Fair Value Measurements and Disclosures

The Company follows the guidance on fair value measurements now codified as FASB ASC Topic 820, “ Fair Value Measurement” (“Topic 820”) . Fair value measurements are not adjusted for transaction costs. Topic 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value.

Management uses its best judgment in estimating the fair value of the Company’s financial instruments, however, there are inherent weaknesses in any estimation technique. Therefore, for substantially all financial instruments, the fair value estimates herein are not necessarily indicative of the amounts the Company could have realized in sales transactions on the dates indicated. The estimated fair value amounts have been measured as of their respective period-end and have not been re-evaluated or updated for the purposes of these consolidated financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different from the amounts reported at each period-end.

The fair value measurement hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:

Level

1 : Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level

2 : Quoted prices in markets that are not active, or inputs that are observable either directly or indirectly, for substantially the full term of the asset or liability.

Level

3 : Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported with little or no market activity).

An asset’s or liability’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.

For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy used at March 31, 2025 were as follows:

	(Level 1)
	Quoted Price		(Level 2)
	in Active		Significant		(Level 3)		Total Fair
	Markets for		Other		Significant		Value
	Identical		Observable		Unobservable		March 31,
Description	Assets		Inputs		Inputs		2025
	(In thousands)
Mortgage-backed securities <br>-U.S.<br> government sponsored enterprise (GSEs)	$	—	$	184,966	$	—	$	184,966
U.S. government agency securities		—		10,367		—		10,367
Obligations of state and political subdivisions		—		39,303		—		39,303
Small Business Association (SBA) securities		—		1,719		—		1,719
U.S. treasury securities		2,879		—		—		2,879
Mortgage servicings rights		—		960		—		960

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 7 – Fair Value Measurements and Disclosures (continued)

For financial assets measured at fair value on a recurring basis, the fair value measurements by level within the fair value hierarchy, used at December 31, 2024 were as follows:

	(Level 1)
	Quoted Price		(Level 2)
	in Active		Significant		(Level 3)		Total Fair
	Markets for		Other		Significant		Value
	Identical		Observable		Unobservable		December 31,
Description	Assets		Inputs		Inputs		2024
	(In thousands)
Mortgage-backed securities <br>-U.S.<br> government sponsored enterprise (GSEs)	$	—	$	190,545	$	—	$	190,545
U.S. government agency securities		—		10,200		—		10,200
Obligations of state and political subdivisions		—		39,730		—		39,730
Small Business Association (SBA) securities		—		1,857		—		1,857
U.S. treasury securities		4,839		—		—		4,839
Mortgage servicings rights		—		1,060		—		1,060

There were no liabilities measured at fair value on a recurring basis, at March 31, 2025 or December 31, 2024 .

For assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at March 31, 2025, were as follows:

	(Level 1)
	Quoted Price		(Level 2)
	in Active		Significant		(Level 3)		Total Fair
	Markets for		Other		Significant		Value
	Identical		Observable		Unobservable		March 31,
Description	Assets		Inputs		Inputs		2025
	(In thousands)
Collateral dependent loan	$	—	$	—	$	15,962	$	15,962
	$	—	$	—	$	15,962	$	15,962

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 7 – Fair Value Measurements and Disclosures (continued)

For assets measured at fair value on a nonrecurring basis, the fair value measurements by level within the fair value hierarchy used at December 31, 2024, were as follows:

	(Level 1)
	Quoted Price		(Level 2)
	in Active		Significant		(Level 3)		Total Fair
	Markets for		Other		Significant		Value
	Identical		Observable		Unobservable		December 31,
Description	Assets		Inputs		Inputs		2024
	(In thousands)
Collateral dependent loan	$	—	$	—	$	16,223	$	16,223
Other real estate owned<br>1						295		295
	$	—	$	—	$	16,518	$	16,518
1	The Bank charged off approximately $197,000 during the year ended December 31, 2024, prior to the property being transferred to other real estate owned.
---	---

The following table presents quantitative information using Level 3 fair value measurements at March 31, 2025.

								Range
	March 31,		Valuation			Unobservable		(Weighted
Description	2025		Technique			Input		Average)
	(Dollars in thousands)
Collateral dependent loan	$	15,962		Collateral	1		Discount <br>adjustment		12.9 <br>12.9	% <br>%
1	Fair value is generally determined through independent appraisal of the underlying collateral, primarily using comparable sales.
---	---

The following table presents quantitative information using Level 3 fair value measurements at December 31, 2024.

							Range
	December 31,		Valuation			Unobservable	(Weighted
Description	2024		Technique			Input	Average)
	(Dollars in thousands)
Collateral dependent loan	$	16,223		Collateral	1	Discount <br>adjustment		12.0 <br>12.0	% <br>%
Other real estate owned<br>2	$	295		Collateral	1	Discount<br> adjustment		0.0 <br>0.0	% <br>%
1	Fair value is generally determined through independent appraisal of the underlying collateral, primarily using comparable sales.
---	---
2	The other real estate owned was written down to the estimated net realizable value.
---	---

There were no transfers between fair value hierarchy levels during the three months ended March 31, 2025 or 2024. The Company’s policy is to recognize transfers between levels as of the end of the reporting period.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 7 – Fair Value Measurements and Disclosures (continued)

The following methods and assumptions were used by the Company in estimating fair value disclosures:

Investment Securities

The fair value of securities available-for-sale (carried at fair value) and held-to-maturity (carried at amortized cost) are determined by obtaining quoted market prices on nationally recognized securities exchanges (Level 1), or matrix pricing (Level 2), which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted market prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted prices. Level 2 debt securities are valued by a third-party pricing service commonly used in the banking industry, and not adjusted by management. Level 2 fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the U.S. treasury yield curve, live trading levels, trade execution date, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things.

