Muncy Columbia Financial Corporation

11/07/2025 | Press release | Distributed by Public on 11/07/2025 09:59

Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

- Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations, or MD&A, represents an overview of the financial condition and results of operations of the Corporation and should be read in conjunction with the more detailed and comprehensive disclosures included in the Annual Report on Form 10-K for the year ended December 31, 2024. In addition, please read this section in conjunction with the unaudited consolidated financial statements and notes to the unaudited consolidated financial statements contained in Item 1, "Financial Statements" of Part I to this Quarterly Report on Form 10-Q.

The Corporation is in the business of providing customary retail, commercial banking and financial services to individuals, businesses and local governments through its 22 branch offices operated by Journey Bank, the Corporation's wholly-owned subsidiary. The Corporation's 22 branch offices are operated in Clinton, Columbia, Lycoming, Montour and Northumberland counties in Northcentral Pennsylvania.

CAUTIONARY STATEMENT

Certain statements in this section and elsewhere in this Quarterly Report on Form 10-Q, other periodic reports filed by us under the Securities Exchange Act of 1934, as amended, and any other written or oral statements made by or on behalf of us may include "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 which reflect our current views with respect to future events and financial performance. Such forward looking statements are based on general assumptions and are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from the views, beliefs and projections expressed in such statements. These risks, uncertainties and other factors include, but are not limited to:

• Our business and financial results are affected by business and economic conditions, both generally and specifically in the mostly Northcentral Pennsylvania market in which we operate.
• Changes in interest rates and valuations in the debt, equity and other financial markets.
• Disruptions in the liquidity and other functioning of financial markets, including such disruptions in the market for real estate and other assets commonly securing financial products.
• Actions by the Federal Reserve Board and other government agencies, including those that impact money supply and market interest rates.
• Changes in our customers' and suppliers' performance in general and their creditworthiness in particular.
• Changes in customer preferences and behavior, whether as a result of changing business and economic conditions or other factors.
• A continuation of recent turbulence in significant segments of the United States and global financial markets, particularly if it worsens, could impact our performance, both directly by affecting our revenues and the value of our assets and liabilities and indirectly by affecting our customers and suppliers and the economy generally.
• Our business and financial performance could be impacted as the financial industry restructures in the current environment by changes in the competitive landscape.
• Given current economic and financial market conditions, our forward-looking statements are subject to the risk that these conditions will be substantially different than we are currently expecting.
• Legal, regulatory and governmental developments could have an impact on our ability to operate our businesses or our financial condition or results of operations or our competitive position or reputation. Reputational impacts, in turn, could affect matters such as business generation and retention, our ability to attract and retain management, liquidity and funding. These legal and regulatory developments could include: (a) the unfavorable resolution of legal proceedings or regulatory and other governmental inquiries; (b) increased litigation risk from recent regulatory and other governmental developments; (c) the results of the regulatory examination process, and regulators' future use of supervisory and enforcement tools; (d) legislative and regulatory reforms, including changes to laws and regulations involving tax, pension, education and mortgage lending, the protection of confidential customer information, and other aspects of the financial institution industry; (e) the potential impact of new broad-based tariffs which may cause economic uncertainty and in turn influence profitability and asset quality; (f) the current U.S. government shutdown and Commonwealth of Pennsylvania budget impasse; and (g) changes in accounting policies and principles.
• Our business and operating results are affected by our ability to identify and effectively manage risks inherent in our businesses, including, where appropriate, through the effective use of third-party insurance and capital management techniques.
• Our ability to anticipate and respond to technological changes can have an impact on our ability to respond to customer needs and to meet competitive demands.
• Our ability to implement our business initiatives and strategies could affect our financial performance over the next several years.
• Competition can have an impact on customer acquisition, growth and retention, as well as on our credit spreads and product pricing, which can affect market share, deposits and revenues.
• Our business and operating results can also be affected by widespread natural disasters, terrorist activities or international hostilities, either as a result of the impact on the economy and capital and other financial markets generally or on us or on our customers and suppliers.

The words "believe," "expect," "anticipate," "project" and similar expressions signify forward looking statements. Readers are cautioned not to place undue reliance on any forward looking statements made by or on behalf of us. Any such statement speaks only as of the date the statement was made. We undertake no obligation to update or revise any forward looking statements.

The following discussion and analysis should be read in conjunction with the detailed information and consolidated financial statements, including notes thereto, included elsewhere in this report. Our consolidated financial condition and results of operations are essentially those of our subsidiary, Journey Bank. Therefore, the analysis that follows is directed to the performance of the Bank.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The Corporation's financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") and conform to general practices within the banking industry. In the preparation of its financial statements, the Corporation is required to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as the disclosure of contingent assets and liabilities. Actual results could differ from those estimates. The Corporation's critical accounting policies are fundamental to understanding this MD&A and are more fully described in Note 1 ("Summary of Significant Accounting Policies") within the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024.

