WESTERN NEW ENGLAND BANCORP, INC. 8-K
Exhibit 99.1
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For further information
contact: |
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James C. Hagan, President and CEO |
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Guida R. Sajdak, Executive Vice President and
CFO |
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Meghan Hibner, First Vice President and Investor
Relations Officer |
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413-568-1911 |
WESTERN
NEW ENGLAND BANCORP, INC. REPORTS RESULTS FOR THREE MONTHS
AND
YEAR ENDED DECEMBER 31, 2025 AND DECLARES QUARTERLY CASH DIVIDEND
Westfield,
Massachusetts, January 27, 2026: Western New England Bancorp, Inc. (the “Company” or “WNEB”) (NasdaqGS:
WNEB), the holding company for Westfield Bank (the “Bank”), announced today the unaudited results of operations for
the three and twelve months ended December 31, 2025. For the three months ended December 31, 2025, the Company reported net income
of $5.2 million, or $0.26 per diluted share, compared to net income of $3.3 million, or $0.16 per diluted share, for the three
months ended December 31, 2024. On a linked quarter basis, net income was $5.2 million, or $0.26 per diluted share, as compared
to net income of $3.2 million, or $0.16 per diluted share, for the three months ended September 30, 2025. For the twelve months
ended December 31, 2025, net income was $15.3 million, or $0.75 per diluted share, compared to net income of $11.7 million, or
$0.56 per diluted share, for the twelve months ended December 31, 2024.
The
Company also announced that its Board of Directors declared a quarterly cash dividend of $0.07 per share on the Company’s
common stock. The dividend will be payable on or about February 25, 2026 to shareholders of record on February 11, 2026.
James
C. Hagan, President and Chief Executive Officer, commented, “We are pleased to report solid earnings for the fourth quarter
of 2025, along with strong loan growth and core deposit growth. Total loans increased $113.2 million, or 5.5%, and core deposits
increased $111.9 million, or 7.2%, from December 31, 2024. At December 31, 2025, our non-interest-bearing deposits and total core
deposits represented 25.2% and 70.8% of total deposits, respectively. Our loan growth and disciplined approach to managing funding
costs have allowed us to expand our net interest margin to 2.91% during the three months ended December 31, 2025. This is the
sixth consecutive quarter of growth in both net interest income and net interest margin for the Company. Asset quality remains
strong, with nonperforming assets to total assets of 0.19%, total delinquency as a percentage of total loans of 0.14%, and strong
loan reserve levels of 393.2% as a percentage of nonaccrual loans.”
Hagan
concluded, “We remain disciplined in our capital management strategies, and during the twelve months ended December 31,
2025, we repurchased 599,853 shares of common stock with an average price per share of $9.73. Over the last twelve months, book
value per share increased $0.86, or 7.6%, to $12.16 and tangible book value per share, a non-GAAP financial measure, increased
$0.86, or 8.1%, to $11.49.
We
are pleased with our fourth quarter results and are committed to delivering long-term value to shareholders through capital management
strategies, which include continued loan growth, share repurchases and quarterly cash dividends.”
Key
Highlights:
Loans
and Deposits
At
December 31, 2025, total loans increased $113.2 million, or 5.5%, from $2.1 billion, or 77.9% of total assets, at December 31,
2024 to $2.2 billion, or 79.7% of total assets. The increase was primarily driven by an increase in residential real estate loans,
including home equity loans, of $81.2 million, or 10.5%, an increase in commercial and industrial loans of $10.1 million, or 4.8%,
and an increase in commercial real estate loans of $23.3 million, or 2.2%. The increase in total loans was partially offset by
a decrease in consumer loans of $1.5 million, or 33.3%.
At
December 31, 2025, total deposits of $2.4 billion increased $98.3 million, or 4.3%, from December 31, 2024. Core deposits, which
the Company defines as all deposits except time deposits, increased $111.9 million, or 7.2%, from $1.6 billion, or 68.9% of total
deposits, at December 31, 2024, to $1.7 billion, or 70.8% of total deposits, at December 31, 2025. Time deposits decreased $13.7
million, or 1.9%, from $703.6 million at December 31, 2024 to $689.9 million at December 31, 2025. Brokered time deposits, which
are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered time deposits at December
31, 2025. The loan-to-deposit ratio was 92.5% and 91.5% at December 31, 2025 and December 31, 2024, respectively.
Allowance
for Credit Losses and Credit Quality
At
December 31, 2025, the allowance for credit losses was $20.3 million, or 0.93% of total loans, compared to $19.5 million, or 0.94%
of total loans, at December 31, 2024. The allowance for credit losses, as a percentage of nonaccrual loans, was 393.2% and 362.9%
at December 31, 2025 and December 31, 2024, respectively. At December 31, 2025, nonaccrual loans totaled $5.2 million, or 0.24%
of total loans, compared to $5.4 million, or 0.26% of total loans, at December 31, 2024. Total delinquent loans decreased from
$5.0 million, or 0.24% of total loans, at December 31, 2024 to $3.1 million, or 0.14% of total loans, at December 31, 2025. At
December 31, 2025 and December 31, 2024, the Company did not have any other real estate owned.
Net
Interest Margin
The
net interest margin increased eight basis points from 2.81% for the three months ended September 30, 2025 to 2.89% for the three
months ended December 31, 2025. The net interest margin, on a tax-equivalent basis, increased eight basis points from 2.83% for
the three months ended September 30, 2025 to 2.91% for the three months ended December 31, 2025.
Stock
Repurchase Program
On
April 22, 2025, the Board of Directors authorized the 2025 Plan, pursuant to which the Company may repurchase up to 1.0 million
shares of its common stock, or approximately 4.8%, of the Company’s then-outstanding shares of common stock, upon the completion
of the 2024 Plan. On June 3, 2025, the Company announced the completion of its 2024 Plan under which the Company repurchased a
total of 1.0 million shares at an average price per share of $8.79.
During
the three months ended December 31, 2025, the Company repurchased 100,000 shares of its common stock at an average price per share
of $11.80. During the twelve months ended December 31, 2025, the Company repurchased 599,853 shares of its common stock under
the 2025 Plan and the 2024 Plan, as applicable, at an average price per share of $9.73. As of December 31, 2025, there were 872,465
shares of common stock available for repurchase under the 2025 Plan.
The
repurchase of shares under our 2025 Plan is administered through an independent broker. The shares of common stock repurchased
under the 2025 Plan have been and will continue to be purchased from time to time at prevailing market prices, through open market
or privately negotiated transactions, or otherwise, depending upon market conditions. There is no guarantee as to the exact number,
or value, of shares that will be repurchased by the Company, and the Company may discontinue repurchases at any time that the
Company’s management (“Management”) determines additional repurchases are not warranted. The timing and amount
of additional share repurchases under the 2025 Plan will depend on a number of factors, including the Company’s stock price
performance, ongoing capital planning considerations, general market conditions, and applicable legal requirements.
Book
Value and Tangible Book Value
The
Company’s book value per share was $12.16 at December 31, 2025, compared to $11.30 at December 31, 2024, while tangible
book value per share, a non-GAAP financial measure, increased $0.86, or 8.1%, from $10.63 at December 31, 2024 to $11.49 at December
31, 2025. See pages 18-20 for the related tangible book value calculation and a reconciliation of GAAP to non-GAAP financial measures.
Net
Income for the Three Months Ended December 31, 2025 Compared to the Three Months Ended September 30, 2025
For
the three months ended December 31, 2025, the Company reported an increase in net income of $2.0 million, or 64.5%, from $3.2
million, or $0.16 per diluted share, for the three months ended September 30, 2025, to $5.2 million, or $0.26 per diluted share.
Net interest income increased $737,000, or 4.1%, the provision for credit losses decreased $1.8 million, and non-interest expense
increased $92,000 or 0.6%. Return on average assets and return on average equity were 0.75% and 8.40%, respectively, for the three
months ended December 31, 2025, compared to 0.46% and 5.20%, respectively, for the three months ended September 30, 2025.
Net
Interest Income and Net Interest Margin
On
a sequential quarter basis, net interest income, our primary driver of revenues, increased $737,000, or 4.1%, to $18.8 million
for the three months ended December 31, 2025, from $18.1 million for the three months ended September 30, 2025. The increase in
net interest income was primarily due to an increase in interest income of $504,000, or 1.7%, and a decrease in interest expense
of $233,000, or 2.0%.
The
net interest margin was 2.89% for the three months ended December 31, 2025, compared to 2.81% for the three months ended September
30, 2025. The net interest margin, on a tax-equivalent basis, was 2.91% for the three months ended December 31, 2025, compared
to 2.83% for the three months ended September 30, 2025. The average yield on interest-earning assets, without the impact of tax-equivalent
adjustments, increased two basis points from 4.67% for the three months ended September 30, 2025 to 4.69% for the three months
ended December 31, 2025. The average loan yield, without the impact of tax-equivalent adjustments, increased two basis points
from 5.01% for the three months ended September 30, 2025, to 5.03% for the three months ended December 31, 2025. During the same
period, average loans increased $54.4 million, or 2.6%, average securities decreased $3.9 million, or 1.0%, and average short-term
investments decreased $19.8 million, or 37.9%.
The
average cost of total funds, including non-interest bearing accounts and borrowings, decreased six basis points from 1.94% for
the three months ended September 30, 2025 to 1.88% for the three months ended December 31, 2025. The average cost of core deposits,
which the Company defines as all deposits except time deposits, decreased two basis points from 1.04% for the three months ended
September 30, 2025, to 1.02% for the three months ended December 31, 2025. The average cost of time deposits decreased five basis
points from 3.51% for the three months ended September 30, 2025, to 3.46% for the three months ended December 31, 2025. The average
cost of borrowings, including subordinated debt, was 4.96% for the three months ended December 31, 2025, compared to 5.03%, for
the three months ended September 30, 2025. Average demand deposits, an interest-free source of funds, increased $14.7 million,
or 2.5%, from $581.8 million, or 25.0%, of total average deposits, for the three months ended September 30, 2025, to $596.5 million,
or 25.3% of total average deposits, for the three months ended December 31, 2025.
(Reversal
of) Provision for Credit Losses
During
the three months ended December 31, 2025, the Company recorded a reversal of credit losses of $485,000, compared to a provision
for credit losses of $1.3 million during the three months ended September 30, 2025. The $1.8 million decrease in the provision
for credit losses was primarily due to a decrease in unfunded commitments of $22.6 million, or 10.6%, and a slight improvement
in macroeconomic forecasts. The reversal of credit losses was determined by a number of factors: the continued strong credit performance
of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic
conditions and the economic outlook from the Federal Reserve Bank’s actions to control inflation. Management continues to
monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn,
and believes it is appropriately reserved for the current economic environment.
During
the three months ended December 31, 2025, the Company recorded net charge-offs of $41,000, compared to net charge-offs of $43,000
for the three months ended September 30, 2025.
Non-Interest
Income
During
each of the three months ended December 31, 2025 and September 30, 2025, non-interest income was $3.2 million. Service charges
and fees on deposits were $2.6 million for the three months ended September 30, 2025 and the three months ended December 31, 2025.
Income from bank-owned life insurance (“BOLI”) increased $10,000, or 2.1%, from the three months ended September 30,
2025 to $492,000 for the three months ended December 31, 2025. Income from loan-level swap fees on commercial loans increased
$18,000, or 15.4%, from the three months ended September 30, 2025 to the three months ended December 31, 2025. During the three
months ended December 31, 2025, the Company reported unrealized losses on marketable equity securities of $7,000, compared to
unrealized gains of $22,000 during the three months ended September 30, 2025.
Non-Interest
Expense
For
the three months ended December 31, 2025, non-interest expense increased $92,000, or 0.6%, to $15.9 million from $15.8 million
for the three months ended September 30, 2025.
Salaries
and employee benefits increased $164,000, or 1.8%, due to an increase in deferred compensation expense to reflect updated year-end
performance award estimates. Occupancy expense increased $75,000, or 6.1%, primarily due to snow removal costs of $54,000. Software
related expenses increased $35,000, or 5.4%, FDIC insurance expense increased $22,000, or 5.9%, and other non-interest expense
increased of $19,000, or 1.3%. These increases were partially offset by a decrease in advertising expense of $84,000, or 19.4%,
a decrease in professional fees of $72,000, or 15.7%, a decrease in debit card processing and ATM network costs of $34,000, or
5.4%, a decrease in data processing of $17,000, or 1.9%, and a decrease in furniture and equipment expense of $16,000, or 3.5%.
For the three months ended December 31, 2025 and the three months ended September 30, 2025, the efficiency ratio was 72.1% and
74.2%, respectively.
Income
Tax Provision
Income
tax expense for the three months ended December 31, 2025 was $1.4 million, with an effective tax rate of 21.3%, compared to $1.0
million, with an effective tax rate of 24.5%, for the three months ended September 30, 2025.
Net
Income for the Three Months Ended December 31, 2025 Compared to the Three Months Ended December 31, 2024
The
Company reported an increase in net income of $1.9 million, or 58.4%, from $3.3 million, or $0.16 per diluted share, for the three
months ended December 31, 2024 to $5.2 million, or $0.26 per diluted share, for the three months ended December 31, 2025. Net
interest income increased $3.6 million, or 23.3%, reversal of credit losses decreased $277,000, or 36.4%, non-interest income
decreased $81,000, or 2.5%, and non-interest expense increased $944,000, or 6.3%, during the same period. Return on average assets
and return on average equity were 0.75% and 8.40%, respectively, for the three months ended December 31, 2025, compared to 0.49%
and 5.48%, respectively, for the three months ended December 31, 2024.
Net
Interest Income and Net Interest Margin
Net
interest income increased $3.6 million, or 23.3%, to $18.8 million, for the three months ended December 31, 2025, from $15.3 million
for the three months ended December 31, 2024. The increase in net interest income was due to an increase in interest and dividend
income of $2.0 million, or 6.8%, and a decrease in interest expense of $1.6 million, or 12.1%. The increase in interest income
was primarily due to the increase in average interest-earnings assets of $67.3 million, or 2.7%, and an increase in the average
yield on interest-earning assets of 17 basis points, from the three months ended December 31, 2024 to the three months ended December
31, 2025.
The
net interest margin increased 48 basis points from 2.41% for the three months ended December 31, 2024 to 2.89% for the three months
ended December 31, 2025. The net interest margin, on a tax-equivalent basis, increased 48 basis points from 2.43%, for the three
months ended December 31, 2024 to 2.91% for the three months ended December 31, 2025. The average yield on interest-earning assets,
without the impact of tax-equivalent adjustments, increased 17 basis points from 4.52% for the three months ended December 31,
2024 to 4.69%, for the three months ended December 31, 2025. The average loan yield, without the impact of tax-equivalent adjustments,
increased 17 basis points from 4.86% for the three months ended December 31, 2024 to 5.03% for the three months ended December
31, 2025. During the same period, average loans increased $104.0 million, or 5.0%.
The
average cost of total funds, including non-interest bearing accounts and borrowings, decreased 32 basis points from 2.20% for
the three months ended December 31, 2024 to 1.88% for the three months ended December 31, 2025. The average cost of core deposits,
which the Company defines as all deposits except time deposits, increased four basis points from 0.98% for the three months ended
December 31, 2024 to 1.02% for the three months ended December 31, 2025. The average cost of time deposits decreased 85 basis
points from 4.31% for the three months ended December 31, 2024 to 3.46% for the three months ended December 31, 2025. The average
cost of borrowings, including subordinated debt, decreased eight basis points from 5.04% for the three months ended December 31,
2024 to 4.96%, for the three months ended December 31, 2025. Average demand deposits, an interest-free source of funds, increased
$17.3 million, or 3.0%, from $579.2 million, or 25.6% of total average deposits, for the three months ended December 31, 2024,
to $596.5 million, or 25.3% of total average deposits, for the three months ended December 31, 2025.