Individual evaluated loans

Individual loans carried at fair value are those loans in which the Company has measured for a reserve and are generally based on the fair value of the related loan’s collateral. Fair value is generally determined based upon independent third-party appraisals of the properties, or discounted cash flows based upon the expected proceeds, discounted for estimated selling costs or other factors the Company determines will impact collection of proceeds. These assets are included as Level 3 fair values, based upon the lowest level of input that is significant to the fair value measurements.

The carrying amounts and estimated fair value of financial instruments at March 31, 2025 are as follows:

	March 31, 2025
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and cash equivalents	$	67,674	$	67,674	$	67,674	$	—	$	—
Securities <br>available-for-sale<br> at fair value		239,234		239,234		2,879		236,355		—
Securities <br>held-to-maturity		159		160		—		160		—
Loans receivable, net		1,832,597		1,851,924		—		—		1,851,924
Restricted investments in bank stock		2,138		2,138		—		2,138		—
Accrued interest receivable		8,146		8,146		—		8,146		—
Equity method investments		11,310		11,310		—		6,850		4,460
Mortgage servicing rights		960		960		—		960		—
Financial Liabilities:
Deposits	$	2,010,666		1,928,981	$	—	$	1,928,981	$	—
Accrued interest payable		12,510		12,510		—		12,510		—

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 7 – Fair Value Measurements and Disclosures (concluded)

The carrying amounts and estimated fair value of financial instruments at December 31, 2024 are as follows:

	December 31, 2024
	Carrying		Estimated
	Amount		Fair Value		Level 1		Level 2		Level 3
	(In thousands)
Financial Assets:
Cash and cash equivalents	$	117,348	$	117,348	$	117,348	$	—	$	—
Securities <br>available-for-sale<br> at fair value		247,171		247,171		4,389		242,782		—
Securities <br>held-to-maturity		161		162		—		162		—
Loans receivable, net		1,795,218		1,798,302		—		—		1,798,302
Restricted investments in bank stock		2,075		2,075		—		2,075		—
Accrued interest receivable		7,975		7,975		—		7,975		—
Equity method investments		11,160		11,160		—		6,850		4,310
Mortgage servicing rights		1,060		1,060		—		1,060		—
Financial Liabilities:
Deposits	$	2,032,625		1,934,884	$	—	$	1,934,884	$	—
Accrued interest payable		15,401		15,401		—		15,401		—

The fair value of cash and cash equivalents, restricted bank stock, accrued interest receivable, equity method investments, and accrued interest payable are measured at the Company’s carrying amount.

The fair value of loans, deposits and borrowings are measured on a discounted basis using similar rates and terms.

The Mortgage servicing rights are carried at estimated fair value. The estimated fair value is obtained through independent third-party valuations.

Certain assets are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).

Limitations

The fair value estimates are made at a discrete point in time based on relevant market information and information about the financial instruments. Fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors.

These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. Further, the foregoing estimates may not reflect the actual amount that could be realized if all or substantially all the financial instruments were offered for sale. This is due to the fact that no market exists for a sizable portion of the loan, deposit and off-balance sheet instruments.

In addition, the fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to value anticipated future business and the value of assets and liabilities that are not considered financial instruments. In addition, the tax ramifications related to the realization of unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in any of the estimates.

Finally, reasonable comparability between financial institutions may not be practical due to the wide range of permitted valuation techniques and numerous estimates which must be made given the absence of active secondary markets for many of the financial instruments. This lack of uniform valuation methodologies introduces a greater degree of subjectivity to these estimated fair values.

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 8 – Leases

Leases ASC (Topic 842) establishes a right of use model that requires a lessee to record a right of use asset (“ROU”) and a lease liability for all leases with terms longer than 12 months. The Company is obligated under 30 operating lease agreements for 28 branches and its corporate offices with terms extending through 2042. The Company’s lease agreements include options to renew at the Company’s discretion. The extensions are reasonably certain to be exercised, therefore they were considered in the calculations of the ROU asset and lease liability.

The following table represents the classification of the Company’s right of use and lease liability.

	Statement of Financial		Three Months Ended			Year Ended
	Condition Location		March 31, 2025			December 31, 2024
			(In thousands)
Operating Lease Right of Use Asset:
Gross carrying amount beginning of year			$	21,903		$	23,398
Increased asset from new leases				—			3,066
Accumulated amortization				(714	)		(4,561	)
Net book value		Operating lease right-of-use asset	$	21,189		$	21,903
Operating Lease Liability:
Lease liability		Operating lease liability	$	22,241		$	22,941

As of March 31, 2025, the weighted-average remaining lease terms for operating leases was 10.8 years and the weighted-average discount rate used in the measurement of operating lease liabilities was 3.54%. The Company used Federal Home Loan Bank (“FHLB”) fixed rate advances or at the time the lease was placed in service for the term most closely aligning with remaining lease term.

Future minimum payments under operating leases with terms longer than 12 months are as follows at March 31, 2025 (in thousands):

	Amount
	(In thousands)
Twelve months ended March 31,
2026	$	3,679
2027		3,428
2028		3,157
2028		2,953
2030		2,446
Thereafter		13,926
Total future operating lease payment		29,589
Amounts representing interest		(7,348	)
Present value of net future lease payments	$	22,241

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 8 – Leases (concluded)

	Three Months Ended
	March 31,
	2025		2024
	(In thousands)
Lease cost:
Operating lease	$	1,025	$	987
Short-term lease cost		66		48
Total lease cost	$	1,091	$	1,035
Other information:
Cash paid for amounts included in the measurement of lease liabilities	$	940	$	898

Note 9 – Goodwill and Core Deposit Intangible

In accordance with ASC 805, the Company recorded $5.5 million of goodwill along with a core deposit intangible asset of $2.8 million for the Cornerstone Bank acquisition in 2024 and recorded $8.9 million of goodwill along with a core deposit intangible asset of $4.2 million for the five branches acquired in 2019. The Noah Bank acquisition that occurred in 2023 did not generate any goodwill, but the Bank recorded $98 thousand in core deposit intangible asset. The core deposit intangible assets are being amortized over 10 years, using the sum of the year’s digits. Except as set forth below, GAAP requires that goodwill be tested for impairment annually based on closing date or more frequently if impairment indicators arise. The reporting unit was determined to be our community banking operations, which is our only operating segment.