The Corporation defines its critical accounting policies in accordance with U.S. GAAP. U.S. GAAP requires the Corporation to make subjective estimates and judgments about matters that are uncertain and are likely to have a material impact on its financial condition and results of operations, as well as the specific manner in which those principles are applied. Application of assumptions different than those used by the Corporation could result in material changes in the Corporation's financial position or results of operations. The Corporation believes its policies governing the determination of the allowance for credit losses, the fair value of available-for-sale debt securities and the fair values of assets acquired and liabilities assumed in business combinations are critical accounting policies. The Corporation's management has reviewed and approved these critical accounting policies and has discussed these policies with its Audit Committee. The Corporation believes the critical accounting policies used in the preparation of its financial statements that require significant estimates and judgments are as follows:

Allowance for Credit Losses (ACL) - Loans

Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 326, Financial Instruments - Credit Losses, provides guidance on the accounting for credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASC 326 requires consideration of a broad range of reasonable and supportable information to form credit loss estimates in an effort to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit. Commonly referred to as Current Expected Credit Losses ("CECL"), ASC 326 requires a financial asset (or a group of financial assets) to be measured at an amortized cost basis and presented at the net amount expected to be collected. ASC 326 affects financial assets and net investment in leases that are not accounted for at fair value through net income, including such financial assets as loans, debt securities, trade receivables, net investments in leases, off-balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash.

Management evaluates the credit quality of the Corporation's loan portfolio on an ongoing basis and performs a formal review of the adequacy of the ACL on a quarterly basis. The ACL is established through a provision for credit losses charged to earnings and is maintained at a level that management considers to be an estimate of the lifetime expected credit losses of the portfolio as of the evaluation date. Loans, or portions of loans, determined by management to be uncollectible are charged off against the ACL, while recoveries of amounts previously charged off are credited to the ACL.

Determining the amount of the ACL is considered a critical accounting estimate because it requires significant judgment and the use of estimates related to the amount and timing of expected future cash flows, estimated losses on pools of homogeneous loans based on historical loss experience and reasonable and supportable forecasts, as well as consideration of current economic trends and conditions, all of which may be susceptible to significant change. Banking regulators, as an integral part of their examination of the Corporation, also review the ACL, and may require, based on information available to them at the time of their examination, that certain loan balances be charged off or require that adjustments be made to the ACL. Additionally, the ACL is determined, in part, by the composition and size of the loan portfolio.

The ACL consists of two components, a specific component and a general component. The specific component relates to loans that are individually analyzed for impairment. For such loans, an allowance is established when the discounted cash flows, collateral value or observable market price of the loan is lower than the carrying value of that loan. The general component covers all other loans and is based on historical loss experience as adjusted for qualitative factors. The general reserve component of the ACL is based on pools of performing loans segregated by loan segment. Historical loss factors are applied based on historical losses in each risk rating category to determine the appropriate reserve related to those loans.

Although the Corporation's management uses the best information available, the level of the ACL remains an estimate which is subject to significant judgment and short-term change which could have a significant impact on the Corporation's financial condition or results of operations. From January 1, 2025 to September 30, 2025, the level of the ACL increased from $9.9 million to $10.5 million and the ACL to total loans increased from 0.88% to 0.90%. The Corporation's ACL is highly sensitive to the methods, assumptions and estimates underlying its calculation. See Note 3 "Loans and Allowance for Credit Losses" within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in Part I of this Quarterly Report on Form 10-Q for additional qualitative and quantitative information about the Corporation's ACL.

Fair Value of Available-For-Sale Debt Securities

Another material estimate is the calculation of fair values of the Corporation's debt securities. For the Corporation's debt securities, the Corporation receives estimated fair values from an independent valuation service, or from brokers. In developing fair values, the valuation service and the brokers compare securities that have similar maturities, coupon rates, and credit ratings. Estimated fair values of debt securities may vary among brokers and other valuation services.