Reversal
of Credit Losses
During
the three months ended December 31, 2025, the Company recorded a reversal of credit losses of $485,000, compared to a reversal
of credit losses of $762,000 during the three months ended December 31, 2024. The reversal of credit losses was determined by
a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio
mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve Bank’s
actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs,
inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.
The
Company recorded net charge-offs of $41,000 for the three months ended December 31, 2025, as compared to net recoveries of $128,000
for the three months ended December 31, 2024.
Non-Interest
Income
Non-interest
income decreased $81,000, or 2.5%, to $3.2 million for the three months ended December 31, 2025, from the three months ended December
31, 2024. During the three months ended December 31, 2025, service charges and fees on deposits increased $252,000, or 11.0%,
income from BOLI increased $6,000, or 1.2%, from $486,000 for the three months ended December 31, 2024 to $492,000 for the three
months ended December 31, 2025. During the three months ended December 31, 2025, the Company reported $135,000 in other income
from loan-level swap fees on commercial loans, compared to $187,000 during the three months ended December 31, 2024.
During
the three months ended December 31, 2025, the Company reported unrealized losses on marketable equity securities of $7,000, compared
to unrealized losses of $9,000 during the three months ended December 31, 2024. During the three months ended December 31, 2024,
the Company reported a loss of $11,000 from mortgage banking activities and did not have a comparable gain or loss during the
three months ended December 31, 2025. During the three months ended December 31, 2024, the Company reported gains on non-marketable
equity investments of $300,000 and did not have a comparable gain or loss during the three months ended December 31, 2025.
Non-Interest
Expense
For
the three months ended December 31, 2025, non-interest expense increased $944,000, or 6.3%, to $15.9 million from $14.9 million
for the three months ended December 31, 2024. Salaries and employee benefits increased $920,000, or 10.9%, to $9.4 million, due
to an increase in deferred compensation expense to reflect updated year-end performance award estimates, software expenses increased
$45,000, or 7.0%, advertising expense increased $39,000, or 12.6%, occupancy expense increased $10,000, or 0.7%, FDIC insurance
expense increased $9,000, or 2.3%, net debit card processing and ATM network costs increased $6,000, or 1.0%, and other non-interest
expense increased $67,000, or 5.0%. These increases were partially offset by a decrease in professional fees of $83,000, or 17.6%,
a decrease in furniture and equipment expense of $68,000, or 13.5%, and a decrease in data processing of $1,000, or 0.1%.
For
the three months ended December 31, 2025, the efficiency ratio was 72.1%, compared to 80.6% for the three months ended December
31, 2024. The decrease in the efficiency ratio was driven by an increase net interest income of $3.6 million, or 23.3%, from the
three months ended December 31, 2024 to the three months ended December 31, 2025.
Income
Tax Provision
Income
tax expense for the three months ended December 31, 2025 was $1.4 million, or an effective tax rate of 21.3%, compared to $1.1
million, or an effective tax rate of 24.6%, for the three months ended December 31, 2024.
Net
Income for the Twelve Months Ended December 31, 2025 Compared to the Twelve Months Ended December 31, 2024
For
the twelve months ended December 31, 2025, the Company reported net income of $15.3 million, or $0.75 per diluted share, compared
to $11.7 million, or $0.56 per diluted share, for the twelve months ended December 31, 2024. Net interest income increased $10.3
million, or 17.2%, provision for credit losses increased $1.0 million, non-interest income decreased $387,000, or 3.0%, and non-interest
expense increased $4.1 million, or 6.9%, during the same period in 2024. Return on average assets and return on average equity
were 0.56% and 6.35% for the twelve months ended December 31, 2025, respectively, compared to 0.45% and 4.93% for the twelve months
ended December 31, 2024, respectively.
Net
Interest Income and Net Interest Margin
During
the twelve months ended December 31, 2025, net interest income increased $10.3 million, or 17.2%, to $70.1 million, compared to
$59.8 million for the twelve months ended December 31, 2024. The increase in net interest income was due to an increase in interest
income of $8.8 million, or 8.0%, and a decrease in interest expense of $1.5 million, or 3.0%.
The
net interest margin for the twelve months ended December 31, 2025 was 2.75%, compared to 2.45% for the twelve months ended December
31, 2024. The net interest margin, on a tax-equivalent basis, was 2.77% for the twelve months ended December 31, 2025, compared
to 2.47% for the twelve months ended December 31, 2024. During the twelve months ended December 31, 2024, the Company had fair
value hedge income of $1.4 million, which contributed six basis points to the net interest margin. The adjusted net interest margin,
excluding income from the fair value hedge, a non-GAAP financial measure, increased 36 basis points from 2.39% for the twelve
months ended December 31, 2024 to 2.75% for the twelve months ended December 31, 2025. The fair value hedge matured in October
of 2024. See pages 18-20 for the related net interest margin, excluding prepayment penalties and income from the fair value hedge
calculation and a reconciliation of GAAP to non-GAAP financial measures.
The
average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased 15 basis points from 4.50%
for the twelve months ended December 31, 2024 to 4.65% for the twelve months ended December 31, 2025. The average yield on loans,
without the impact of tax-equivalent adjustments, increased 14 basis points from 4.86% for the twelve months ended December 31,
2024 to 5.00% for the twelve months ended December 31, 2025. During the twelve months ended December 31, 2025, average interest-earning
assets increased $108.9 million, or 4.5%, to $2.5 billion, compared to the twelve months ended December 31, 2024, primarily due
to an increase in average loans of $73.6 million, or 3.6%, an increase in average short-term investments, consisting of cash and
cash equivalents, of $21.5 million, or 64.7%, and an increase in average securities of $13.6 million, or 3.8%.
During
the twelve months ended December 31, 2025, the average cost of funds, including non-interest-bearing demand accounts and borrowings,
decreased 15 basis points from 2.14% for the twelve months ended December 31, 2024 to 1.99%. For the twelve months ended December
31, 2025, the average cost of core deposits, including non-interest-bearing demand deposits, increased 15 basis points from 0.89%
for the twelve months ended December 31, 2024, to 1.04%. The average cost of time deposits decreased 63 basis points from 4.32%
for the twelve months ended December 31, 2024 to 3.69% for the twelve months ended December 31, 2025. The average cost of borrowings,
which include borrowings and subordinated debt, increased 2 basis points from 5.00% for the twelve months ended December 31, 2024
to 5.02% for the twelve months ended December 31, 2025.
For
the twelve months ended December 31, 2025, average demand deposits, an interest-free source of funds, increased $20.9 million,
or 3.7%, from $561.3 million, or 25.8% of total average deposits, for the twelve months ended December 31, 2024, to $582.2 million,
or 25.1% of total average deposits.
Provision
for (Reversal of) Credit Losses
During
the twelve months ended December 31, 2025, the Company recorded a provision for credit losses of $335,000, compared to a reversal
of credit losses of $665,000 during the twelve months ended December 31, 2024. The $1.0 million increase in the provision for
credit losses was primarily due to an increase in total loans of $113.2 million, or 5.5%, as well as an increase in unfunded commitments
of $15.0 million, or 8.6%. The provision for credit losses was determined by a number of factors: the continued strong credit
performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing
economic conditions and the economic outlook from the Federal Reserve Bank’s actions to control inflation. Management continues
to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn,
and believes it is appropriately reserved for the current economic environment.
The
Company recorded net recoveries of $472,000 for the twelve months ended December 31, 2025, as compared to net recoveries of $87,000
for the twelve months ended December 31, 2024. During the twelve months ended December 31, 2025, the Company recorded a recovery
of $624,000 on a previously charged-off commercial relationship acquired on October 21, 2016 from Chicopee Bancorp, Inc. As of
June 30, 2025, the relationship paid in full.
Non-Interest
Income
For
the twelve months ended December 31, 2025, non-interest income decreased $387,000, or 3.0%, from $12.9 million during the twelve
months ended December 31, 2024 to $12.5 million. During the same period, service charges and fees on deposits increased $715,000,
or 7.8%, and income from BOLI increased $52,000, or 2.7%. During the twelve months ended December 31, 2025, the Company reported
$347,000 in other income from loan-level swap fees on commercial loans, compared to $261,000 during the same period in 2024. During
the twelve months ended December 31, 2025, the Company reported a gain of $243,000 on non-marketable equity investments, compared
to a gain of $1.3 million during the twelve months ended December 31, 2024. During the twelve months ended December 31, 2025,
the Company reported unrealized gains on marketable equity securities of $35,000, compared to unrealized gains on marketable equity
securities of $13,000 during the twelve months ended December 31, 2024. Gains and losses from the investment portfolio vary from
quarter to quarter based on market conditions, as well as the related yield curve and valuation changes. During the twelve months
ended December 31, 2025, the Company reported $11,000 in gains from mortgage banking activities, compared to $235,000 during the
twelve months ended December 31, 2024 due to the sale of fixed rate residential real estate loans. In addition, during the twelve
months ended December 31, 2024, the Company reported a loss on the disposal of premises and equipment of $6,000 and did not have
a comparable gain or loss during the twelve months ended December 31, 2025.
Non-Interest
Expense
For
the twelve months ended December 31, 2025, non-interest expense increased $4.1 million, or 6.9%, to $62.5 million, compared to
$58.4 million for the twelve months ended December 31, 2024. The increase in non-interest expense was primarily due to an increase
in salaries and employee benefits of $3.0 million, or 9.3%, due to an increase in deferred compensation expense to reflect updated
year-end performance award estimates as well as annual merit increases. Advertising expense increased $385,000, or 30.3%, data
processing expense increased $153,000, or 4.4%, FDIC insurance expense increased $144,000, or 9.9%, software related expenses
increased $124,000, or 4.9%, debit card and ATM processing fees increased $46,000, or 1.9%, and other non-interest expense increased
$410,000, or 8.0%. These increases were partially offset by a decrease in occupancy expense of $11,000 or 0.2%, a decrease in
furniture and equipment expense of $87,000, or 4.5%, and a decrease in professional fees of $144,000, or 6.7%.
For
the twelve months ended December 31, 2025, the efficiency ratio was 75.6%, compared to 80.4% for the twelve months ended December
31, 2024. The decrease in the efficiency ratio was driven by higher net interest income during the twelve months ended December
31, 2025 compared to the twelve months ended December 31, 2024.
Income
Tax Provision
Income
tax expense for the twelve months ended December 31, 2025 was $4.5 million, representing an effective tax rate of 22.8%, compared
to $3.3 million, representing an effective tax rate of 22.0%, for the twelve months ended December 31, 2024. The increase in income
tax expense was due to higher pre-tax income for the twelve months ended December 31, 2025.
Balance
Sheet
At
December 31, 2025, total assets increased $83.4 million, or 3.1%, from December 31, 2024 to $2.7 billion. The increase in total
assets was primarily due to an increase in total loans of $113.2 million, or 5.5%, partially offset by a decrease in cash and
cash equivalents of $26.1 million, or 39.2%.
Investments
At
December 31, 2025, the investment securities portfolio totaled $365.2 million, or 13.3% of total assets, compared to $366.1 million,
or 13.8% of total assets, at December 31, 2024. At December 31, 2025, the Company’s available-for-sale securities portfolio,
recorded at fair market value, increased $15.1 million, or 9.4%, from $160.7 million at December 31, 2024 to $175.8 million. The
held-to-maturity securities portfolio, recorded at amortized cost, decreased $16.2 million, or 7.9%, from $205.0 million at December
31, 2024 to $188.8 million at December 31, 2025.
At
December 31, 2025, the Company reported unrealized losses on the available-for-sale securities portfolio of $22.4 million, or
11.3% of the amortized cost basis of the available-for-sale securities portfolio, compared to unrealized losses of $31.2 million,
or 16.2% of the amortized cost basis of the available-for-sale securities at December 31, 2024. At December 31, 2025, the Company
reported unrealized losses on the held-to-maturity securities portfolio of $30.3 million, or 16.1% of the amortized cost basis
of the held-to-maturity securities portfolio, compared to $39.4 million, or 19.2% of the amortized cost basis of the held-to-maturity
securities portfolio at December 31, 2024.
The
securities in which the Company may invest are limited by regulation. Federally chartered savings banks have authority to invest
in various types of assets, including U.S. Treasury obligations, securities of various government-sponsored enterprises, mortgage-backed
securities, certain certificates of deposit of insured financial institutions, repurchase agreements, overnight and short-term
loans to other banks, corporate debt instruments and marketable equity securities. The securities, with the exception of $10.9
million in corporate bonds, are issued by the United States government or government-sponsored enterprises and are therefore either
explicitly or implicitly guaranteed as to the timely payment of contractual principal and interest. These positions are deemed
to have no credit impairment, therefore, the disclosed unrealized losses with the securities portfolio relate primarily to changes
in prevailing interest rates. In all cases, price improvement in future periods will be realized as the issuances approach maturity.
Management
regularly reviews the portfolio for securities in an unrealized loss position. At December 31, 2025 and December 31, 2024, the
Company did not record any credit impairment charges on its securities portfolio and attributed the unrealized losses primarily
due to fluctuations in general interest rates or changes in expected prepayments and not due to credit quality. The primary objective
of the Company’s investment portfolio is to provide liquidity and to secure municipal deposit accounts while preserving
the safety of principal. The available-for-sale and held-to-maturity portfolios are both eligible for pledging to the Federal
Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) as collateral for borrowings. The portfolios
are comprised of high-credit quality investments and both portfolios generated cash flows monthly from interest, principal amortization
and payoffs, which supports the Bank’s objective to provide liquidity.
Total
Loans
Total
loans increased $113.2 million, or 5.5%, from $2.1 billion, or 77.9% of total assets, at December 31, 2024 to $2.2 billion, or
79.7% of total assets, at December 31, 2025. The increase in total loans was primarily driven by an increase in residential real
estate loans, including home equity loans, of $81.2 million, or 10.5%, an increase in commercial and industrial loans of $10.1
million, or 4.8%, and an increase in commercial real estate loans of $23.3 million, or 2.2%. The increase in total loans was partially
offset by a decrease in consumer loans of $1.5 million, or 33.3%.
The
following table presents a summary of the loan portfolio by the major classification of loans at the periods indicated:
| | |
December 31, 2025 | | |
December 31, 2024 | |
| | |
(Dollars in thousands) | |
| | |
| |
| Commercial real estate loans: | |
| | | |
| | |
| Non-owner occupied | |
$ | 900,513 | | |
$ | 880,828 | |
| Owner occupied | |
| 198,550 | | |
| 194,904 | |
| Total commercial real estate loans | |
| 1,099,063 | | |
| 1,075,732 | |
| | |
| | | |
| | |
| Residential real estate loans: | |
| | | |
| | |
| Residential | |
| 719,070 | | |
| 653,802 | |
| Home equity | |
| 137,801 | | |
| 121,857 | |
| Total residential real estate loans | |
| 856,871 | | |
| 775,659 | |
| | |
| | | |
| | |
| Commercial and industrial loans | |
| 221,790 | | |
| 211,656 | |
| | |
| | | |
| | |
| Consumer loans | |
| 2,929 | | |
| 4,391 | |
| Total loans | |
| 2,180,653 | | |
| 2,067,438 | |
| Unamortized premiums and net deferred loan fees and costs | |
| 2,939 | | |
| 2,751 | |
| Total loans, including unamortized premiums and net deferred loan fees and costs | |
$ | 2,183,592 | | |
$ | 2,070,189 | |
Credit
Quality
Management
continues to closely monitor the loan portfolio for any signs of deterioration in borrowers’ financial condition and also
in light of speculation that commercial real estate values may deteriorate as the market continues to adjust to higher vacancies
and interest rates. We continue to proactively take steps to mitigate risk in our loan portfolio.