ASC Topic 350-20 guidance requires an annual review of the fair value of a Reporting Unit that has goodwill in order to determine if it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a Reporting Unit is less than its carrying amount, including goodwill. A qualitative factor test can be performed to determine whether it is necessary to perform a quantitative goodwill impairment test. If this qualitative test determines it is not more likely than not (less than 50% probability) that the fair value of the Reporting Unit is less than the Carrying Value, then the Company does not have to perform a quantitative test and goodwill can be considered not impaired. The Company performed its annual review at May 31, 2024 and determined that it was more than 50% probable the fair value of the Reporting Unit exceeds the Carrying Value, therefore a quantitative test was not required as of May 31, 2024.

The changes in the carrying amount of goodwill and core deposit intangible assets are summarized as follows:

			Core Deposit
	Goodwill		Intangible
	(In thousands)
Balance at December 31, 2024	$	14,381	$	3,632
Amortization expense		—		(229	)
Balance at March 31, 2025	$	14,381	$	3,403

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PRINCETON BANCORP, INC.

Notes to Consolidated Financial Statements (unaudited)

Note 9 – Goodwill and Core Deposit Intangible (concluded)

As of March 31, 2025, the remaining current fiscal year and future fiscal periods amortization for the core deposit intangible is (in thousands):

	Amount
	(In thousands)
2025		618
2026		717
2027		587
2028		457
2029		327
Thereafter		697
Total	$	3,403

Note 10 – Subsequent Events

On April 22, 2025, the Board of Directors declared a cash dividend of $0.30 per share of common stock to shareholders of record on May 6, 2025, payable on May 29, 2025.

Note 11 – Risk and Uncertainties

The occurrence of events which adversely affect the global, national, and regional economies may have a negative impact on our business. Like other financial institutions, our business relies upon the ability and willingness of our customers to transact business with us, including banking, borrowing and other financial transactions. A strong and stable economy at each of the local, federal, and global levels is often a critical component of consumer confidence and typically correlates positively with our customers’ ability and willingness to transact certain types of business with us. Local and global events outside of our control which disrupt the New Jersey, Pennsylvania, New York, United States and/or global economy may therefore negatively impact our business and financial condition.

Government economic programs intended to backstop and bolster the economy through the pandemic have ended, and the nation’s economy has entered an inflationary phase. The Consumer Price Index has risen to levels not experienced since the 1980s while the labor market remains very tight, contributing additional inflationary pressure. To address the inflation problem, the Federal Reserve has reversed course on its previously accommodative monetary policies and modestly decreased short-term interest rates. These actions are intended to slow overall economic activity and risk entering the economy into a recession. Regional conflicts around the world, including between Russia and Ukraine, have exacerbated pandemic-related supply chain issues, upset numerous global markets including energy and certain raw materials, and generally added to economic uncertainty and geopolitical instability. Any or all could have negative downstream effects on the Company’s operating results, the extent of which is indeterminable at this time.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis in conjunction with the unaudited consolidated interim financial statements contained in Part I, Item 1 of this report, and with our audited consolidated financial statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” presented in our Form 10-K as of and for the year ended December 31, 2024.

Cautionary Statement Regarding Forward-Looking Statements

The Company may from time to time make written or oral “forward-looking statements,” including statements contained in the Company’s filings with the Securities and Exchange Commission, in its reports to stockholders and in other communications by the Company (including this press release), which are made in good faith by the Company pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended.

These forward-looking statements involve risks and uncertainties, such as statements of the Company’s plans, objectives, expectations, estimates and intentions that are subject to change based on various important factors (some of which are beyond the Company’s control). The most significant factors that could cause future results to differ materially from those anticipated by our forward-looking statements include the ongoing impact of higher tariffs imposed by the Trump administration, higher inflation levels, and general economic and recessionary concerns, all of which could impact economic growth and could cause an increase in loan delinquencies, a reduction in financial transactions and business activities including decreased deposits and reduced loan originations, difficulties in managing liquidity in a rapidly changing and unpredictable market, and supply chain disruptions. Other factors that could cause actual results to differ materially from those indicated by forward-looking statements include, but are not limited to, the following factors: the integration of the businesses of the Company and Cornerstone Bank; the global impact of the military conflicts in the Ukraine and the Middle East; the impact of any future pandemics or other natural disasters; civil unrest, rioting, acts or threats of terrorism, or actions taken by the local, state and Federal governments in response to such events, which could impact business and economic conditions in our market area; the strength of the United States economy in general and the strength of the local economies in which the Company and Bank conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; market and monetary fluctuations; market volatility; the value of the Bank’s products and services as perceived by actual and prospective customers, including the features, pricing and quality compared to competitors’ products and services; the willingness of customers to substitute competitors’ products and services for the Bank’s products and services; credit risk associated with the Bank’s lending activities; risks relating to the real estate market and the Bank’s real estate collateral; the impact of changes in applicable laws and regulations and requirements arising out of our supervision by banking regulators; other regulatory requirements applicable to the Company and the Bank; and the timing and nature of the regulatory response to any applications filed by the Company and the Bank; technological changes; other acquisitions; changes in consumer spending and saving habits; those risks under the heading “Risk Factors” set forth in the Bank’s Annual Report on Form 10-K for the year ended December 31, 2024, and the success of the Company at managing the risks involved in the foregoing.

The Company cautions that the foregoing list of important factors is not exclusive. The Company does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company, except as required by applicable law or regulation.

Throughout this document, references to “we,” “us,” or “our” refer to the Company and the Bank.