Business Combinations

Business combinations are accounted for by applying the acquisition method. As of acquisition date, the identifiable assets acquired and liabilities assumed are measured at fair value and recognized separately from goodwill. Results of operations of the acquired entity are included in the consolidated statement of income from the date of acquisition. The calculation of intangible assets including core deposits and the fair value of loans are based on significant judgements. Core deposit intangibles are calculated using a discounted cash flow model based on various factors including discount rate, attrition rate, interest rate, cost of alternative funds and net maintenance costs. Core deposit intangibles are amortized over the expected life of each acquired cored deposit type, discounted at a long-term market oriented after-tax rate of return. Loans acquired in connection with acquisitions are recorded at their acquisition-date fair value. Determining the fair value of the acquired loans involves estimating the principal and interest cash flows expected to be collected on the loans and discounting those cash flows at a market rate of interest. Management considers a number of factors in evaluating the acquisition-date fair value including the remaining life of the acquired loans, delinquency status, estimated prepayments, payment options and other loan features, internal risk grade, estimated value of the underlying collateral and interest rate environment.

FINANCIAL CONDITION

Total assets at September 30, 2025, were $1.655 billion, an increase of $59.0 million, or 3.7% from $1.596 billion at December 31, 2024. The change in total assets primarily reflects increases in cash and cash equivalents and loans receivable, partially offset by a decrease in available-for-sale debt securities. Cash and cash equivalents increased $27.9 million and gross loans receivable increased $43.9 million. Available-for-sale debt securities decreased $5.4 million. Total liabilities at September 30, 2025, were $1.470 billion, an increase of $40.9 million, or 2.9% from $1.430 billion at December 31, 2024. Deposit balances increased by $104.5 million, short-term borrowings decreased $51.5 million and long-term borrowings decreased $15.0 million since December 31, 2024.

Total average assets increased 2.2% from $1.602 billion for the three months ended September 30, 2024, to $1.637 billion for the three months ended September 30, 2025. Average earning assets were $1.525 billion for the three months ended September 30, 2025 and $1.493 billion for the three months ended September 30, 2024. Average interest-bearing liabilities were $1.167 billion for the three months ended September 30, 2025 and $1.162 billion for the three months ended September 30, 2024.

Total average assets increased 1.6% from $1.590 billion for the nine months ended September 30, 2024, to $1.616 billion for the nine months ended September 30, 2025. Average earning assets were $1.509 billion for the nine months ended September 30, 2025 and $1.490 billion for the nine months ended September 30, 2024. Average interest-bearing liabilities were $1.155 billion for the nine months ended September 30, 2025 and $1.160 billion for the nine months ended September 30, 2024.

Cash and cash equivalents increased $27.9 million or 160.8% from $17.4 million at December 31, 2024 to $45.3 million at September 30, 2025. This increase is primarily related to increased correspondent bank balances resulting from cash flows from available-for-sale debt securities as well as strong deposit growth during the nine months ended September 30, 2025.

Gross loans receivable not held for sale increased $43.9 million or 3.9% to $1.170 billion at September 30, 2025 from $1.126 billion at December 31, 2024. This increase is related to strong loan demand during the nine months ended September 30, 2025.

Available-for-sale debt securities decreased $5.4 million to $317.8 million at September 30, 2025 from $323.2 million at December 31, 2024. The Corporation received proceeds from sales, paydowns, calls and maturities of available-for-sale debt securities of $85.5 million during the nine months ended September 30, 2025. Partially offsetting this activity were purchases of $69.6 million and an increase in fair value of available-for-sale debt securities of $9.7 million for the nine months ended September 30, 2025.

Interest-bearing deposits increased $91.8 million to $1.125 billion at September 30, 2025 from $1.033 billion at December 31, 2024. Noninterest-bearing deposits increased 4.9% from $259.7 million at December 31, 2024 to $272.4 million at September 30, 2025. The increase in total deposits during the nine months ended September 30, 2025 was a result of strong organic deposit growth in combination with a strategic initiative to reposition customer repurchase agreements, which are classified as short-term borrowings, into core deposit accounts.

Short-term borrowings decreased $51.5 million to $16.9 million at September 30, 2025 from $68.4 million at December 31, 2024. This change was primarily related to the migration of customer repurchase agreements described above as well as a paydown in short-term FHLB borrowings during the nine months ended September 30, 2025.

Long-term borrowings were $40.5 million at September 30, 2025 compared to $55.5 million at December 31, 2024. This decrease is primarily related to $15.2 million in repayments on long-term borrowings during the nine months ended September 30, 2025.

Total stockholder's equity increased by $18.1 million, or 10.9%, from $166.4 million at December 31, 2024, to $184.5 million at September 30, 2025. This increase is primarily attributable to earnings, net of cash dividends, along with a decrease in accumulated other comprehensive loss due to changes in the fair values of available-for-sale debt securities. Accumulated other comprehensive loss amounted to $6.3 million as of September 30, 2025 and $13.9 million as of December 31, 2024.