Total
delinquency was $3.1 million, or 0.14% of total loans, at December 31, 2025, compared to $5.0 million, or 0.24% of total loans
at December 31, 2024. At December 31, 2025, nonaccrual loans totaled $5.2 million, or 0.24% of total loans, compared to $5.4 million,
or 0.26% of total loans, at December 31, 2024. At December 31, 2025 and December 31, 2024, there were no loans 90 or more days
past-due and still accruing interest. Total nonperforming assets, defined as nonaccrual loans and other real estate owned, totaled
$5.2 million, or 0.19% of total assets, at December 31, 2025, compared to $5.4 million, or 0.20% of total assets, at December
31, 2024. At December 31, 2025 and December 31, 2024, the Company did not have any other real estate owned.
At
December 31, 2025, the allowance for credit losses was $20.3 million, or 0.93% of total loans and 393.2% of nonaccrual loans,
compared to $19.5 million, or 0.94% of total loans and 362.9% of nonaccrual loans, at December 31, 2024. Total criticized loans,
defined as special mention and substandard loans, increased $1.3 million, or 3.4%, from $38.4 million, or 1.9% of total loans,
at December 31, 2024 to $39.7 million, or 1.8% of total loans, at December 31, 2025.
Our
commercial real estate portfolio is comprised of diversified property types and primarily within our geographic footprint. At
December 31, 2025, the commercial real estate portfolio totaled $1.1 billion and represented 50.4% of total loans. Of the $1.1
billion, $900.5 million, or 81.9%, was categorized as non-owner occupied commercial real estate and represented 325.1% of the
Bank’s total risk-based capital. More details on the diversification of the loan portfolio are available in the supplementary
earnings presentation.
Deposits
At
December 31, 2025, total deposits were $2.4 billion and increased $98.3 million, or 4.3%, from December 31, 2024. Core deposits,
which the Company defines as all deposits except time deposits, increased $111.9 million, or 7.2%, from $1.6 billion, or 68.9%
of total deposits, at December 31, 2024, to $1.7 billion, or 70.8% of total deposits, at December 31, 2025. Non-interest-bearing
deposits increased $28.9 million, or 5.1%, to $594.5 million, and represent 25.2% of total deposits, money market accounts increased
$54.1 million, or 8.2%, to $715.6 million, interest-bearing checking accounts increased $23.9 million, or 15.9%, to $174.2 million,
and savings accounts increased $5.0 million, or 2.7%, to $186.6 million.
Time
deposits decreased $13.7 million, or 1.9%, from $703.6 million at December 31, 2024 to $689.9 million at December 31, 2025. Brokered
time deposits, which are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered
time deposits at December 31, 2025. We continue our disciplined and focused approach to core relationship management and customer
outreach to meet funding requirements and liquidity needs, with an emphasis on retaining a long-term core customer relationship
base by competing for and retaining deposits in our local market. At December 31, 2025, the Bank’s uninsured deposits totaled
$697.6 million, or 29.5% of total deposits, compared to $643.6 million, or 28.4% of total deposits, at December 31, 2024.
The
table below is a summary of our deposit balances for the periods noted:
| | |
December 31, 2025 | | |
September 30, 2025 | | |
December 31, 2024 | |
| | |
(Dollars in thousands) | |
| Core Deposits: | |
| | | |
| | | |
| | |
| Demand accounts | |
$ | 594,516 | | |
$ | 590,152 | | |
$ | 565,620 | |
| Interest-bearing accounts | |
| 174,227 | | |
| 176,823 | | |
| 150,348 | |
| Savings accounts | |
| 186,597 | | |
| 186,823 | | |
| 181,618 | |
| Money market accounts | |
| 715,620 | | |
| 702,712 | | |
| 661,478 | |
| Total Core Deposits | |
$ | 1,670,960 | | |
$ | 1,656,510 | | |
$ | 1,559,064 | |
| Time Deposits: | |
| 689,948 | | |
| 693,365 | | |
| 703,583 | |
| Total Deposits: | |
$ | 2,360,908 | | |
$ | 2,349,875 | | |
$ | 2,262,647 | |
FHLB
and Subordinated Debt
At
December 31, 2025, total borrowings decreased $17.1 million, or 13.9%, from $123.1 million at December 31, 2024 to $106.1 million.
At December 31, 2025, short-term borrowings increased $7.9 million, or 146.2%, to $13.3 million, compared to $5.4 million at December
31, 2024. Long-term borrowings decreased $25.0 million, or 25.5%, from $98.0 million at December 31, 2024 to $73.0 million at
December 31, 2025. At December 31, 2025 and December 31, 2024, borrowings also consisted of $19.8 million in fixed-to-floating
rate subordinated notes.
As
of December 31, 2025, the Company had $538.6 million of additional borrowing capacity at the FHLB, $349.0 million of additional
borrowing capacity under the FRB Discount Window and $25.0 million of other unsecured lines of credit with correspondent
banks.
Capital
At
December 31, 2025, shareholders’ equity was $247.6 million, or 9.1% of total assets, compared to $235.9 million, or 8.9%
of total assets, at December 31, 2024. The change was primarily attributable to net income of $15.3 million and a decrease in
accumulated other comprehensive loss of $6.6 million, partially offset by cash dividends paid of $5.7 million and the repurchase
of shares at a cost of $6.2 million. At December 31, 2025, total shares outstanding were 20,372,786. The Company’s regulatory
capital ratios continue to be strong and in excess of regulatory minimum requirements to be considered well-capitalized as defined
by regulators and internal Company targets.
| | |
December 31, 2025 | | |
December 31, 2024 | |
| | |
Company | | |
Bank | | |
Company | | |
Bank | |
| Total Capital (to Risk Weighted Assets) | |
| 14.19 | % | |
| 13.48 | % | |
| 14.38 | % | |
| 13.65 | % |
| Tier 1 Capital (to Risk Weighted Assets) | |
| 12.21 | % | |
| 12.46 | % | |
| 12.37 | % | |
| 12.64 | % |
| Common Equity Tier 1 Capital (to Risk Weighted Assets) | |
| 12.21 | % | |
| 12.46 | % | |
| 12.37 | % | |
| 12.64 | % |
| Tier 1 Leverage Ratio (to Adjusted Average Assets) | |
| 9.13 | % | |
| 9.32 | % | |
| 9.14 | % | |
| 9.34 | % |
Dividends
Although
the Company has historically paid quarterly dividends on its common stock and currently intends to continue to pay such dividends,
the Company’s ability to pay such dividends depends on a number of factors, including restrictions under federal laws and
regulations on the Company’s ability to pay dividends, and as a result, there can be no assurance that dividends will continue
to be paid in the future.
About
Western New England Bancorp, Inc.
Western
New England Bancorp, Inc. is a Massachusetts-chartered stock holding company and the parent company of Westfield Bank, CSB Colts,
Inc., Elm Street Securities Corporation, WFD Securities, Inc. and WB Real Estate Holdings, LLC. Western New England Bancorp, Inc.
and its subsidiaries are headquartered in Westfield, Massachusetts and operate 25 banking offices throughout western Massachusetts
and northern Connecticut. To learn more, visit our website at www.westfieldbank.com.
Forward-Looking
Statements
This
press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the Company’s financial
condition, liquidity, results of operations, future performance, and business. Forward-looking statements may be identified by
the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,”
“estimated,” and “potential.” Examples of forward-looking statements include, but are not limited
to, estimates with respect to our financial condition, results of operations and business that are subject to various factors
which could cause actual results to differ materially from these estimates. These factors include, but are not limited to:
| ● | unpredictable
changes in general economic or political conditions, financial markets, fiscal, monetary
and regulatory policies, including actual or potential stress in the banking industry; |
| ● | unstable
political and economic conditions, including changes in tariff policies, which could
materially impact credit quality trends and the ability to generate loans and gather
deposits; |
| ● | inflation
and governmental responses to inflation, including potential future increases in interest
rates that reduce margins; |
| ● | the
effect on our operations of governmental legislation and regulation, including changes
in accounting regulation or standards, the nature and timing of the adoption and effectiveness
of new requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act
of 2010, Basel guidelines, capital requirements and other applicable laws and regulations; |
| ● | significant
changes in accounting, tax or regulatory practices or requirements; |
| ● | new
legal obligations or liabilities or unfavorable resolutions of litigation; |
| ● | disruptive
technologies in payment systems and other services traditionally provided by banks; |
| ● | the
highly competitive industry and market area in which we operate; |
| ● | operational
risks or risk management failures by us or critical third parties, including without
limitation with respect to data processing, information systems, cybersecurity, technological
changes, vendor issues, business interruption, and fraud risks; |
| ● | failure
or circumvention of our internal controls or procedures; |
| ● | changes
in the securities markets which affect investment management revenues; |
| ● | increases
in Federal Deposit Insurance Corporation deposit insurance premiums and assessments;
|
| ● | the
soundness of other financial services institutions which may adversely affect our credit
risk; |
| ● | certain
of our intangible assets may become impaired in the future; |
| ● | the
duration and scope of potential pandemics, including the emergence of new variants and
the response thereto; |
| ● | new
lines of business or new products and services, which may subject us to additional risks; |
| ● | changes
in key management personnel which may adversely impact our operations; |
| ● | severe
weather, natural disasters, acts of war or terrorism and other external events which
could significantly impact our business; and |
| ● | other
risk factors detailed from time to time in our SEC filings. |
Although
we believe that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially
from the results discussed in these forward-looking statements. You are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. We do not undertake any obligation to republish revised forward-looking statements
to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent
required by law.
WESTERN
NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Consolidated
Statements of Net Income and Other Data
(Dollars
in thousands, except per share data)
(Unaudited)
| | |
Three Months Ended | | |
Twelve Months Ended | |
| | |
December 31, | | |
September 30, | | |
June 30, | | |
March 31, | | |
December 31, | | |
December 31, | |
| | |
2025 | | |
2025 | | |
2025 | | |
2025 | | |
2024 | | |
2025 | | |
2024 | |
| INTEREST AND DIVIDEND INCOME: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans | |
$ | 27,491 | | |
$ | 26,690 | | |
$ | 26,214 | | |
$ | 24,984 | | |
$ | 25,183 | | |
$ | 105,379 | | |
$ | 98,898 | |
| Securities | |
| 2,588 | | |
| 2,617 | | |
| 2,588 | | |
| 2,422 | | |
| 2,273 | | |
| 10,215 | | |
| 8,649 | |
| Other investments | |
| 164 | | |
| 166 | | |
| 169 | | |
| 191 | | |
| 214 | | |
| 690 | | |
| 687 | |
| Short-term investments | |
| 294 | | |
| 560 | | |
| 641 | | |
| 840 | | |
| 916 | | |
| 2,335 | | |
| 1,598 | |
| Total interest and dividend income | |
| 30,537 | | |
| 30,033 | | |
| 29,612 | | |
| 28,437 | | |
| 28,586 | | |
| 118,619 | | |
| 109,832 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| INTEREST EXPENSE: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Deposits | |
| 10,296 | | |
| 10,403 | | |
| 10,437 | | |
| 11,376 | | |
| 11,443 | | |
| 42,512 | | |
| 42,236 | |
| Short-term borrowings | |
| 85 | | |
| 39 | | |
| 47 | | |
| 54 | | |
| 60 | | |
| 225 | | |
| 600 | |
| Long-term debt | |
| 1,073 | | |
| 1,245 | | |
| 1,232 | | |
| 1,219 | | |
| 1,557 | | |
| 4,769 | | |
| 6,164 | |
| Subordinated debt | |
| 254 | | |
| 254 | | |
| 254 | | |
| 254 | | |
| 253 | | |
| 1,016 | | |
| 1,015 | |
| Total interest expense | |
| 11,708 | | |
| 11,941 | | |
| 11,970 | | |
| 12,903 | | |
| 13,313 | | |
| 48,522 | | |
| 50,015 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest and dividend income | |
| 18,829 | | |
| 18,092 | | |
| 17,642 | | |
| 15,534 | | |
| 15,273 | | |
| 70,097 | | |
| 59,817 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| (REVERSAL OF) PROVISION FOR CREDIT LOSSES | |
| (485 | ) | |
| 1,293 | | |
| (615 | ) | |
| 142 | | |
| (762 | ) | |
| 335 | | |
| (665 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest and dividend income after (reversal of) provision for credit losses | |
| 19,314 | | |
| 16,799 | | |
| 18,257 | | |
| 15,392 | | |
| 16,035 | | |
| 69,762 | | |