Executive Overview

The Company is the holding company for The Bank of Princeton (the “Bank”), a community bank founded in 2007. The Bank is a New Jersey state-chartered commercial bank with 28 branches in New Jersey, including three in Princeton and others in Bordentown, Browns Mills, Burlington, Chesterfield, Cherry Hill, Cream Ridge, Deptford, Fort Lee, Hamilton, Kingston, Lakewood, Lambertville, Lawrenceville, Medford, Monroe, Moorestown, New Brunswick, Palisades Park, Pennington, Piscataway, Princeton Junction, Quakerbridge, Sicklerville, Voorhees, and Woodbury. There are also five branches in the Philadelphia, Pennsylvania area and two in the New York City metropolitan area. The Bank of Princeton is a member of the Federal Deposit Insurance Corporation (“FDIC”).

The Company’s common stock trades on the “Nasdaq Global Select Market” under ticker symbol, “BPRN.”

Critical Accounting Policies and Estimates

The Company has chosen accounting policies that it believes are appropriate to accurately and fairly report its operating results and financial position, and the Company applies those accounting policies in a consistent manner. The Significant Accounting Policies are summarized in Note 1 to the consolidated financial statements included in the 2024 Annual Report on Form 10-K. There have been no changes to the Critical Accounting Estimates since the Company filed its Annual Report on Form 10-K for the year ended December 31, 2024.

New Accounting Pronouncements

Refer to Note 1 to the consolidated financial statements included in the 2024 Annual Report on Form 10-K and Note 1- Summary of Significant Accounting Policies in this document.

Economy

The first quarter of 2025 opened with optimism regarding economic resilience, the potential for tax cuts, and expectations for a more favorable regulatory environment for businesses. That optimism was replaced by a growing sense of uncertainty around trade policy. The economic data proved mostly stable although there was early evidence of uncertainty. Financial markets also showed signs of uncertainty with equities and Treasury yields falling into quarter-end.

Comparison of Financial Condition at March 31, 2025 and December 31, 2024

General

Total assets were $2.32 billion at March 31, 2025, a decrease of $22.1 million, or 0.95% when compared to $2.34 billion at the end of 2024. The primary reasons for the decrease in total assets were related to decreases in cash of $49.7 million and in investment securities of $7.9 million, partially offset by an increase in net loans of $37.7 million. The decreases in cash and investment securities were caused in part by the decrease in deposits discussed below. The increase in the Company’s net loans consisted of increases of $29.2 million in residential mortgages, and $19.0 million in commercial real estate (“CRE”) loans, all partially offset by decreases of $8.0 million in construction loans and $2.9 million in commercial and industrial loans.

Cash and cash equivalents

Cash and cash equivalents decreased $49.7 million, or 42.3%, to $67.7 million at March 31, 2025 compared to December 31, 2024.

Investment securities

Total available-for-sale investment securities decreased $7.9 million, or 3.2%, to $239.2 million at March 31, 2025 compared to December 31, 2024. This decrease was primarily related to decreases in mortgage-backed securities of U.S. government sponsored enterprises and U.S treasury securities during the three-months ended March 31, 2025.

Loans

Loans, net of deferred loan fees and costs, increased $37.7 million, or 2.1%, to $1.86 billion at March 31, 2025 compared to December 31, 2024. The increase in the Company’s net loans consisted of increases of $29.2 million in residential mortgages, and $19.0 million in commercial real estate loans, all partially offset by decreases of $8.0 million in construction loans and $2.9 million in commercial and industrial loans.

The Company’s CRE loan portfolio, which includes multi-family, land, owner-occupied and non-owner-occupied CRE loans, was $1.40 billion or 75.5% of total loans of $1.86 billion at March 31, 2025. There were 766 loans in the Company’s CRE portfolio with an average and median loan size of $1.8 million and $0.6 million, respectively. Loan to Value (“LTV”) estimates are less than 70% for $1.29 billion or 92.6% of the CRE portfolio and less than 80% for $1.39 billion or 99.6% of the CRE portfolio.

The following table presents the commercial real estate portfolio by property type along with the weighted average loan to value for the periods presented (dollars in thousands):

	March 31, 2025								December 31, 2024
	Balance		% of portfolio			Weighted Average<br>LTV			Balance		% of portfolio			Weighted Average<br>LTV
Commercial Real Estate
Multi Family		524,234		37.4	%		53.0	%		533,287		38.6	%		53.6	%
Owner Occupied		411,895		29.3	%		36.2	%		407,798		29.4	%		36.3	%
Land		27,745		2.0	%		63.0	%		25,241		1.8	%		73.9	%
Non Owner Occupied
Retail		114,490		8.2	%		42.6	%		100,771		7.3	%		42.5	%
Office Building		104,435		7.4	%		44.0	%		104,388		7.5	%		43.5	%
Industrial/Warehousing		83,329		5.9	%		45.0	%		73,417		5.3	%		44.9	%
Mixed Use		47,677		3.4	%		43.7	%		48,076		3.5	%		43.7	%
Restaurants		21,429		1.5	%		39.2	%		22,650		1.6	%		39.3	%
Healthcare		10,158		0.7	%		52.7	%		10,268		0.7	%		53.3	%
Other		58,716		4.2	%		44.5	%		59,189		4.3	%		45.6	%
Total non owner occupied		440,234		31.3	%					418,759		30.2	%
Total Commercial Real Estate		1,404,108		100.0	%					1,385,085		100.0	%

The following table presents the geographic markets of the commercial real estate portfolio for the periods presented (dollars in thousands):

	March 31, 2025					December 31, 2024
	Balance		% of portfolio			Balance		% of portfolio
Geographical Market
New York		637,112		45.3	%		639,994		46.1	%
New Jersey		548,319		39.1	%		540,896		39.1	%
Pennslyvania		197,725		14.1	%		184,084		13.3	%
Other		20,952		1.5	%		20,111		1.5	%
		1,404,108		100.00	%		1,385,085		100.00	%

For the three-months ended March 31, 2025, charge-offs were $84 thousand and recoveries were $143 thousand. For the three-months ended December 31, 2024, charge-offs were $107 thousand and recoveries were $21 thousand. The coverage ratio of the allowance for credit losses to period end loans was 1.29% at March 31, 2025 and 1.30% at December 31, 2024.