The loan-to-deposit ratio is a key measurement of liquidity. Our loan-to-deposit ratio decreased from 86.4% as of December 31, 2024 to 83.0% as of September 30, 2025 due to the asset/liability mix changes noted above, and remains within internal policy limits.

It is our opinion that the asset/liability mix and the interest rate risk associated with the balance sheet are within manageable parameters. Constant monitoring using asset/liability reports and interest rate risk scenarios are in place along with quarterly asset/liability management meetings on the committee level by the Bank's Board of Directors. Additionally, the Bank's Asset/Liability Committee meets quarterly with an investment consultant and works with independent third parties regularly to review key assumptions and other metrics used in the modeling software.

Securities

The Corporation's investment securities portfolio provides a source of liquidity needed to meet expected loan demand and interest income to increase profitability. Additionally, the investment securities portfolio is used to meet pledging requirements to secure public deposits, customer repurchase agreements and for other purposes. Debt securities are classified as either available-for-sale or held-to-maturity at the time of purchase based on management's intent. Available-for-sale securities are carried at fair value, with unrealized holding gains and losses reported as a component of stockholders' equity in accumulated other comprehensive income (loss), net of tax, while held-to-maturity securities are carried at amortized cost. At September 30, 2025 and December 31, 2024, all debt securities were classified as available-for-sale. Equity securities with readily determinable fair values are carried at fair value, with gains and losses due to fluctuations in market value included in the Consolidated Statements of Income. Securities with limited marketability and/or restrictions, such as FHLB of Pittsburgh stock, are carried at cost. Decisions to purchase or sell investment securities are based upon management's current assessment of long and short-term economic and financial conditions, including the interest rate environment and asset/liability management, liquidity and tax-planning strategies.

At September 30, 2025, the investment portfolio was comprised principally of available-for-sale debt securities including, fixed-rate, taxable and tax-exempt obligations of state and political subdivisions and fixed-rate and floating-rate securities issued by U.S. government or U.S. government-sponsored agencies, which include agencies, mortgage-backed securities and collateralized mortgage obligations, or CMOs. Additionally, the Corporation holds equity investments in the stock of certain publicly traded bank holding companies. Except for U.S. government and government-sponsored agencies, there were no securities of any individual issuer that exceeded 10.0% of stockholders' equity as of September 30, 2025.

The majority of the Corporation's debt securities are fixed-rate instruments and inherently subject to interest rate risk, as the value of fixed-rate securities fluctuates with changes in interest rates. Generally, a security's value reacts inversely with changes in interest rates. Available-for-sale securities are carried at fair value, with unrealized gains or losses reported in the accumulated other comprehensive income or loss component of stockholder's equity, net of deferred income taxes. At September 30, 2025, the Corporation reported a net unrealized loss, included in accumulated other comprehensive loss, of $6.3 million, net of deferred income taxes of $1.6 million, a decrease of $7.6 million compared to the net unrealized holding loss of $13.9 million, net of deferred income taxes of $3.7 million, at December 31, 2024. Any future changes in interest rates could result in changes in the fair value of the Corporation's securities portfolio and capital position. However, accumulated other comprehensive income and loss related to available-for-sale debt securities is excluded from regulatory capital and does not have an impact on the Corporation's regulatory capital ratios.

The following table presents the carrying value of available-for-sale debt securities, at fair value at September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024
Amortized Fair Amortized Fair
(In Thousands) Cost Value Cost Value
AVAILABLE-FOR-SALE DEBT SECURITIES:
Obligation of U.S. Government Corporations and Agencies:
Mortgage-backed $ 182,564 $ 173,389 $ 128,631 $ 113,707
Collateralized mortgage obligations 5,999 6,448 6,752 7,046
Other 54,500 53,182 123,500 119,454
Obligations of state and political subdivisions 82,479 84,593 81,680 82,762
Other debt securities 179 188 274 279
Total available-for-sale debt securities $ 325,721 $ 317,800 $ 340,837 $ 323,248
Aggregate Unrealized Loss $ (7,921 ) $ (17,589 )
Aggregate Unrealized Loss as a % of Amortized Cost (2.4% ) (5.2% )

The following table presents the weighted-average yields on available-for-sale debt securities by major category and maturity period at September 30, 2025. Yields are calculated on the basis of the amortized cost and weighted for the scheduled maturity of each security. Because mortgage-backed securities and collateralized mortgage obligations are not due at a single maturity date, they are not included in the maturity categories in the following summary.