| 60,482 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| NON-INTEREST INCOME: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Service charges and fees on deposits | |
| 2,553 | | |
| 2,552 | | |
| 2,528 | | |
| 2,284 | | |
| 2,301 | | |
| 9,917 | | |
| 9,202 | |
| Income from bank-owned life insurance | |
| 492 | | |
| 482 | | |
| 516 | | |
| 473 | | |
| 486 | | |
| 1,963 | | |
| 1,911 | |
| Unrealized (loss) gain on marketable equity securities | |
| (7 | ) | |
| 22 | | |
| 25 | | |
| (5 | ) | |
| (9 | ) | |
| 35 | | |
| 13 | |
| Gain (loss) on mortgage banking activities | |
| — | | |
| — | | |
| 4 | | |
| 7 | | |
| (11 | ) | |
| 11 | | |
| 235 | |
| Gain on non-marketable equity investments | |
| — | | |
| — | | |
| 243 | | |
| — | | |
| 300 | | |
| 243 | | |
| 1,287 | |
| Loss on disposal of premises and equipment | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| (6 | ) |
| Other income | |
| 135 | | |
| 117 | | |
| 95 | | |
| — | | |
| 187 | | |
| 347 | | |
| 261 | |
| Total non-interest income | |
| 3,173 | | |
| 3,173 | | |
| 3,411 | | |
| 2,759 | | |
| 3,254 | | |
| 12,516 | | |
| 12,903 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| NON-INTEREST EXPENSE: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Salaries and employee benefits | |
| 9,373 | | |
| 9,209 | | |
| 8,831 | | |
| 8,413 | | |
| 8,453 | | |
| 35,826 | | |
| 32,786 | |
| Occupancy | |
| 1,312 | | |
| 1,237 | | |
| 1,265 | | |
| 1,412 | | |
| 1,302 | | |
| 5,226 | | |
| 5,237 | |
| Furniture and equipment | |
| 437 | | |
| 453 | | |
| 491 | | |
| 487 | | |
| 505 | | |
| 1,868 | | |
| 1,955 | |
| Data processing | |
| 899 | | |
| 916 | | |
| 933 | | |
| 882 | | |
| 900 | | |
| 3,630 | | |
| 3,477 | |
| Software | |
| 687 | | |
| 652 | | |
| 645 | | |
| 659 | | |
| 642 | | |
| 2,643 | | |
| 2,519 | |
| Debit/ATM card processing expense | |
| 599 | | |
| 633 | | |
| 674 | | |
| 577 | | |
| 593 | | |
| 2,483 | | |
| 2,437 | |
| Professional fees | |
| 388 | | |
| 460 | | |
| 623 | | |
| 546 | | |
| 471 | | |
| 2,017 | | |
| 2,161 | |
| FDIC insurance | |
| 398 | | |
| 376 | | |
| 399 | | |
| 431 | | |
| 389 | | |
| 1,604 | | |
| 1,460 | |
| Advertising | |
| 349 | | |
| 433 | | |
| 443 | | |
| 429 | | |
| 310 | | |
| 1,654 | | |
| 1,269 | |
| Other | |
| 1,428 | | |
| 1,409 | | |
| 1,352 | | |
| 1,348 | | |
| 1,361 | | |
| 5,537 | | |
| 5,127 | |
| Total non-interest expense | |
| 15,870 | | |
| 15,778 | | |
| 15,656 | | |
| 15,184 | | |
| 14,926 | | |
| 62,488 | | |
| 58,428 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| INCOME BEFORE INCOME TAXES | |
| 6,617 | | |
| 4,194 | | |
| 6,012 | | |
| 2,967 | | |
| 4,363 | | |
| 19,790 | | |
| 14,957 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| INCOME TAX PROVISION | |
| 1,408 | | |
| 1,027 | | |
| 1,422 | | |
| 664 | | |
| 1,075 | | |
| 4,521 | | |
| 3,291 | |
| NET INCOME | |
$ | 5,209 | | |
$ | 3,167 | | |
$ | 4,590 | | |
$ | 2,303 | | |
$ | 3,288 | | |
$ | 15,269 | | |
$ | 11,666 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic earnings per share | |
$ | 0.26 | | |
$ | 0.16 | | |
$ | 0.23 | | |
$ | 0.11 | | |
$ | 0.16 | | |
$ | 0.76 | | |
$ | 0.56 | |
| Weighted average shares outstanding | |
| 20,060,358 | | |
| 20,110,492 | | |
| 20,210,650 | | |
| 20,385,481 | | |
| 20,561,749 | | |
| 20,194,877 | | |
| 20,899,573 | |
| Diluted earnings per share | |
$ | 0.26 | | |
$ | 0.16 | | |
$ | 0.23 | | |
$ | 0.11 | | |
$ | 0.16 | | |
$ | 0.75 | | |
$ | 0.56 | |
| Weighted average diluted shares outstanding | |
| 20,206,539 | | |
| 20,240,975 | | |
| 20,312,881 | | |
| 20,514,098 | | |
| 20,701,276 | | |
| 20,321,755 | | |
| 21,016,358 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Other Data: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Return on average assets (1) | |
| 0.75 | % | |
| 0.46 | % | |
| 0.69 | % | |
| 0.35 | % | |
| 0.49 | % | |
| 0.56 | % | |
| 0.45 | % |
| Return on average equity (1) | |
| 8.40 | % | |
| 5.20 | % | |
| 7.76 | % | |
| 3.94 | % | |
| 5.48 | % | |
| 6.35 | % | |
| 4.93 | % |
| Efficiency ratio | |
| 72.13 | % | |
| 74.20 | % | |
| 74.36 | % | |
| 83.00 | % | |
| 80.56 | % | |
| 75.64 | % | |
| 80.35 | % |
| Adjusted efficiency ratio (non-GAAP) (2) | |
| 72.11 | % | |
| 74.27 | % | |
| 75.32 | % | |
| 82.98 | % | |
| 81.85 | % | |
| 75.89 | % | |
| 81.80 | % |
| Net interest margin | |
| 2.89 | % | |
| 2.81 | % | |
| 2.80 | % | |
| 2.49 | % | |
| 2.41 | % | |
| 2.75 | % | |
| 2.45 | % |
| Net interest margin, on a fully tax-equivalent basis | |
| 2.91 | % | |
| 2.83 | % | |
| 2.82 | % | |
| 2.51 | % | |
| 2.43 | % | |
| 2.77 | % | |
| 2.47 | % |
| (2) | The adjusted efficiency ratio (non-GAAP) represents the
ratio of operating expenses divided by the sum of net interest and dividend income and non-interest income, excluding realized
and unrealized gains and losses on securities, gain on non-marketable equity investments, and loss on disposal of premises and
equipment. |
WESTERN
NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Consolidated
Balance Sheets
(Dollars
in thousands)
(Unaudited)
| | |
December 31, | | |
September 30, | | |
June 30, | | |
March 31, | | |
December 31, | |
| | |
2025 | | |
2025 | | |
2025 | | |
2025 | | |
2024 | |
| Cash and cash equivalents | |
$ | 40,381 | | |
$ | 82,942 | | |
$ | 93,308 | | |
$ | 110,579 | | |
$ | 66,450 | |
| Securities available-for-sale, at fair value | |
| 175,800 | | |
| 179,234 | | |
| 178,785 | | |
| 167,800 | | |
| 160,704 | |
| Securities held to maturity, at amortized cost | |
| 188,800 | | |
| 193,446 | | |
| 197,671 | | |
| 201,557 | | |
| 205,036 | |
| Marketable equity securities, at fair value | |
| 632 | | |
| 471 | | |
| 444 | | |
| 414 | | |
| 397 | |
| Federal Home Loan Bank of Boston and other restricted stock - at cost | |
| 5,359 | | |
| 5,818 | | |
| 5,818 | | |
| 5,818 | | |
| 5,818 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans | |
| 2,183,592 | | |
| 2,131,308 | | |
| 2,092,631 | | |
| 2,079,561 | | |
| 2,070,189 | |
| Allowance for credit losses | |
| (20,297 | ) | |
| (20,542 | ) | |
| (19,733 | ) | |
| (19,669 | ) | |
| (19,529 | ) |
| Net loans | |
| 2,163,295 | | |
| 2,110,766 | | |
| 2,072,898 | | |
| 2,059,892 | | |
| 2,050,660 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Bank-owned life insurance | |
| 79,019 | | |
| 78,527 | | |
| 78,045 | | |
| 77,529 | | |
| 77,056 | |
| Goodwill | |
| 12,487 | | |
| 12,487 | | |
| 12,487 | | |
| 12,487 | | |
| 12,487 | |
| Core deposit intangible | |
| 1,063 | | |
| 1,156 | | |
| 1,250 | | |
| 1,344 | | |
| 1,438 | |
| Other assets | |
| 69,644 | | |
| 70,683 | | |
| 70,443 | | |
| 71,864 | | |
| 73,044 | |
| TOTAL ASSETS | |
$ | 2,736,480 | | |
$ | 2,735,530 | | |
$ | 2,711,149 | | |
$ | 2,709,284 | | |
$ | 2,653,090 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total deposits | |
$ | 2,360,908 | | |
$ | 2,349,875 | | |
$ | 2,330,113 | | |
$ | 2,328,593 | | |
$ | 2,262,647 | |
| Short-term borrowings | |
| 13,270 | | |
| 2,980 | | |
| 4,040 | | |
| 4,520 | | |
| 5,390 | |
| Long-term debt | |
| 73,000 | | |
| 98,000 | | |
| 98,000 | | |
| 98,000 | | |
| 98,000 | |
| Subordinated debt | |
| 19,790 | | |
| 19,781 | | |
| 19,771 | | |
| 19,761 | | |
| 19,751 | |
| Securities pending settlement | |
| 242 | | |
| — | | |
| — | | |
| 2,093 | | |
| 8,622 | |
| Other liabilities | |
| 21,633 | | |
| 21,254 | | |
| 19,797 | | |
| 18,641 | | |
| 22,770 | |
| TOTAL LIABILITIES | |
| 2,488,843 | | |
| 2,491,890 | | |
| 2,471,721 | | |
| 2,471,608 | | |
| 2,417,180 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| TOTAL SHAREHOLDERS’ EQUITY | |
| 247,637 | | |
| 243,640 | | |
| 239,428 | | |
| 237,676 | | |
| 235,910 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | |
$ | 2,736,480 | | |
$ | 2,735,530 | | |
$ | 2,711,149 | | |
$ | 2,709,284 | | |
$ | 2,653,090 | |
WESTERN
NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Other
Data
(Dollars
in thousands, except per share data)
(Unaudited)
| | |
Three Months Ended | |
| | |
December 31, | | |
September 30, | | |
June 30, | | |
March 31, | | |
December 31, | |
| | |
2025 | | |
2025 | | |
2025 | | |
2025 | | |
2024 | |
| Shares outstanding at end of period | |
| 20,372,786 | | |
| 20,491,966 | | |
| 20,494,501 | | |
| 20,774,319 | | |
| 20,875,713 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Operating results: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest income | |
$ | 18,829 | | |
$ | 18,092 | | |
$ | 17,642 | | |
$ | 15,534 | | |
$ | 15,273 | |
| (Reversal of) provision for credit losses | |
| (485 | ) | |
| 1,293 | | |
| (615 | ) | |
| 142 | | |
| (762 | ) |
| Non-interest income | |
| 3,173 | | |
| 3,173 | | |
| 3,411 | | |
| 2,759 | | |
| 3,254 | |
| Non-interest expense | |
| 15,870 | | |
| 15,778 | | |
| 15,656 | | |
| 15,184 | | |
| 14,926 | |
| Income before provision for income taxes | |
| 6,617 | | |
| 4,194 | | |
| 6,012 | | |
| 2,967 | | |
| 4,363 | |
| Income tax provision | |
| 1,408 | | |
| 1,027 | | |
| 1,422 | | |
| 664 | | |
| 1,075 | |
| Net income | |
| 5,209 | | |
| 3,167 | | |
| 4,590 | | |
| 2,303 | | |
| 3,288 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Performance Ratios: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest margin | |
| 2.89 | % | |
| 2.81 | % | |
| 2.80 | % | |
| 2.49 | % | |
| 2.41 | % |
| Net interest margin, on a fully tax-equivalent basis | |
| 2.91 | % | |
| 2.83 | % | |
| 2.82 | % | |
| 2.51 | % | |
| 2.43 | % |
| Interest rate spread | |
| 2.21 | % | |
| 2.13 | % | |
| 2.10 | % | |
| 1.74 | % | |
| 1.63 | % |
| Interest rate spread, on a fully tax-equivalent basis | |
| 2.23 | % | |
| 2.14 | % | |
| 2.12 | % | |
| 1.76 | % | |
| 1.65 | % |
| Return on average assets | |
| 0.75 | % | |
| 0.46 | % | |
| 0.69 | % | |
| 0.35 | % | |
| 0.49 | % |
| Return on average equity | |
| 8.40 | % | |
| 5.20 | % | |
| 7.76 | % | |
| 3.94 | % | |
| 5.48 | % |
| Efficiency ratio (GAAP) | |
| 72.13 | % | |
| 74.20 | % | |
| 74.36 | % | |
| 83.00 | % | |
| 80.56 | % |
| Adjusted efficiency ratio (non-GAAP) (1) |
| 72.11 | % | |
| 74.27 | % | |
| 75.32 | % | |
| 82.98 | % | |
| 81.85 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Per Common Share Data: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic earnings per share | |
$ | 0.26 | | |
$ | 0.16 | | |
$ | 0.23 | | |
$ | 0.11 | | |
$ | 0.16 | |
| Earnings per diluted share | |
| 0.26 | | |
| 0.16 | | |
| 0.23 | | |
| 0.11 | | |
| 0.16 | |
| Cash dividend declared | |
| 0.07 | | |
| 0.07 | | |
| 0.07 | | |
| 0.07 | | |
| 0.07 | |
| Book value per share | |
| 12.16 | | |
| 11.89 | | |
| 11.68 | | |
| 11.44 | | |
| 11.30 | |
| Tangible book value per share (non-GAAP) (2) | |
| 11.49 | | |
| 11.22 | | |
| 11.01 | | |
| 10.78 | | |
| 10.63 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Asset Quality: | |
| | | |
| | | |
| | | |
| | | |
| | |
| 30-89 day delinquent loans | |
$ | 2,098 | | |
$ | 3,123 | | |
$ | 2,525 | | |
$ | 2,459 | | |
$ | 3,694 | |
| 90 days or more delinquent loans | |
| 1,047 | | |
| 1,425 | | |
| 1,328 | | |
| 2,027 | | |
| 1,301 | |
| Total delinquent loans | |
| 3,145 | | |
| 4,548 | | |
| 3,853 | | |
| 4,486 | | |
| 4,995 | |
| Total delinquent loans as a percentage of total loans | |
| 0.14 | % | |
| 0.21 | % | |
| 0.18 | % | |
| 0.22 | % | |
| 0.24 | % |
| Nonaccrual loans | |
$ | 5,162 | | |
$ | 5,649 | | |
$ | 5,752 | | |
$ | 6,014 | | |
$ | 5,381 | |
| Nonaccrual loans as a percentage of total loans | |
| 0.24 | % | |
| 0.27 | % | |
| 0.27 | % | |
| 0.29 | % | |
| 0.26 | % |
| Nonperforming assets as a percentage of total assets | |
| 0.19 | % | |
| 0.21 | % | |
| 0.21 | % | |
| 0.22 | % | |
| 0.20 | % |
| Allowance for credit losses as a percentage of nonaccrual loans | |
| 393.20 | % | |
| 363.64 | % | |
| 343.06 | % | |
| 327.05 | % | |
| 362.93 | % |
| Allowance for credit losses as a percentage of total loans | |
| 0.93 | % | |
| 0.96 | % | |
| 0.94 | % | |
| 0.95 | % | |
| 0.94 | % |
| Net loan charge-offs (recoveries) | |
$ | 41 | | |
$ | 43 | | |
$ | (585 | ) | |
$ | 29 | | |
$ | (128 | ) |
| Net loan charge-offs (recoveries) as a percentage of average loans | |
| 0.00 | % | |
| 0.00 | % | |
| (0.03 | )% | |
| 0.00 | % | |
| (0.01 | )% |
| (1) | The
adjusted efficiency ratio (non-GAAP) represents the ratio of operating expenses divided by the sum of net interest and dividend
income and non-interest income, excluding realized and unrealized gains and losses on securities, gains on non-marketable equity
investments, and loss on disposal of premises and equipment. |
| (2) | Tangible
book value per share (non-GAAP) represents the value of the Company’s tangible assets divided by its current outstanding
shares. |
The
following table sets forth the information relating to our average balances and net interest income for the three months ended
December 31, 2025, September 30, 2025 and December 31, 2024 and reflects the average yield on interest-earning assets and average
cost of interest-bearing liabilities for the periods indicated.