At March 31, 2025, non-performing assets totaled $26.5 million, a decrease of $614 thousand when compared to the amount at December 31, 2024. Non-performing assets as a percentage of total loans, net of deferred fees and costs, was 1.43% at March 31, 2025 and 1.48% at December 31, 2024.

Deposits

Total deposits on March 31, 2025, decreased $22.0 million, or 1.08%, when compared to December 31, 2024. The decrease in the Company’s deposits consisted of decreases in money market deposits of $26.5 million, certificates of deposit of $17.1 million, and non-interest-bearing deposits of $10.5 million, These were partially offset by increases in interest-bearing demand deposits of $30.5 million, and savings deposits of $1.7 million.

At March 31, 2025, the Company had approximately $645.1 million in uninsured deposits, consisting of $85.5 million in non-interest-bearing demand deposits, $230.6 million in interest-bearing demand deposits, $152.8 million in money market accounts, $24.7 million in savings deposits and $151.5 million in certificates of deposits.

Borrowings

The Company had no outstanding borrowings at March 31, 2025 or December 31, 2024.

Stockholders’ equity

Total stockholders’ equity at March 31, 2025, increased $4.9 million or 1.89% when compared to December 31, 2024. The increase was primarily due to an increase in retained earnings of $3.3 million, which consisted of $5.4 million in net income, partially offset by $2.1 million of cash dividends recorded during the period, an increase in paid-in capital of $544 thousand, and a $1.3 million decrease in our accumulated other comprehensive loss. These were partially offset by a $163 thousand purchase of treasury stock. The ratio of equity to total assets at March 31, 2025 and at December 31, 2024 was 11.5% and 11.2%, respectively.

Liquidity

Our liquidity, represented by cash and cash equivalents, is a product of our operating, investing and financing activities. Our primary sources of funds are deposits, principal repayments of securities and outstanding loans, and funds provided from operations. In addition, we invest excess funds in short-term interest-earnings assets such as overnight deposits or U.S. agency securities, which provide liquidity to meet lending requirements. While scheduled payments from the amortization of loans and

securities and short-term investments are relatively predictable sources of funds, general interest rates, economic conditions and competition greatly influence deposit flows and repayments on loans and mortgage-backed securities.

As a member of the FHLB we are eligible to borrow funds in an aggregate amount of up to 50% of the Company’s total assets, subject to its collateral requirements. The Company maintained a $110.0 million letter of credit with the FHLB supporting municipal deposits as of March 31, 2025. Based on available eligible securities and qualified real estate loan collateral, the Company had the ability to borrow an additional $540.5 million as of March 31, 2025.

As of March 31, 2025, the Bank was eligible to use the Federal Reserve discount window for borrowings. Based on assets pledged as collateral as of the applicable date, the Bank’s borrowing availability was approximately $10.0 million at March 31, 2025. As of March 31, 2025, the Company had no outstanding advances from the discount window.

The Company is also a shareholder of Atlantic Community Bancshares, Inc., the parent company of Atlantic Community Bankers Bank (“ACBB”). As of March 31, 2025, the Company had available borrowing capacity with ACBB of $10.0 million to provide short-term liquidity generally for a period of not more than fourteen days. No amounts were outstanding under our line of credit with ACBB at March 31, 2025.

We believe that our current sources of funds provide adequate liquidity for our current cash flow needs.

Capital Resources

Regulatory Capital Requirements

. Federally insured, state-chartered non-member banks are required to maintain minimum levels of regulatory capital. Current FDIC capital standards require these institutions to satisfy a common equity Tier 1 capital requirement and a Tier 1 capital requirement, a leverage capital requirement and a risk-based capital requirement.
In addition, in order to make capital distributions and pay discretionary bonuses to executive officers without restriction, an institution must also maintain additional common equity in excess of the minimum requirements. This excess is referred to as a capital conservation buffer. At March 31, 2025, the required capital conservation buffer is 2.50%.

Under the risk-based capital requirements, “total” capital (a combination of core and “supplementary” capital) must equal at least 8.0% of “risk-weighted” assets. The FDIC also is authorized to impose capital requirements in excess of these standards on individual institutions on a case-by-case basis. Management believes, as of March 31, 2025, that the Bank meets all capital adequacy requirements to which it is subject and is “well capitalized” under applicable regulations.

The Bank’s actual capital amounts and ratios and the regulatory requirements at March 31, 2025 and December 31, 2024 are presented below:

	Actual					For capital conservation<br>buffer requirement					To be well capitalized<br>under prompt corrective<br>action provision
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
March 31, 2025:
Total capital (to risk-weighted assets)	$	276,526		13.681	%	$	212,223		10.500	%	$	202,117		10.000	%
Tier 1 capital (to risk-weighted assets)	$	252,584		12.497	%	$	171,799		8.500	%	$	161,694		8.000	%
Common equity tier 1 capital (to risk-weighted assets)	$	252,584		12.497	%	$	141,482		7.000	%	$	131,376		6.500	%
Tier 1 leverage capital (to average assets)	$	252,584		10.913	%	$	150,443		6.500	%	$	115,725		5.000	%
December 31, 2024:
Total capital (to risk-weighted assets)	$	270,633		13.490	%	$	210,648		10.500	%	$	200,617		10.000	%
Tier 1 capital (to risk-weighted assets)	$	246,976		12.311	%	$	170,524		8.500	%	$	160,493		8.000	%
Common equity tier 1 capital (to risk- weighted assets)	$	246,976		12.311	%	$	140,432		7.000	%	$	130,401		6.500	%
Tier 1 leverage capital (to average assets)	$	246,976		10.577	%	$	151,776		6.500	%	$	116,750		5.000	%

Comparison of Operating Results for the Three Months Ended March 31, 2025 and 2024

General

The Company reported net income of $5.4 million, or $0.77 per diluted common share, for the first quarter of 2025, compared to net income of $4.3 million, or $0.68 per diluted common share, for the first quarter of 2024. The increase in net income for the first quarter of 2025 when compared to the first quarter of 2024 was primarily due to increases of $3.2 million and $205 thousand in net interest income after provision for credit losses and non-interest income, respectively, partially offset by increases of $2.0 million and $443 thousand in non-interest expense and income tax expense, respectively.

Interest income

Interest income increased $5.2 million for the three months ended March 31, 2025, compared to the same period in 2024. Interest income on loans increased $4.7 million due to increases in both the average balance of loans of $300.2 million and the yield of 2 basis points. Interest on taxable available-for-sale securities increased $2.1 million due to a 127 basis point increase in yield and a $145.3 million increase in the average balance of taxable available-for-sale securities. Other interest and dividend income decreased $1.5 million due to a decrease in average balance of $97.7 million and a decrease in the yield of 97 basis points.

Interest expense

Interest expense on deposits increased $1.9 million to $14.5 million for the three-month period ended March 31, 2025 over the same prior year period, due to an increase in the average balance of interest-bearing deposits of $306.8 million, partially offset by a decrease in the rate paid on interest-bearing deposits of 15 basis points.

Provision for credit losses

The Company recorded a provision for credit losses of $268 thousand during the first quarter of 2025, which consisted of a provision to the reserve for credit losses on loans in the amount of $225 thousand and a provision to the reserve for unfunded liabilities of $43 thousand. The current quarter’s provision recorded on the Company’s statements of income was $82 thousand higher when compared to the first quarter of 2024. For the quarter ended March 31, 2025, the Company recorded charge-offs of $84 thousand and recoveries of $143 thousand.

Non-interest income

Total non-interest income was $2.2 million for the three-months ended March 31, 2025, an increase of $205 thousand or 10.3% when compared to the same prior year period.

Non-interest expense

Total non-interest expense was impacted by the Cornerstone Bank acquisition in the third quarter of 2024. It was $13.8 million for the three-months ended March 31, 2025, an increase of $2.0 million or 16.5% when compared to the same prior year period. This increase was primarily related to increases in salaries and employee benefits expense of $652 thousand, data processing and communications expense of $466 thousand, federal deposit insurance expense of $260 thousand, occupancy and equipment expense of $256 thousand, professional fees of $237 thousand and core deposit intangible expense of $108 thousand.

Provision for income taxes

For the quarter ended March 31, 2025, the Company recorded an income tax expense of $1.5 million, resulting in an effective tax rate of 21.9%, compared to an income tax expense of $1.1 million resulting in an effective tax rate of 19.7% for the quarter ended March 31, 2024.

Average Balances, Net Interest Income, and Yields Earned and Rates Paid

The following table shows for the three-month period indicated the total dollar amount of interest earned from average interest earning assets and the resulting yields, as well as the interest expense on average interest-bearing liabilities and the resulting costs, expressed both in dollars and rates. Average loan receivables balances include non-accrual loans. Average yields have been annualized. Tax-exempt incomes and yields have not been adjusted to a tax-equivalent basis, as the impacts were not deemed to be significant.

	Three Months Ended March 31,
	2025							2024							Change 2025 vs 2024
	Average<br>Balances		Income/<br>Expense		Yield<br>Rates			Average<br>Balances		Income/<br>Expense		Yield<br>Rates			Average<br>Balances			Yield<br>Rates
	(Dollars in thousands)
Interest-earning assets:
Loans receivable	$	1,851,439	$	29,624		6.49	%	$	1,551,206	$	24,940		6.47	%	$	300,233			0.02	%
Securities
Taxable available-for-sale		203,992		2,616		5.13	%		58,742		564		3.86	%		145,250			1.27	%
Tax exempt available-for-sale		39,978		284		2.84	%		40,758		285		2.81	%		(780	)		0.03	%
Held-to-maturity		160		2		5.33	%		182		2		4.42	%		(22	)		0.91	%
Federal funds sold		53,314		580		4.41	%		148,069		2,009		5.46	%		(94,755	)		-1.05	%
Other interest earning-assets		16,028		189		4.78	%		18,954		266		5.64	%		(2,926	)		-0.86	%
Total interest-earning assets		2,164,911	$	33,295		6.24	%		1,817,911	$	28,066		6.21	%		347,000			0.03	%
Other non-earnings assets		170,945							140,660							30,285
Total assets	$	2,335,856						$	1,958,571						$	377,285
Interest-bearing liabilities
Demand	$	325,278	$	1,556		1.94	%	$	242,030	$	1,193		1.98	%	$	83,248			-0.04	%
Savings		171,404		948		2.24	%		147,672		921		2.51	%		23,732			-0.27	%
Money markets		476,338		3,640		3.10	%		364,150		3,557		3.93	%		112,188			-0.83	%
Certificates of deposit		765,942		8,394		4.45	%		678,306		6,947		4.12	%		87,636			0.34	%
Total deposit		1,738,962		14,538		3.39	%		1,432,158		12,618		3.54	%		306,804			-0.15	%
Borrowings		—		—		N/A			—		—		0.00	%		—			N/A
Total interest-bearing liabilities		1,738,962	$	14,538		3.39	%		1,432,158	$	12,618		3.54	%		306,804			-0.15	%
Non-interest-bearing deposits		287,506							244,089							43,417
Other liabilities		45,354							42,094							3,260
Total liabilities		2,071,822							1,718,341							353,481
Stockholders’ equity		264,034							240,230							23,804
Total liabilities and stockholder’s equity	$	2,335,856						$	1,958,571						$	377,285
Net interest-earnings assets	$	425,949						$	385,753						$	40,196
Net interest income; interest rate spread						2.85	%						2.67	%					0.18	%
Net interest margin			$	18,757		3.51	%			$	15,448		3.42	%	$	3,309			0.10	%

Rate/Volume Analysis

The following table reflects the changes in our interest income and interest expense segregated into amounts attributable to changes in volume and in yields on interest-earning assets and interest-bearing liabilities during the periods indicated.