| | |
Three
Months Ended | |
| | |
December
31, 2025 | | |
September
30, 2025 | | |
December
31, 2024 | |
| | |
Average | | |
| | |
Average
Yield/ | | |
Average | | |
| | |
Average
Yield/ | | |
Average | | |
| | |
Average Yield/ | |
| | |
Balance | | |
Interest | | |
Cost(8) | | |
Balance | | |
Interest | | |
Cost(8) | | |
Balance | | |
Interest | | |
Cost(8) | |
| | |
(Dollars
in thousands) | |
| ASSETS: | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| | |
| |
| Interest-earning
assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans(1)(2) | |
$ | 2,166,804 | | |
$ | 27,616 | | |
| 5.06 | % | |
$ | 2,112,394 | | |
$ | 26,810 | | |
| 5.04 | % | |
$ | 2,062,822 | | |
$ | 25,311 | | |
| 4.88 | % |
| Securities(2) | |
| 370,210 | | |
| 2,588 | | |
| 2.77 | | |
| 374,082 | | |
| 2,617 | | |
| 2.78 | | |
| 361,476 | | |
| 2,273 | | |
| 2.50 | |
| Other
investments | |
| 14,752 | | |
| 164 | | |
| 4.41 | | |
| 14,993 | | |
| 166 | | |
| 4.39 | | |
| 15,924 | | |
| 214 | | |
| 5.35 | |
| Short-term
investments(3) | |
| 32,544 | | |
| 294 | | |
| 3.58 | | |
| 52,380 | | |
| 560 | | |
| 4.24 | | |
| 76,795 | | |
| 916 | | |
| 4.75 | |
| Total
interest-earning assets | |
| 2,584,310 | | |
| 30,662 | | |
| 4.71 | | |
| 2,553,849 | | |
| 30,153 | | |
| 4.68 | | |
| 2,517,017 | | |
| 28,714 | | |
| 4.54 | |
| Total
non-interest-earning assets | |
| 156,258 | | |
| | | |
| | | |
| 157,127 | | |
| | | |
| | | |
| 155,538 | | |
| | | |
| | |
| Total
assets | |
$ | 2,740,568 | | |
| | | |
| | | |
$ | 2,710,976 | | |
| | | |
| | | |
$ | 2,672,555 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES
AND EQUITY: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing
liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing
checking accounts | |
$ | 163,174 | | |
| 371 | | |
| 0.90 | | |
$ | 161,171 | | |
| 453 | | |
| 1.12 | | |
$ | 149,231 | | |
| 264 | | |
| 0.70 | |
| Savings
accounts | |
| 187,428 | | |
| 43 | | |
| 0.09 | | |
| 187,279 | | |
| 42 | | |
| 0.09 | | |
| 179,122 | | |
| 38 | | |
| 0.08 | |
| Money
market accounts | |
| 723,501 | | |
| 3,889 | | |
| 2.13 | | |
| 703,084 | | |
| 3,784 | | |
| 2.14 | | |
| 654,965 | | |
| 3,553 | | |
| 2.16 | |
| Time
deposit accounts | |
| 686,966 | | |
| 5,993 | | |
| 3.46 | | |
| 692,742 | | |
| 6,124 | | |
| 3.51 | | |
| 700,324 | | |
| 7,588 | | |
| 4.31 | |
| Total
interest-bearing deposits | |
| 1,761,069 | | |
| 10,296 | | |
| 2.32 | | |
| 1,744,276 | | |
| 10,403 | | |
| 2.37 | | |
| 1,683,642 | | |
| 11,443 | | |
| 2.70 | |
| Borrowings | |
| 112,904 | | |
| 1,412 | | |
| 4.96 | | |
| 121,389 | | |
| 1,538 | | |
| 5.03 | | |
| 147,748 | | |
| 1,870 | | |
| 5.04 | |
| Interest-bearing
liabilities | |
| 1,873,973 | | |
| 11,708 | | |
| 2.48 | | |
| 1,865,665 | | |
| 11,941 | | |
| 2.54 | | |
| 1,831,390 | | |
| 13,313 | | |
| 2.89 | |
| Non-interest-bearing
deposits | |
| 596,462 | | |
| | | |
| | | |
| 581,835 | | |
| | | |
| | | |
| 579,168 | | |
| | | |
| | |
| Other
non-interest-bearing liabilities | |
| 24,231 | | |
| | | |
| | | |
| 22,014 | | |
| | | |
| | | |
| 23,380 | | |
| | | |
| | |
| Total
non-interest-bearing liabilities | |
| 620,693 | | |
| | | |
| | | |
| 603,849 | | |
| | | |
| | | |
| 602,548 | | |
| | | |
| | |
| Total
liabilities | |
| 2,494,666 | | |
| | | |
| | | |
| 2,469,514 | | |
| | | |
| | | |
| 2,433,938 | | |
| | | |
| | |
| Total
equity | |
| 245,902 | | |
| | | |
| | | |
| 241,462 | | |
| | | |
| | | |
| 238,617 | | |
| | | |
| | |
| Total
liabilities and equity | |
$ | 2,740,568 | | |
| | | |
| | | |
$ | 2,710,976 | | |
| | | |
| | | |
$ | 2,672,555 | | |
| | | |
| | |
| Less:
Tax-equivalent adjustment(2) | |
| | | |
| (125 | ) | |
| | | |
| | | |
| (120 | ) | |
| | | |
| | | |
| (128 | ) | |
| | |
| Net
interest and dividend income | |
| | | |
$ | 18,829 | | |
| | | |
| | | |
$ | 18,092 | | |
| | | |
| | | |
$ | 15,273 | | |
| | |
| Net
interest rate spread(4) | |
| | | |
| | | |
| 2.21 | % | |
| | | |
| | | |
| 2.13 | % | |
| | | |
| | | |
| 1.63 | % |
| Net
interest rate spread, on a tax-equivalent basis(5) | |
| | | |
| | | |
| 2.23 | % | |
| | | |
| | | |
| 2.14 | % | |
| | | |
| | | |
| 1.65 | % |
| Net
interest margin(6) | |
| | | |
| | | |
| 2.89 | % | |
| | | |
| | | |
| 2.81 | % | |
| | | |
| | | |
| 2.41 | % |
| Net
interest margin, on a tax-equivalent basis(7) | |
| | | |
| | | |
| 2.91 | % | |
| | | |
| | | |
| 2.83 | % | |
| | | |
| | | |
| 2.43 | % |
| Ratio
of average interest-earning | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| assets
to average interest-bearing liabilities | |
| | | |
| | | |
| 137.91 | % | |
| | | |
| | | |
| 136.89 | % | |
| | | |
| | | |
| 137.44 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
The
following tables set forth the information relating to our average balances and net interest income for the twelve months ended
December 31, 2025 and 2024 and reflect the average yield on interest-earning assets and average cost of interest-bearing liabilities
for the periods indicated.
| | |
Twelve Months Ended December 31, | |
| | |
2025 | | |
2024 | |
| | |
Average
Balance | | |
Interest | | |
Average Yield/
Cost | | |
Average
Balance | | |
Interest | | |
Average Yield/
Cost | |
| | |
(Dollars in thousands) | |
| ASSETS: | |
| | |
| | |
| | |
| | |
| | |
| |
| Interest-earning assets | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loans(1)(2) | |
$ | 2,108,767 | | |
$ | 105,866 | | |
| 5.02 | % | |
$ | 2,035,149 | | |
$ | 99,369 | | |
| 4.88 | % |
| Securities(2) | |
| 371,206 | | |
| 10,215 | | |
| 2.75 | | |
| 357,631 | | |
| 8,649 | | |
| 2.42 | |
| Other investments | |
| 14,907 | | |
| 690 | | |
| 4.63 | | |
| 14,669 | | |
| 687 | | |
| 4.68 | |
| Short-term investments(3) | |
| 54,770 | | |
| 2,335 | | |
| 4.26 | | |
| 33,254 | | |
| 1,598 | | |
| 4.81 | |
| Total interest-earning assets | |
| 2,549,650 | | |
| 119,106 | | |
| 4.67 | | |
| 2,440,703 | | |
| 110,303 | | |
| 4.52 | |
| Total non-interest-earning assets | |
| 156,591 | | |
| | | |
| | | |
| 155,056 | | |
| | | |
| | |
| Total assets | |
$ | 2,706,241 | | |
| | | |
| | | |
$ | 2,595,759 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES AND EQUITY: | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing liabilities | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest-bearing checking accounts | |
$ | 155,831 | | |
| 1,497 | | |
| 0.96 | % | |
$ | 136,861 | | |
| 1,022 | | |
| 0.75 | % |
| Savings accounts | |
| 186,780 | | |
| 180 | | |
| 0.10 | | |
| 182,678 | | |
| 166 | | |
| 0.09 | |
| Money market accounts | |
| 704,654 | | |
| 15,242 | | |
| 2.16 | | |
| 631,197 | | |
| 12,242 | | |
| 1.94 | |
| Time deposit accounts | |
| 693,208 | | |
| 25,593 | | |
| 3.69 | | |
| 666,917 | | |
| 28,806 | | |
| 4.32 | |
| Total interest-bearing deposits | |
| 1,740,473 | | |
| 42,512 | | |
| 2.44 | | |
| 1,617,653 | | |
| 42,236 | | |
| 2.61 | |
| Short-term borrowings and long-term debt | |
| 119,764 | | |
| 6,010 | | |
| 5.02 | | |
| 155,560 | | |
| 7,779 | | |
| 5.00 | |
| Total interest-bearing liabilities | |
| 1,860,237 | | |
| 48,522 | | |
| 2.61 | | |
| 1,773,213 | | |
| 50,015 | | |
| 2.82 | |
| Non-interest-bearing deposits | |
| 582,168 | | |
| | | |
| | | |
| 561,264 | | |
| | | |
| | |
| Other non-interest-bearing liabilities | |
| 23,472 | | |
| | | |
| | | |
| 24,541 | | |
| | | |
| | |
| Total non-interest-bearing liabilities | |
| 605,640 | | |
| | | |
| | | |
| 585,805 | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total liabilities | |
| 2,465,877 | | |
| | | |
| | | |
| 2,359,018 | | |
| | | |
| | |
| Total equity | |
| 240,364 | | |
| | | |
| | | |
| 236,741 | | |
| | | |
| | |
| Total liabilities and equity | |
$ | 2,706,241 | | |
| | | |
| | | |
$ | 2,595,759 | | |
| | | |
| | |
| Less: Tax-equivalent adjustment (2) | |
| | | |
| (487 | ) | |
| | | |
| | | |
| (471 | ) | |
| | |
| Net interest and dividend income | |
| | | |
$ | 70,097 | | |
| | | |
| | | |
$ | 59,817 | | |
| | |
| Net interest rate spread (4) | |
| | | |
| | | |
| 2.04 | % | |
| | | |
| | | |
| 1.68 | % |
| Net interest rate spread, on a tax-equivalent basis (5) | |
| | | |
| | | |
| 2.06 | % | |
| | | |
| | | |
| 1.70 | % |
| Net interest margin (6) | |
| | | |
| | | |
| 2.75 | % | |
| | | |
| | | |
| 2.45 | % |
| Net interest margin, on a tax-equivalent basis (7) | |
| | | |
| | | |
| 2.77 | % | |
| | | |
| | | |
| 2.47 | % |
| Ratio of average interest-earning assets to average interest-bearing liabilities | |
| | | |
| | | |
| 137.06 | % | |
| | | |
| | | |
| 137.64 | % |
| (1) | Loans,
including nonaccrual loans, are net of deferred loan origination costs and unadvanced funds. |
| (2) | Loan
and securities income are presented on a tax-equivalent basis using a tax rate of 21%.
The tax-equivalent adjustment is deducted from tax-equivalent net interest and dividend
income to agree to the amount reported on the consolidated statements of net income. |
| (3) | Short-term
investments include federal funds sold. |
| (4) | Net
interest rate spread represents the difference between the weighted average yield on
interest-earning assets and the weighted average cost of interest-bearing liabilities. |
| (5) | Net
interest rate spread, on a tax-equivalent basis, represents the difference between the
tax-equivalent weighted average yield on interest-earning assets and the weighted average
cost of interest-bearing liabilities. |
| (6) | Net
interest margin represents net interest and dividend income as a percentage of average
interest-earning assets. |
| (7) | Net
interest margin, on a tax-equivalent basis, represents tax-equivalent net interest and
dividend income as a percentage of average interest-earning assets. |
Reconciliation
of Non-GAAP to GAAP Financial Measures
The
Company believes that certain non-GAAP financial measures provide information to investors that is useful in understanding its
results of operations and financial condition. Because not all companies use the same calculation, this presentation may
not be comparable to other similarly titled measures calculated by other companies. A reconciliation of these non-GAAP financial
measures is provided below.
| | |
For the quarter ended | |
| | |
12/31/2025 | | |
9/30/2025 | | |
6/30/2025 | | |
3/31/2025 | | |
12/31/2024 | |
| | |
(Dollars in thousands) | |
| | |
| | |
| | |
| | |
| | |
| |
| Loan interest (no tax adjustment) | |
$ | 27,491 | | |
$ | 26,690 | | |
$ | 26,214 | | |
$ | 24,984 | | |
$ | 25,183 | |
| Tax-equivalent adjustment | |
| 125 | | |
| 120 | | |
| 121 | | |
| 121 | | |
| 128 | |
| Loan interest (tax-equivalent basis) | |
$ | 27,616 | | |
$ | 26,810 | | |
$ | 26,335 | | |
$ | 25,105 | | |
$ | 25,311 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Loan interest (tax-equivalent basis) | |
$ | 27,616 | | |
$ | 26,810 | | |
$ | 26,335 | | |
$ | 25,105 | | |
$ | 25,311 | |
| Less: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Prepayment penalties and fees | |
| — | | |
| 34 | | |
| 425 | | |
| — | | |
| — | |
| Adjusted loan income, excluding prepayment penalties (tax-equivalent basis) (non-GAAP) | |
$ | 27,616 | | |
$ | 26,776 | | |
$ | 25,910 | | |
$ | 25,105 | | |
$ | 25,311 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Average loans | |
$ | 2,166,804 | | |
$ | 2,112,394 | | |
$ | 2,081,319 | | |
$ | 2,073,486 | | |
$ | 2,062,822 | |
| Average loan yield (no tax adjustment) | |
| 5.03 | % | |
| 5.01 | % | |
| 5.05 | % | |
| 4.89 | % | |
| 4.86 | % |
| Average loan yield (no tax adjustment), excluding prepayment penalties (non-GAAP) | |
| 5.03 | % | |
| 5.01 | % | |
| 4.97 | % | |
| 4.89 | % | |
| 4.86 | % |
| Average loan yield (tax-equivalent) | |
| 5.06 | % | |
| 5.04 | % | |
| 5.08 | % | |
| 4.91 | % | |
| 4.88 | % |
| Average loan yield (tax-equivalent basis), excluding prepayment penalties (non-GAAP) | |
| 5.06 | % | |
| 5.03 | % | |
| 4.99 | % | |
| 4.91 | % | |
| 4.88 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest income (no tax adjustment) | |
$ | 18,829 | | |
$ | 18,092 | | |
$ | 17,642 | | |
$ | 15,534 | | |
$ | 15,273 | |
| Tax equivalent adjustment | |
| 125 | | |
| 120 | | |
| 121 | | |
| 121 | | |
| 128 | |
| Net interest income (tax-equivalent basis) | |
$ | 18,954 | | |
$ | 18,212 | | |
$ | 17,763 | | |
$ | 15,655 | | |
$ | 15,401 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net interest income (no tax adjustment) | |
$ | 18,829 | | |
$ | 18,092 | | |
$ | 17,642 | | |
$ | 15,534 | | |
$ | 15,273 | |
| Less: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Prepayment penalties | |
| — | | |
| 34 | | |
| 425 | | |
| — | | |
| — | |
| Income from fair value hedge | |
| — | | |
| — | | |
| — | | |
| — | | |
| 74 | |
| Adjusted net interest income (non-GAAP) | |
$ | 18,829 | | |
$ | 18,058 | | |
$ | 17,217 | | |
$ | 15,534 | | |
$ | 15,199 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Average interest-earning assets | |
$ | 2,584,310 | | |
$ | 2,553,849 | | |
$ | 2,530,077 | | |
$ | 2,529,715 | | |
$ | 2,517,017 | |
| Net interest margin (no tax adjustment) | |
| 2.89 | % | |
| 2.81 | % | |
| 2.80 | % | |
| 2.49 | % | |
| 2.41 | % |
| Net interest margin (tax-equivalent basis) | |
| 2.91 | % | |
| 2.83 | % | |
| 2.82 | % | |
| 2.51 | % | |
| 2.43 | % |
| Adjusted net interest margin, excluding prepayment penalties and income from fair value hedge (no tax adjustment) (non-GAAP) | |
| 2.89 | % | |
| 2.81 | % | |
| 2.73 | % | |
| 2.49 | % | |
| 2.40 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| | |
For the quarter ended | |
| | |
12/31/2025 | | |
9/30/2025 | | |
6/30/2025 | | |
3/31/2025 | | |
12/31/2024 | |
| | |
(Dollars in thousands, except per share data) | |
| | |
| |
| Book Value per Share (GAAP) | |
$ | 12.16 | | |
$ | 11.89 | | |
$ | 11.68 | | |
$ | 11.44 | | |
$ | 11.30 | |
| Non-GAAP adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Goodwill | |
| (0.61 | ) | |
| (0.61 | ) | |
| (0.61 | ) | |
| (0.60 | ) | |
| (0.60 | ) |
| Core deposit intangible | |
| (0.06 | ) | |
| (0.06 | ) | |
| (0.06 | ) | |
| (0.06 | ) | |
| (0.07 | ) |
| Tangible Book Value per Share (non-GAAP) | |