	Three Months Ended March 31,<br>2025 vs . 2024<br>Increase (Decrease) Due to
	Rate			Volume			Net
	(In thousands)
Interest and dividend income:
Loans receivable, including fees	$	5		$	4,679		$	4,684
Securities available-for-sale
Taxable		358			1,694			2,052
Tax-exempt		6			(7	)		(1	)
Securities held-to-maturity		—			—			—
Federal funds sold		(752	)		(677	)		(1,429	)
Other interest and dividend income		(80	)		3			(77	)
Total interest and dividend income	$	(463	)	$	5,692		$	5,229
Interest expense
Demand	$	(26	)	$	389		$	363
Savings		(105	)		133			28
Money markets		(849	)		932			83
Certificates of deposit		549			897			1,446
Borrowings		—			—			—
Total interest expense	$	(431	)	$	2,351		$	1,920
Change in net interest income	$	(32	)	$	3,341		$	3,309

How We Manage Market Risk

Market risk is the risk of loss from adverse changes in market prices and rates. Our market risk arises primarily from interest rate risk which is inherent in our lending, investment and deposit gathering activities. To that end, management actively monitors and manages interest rate risk exposure. In addition to market risk, our primary risk is credit risk on our loan portfolio. We attempt to manage credit risk through our loan underwriting and oversight policies.

The principal objective of our interest rate risk management function is to evaluate the interest rate risk embedded in certain balance sheet accounts, determine the level of risk appropriate given our business strategy, operating environment, capital and liquidity requirements and performance objectives, and manage the risk consistent with approved guidelines. We seek to manage our exposure to risks from changes in interest rates while at the same time trying to improve our net interest spread. We monitor interest rate risk as such risk relates to our operating strategies. We have established an Asset/Liability Committee which is comprised of both Management and members of the Board of Directors. The Asset/Liability Committee meets on a regular basis and is responsible for reviewing our asset/liability policies and interest rate risk position. Both the extent and direction of shifts in interest rates are uncertainties that could have a negative impact on future earnings.

Gap Analysis. The matching of assets and liabilities may be analyzed by examining the extent to which such assets and liabilities are “interest rate sensitive” and by monitoring the Company’s interest rate sensitivity “gap.” An asset or liability is said to be interest rate sensitive within a specific time period if it will mature or reprice within that time period. The interest rate sensitivity gap is defined as the difference between the amount of interest-earning assets maturing or repricing within a specific time period and the amount of interest-bearing liabilities maturing or repricing within that same time period. A gap is considered positive when the amount of interest rate sensitive assets exceeds the amount of interest rate-sensitive liabilities. A gap is considered negative when the amount of interest rate sensitive liabilities exceeds the amount of interest rate sensitive assets. During a period of rising interest rates, a negative gap would tend to affect adversely net interest income while a positive gap would tend to result in an increase in net interest income. Conversely, during a period of falling interest rates, a negative gap would tend to result in an increase in net interest income while a positive gap would tend to affect adversely net interest income.

The table on the next page sets forth the amounts of our interest-earning assets and interest-bearing liabilities outstanding at March 31, 2025, which we expect, based upon certain assumptions, to reprice or mature in each of the future time periods shown (the “GAP Table”). Except as stated below, 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 table sets forth an approximation of the projected repricing of assets and liabilities at March 31, 2025, based on contractual maturities, anticipated prepayments, and scheduled rate adjustments within a three-month period and subsequent selected time intervals. The loan amounts in the table reflect principal balances expected to be redeployed and/or repriced as a result of contractual amortization and anticipated prepayments of adjustable-rate loans and fixed-rate loans, and as a result of contractual rate adjustments on adjustable-rate loans.

	3 Months or<br>Less			More than 3<br>Months to 1<br>Year			More than 1<br>Year to 3 Years			More than 3<br>Years to 5<br>Years			More than 5<br>Years			Non-Rate<br>Sensitive			Total Amount
(Dollars in thousands)
Interest-earning assets: (1)
Investment securities	$	22,235		$	39,585		$	64,336		$	32,892		$	91,817		$	(11,472	)	$	239,393
Loans receivable		428,110			216,932			568,904			516,333			116,723			(14,405	)		1,832,597
Other interest-earnings assets (2)		47,032			—			—			—			—			—			47,032
Total interest-earning assets	$	497,377		$	256,517		$	633,240		$	549,225		$	208,540		$	(25,877	)	$	2,119,022
Interest-bearing liabilities:
Checking and savings accounts	$	503,578					$	—		$	—		$	—		$	—		$	503,578
Money market accounts		464,012			—			—			—			—			—			464,012
Certificate accounts		333,267			382,468			33,682			3,163			—			—			752,580
Borrowings		—			—			—			—			—			—			—
Total interest-bearing liabilities	$	1,300,857		$	382,468		$	33,682		$	3,163		$	—		$	—		$	1,720,170
Interest-earning assets less interest-bearing liabilities	$	(803,480	)	$	(125,951	)	$	599,558		$	546,062		$	208,540		$	(25,877	)	$	398,852
Cumulative interest-rate sensitivity gap (3)	$	(803,480	)	$	(929,431	)	$	(329,873	)	$	216,189		$	424,729
Cumulative interest-rate gap as a percentage of total assets at March 31, 2025		-34.66	%		-40.09	%		-14.23	%		9.33	%		18.32	%
Cumulative interest-earning assets as a percentage of cumulative interest-bearing liabilities at March 31, 2025		38.23	%		44.79	%		80.79	%		112.57	%		124.69	%
(1)	Interest-earnings assets are included in the period in which the balances are expected to be redeployed and/or repriced as a result of anticipated prepayments, scheduled rate adjustments and contractual maturities.
---	---
(2)	Includes interest-bearing bank balances, FHLB Stock and Federal Funds Sold
---	---
(3)	Interest-rate sensitivity gap represents the difference between total interest-earning assets and total interest-bearing liabilities.
---	---

Certain shortcomings are inherent in the method of analysis presented in the foregoing table. For example, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Additionally, certain assets, such as adjustable-rate loans, have features which restrict changes in interest rates both on a short-term basis and over the life of the asset. Further, in the event of a change in interest rates, prepayment and early withdrawal levels would likely deviate significantly from those assumed in calculating the table. Finally, the ability of many borrowers to service their adjustable-rate loans may decrease in the event of an interest rate increase.