$ | 11.49 | | |
$ | 11.22 | | |
$ | 11.01 | | |
$ | 10.78 | | |
$ | 10.63 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Efficiency Ratio: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Non-interest Expense (GAAP) | |
$ | 15,870 | | |
$ | 15,778 | | |
$ | 15,656 | | |
$ | 15,184 | | |
$ | 14,926 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net Interest Income (GAAP) | |
$ | 18,829 | | |
$ | 18,092 | | |
$ | 17,642 | | |
$ | 15,534 | | |
$ | 15,273 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Non-interest Income (GAAP) | |
$ | 3,173 | | |
$ | 3,173 | | |
$ | 3,411 | | |
$ | 2,759 | | |
$ | 3,254 | |
| Non-GAAP adjustments: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Unrealized losses (gains) on marketable equity securities | |
| 7 | | |
| (22 | ) | |
| (25 | ) | |
| 5 | | |
| 9 | |
| Gain on non-marketable equity investments | |
| — | | |
| — | | |
| (243 | ) | |
| — | | |
| (300 | ) |
| Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) | |
$ | 3,180 | | |
$ | 3,151 | | |
$ | 3,143 | | |
$ | 2,764 | | |
$ | 2,963 | |
| Total Revenue for Adjusted Efficiency Ratio (non-GAAP) | |
$ | 22,009 | | |
$ | 21,243 | | |
$ | 20,785 | | |
$ | 18,298 | | |
$ | 18,236 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Efficiency Ratio (GAAP) | |
| 72.13 | % | |
| 74.20 | % | |
| 74.36 | % | |
| 83.00 | % | |
| 80.56 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP)) | |
| 72.11 | % | |
| 74.27 | % | |
| 75.32 | % | |
| 82.98 | % | |
| 81.85 | % |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| | |
For the twelve months ended | |
| | |
12/31/2025 | | |
12/31/2024 | |
| | |
(Dollars in thousands) | |
| | |
| | |
| |
| Loan income (no tax adjustment) | |
$ | 105,379 | | |
$ | 98,898 | |
| Tax-equivalent adjustment | |
| 487 | | |
| 471 | |
| Loan income (tax-equivalent basis) | |
$ | 105,866 | | |
$ | 99,369 | |
| | |
| | | |
| | |
| Net interest income (no tax adjustment) | |
$ | 70,097 | | |
$ | 59,817 | |
| Tax equivalent adjustment | |
| 487 | | |
| 471 | |
| Net interest income (tax-equivalent basis) | |
$ | 70,584 | | |
$ | 60,288 | |
| | |
| | | |
| | |
| Net interest income (no tax adjustment) | |
$ | 70,097 | | |
$ | 59,817 | |
| Less: | |
| | | |
| | |
| Prepayment penalties | |
| 459 | | |
| 8 | |
| Income from fair value hedge | |
| — | | |
| 1,398 | |
| Adjusted net interest income (non-GAAP) | |
$ | 69,638 | | |
$ | 58,411 | |
| | |
| | | |
| | |
| Average interest-earning assets | |
$ | 2,549,650 | | |
$ | 2,440,703 | |
| Net interest margin (no tax adjustment) | |
| 2.75 | % | |
| 2.45 | % |
| Net interest margin (tax-equivalent basis) | |
| 2.77 | % | |
| 2.47 | % |
| Adjusted net interest margin, excluding prepayment penalties and income from fair value hedge (no tax adjustment) (non-GAAP) | |
| 2.73 | % | |
| 2.39 | % |
| | |
| | | |
| | |
| Adjusted Efficiency Ratio: | |
| | | |
| | |
| Non-interest Expense (GAAP) | |
$ | 62,488 | | |
$ | 58,428 | |
| | |
| | | |
| | |
| Net Interest Income (GAAP) | |
$ | 70,097 | | |
$ | 59,817 | |
| | |
| | | |
| | |
| Non-interest Income (GAAP) | |
$ | 12,516 | | |
$ | 12,903 | |
| Non-GAAP adjustments: | |
| | | |
| | |
| Unrealized gains on marketable equity securities | |
| (35 | ) | |
| (13 | ) |
| Loss on disposal of premises and equipment, net | |
| — | | |
| 6 | |
| Gain on non-marketable equity investments | |
| (243 | ) | |
| (1,287 | ) |
| Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) | |
$ | 12,238 | | |
$ | 11,609 | |
| Total Revenue for Adjusted Efficiency Ratio (non-GAAP) | |
$ | 82,335 | | |
$ | 71,426 | |
| | |
| | | |
| | |
| Efficiency Ratio (GAAP) | |
| 75.64 | % | |
| 80.35 | % |
| | |
| | | |
| | |
| Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP)) | |
| 75.89 | % | |
| 81.80 | % |
WESTERN NEW ENGLAND BANCORP, INC. 8-K
Exhibit 99.2
Local banking is better than ever. INVESTOR PRESENTATION 4TH QUARTER 2025
FORWARD - LOOKING STATEMENTS 2 We may, from time to time, make written or oral “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 , including statements contained in our filings with the Securities and Exchange Commission (the “SEC”), our reports to shareholders and in other communications by us . This Investor Presentation contains “forward - looking statements” with respect to the Company’s financial condition, liquidity, results of operations, future performance, and business . Forward - looking statements may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential . ” Examples of forward - looking statements include, but are not limited to, estimates with respect to our financial condition, results of operations and business that are subject to various factors which could cause actual results to differ materially from these estimates . These factors include, but are not limited to : ● unpredictable changes in general economic or political conditions, financial markets, fiscal, monetary and regulatory policies, including actual or potential stress in the banking industry ; ● unstable political and economic conditions, including changes in tariff policies, which could materially impact credit quality trends and the ability to generate loans and gather deposits ; ● inflation and governmental responses to inflation, including potential future increases in interest rates that reduce margins ; ● the effect on our operations of governmental legislation and regulation, including changes in accounting regulation or standards, the nature and timing of the adoption and effectiveness of new requirements under the Dodd - Frank Wall Street Reform and Consumer Protection Act of 2010 , Basel guidelines, capital requirements and other applicable laws and regulations ; ● significant changes in accounting, tax or regulatory practices or requirements ; ● new legal obligations or liabilities or unfavorable resolutions of litigation ; ● disruptive technologies in payment systems and other services traditionally provided by banks ; ● the highly competitive industry and market area in which we operate ; ● operational risks or risk management failures by us or critical third parties, including without limitation with respect to data processing, information systems, cybersecurity, technological changes, vendor issues, business interruption, and fraud risks ;
FORWARD - LOOKING STATEMENTS 3 ● failure or circumvention of our internal controls or procedures ; ● changes in the securities markets which affect investment management revenues ; ● increases in Federal Deposit Insurance Corporation deposit insurance premiums and assessments ; ● the soundness of other financial services institutions which may adversely affect our credit risk ; ● certain of our intangible assets may become impaired in the future ; ● the duration and scope of potential pandemics, including the emergence of new variants and the response thereto ; ● new lines of business or new products and services, which may subject us to additional risks ; ● changes in key management personnel which may adversely impact our operations ; ● severe weather, natural disasters, acts of war or terrorism and other external events which could significantly impact our business ; and ● other risk factors detailed from time to time in our SEC filings . Although we believe that the expectations reflected in such forward - looking statements are reasonable, actual results may differ materially from the results discussed in these forward - looking statements. You are cautioned not to place undue reliance on the se forward - looking statements, which speak only as of the date hereof. We do not undertake any obligation to republish revised for ward - looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent required by law.
WHO WE ARE Every day, we focus on showing Westfield Bank customers “ what better banking is all about . ” For us, the idea of better banking starts with putting customers first, while adhering to our core values . Our Core Values : • Integrity • Enhance Shareholder Value • Customer Focus • Community Focus Our Core Mission : Our core mission is to help customers succeed in our community, while creating and increasing shareholder value . The Company’s mission drives the outcome we envision for Western New England Bancorp . 4 70 Center Street, Chicopee, MA.
SENIOR MANAGEMENT TEAM James C . Hagan, President & Chief Executive Officer Guida R . Sajdak, Executive Vice President, Chief Financial Officer & Treasurer Allen J . Miles III, Executive Vice President & Chief Lending Officer Kevin C . O’Connor, Executive Vice President & Chief Operating Officer John E . Bonini , Senior Vice President & General Counsel Filipe Goncalves, Senior Vice President & Chief Credit Officer Darlene Libiszewski , Senior Vice President & Chief Information Officer Christine Phillips , Senior Vice President, Chief Human Resources Officer Leo R . Sagan, Jr . , Senior Vice President & Chief Risk Officer 5
4Q2025 QUARTERLY EARNINGS 6 ($ in thousands, except EPS) 4Q2025 3Q2025 2Q2025 (1) 1Q2025 4Q2024 (2) Net interest income $ 18,829 $ 18,092 $ 17,642 $ 15,534 $ 15,273 (Reversal of) provision for credit losses (485) 1,293 (615) 142 (762) Non - interest income 3,173 3,173 3,411 2,759 3,254 Non - interest expense 15,870 15,778 15,656 15,184 14,926 Income before taxes 6,617 4,194 6,012 2,967 4,363 Income tax expense 1,408 1,027 1,422 664 1,075 Net income $ 5,209 $ 3,167 $ 4,590 $ 2,303 $ 3,288 Diluted earnings per share (EPS) $ 0.26 $ 0.16 $ 0.23 $ 0.11 $ 0.16 Return on average assets (ROA) 0.75% 0.46% 0.69% 0.35% 0.49% Return on average equity (ROE) 8.40% 5.20% 7.76% 3.94% 5.48% Net interest margin 2.89% 2.81% 2.80% 2.49% 2.41% Net interest margin, tax - equivalent basis 2.91% 2.83% 2.82% 2.51% 2.43% (1) Non - interest income includes a $243,000 gain on non - marketable equity investments. (2) Non - interest income includes a $300,000 gain on non - marketable equity investments.
NET INTEREST INCOME AND NET INTEREST MARGIN 7 $15.3 $15.5 $17.6 $18.1 $18.8 2.41% 2.49% 2.80% 2.81% 2.89% 2.10% 2.20% 2.30% 2.40% 2.50% 2.60% 2.70% 2.80% 2.90% 3.00% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 Net interest income ($) Net interest margin (%) ($ in millions) (1) See slides 32 - 34 for the related net interest margin calculation and a reconciliation of GAAP to non - GAAP financial measures . HIGHLIGHTS On a sequential quarter basis, net interest income, our primary driver of revenues, increased $ 737 , 000 , or 4 . 1 % , from $ 18 . 1 million for the three months ended September 30 , 2025 to $ 18 . 8 million for the three months ended December 31 , 2025 . The net interest margin increased eight basis points from 2 . 81 % for the three months ended September 30 , 2025 to 2 . 89 % for the three months ended December 31 , 2025 .
TOTAL LOANS 8 Residential Real Estate 33% Home Equity Lines and Loans 6% CRE - Owner Occupied 9% [CATEGOR Y NAME] 41% [CATEGOR Y NAME] 11% Total Loans $2.2 Billion HIGHLIGHTS • Total loans increased $ 113 . 2 million, or 5 . 5 % , from $ 2 . 1 billion, or 77 . 9 % of total assets, at December 31 , 2024 to $ 2 . 2 billion, or 79 . 7 % of total assets, at December 31 , 2025 ; • Commercial and industrial loans (“C&I”) increased $ 10 . 1 million, or 4 . 8 % ; • Commercial real estate loans (“CRE”) increased $ 23 . 3 million, or 2 . 2 % ; • Residential real estate loans, including home equity loans, increased $ 81 . 2 million, or 10 . 5 % ; • Consumer loans decreased $ 1 . 5 million, or 33 . 3 % ; • Loan Mix : 61 % Commercial and 39 % Retail/Consumer ; • CRE non - owner occupied as a % of Total Bank Risk - Based Capital was 325 . 1 % at December 31 , 2025 ; • Fixed rate ( 54 % ) ; Adjustable ( 29 % ) ; and Floating ( 17 % ) . Line of Business Portfolio Rate as of December 31, 2025 Yield on New Originations (2) Commercial Real Estate 4.94% 6.49% Commercial and Industrial 6.10% 6.82% Residential Real Estate 4.86% 6.07% ($ in millions) (1) As of December 31, 2025. (2) Yield on new originations for the fourth quarter of 2025. (1)
TOTAL LOANS 9 $2,063 $2,073 $2,081 $2,112 $2,167 4.88% 4.91% 5.08% 5.04% 5.06% 4.75% 4.80% 4.85% 4.90% 4.95% 5.00% 5.05% 5.10% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $2,000 $2,025 $2,050 $2,075 $2,100 $2,125 $2,150 $2,175 AVERAGE LOANS OUTSTANDING Average Loans Outstanding Average Loan Yield, Tax-Equivalent Basis ($ in millions) (1) Represents total loans for the periods noted. (2) See slides 32 - 34 for the related average loan yield on a tax - equivalent basis calculation and a reconciliation of GAAP to non - GA AP financial measures. $2,067 $2,077 $2,090 $2,128 $2,181 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $2,000 $2,025 $2,050 $2,075 $2,100 $2,125 $2,150 $2,175 $2,200 PERIOD - END LOANS OUTSTANDING (1) The average loan yield, on a tax - equivalent basis, increased two basis points from 5.04% for the three months ended September 30, 2025 to 5.06% for the three months ended December 31, 2025, while average loans increased $54.4 million, or 2.6%, during the same period. (2)
COMMERCIAL AND INDUSTRIAL LOANS 10 $212 $216 $235 $219 $222 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $200 $205 $210 $215 $220 $225 $230 $235 $240 Total C&I loans increased $ 10 . 1 million, or 4 . 8 % , to $ 221 . 8 million at December 31 , 2025 , from $ 211 . 7 million at December 31 , 2024 . ($ in millions)
COMMERCIAL & INDUSTRIAL PORTFOLIO (1) 11 (1) % of total loans as of December 31, 2025. Specialty Trade Contractors, 0.5% Other, 2.5% Merchant Wholesalers, 1.5% Manufacturing, 2.8% Hotels, 0.1% Heavy and Civil Engineering Construction, 0.4% Healthcare, 0.5% Educational Services, 1.2% Construction, Sand and Gravel Mining, 0.7%
COMMERCIAL REAL ESTATE LOANS 12 $1,076 $1,073 $1,046 $1,078 $1,099 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $1,000 $1,010 $1,020 $1,030 $1,040 $1,050 $1,060 $1,070 $1,080 $1,090 $1,100 At December 31 , 2025 , total CRE loans increased $ 23 . 3 million, or 2 . 2 % , to $ 1 . 1 billion from December 31 , 2024 . ($ in millions)
COMMERCIAL REAL ESTATE LOANS (CRE) (1) 13 ($ in thousands) (1) As of December 31, 2025 (2) The total RBC ratio is based on Westfield Bank’s capital and due to loan classifications, the percentage of total RBC ma y d iffer from the Call Report. At December 31 , 2025 , the commercial real estate portfolio totaled $ 1 . 1 billion and represented 50 . 4 % of total loans . Of the $ 1 . 1 billion, $ 900 . 5 million, or 81 . 9 % , were categorized as non - owner occupied commercial real estate and $ 198 . 6 million, or 18 . 1 % , were categorized as owner occupied commercial real estate . Property Type Non - Owner Occupied Owner Occupied Total % of CRE Portfolio % of Total Loans % of Total Bank Risk - Based Capital (RBC) (2) Office $174,196 $20,961 $195,157 17.8% 8.9% 70.5% Apartment 174,330 - 174,330 15.9% 8.0% 62.9% Industrial 124,601 44,382 168,983 15.4% 7.7% 61.0% Retail 110,356 5,102 115,458 10.5% 5.3% 41.7% Mixed Use 75,593 5,741 81,334 7.4% 3.7% 29.4% Other 45,445 25,376 70,821 6.4% 3.3% 25.5% Self Storage 46,106 67 46,173 4.2% 2.1% 16.7% Hotel/Hospitality 41,582 - 41,582 3.8% 1.9% 15.0% Shopping Center 28,854 6,292 35,146 3.2% 1.6% 12.7% Warehouse 23,560 10,339 33,899 3.1% 1.6% 12.2% Automotive Sales 697 33,822 34,519 3.1% 1.6% 12.4% Auto Service and Repair 6,153 21,783 27,936 2.5% 1.3% 10.1% Adult Care/Assisted Living 17,057 9,726 26,783 2.4% 1.2% 9.7% School/Higher Education 10,420 14,959 25,379 2.3% 1.2% 9.2% Student Housing 21,563 - 21,563 2.0% 1.0% 7.8% Total commercial real estate loans $900,513 $198,550 $1,099,063 100.00% 50.4% 396.8% % of Total Bank Risk - Based Capital 325.1% 71.7% % of Total CRE Loans 81.9% 18.1%
COMMERCIAL REAL ESTATE – NON - OWNER OCCUPIED (1) 14 At December 31 , 2025 , the non - owner occupied CRE portfolio totaled $ 900 . 5 million, or 325 . 1 % of total RBC . Of the $ 900 . 5 million, $ 485 . 7 million, or 53 . 9 % of non - owner occupied CRE, was concentrated in Massachusetts and $ 271 . 2 million, or 30 . 1 % of non - owner occupied CRE, was concentrated in Connecticut . At December 31 , 2025 , the non - owner occupied office portfolio totaled $ 174 . 2 million, or 62 . 9 % of total RBC with a weighted average LTV of 62 . 6 % . The non - owner occupied apartment portfolio totaled $ 174 . 3 million, or 62 . 9 % of total RBC with a weighted average LTV of 52 . 2 % . ($ in thousands) (1) As of December 31, 2025 (2) The total RBC ratio is based on Westfield Bank’s capital and due to loan classifications, the percentage of total RBC may dif fer from the Call Report. (3) Weighted average LTV is based on the original appraisal and the current loan balance. Property Type MA CT NH RI ME Other Total % of Total Weighted Average Loan to Value RBC (2) (LTV) (3) Apartment $107,299 $43,612 $ - $23,419 $ - $ - $174,330 62.9% 52.2% Office 63,973 60,433 38,586 - 11,204 - 174,196 62.9% 62.6% Industrial 74,031 34,887 - 11,229 - 4,454 124,601 45.0% 56.4% Retail 53,291 25,964 13,865 6,070 11,166 - 110,356 39.8% 50.8% Mixed Use 35,641 22,503 - 12,809 - 4,640 75,593 27.3% 55.7% Self Storage 36,155 9,180 771 - - - 46,106 16.6% 55.4% Other 40,666 3,984 677 - 118 - 45,445 16.4% 51.5% Hotel/Hospitality 20,074 21,508 - - - - 41,582 15.0% 51.1% Shopping Center 9,227 19,627 - - - - 28,854 10.4% 48.4% Warehouse 17,034 4,889 - - - 1,637 23,560 8.5% 41.4% Student Housing 3,628 14,934 2,660 - 341 21,563 7.8% 60.7% Adult Care/Assisted Living 8,543 8,514 - - - - 17,057 6.2% 58.6% School/Higher Education 10,420 - - - - - 10,420 3.8% 43.3% Automotive Service and Repair 4,982 1,171 - - - - 6,153 2.2% 65.8% Automotive Sales 697 - - - - - 697 0.3% 57.0% Total non - owner occupied $485,661 $271,206 $56,559 $53,527 $22,488 $11,072 $900,513 325.1% 54.9% commercial real estate
COMMERCIAL REAL ESTATE – OFFICE BUILDINGS (1) 15 ($ in thousands) (1) As of December 31, 2025. (2) The total RBC ratio is based on Westfield Bank’s capital and due to loan classifications, the percentage of total RBC may dif fer from the Call Report. Non - Owner Occupied Owner Occupied Total % of Office Portfolio % of Total Bank RBC (2) By Collateral Type Office/Medical $ 108,113 $ 9,941 $ 118,054 60.5% 42.6% Office/Professional Metro 3,577 7,796 11,373 5.8% 4.1% Office/Professional Suburban 35,686 3,011 38,697 19.8% 14.0% Office/Professional Urban 26,820 213 27,033 13.9% 9.8% Total Office Portfolio $ 174,196 $ 20,961 $ 195,157 100.0% 70.5% Percent of RBC 62.9% 7.6% Non - Owner Occupied Owner Occupied Total % of Office Portfolio % of Total Bank RBC (2) By State Massachusetts $ 63,973 $ 18,550 $ 82,523 42.3% 29.8% Connecticut 60,433 2,411 62,844 32.2% 22.7% New Hampshire 38,586 - 38,586 19.8% 14.0% Other 11,204 - 11,204 5.7% 4.0% Total Office Portfolio $ 174,196 $ 20,961 $ 195,157 100.0% 70.5% Non - Owner Occupied Owner Occupied Total % of Office Portfolio % of Total Bank RBC (2) By Risk Rating Pass $ 166,275 $ 20,683 $ 186,958 95.8% 67.5% Special Mention 72 - 72 - - % Substandard 7,849 278 8,127 4.2% 3.0% Total Office Portfolio $ 174,196 $ 20,961 $ 195,157 100.0% 70.5% • As of December 31 , 2025 , the office portfolio totaled $ 195 . 2 million, or 70 . 5 % of total RBC, and represented 17 . 8 % of total CRE loans . • Non - owner occupied office totaled $ 174 . 2 million, or 62 . 9 % of total RBC, and owner - occupied office totaled $ 21 . 0 million, or 7 . 6 % of total RBC . • Office exposure is concentrated in medical - office, totaling $ 118 . 1 million, or 60 . 5 % of the total office portfolio . • Of the $ 195 . 2 million in total office, 42 . 3 % is concentrated in Massachusetts and 32 . 2 % is concentrated in Connecticut . The Company does not have any exposure in greater Boston or New York . • Of the $ 195 . 2 million in total office, 95 . 8 % of the office portfolio is in the pass - rated category .
RESIDENTIAL REAL ESTATE LOANS (1) 16 $776 $784 $805 $828 $857 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $720 $740 $760 $780 $800 $820 $840 $860 $880 At December 31 , 2025 , residential real estate loans, including home equity loans, increased $ 81 . 2 million, or 10 . 5 % , from $ 775 . 7 million at December 31 , 2024 to $ 856 . 9 million . At December 31 , 2025 , the Company serviced $ 77 . 1 million in loans sold to the secondary market, with servicing retained, which are not included on the Company’s balance sheet under residential real estate loans . ($ in millions) (1) Residential real estate loans includes home equity loans.
INVESTMENT PORTFOLIO 17 The held - to - maturity (“HTM”) and available - for - sale (“AFS”) securities portfolio totaled $ 364 . 6 million and represented 13 . 3 % of total assets at December 31 , 2025 and $ 365 . 7 million, or 13 . 8 % of total assets, at December 31 , 2024 . The HTM unrealized losses, net of tax, were approximately $ 22 . 0 million, or 11 . 7 % , of the total HTM amortized cost basis . If the HTM losses, net of tax, were included in capital, the losses would represent 8 . 6 % of Tier 1 capital and negatively impact tangible common equity (“TCE”), a non - GAAP financial measure, by 0 . 8 % . The AFS unrealized losses, net of tax, were approximately $ 16 . 7 million, or 8 . 4 % of the total AFS amortized cost basis . As a percentage of Tier 1 capital, the AFS unrealized losses, net of tax, represented 6 . 5 % of Tier 1 capital and negatively impacted TCE, a non - GAAP financial measure, by 0 . 6 % . (1) Tier 1 Capital represents Westfield Bank’s Tier 1 Capital as of December 31, 2025 (2) Impact to TCE is net of tax. TCE is a non - GAAP measure. See slides 32 - 34 for the related TCE calculation and a reconciliation o f GAAP to non - GAAP financial measures. The table below displays the investment portfolio as of December 31 , 2025 : (Dollars in millions) Amortized Cost Basis % of Investment Portfolio’s Amortized Cost Basis Fair Value Unrealized Loss, Net of Tax Net of Tax Loss as a % of Amortized Cost Basis Net of Tax Loss as a % of Tier 1 Capital (1) Impact to TCE (Non - GAAP) (2) HTM $188.8 48.8% $158.5 ($22.0) (11.7%) 8.6% (0.8%) AFS $198.2 51.2% $175.8 ($16.7) (8.4%) 6.5% (0.6%) Total Investments $387.0 100.0% $334.3 ($38.7) (10.0%) 15.1% (1.4%)
TOTAL DEPOSITS 18 ($ in millions) (1) As of December 31, 2025 Time Deposits 29% Money Market 30% Demand (Non - interest bearing) 25% Savings 8% Interest - bearing 8% Total Deposits $2.4 Billion HIGHLIGHTS • Average cost of total deposits decreased 4 basis points from 1.77% at September 30, 2025 to 1.73% at December 31, 2025; • Period - end deposits increased $98.3 million, or 4.3%, from December 31, 2024, driven by an increase in core deposits; • Core deposits increased $111.9 million, or 7.2%, from $1.6 billion, or 68.9% of total deposits at December 31, 2024, to $1.7 billion, or 70.8% of total deposits, at December 31, 2025; • Non - interest bearing deposits were 25.2% of total deposits at December 31, 2025; • No brokered deposits at December 31, 2025; • Loan to deposit ratio was 92.5% at December 31, 2025. Average Cost of Interest - Bearing Deposits Average Cost of Deposits for the Quarter - ended December 31, 2025 Money market 2.13% Savings 0.09% Interest - bearing checking 0.90% Time deposits 3.46% Total average cost of deposits 1.73% (1)
TOTAL DEPOSITS 19 $1,559 $1,629 $1,640 $1,657 $1,671 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $1,500 $1,520 $1,540 $1,560 $1,580 $1,600 $1,620 $1,640 $1,660 $1,680 PERIOD - END CORE DEPOSITS At December 31 , 2025 , total deposits of $ 2 . 4 billion increased $ 98 . 3 million, or 4 . 3 % , from December 31 , 2024 . Core deposits, which the Company defines as all deposits except time deposits, increased $ 111 . 9 million, or 7 . 2 % , from $ 1 . 6 billion, or 68 . 9 % of total deposits, at December 31 , 2024 , to $ 1 . 7 billion, or 70 . 8 % of total deposits, at December 31 , 2025 . Time deposits decreased $ 13 . 7 million, or 1 . 9 % , from $ 703 . 6 million at December 31 , 2024 to $ 689 . 9 million at December 31 , 2025 . At December 31 , 2025 , the Bank’s uninsured deposits totaled $ 697 . 6 million, or 29 . 5 % of total deposits, compared to $ 643 . 6 million, or 28 . 4 % of total deposits, at December 31 , 2024 . $704 $699 $690 $693 $690 4Q2024 (1) 1Q2025 (1) 2Q2025 3Q2025 4Q2025 $680 $685 $690 $695 $700 $705 $710 PERIOD - END TIME DEPOSITS ($ in millions) (1) Includes $1.7 million in brokered time deposits.
AVERAGE TOTAL DEPOSITS 20 $1,684 $1,732 $1,732 $1,744 $1,761 $579 $570 $573 $582 $596 2.01% 2.00% 1.82% 1.77% 1.73% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $500 $700 $900 $1,100 $1,300 $1,500 $1,700 $1,900 $2,100 $2,300 $2,500 AVERAGE DEPOSITS AND RATES Interest-bearing deposits Non-interest-bearing deposits Average deposit cost Total average deposits, consisting of interest - bearing and non - interest bearing deposits, increased $ 31 . 4 million, or 1 . 4 % , from the three months ended September 30 , 2025 , to $ 2 . 4 billion for the three months ended December 31 , 2025 . The average cost of deposits decreased four basis points, from 1 . 77 % for the three months ended September 30 , 2025 to 1 . 73 % for the three months ended December 31 , 2025 . ($ in millions)
AVERAGE CORE AND TIME DEPOSITS 21 $1,562 $1,599 $1,614 $1,633 $1,671 0.98% 1.08% 1.01% 1.04% 1.02% 0.92% 0.94% 0.96% 0.98% 1.00% 1.02% 1.04% 1.06% 1.08% 1.10% $1,300 $1,350 $1,400 $1,450 $1,500 $1,550 $1,600 $1,650 $1,700 AVERAGE CORE DEPOSITS AND RATES During the three months ended December 31 , 2025 , average core deposits of $ 1 . 7 billion, including non - interest bearing deposits, increased $ 37 . 2 million, or 2 . 3 % , from the three months ended September 30 , 2025 . During the three months ended December 31 , 2025 , average time deposits of $ 687 . 0 million decreased $ 5 . 8 million, or 0 . 8 % , from the three months ended September 30 , 2025 . The average cost of time deposits decreased five basis points to 3 . 46 % during the same period . As of December 31 , 2025 , there was $ 678 . 4 million in time deposits scheduled to mature by December 31 , 2026 , with a weighted average rate of 3 . 48 % . ($ in millions) $700 $703 $691 $693 $687 4.31% 4.11% 3.69% 3.51% 3.46% 0.25% 0.75% 1.25% 1.75% 2.25% 2.75% 3.25% 3.75% 4.25% 4.75% $500 $600 $700 $800 AVERAGE TIME DEPOSITS AND RATES
LOAN - TO - DEPOSIT RATIO 22 91.5% 89.3% 89.8% 90.7% 92.5% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 87% 88% 89% 90% 91% 92% 93% PERIOD - END LOAN - TO - DEPOSIT RATIO 68.9% 70.0% 70.4% 70.5% 70.8% 31.1% 30.0% 29.6% 29.5% 29.2% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 0% 10% 20% 30% 40% 50% 60% 70% 80% CORE DEPOSITS AND TIME DEPOSITS AS A % OF TOTAL DEPOSITS Core deposits/Total deposits Time deposits/Total deposits
WHOLESALE FUNDING 23 $123 $122 $122 $121 $106 5.04% 5.04% 5.04% 5.03% 4.96% 4.80% 4.85% 4.90% 4.95% 5.00% 5.05% 5.10% 5.15% 5.20% 5.25% 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 $25 $45 $65 $85 $105 $125 $145 $165 WHOLESALE FUNDING (Includes $20 million in Subordinated Debt) (1) Wholesale Funding Average Cost of Funds The Bank is considered to be well - capitalized as defined by regulators (see slide 29 ) . The Bank’s Tier 1 Leverage Ratio to adjusted average assets was 9 . 32 % at December 31 , 2025 and 9 . 34 % at December 31 , 2024 . In addition, Westfield Bank’s TCE Ratio ( 2 ) of 8 . 71 % , a non - GAAP financial measure, exceeds the Federal Home Loan Bank of Boston (“FHLB”) requirements to continue to utilize the FHLB as a funding source . At December 31 , 2025 , total borrowings decreased $ 17 . 1 million, or 13 . 9 % , from $ 123 . 1 million at December 31 , 2024 to $ 106 . 1 million . At December 31 , 2025 , short - term borrowings increased $ 7 . 9 million to $ 13 . 3 million, compared to $ 5 . 4 million at December 31 , 2024 . Long - term borrowings decreased $ 25 . 0 million to $ 73 . 0 million at December 31 , 2025 , from $ 98 . 0 million at December 31 , 2024 . At December 31 , 2025 and December 31 , 2024 , borrowings also consisted of $ 19 . 8 million in fixed - to - floating rate subordinated notes . (1) ($ in millions) (2) TCE is a non - GAAP measure. See slides 32 - 34 for the related TCE calculation and a reconciliation of GAAP to non - GAAP financial measures.