Net Portfolio Value Analysis. Our interest rate sensitivity is also monitored by management through the use of a model which generates estimates of the changes in our net portfolio value (“NPV”) over a range of interest rate scenarios. NPV is the present value of expected cash flows from assets, liabilities, and off-balance sheet contracts. The NPV ratio, under any interest rate scenario, is defined as the NPV in that scenario divided by the market value of assets in the same scenario. The following table sets forth our NPV as of March 31, 2025, and reflects the changes to NPV as a result of immediate and sustained changes in interest rates as indicated.

Change in Interest Rates	Net Portfolio Value							NPV as % of Portfolio<br>Value of Assets
In Basis Points (Rate Shock)	Amounts		Change		% Change			EVE/EVA^1^			Change
			(Dollars in thousands)
300	$	306,783		)		-12.39	%		14.07	%		(1.03	)
200	$	323,140		)		-7.72	%		14.52	%		(0.58	)
100	$	336,132		)		-4.01	%		14.80	%		(0.30	)
Static	$	350,172							15.10	%
(100)	$	362,926				3.64	%		15.38	%		0.28
(200)	$	367,180				4.86	%		15.35	%		0.25
(300)	$	359,511				2.67	%		14.84	%		(0.26	)

All values are in US Dollars.

^1^	Economic Value of Equity (EVE) divded by Economic Value of Assets (EVA)

As is the case with the GAP Table, certain shortcomings are inherent in the methodology used in the above interest rate risk measurements. Modeling changes in NPV require the making of certain assumptions which may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. In this regard, the models presented assume that the composition of our interest sensitive assets and liabilities existing at the beginning of a period remains constant over the period being measured and assumes that a particular change in interest rates is reflected uniformly across the yield curve regardless of the duration to maturity or repricing of specific assets and liabilities. Accordingly, although the NPV model provides an indication of interest rate risk exposure at a particular point in time, such model is not intended to and does not provide a precise forecast of the effect of changes in market interest rates on net interest income and will differ from actual results.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company, such as the Company, is not required to provide the information by this Item. Certain market risk disclosure is set forth in Item 2 above under “How We Manage Market Risk.”

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Management, with the participation of the Company’s Chief Executive Officer and its Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule l3a-l5 (e) promulgated under the Exchange Act) as of March 31, 2025. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective as of March 31, 2025 to ensure that the information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in FDIC rules and forms.

Changes in Internal Control Over Financial Reporting

There was no change in the Company’s internal control over financial reporting identified during the quarter ended March 31, 2025, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II–OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

There have been no material changes to the risk factors set forth under the Part I, Item 1.A. Risk Factors as set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The Company’s repurchase of shares of common stock for the three months ended March 31, 2024 were as follows:

	Total<br>Number of<br>Shares<br>Purchased		Average<br>Price<br>Paid Per<br>Share
Period
						286,500
January 1 - 31, 2025		—	$	—	—	286,500
February 1 - 28, 2025		—	$	—	—	286,500
March 1 - 31, 2025		5,250	$	31.10	5,250	281,250
		5,250	$	31.10	5,250
1	On August 10, 2023, the Company announced a stock repurchase program to repurchase up to 314,000 shares of common stock, approximately 5% of the Company’s outstanding shares of common stock, over a period of time necessary to complete such repurchases.
---	---

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the fiscal quarter ended March 31, 2025, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule

10b5-1 trading arrangement”.

Item 6. Exhibits

Exhibit<br>Number	Description
31.1	Rule 13a-14(a) Certification on the Principal Executive Officer
31.2	Rule 13a-14(a) Certification on the Principal Financial Officer
32	Section 1350 Certifications
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Label Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Princeton Bancorp, Inc.
Date: May 9, 2025	By:	/s/ Edward Dietzler
		Edward Dietzler
		Chief Executive Officer and President
		(Principal Executive Officer)
	By:	/s/ George Rapp
		George Rapp
		Executive Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer)

EX-31.1

Exhibit 31.1

RULE 13A-14(a) CERTIFICATION

OF THE PRINCIPAL EXECUTIVE OFFICER

I, Edward Dietzler, Chief Executive Officer and President of Princeton Bancorp, Inc., certify that:

I have reviewed this quarterly report on Form 10-Q of Princeton Bancorp, Inc.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, considering the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2025	/s/ Edward Dietzler
	Edward Dietzler
	Chief Executive Officer and President
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

RULE 13A-14(a) CERTIFICATION

OF THE PRINCIPAL FINANCIAL OFFICER

I, George Rapp, Executive Vice President and Chief Financial Officer of Princeton Bancorp, Inc., certify that:

I have reviewed this quarterly report on Form 10-Q of Princeton Bancorp, Inc.;
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2025	/s/ George Rapp
	George Rapp
	Executive Vice President and Chief Financial Officer
	(Principal Financial and Accounting Officer)

EX-32

Exhibit 32

SECTION 1350 CERTIFICATIONS

In connection with the Quarterly Report of Princeton Bancorp, Inc. on Form 10-Q for the period ended March 31, 2025 as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), the undersigned certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities and Exchange Act of 1934; and
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Princeton Bancorp, Inc.

	/s/ Edward Dietzler
	Edward Dietzler
	Chief Executive Officer and President
	(Principal Executive Officer)
	/s/ George Rapp
	George Rapp
	Executive Vice President and Chief Financial Officer
	(Principal Financial and Accounting Officer)
Date: May 9, 2025