24 The Company’s liquidity position remains strong with solid core deposit relationships, cash, unencumbered securities and access to diversified borrowing sources . At December 31 , 2025 , the Company had available borrowing capacity with the FHLB of $ 538 . 6 million, including its overnight Ideal Way Line of Credit . In addition, at December 31 , 2025 ; the Company had available borrowing capacity of $ 349 . 0 million from the Federal Reserve Discount Window, with no outstanding borrowings . At December 31 , 2025 ; the Company also had available borrowing capacity of $ 25 . 0 million from two unsecured credit lines with correspondent banks, with no outstanding borrowings . At December 31 , 2025 ; the Company had $ 1 . 1 billion in immediately available liquidity, compared to $ 697 . 6 million in uninsured deposits, or 29 . 5 % of total deposits, representing a coverage ratio of 161 % . Lastly, the Company has access to the brokered deposit market with approval from the Board of Directors to purchase brokered deposits in an amount not to exceed 10 % of total assets . LIQUIDITY ($ in millions) Total Available Amount in Use at December 31, 2025; Net Available Internal Sources: Cash and cash equivalents $40.4 - $40.4 Unpledged securities $170.4 - $170.4 Excess pledged securities $1.3 - $1.3 External Sources: FHLB $622.0 $83.4 $538.6 FRB Discount Window $349.0 - $349.0 Other Unsecured: Correspondent banks $25.0 - $25.0 Total Liquidity $1,208.1 $83.4 $1,124.7 Uninsured deposits $697.6 Liquidity/Total 161%
________ Source: SNL Financial as of June 30, 2025 Note: Total number of Westfield Bank branches shown includes the Big E seasonal branch and online deposit channel. Three Wes tfi eld branches are located in Hampshire County, MA and four Westfield branches are located in Hartford County, CT outside of Springfield MSA. DEPOSIT MARKET SHARE IN HAMPDEN COUNTY, MA AS OF JUNE 30, 2025 25 Total Deposit Rank 2025 Parent Company Name Deposits in Market ($000) Market Share # of Branches 1 PeoplesBank 2,418,846 17.13% 11 1,762,519 13.1% 20 3 Westfield Bank 1,912,916 13.54% 20 2 TD Bank 2,266,902 16.05% 14 4 Bank of America 1,572,220 11.13% 8 5 Berkshire Bank 1,151,420 8.15% 11 6 M&T Bank 1,060,594 7.51% 14 7 KeyBank 1,010,477 7.15% 7 8 Citizens Bank 632,427 4.48% 10 9 Monson Savings Bank 599,110 4.24% 4 10 Country Bank 565,595 4.00% 4 11 New Valley Bank & Trust 277,552 1.97% 3
ASSET QUALITY INDICATORS 26 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 Total delinquent loans $5.0M $4.5M $3.9M $4.5M $3.1M Delinquent loans as a % of total loans 0.24% 0.22% 0.18% 0.21% 0.14% Nonaccrual loans $5.4M $6.0M $5.8M $5.6M $5.2M Nonaccrual loans as a % of total loans 0.26% 0.29% 0.27% 0.27% 0.24% Nonaccrual loans as a % of total assets 0.20% 0.22% 0.21% 0.21% 0.19% Allowance for credit losses % of total loans 0.94% 0.95% 0.94% 0.96% 0.93% Allowance for credit losses % of nonperforming loans 363% 327% 343% 364% 393% Net (recoveries) charge - offs ($128K) $29K ($585K) $43K $41K Net (recoveries) charge - offs as a % average loans (0.01%) 0.00% (0.03%) 0.00% 0.00% At December 31 , 2025 , total delinquent loans totaled $ 3 . 1 million, or 0 . 14 % of total loans, compared to $ 5 . 0 million, or 0 . 24 % of total loans, at December 31 , 2024 . Of the $ 3 . 1 million in delinquent loans, $ 2 . 8 million, or 88 . 7 % , represent residential real estate loans, which includes home equity loans . Of the $ 2 . 8 million in delinquent residential real estate loans, $ 1 . 0 million, or 37 . 5 % , are 90 days or greater past due .
ASSET QUALITY 27 Management continues to remain attentive to any signs of deterioration in borrowers’ financial conditions and is proactive in taking the appropriate steps to mitigate risk . The allowance for credit losses as a percentage of total loans was 0 . 93 % at December 31 , 2025 and 0 . 94 % at December 31 , 2024 . At December 31 , 2025 , the allowance for credit losses as a percentage of nonaccrual loans was 393 . 2 % , compared to 362 . 9 % at December 31 , 2024 . December 31, 2025 December 31, 2024 Allowance for Credit Losses (ACL) (1) Loans Outstanding (1) ACL/ Total Loan Segment Allowance for Credit Losses (ACL) (1) Loans Outstanding (1) ACL/ Total Loan Segment Commercial and industrial $ 2,245 $ 221,790 1.01% $ 2,477 $ 211,656 1.17% Commercial real estate 13,718 1,099,063 1.25% 13,677 1,075,732 1.27% Residential (2) 4,186 856,871 0.49% 3,156 775,659 0.41% Consumer 148 2,929 5.05% 219 4,391 4.99% Unallocated - - - - - - Total Loans $ 20,297 $ 2,180,653 0.93% $ 19,529 $ 2,067,438 0.94% (1) ( $ in thousands) (2) Includes home equity loans and home equity lines of credit .
ASSET QUALITY 28 ($ in millions) 4Q2024 1Q2025 2Q2025 3Q2025 4Q2025 Special Mention $11.4 $10.7 $1.5 $13.0 $17.2 % of Total Loans 0.6% 0.5% 0.1% 0.6% 0.8% Substandard $27.0 $25.6 $24.6 $27.0 $22.5 % of Total Loans 1.3% 1.2% 1.2% 1.3% 1.0% Total Criticized Loans $38.4 $36.3 $26.1 $40.0 $39.7 % of Total Loans 1.9% 1.7% 1.2% 1.9% 1.8% At December 31 , 2025 , total criticized loans, defined as special mention and substandard loans, totaled $ 39 . 7 million, or 1 . 8 % of total loans, compared to $ 38 . 4 million, or 1 . 9 % , at December 31 , 2024 .
CAPITAL MANAGEMENT 29 We are well - capitalized with excess capital. Consolidated December 31, 2025 December 31, 2024 Tier 1 Leverage Ratio (to Adjusted Average Assets) 9.13% 9.14% Common Equity Tier 1 Capital (to Risk Weighted Assets) 12.21% 12.37% Tier 1 Capital (to Risk Weighted Assets) 12.21% 12.37% Total Capital (to Risk Weighted Assets) 14.19% 14.38% At December 31 , 2025 , the Bank’s Tier 1 Leverage Ratio was 9 . 32 % . The Bank’s TCE ratio ( 1 ) , a non - GAAP financial measure, was 8 . 71 % at December 31 , 2025 . At December 31 , 2025 , available - for - sale unrealized losses of $ 16 . 7 million, net of tax, negatively impacted the TCE ratio by 0 . 6 % . If the held - to - maturity unrealized losses of $ 22 . 0 million, net of tax, were factored in, the TCE ratio would decrease to 7 . 91 % . Westfield Bank December 31, 2025 December 31, 2024 Well Capitalized Tier 1 Leverage Ratio (to Adjusted Average Assets) 9.32% 9.34% 5.0% Common Equity Tier 1 Capital (to Risk Weighted Assets) 12.46% 12.64% 6.5% Tier 1 Capital (to Risk Weighted Assets) 12.46% 12.64% 8.0% Total Capital (to Risk Weighted Assets) 13.48% 13.65% 10.0% (1) TCE is a non - GAAP measure. See slides 32 - 34 for the related TCE calculation and a reconciliation of GAAP to non - GAAP financial measures. x From a regulatory standpoint, we are well - capitalized with excess capital . x We take a prudent approach to capital management .
CAPITAL RETURN TO SHAREHOLDERS 30 Year # of Shares 2021 2,758,051 2022 720,975 2023 649,744 2024 934,282 1Q - 2025 206,709 2Q - 2025 290,609 3Q - 2025 2,535 4Q - 2025 100,000 Year Annual Dividends per Share 2021 $0.20 2022 $0.24 2023 $0.28 2024 $0.28 1Q - 2025 $0.07 2Q - 2025 $0.07 3Q - 2025 $0.07 4Q - 2025 $0.07 SHARE REPURCHASES DIVIDENDS PAID ON COMMON STOCK On April 22 , 2025 , the Board of Directors authorized the 2025 Plan, pursuant to which the Company may repurchase up to 1 . 0 million shares of its common stock, or approximately 4 . 8 % , of the Company’s then - outstanding shares of common stock, upon the completion of the 2024 Repurchase Plan (“ 2024 Plan”) . On June 3 , 2025 , the Company announced the completion of its 2024 Plan under which the Company repurchased a total of 1 . 0 million shares at an average price per share of $ 8 . 79 . During the three months ended December 31 , 2025 , the Company repurchased 100 , 000 shares of its common stock at an average price per share of $ 11 . 80 . During the twelve months ended December 31 , 2025 , the Company repurchased 599 , 853 shares of its common stock under the 2025 Plan and the 2024 Plan, as applicable, at an average price per share of $ 9 . 73 . As of December 31 , 2025 , there were 872 , 465 shares of common stock available for repurchase under the 2025 Plan .
CAPITAL MANAGEMENT 31 $11.30 $11.44 $11.68 $11.89 [VALUE] $10.63 $10.78 $11.01 $11.22 [VALUE] BOOK VALUE PER SHARE TANGIBLE BOOK VALUE PER SHARE (non - GAAP ) (1) Book Value Tangible Book Value (non-GAAP) The Company’s book value per share was $12.16 at December 31, 2025, compared to $11.30 at December 31, 2024, while tangible book value per share, a non - GAAP financial measure, increased $0.86, or 8.1%, from $10.63 at December 31, 2024 to $11.49 at December 31, 2025. (1) Tangible book value is a non - GAAP measure. See slides 32 - 34 for the related tangible book value calculation and a reconcili ation of GAAP to non - GAAP financial measures.
APPENDIX: NON - GAAP TO GAAP RECONCILIATION 32 Reconciliation of Non - GAAP to GAAP Financial Measures The Company believes that certain non - GAAP financial measures provide information to investors that is useful in understanding its results of operations and financial condition. Because not all companies use the same calculation, this presentation may not be comparable to other simil arly titled measures calculated by other companies. A reconciliation of these non - GAAP financial measures is provided below. 12/31/2025 9/30/2025 6/30/2025 3/31/2025 12/31/2024 Loan interest (no tax adjustment) 27,491$ 26,690$ 26,214$ 24,984$ 25,183$ Tax-equivalent adjustment 125 120 121 121 128 Loan interest (tax-equivalent basis) 27,616$ 26,810$ 26,335$ 25,105$ 25,311$ Loan interest (tax-equivalent basis) 27,616$ 26,810$ 26,335$ 25,105$ 25,311$ Less: Prepayment penalties - 34 425 - - Adjusted loan income, excluding prepayment penalties (tax- equivalent basis) (non-GAAP) 27,616$ 26,776$ 25,910$ 25,105$ 25,311$ Average loans 2,166,804$ 2,112,394$ 2,081,319$ 2,073,486$ 2,062,822$ Average loan yield (no tax adjustment) 5.03% 5.01% 5.05% 4.89% 4.86% Average loan yield (no tax adjustment), excluding prepayment penalties (non-GAAP) 5.03% 5.01% 4.97% 4.89% 4.86% Average loan yield (tax-equivalent basis) 5.06% 5.04% 5.08% 4.91% 4.88% Average loan yield (tax equivalent basis), excluding prepayment penalties (non-GAAP) 5.06% 5.03% 4.99% 4.91% 4.88% For the quarter ended (Dollars in thousands)
APPENDIX: NON - GAAP TO GAAP RECONCILIATION 33 12/31/2025 9/30/2025 6/30/2025 3/31/2025 12/31/2024 Net interest income (no tax adjustment) 18,829$ 18,092$ 17,642$ 15,534$ 15,273$ Tax equivalent adjustment 125 120 121 121 128 Net interest income (tax-equivalent basis) 18,954$ 18,212$ 17,763$ 15,655$ 15,401$ Net interest income (no tax adjustment) 18,829$ 18,092$ 17,642$ 15,534$ 15,273$ Less: Prepayment penalties - 34 425 - - Income from fair value hedge - - - - 74 Adjusted net interest income (non-GAAP) 18,829$ 18,058$ 17,217$ 15,534$ 15,199$ Average interest-earning assets 2,584,310$ 2,553,849$ 2,530,077$ 2,529,715$ 2,517,017$ Net interest margin (no tax adjustment) 2.89% 2.81% 2.80% 2.49% 2.41% Net interest margin (tax-equivalent) 2.91% 2.83% 2.82% 2.51% 2.43% Adjusted net interest margin, excluding prepayment penalties and income from fair value hedge (no tax adjustment) (non-GAAP) 2.89% 2.81% 2.73% 2.49% 2.40% Book Value per Share (GAAP) 12.16$ 11.89$ 11.68$ 11.44$ 11.30$ Non-GAAP adjustments: Goodwill (0.61) (0.61) (0.61) (0.60) (0.60) Core deposit intangible (0.06) (0.06) (0.06) (0.06) (0.07) Tangible Book Value per Share (non-GAAP) 11.49$ 11.22$ 11.01$ 10.78$ 10.63$ For the quarter ended (Dollars in thousands)
APPENDIX: NON - GAAP TO GAAP RECONCILIATION 34 12/31/2025 9/30/2025 6/30/2025 3/31/2025 12/31/2024 Total Bank Equity (GAAP) 252,553$ 248,575$ 244,460$ 242,981$ 240,994$ Non-GAAP adjustments: Goodwill (12,487) (12,487) (12,487) (12,487) (12,487) Core deposit intangible net of associated deferred tax (764) (831) (899) (966) (1,033) Tangible Capital (non-GAAP) 239,302$ 235,257$ 231,074$ 229,528$ 227,474$ Tangible Capital (non-GAAP) 239,302$ 235,257$ 231,074$ 229,528$ 227,474$ Unrealized losses on HTM securities net of tax (22,019) (23,154) (25,702) (25,698) (28,346) Adjusted Tangible Capital For Impact of Unrealized Losses on HTM Securities Net of Tax (non-GAAP) 217,283$ 212,103$ 205,372$ 203,830$ 199,128$ Common Equity Tier (CET) 1 Capital 256,019$ 253,044$ 250,888$ 250,217$ 250,748$ Total Assets for Leverage Ratio (non-GAAP) 2,746,949$ 2,721,892$ 2,699,710$ 2,701,212$ 2,684,740$ Tier 1 Leverage Ratio 9.32% 9.30% 9.29% 9.26% 9.34% Tangible Common Equity (non-GAAP) =Tangible Capital (non- GAAP)/Total Assets for Leverage Ratio (non-GAAP) 8.71% 8.64% 8.56% 8.50% 8.47% Adjusted Tangible Common Equity for HTM Impact (non- GAAP) = Adjusted Tangible Capital For Impact of Unrealized Losses on HTM Securities Net of Tax (non-GAAP)/Total Assets for Leverage Ratio (non-GAAP) 7.91% 7.79% 7.61% 7.55% 7.42% For the quarter ended (Dollars in thousands)
WESTFIELD BANK “WHAT BETTER BANKING’S ALL ABOUT” James C. Hagan , President and Chief Executive Officer Guida R. Sajdak , Executive Vice President and Chief Financial Officer Meghan Hibner , First Vice President and Investor Relations Officer 35 141 Elm Street, Westfield, MA