Within One- Five- After
One Five Ten Ten
(Dollars In Thousands) Year Yield Years Yield Years Yield Years Yield Total Yield
AVAILABLE-FOR-SALE DEBT SECURITIES:
Obligation of U.S. Government Corporations and Agencies:
Other $ 23,000 1.00% $ 31,500 1.15% $ - - $ - - $ 54,500 1.09%
Obligations of state and political subdivisions 1,154 4.37% 8,656 4.00% 29,192 4.35% 43,477 4.55% 82,479 4.42%
Other debt securities - - 179 5.39% - - - - 179 5.39%
Sub-total $ 24,154 1.16% $ 40,335 2.20% $ 29,192 4.35% $ 43,477 4.55% $ 137,158 3.22%
Mortgage-backed securities 182,564 3.06%
Collateralized mortgage obligations 5,999 5.45%
Total $ 325,721 3.12%

Marketable Equity Securities

At September 30, 2025 and December 31, 2024, the Corporation held $1.4 million in equity securities recorded at fair value. The following is a summary of unrealized and realized gains and losses recognized in net income on equity securities during the three and nine months ended September 30, 2025 and 2024:

For the Three Months For the Nine Months
Ended September 30, Ended September 30,
(In Thousands) 2025 2024 2025 2024
Net gains recognized during the period on marketable equity securities $ 48 $ 163 $ 28 $ 8
Less: Net gains recognized during the period on marketable equity securities sold during the period - - - -
Unrealized gains recognized during the period on marketable equity securities still held at the reporting date $ 48 $ 163 $ 28 $ 8

See Note 2 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding Corporation's investment portfolio as of September 30, 2025.

Loans

Gross loans receivable increased 3.9% from $1.126 billion at December 31, 2024 to $1.170 billion at September 30, 2025. The percentage distribution in the loan portfolio is shown in the tables below:

September 30, 2025 December 31, 2024
(In Thousands) Amount % Amount %
Commercial and industrial $ 92,667 7.9% $ 93,445 8.3%
Commercial real estate:
Commercial mortgages 347,363 29.7% 325,882 28.9%
Student housing 48,001 4.1% 45,808 4.1%
Residential real estate 663,185 56.7% 638,952 56.7%
Consumer and other 18,641 1.6% 21,850 1.9%
Gross loans $ 1,169,857 100.0% $ 1,125,937 100.0%

Loan concentrations are considered to exist when there are amounts loaned to a number of borrowers engaged in similar activities that would cause them to be similarly impacted by economic or other conditions. Our lending activity is heavily concentrated in the geographic market areas we serve. This geographic concentration subjects our loan portfolio to the general economic conditions within the state. The risks created by this concentration have been considered by management and are monitored on an ongoing basis. As of September 30, 2025 and December 31, 2024, there were no concentrations of loans exceeding 10% of total loans other than the categories of loans disclosed in the table above. We believe our loan portfolio is diversified relative to industry concentrations across the various loan portfolio categories.

Banking regulators have established guidelines of less than 100% of tier 1 capital plus allowance for credit losses in construction lending and less than 300% of tier 1 capital plus allowance for credit losses in commercial real estate lending that management monitors as part of the risk management process. The construction concentration ratio is a percentage of the outstanding construction and land development loans to total tier 1 capital plus allowance for credit losses. The commercial real estate concentration ratio is a percentage of the outstanding balance of non-owner occupied commercial real estate, multifamily, and construction and land development loans to tier 1 capital plus allowance for credit losses. At September 30, 2025 and December 31, 2024, the Bank's exposure to commercial real estate was well below these guidelines.

As of September 30, 2025, commercial real estate loans totaled $395.4 million or 33.8% of total gross loans. Of this amount commercial mortgage loans represented $347.4 million or 29.7% of total gross loans and student housing loans represented $48.0 million or 4.1% of total gross loans. The following table presents the distribution of commercial real estate loans and related percentage of the total loan portfolio as of September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024
(In Thousands) Amount % Amount %
Commercial real estate:
Commercial mortgages:
Commercial construction $ 17,938 1.5% $ 24,664 2.2%
Multifamily 73,490 6.3% 74,463 6.6%
Owner occupied nonfarm nonresidential 113,460 9.7% 101,697 9.0%
Non-owner occupied nonfarm nonresidential 93,583 8.0% 83,882 7.4%
Other commercial 48,892 4.2% 41,176 3.7%
Student housing 48,001 4.1% 45,808 4.1%
Total commercial real estate $ 395,364 33.8% $ 371,690 33.0%

The following table presents the maturity distribution and interest rate information of the loan portfolio by major category as of September 30, 2025:

As of September 30, 2025
Fixed-Rate Loans Variable- or Adjustable-Rate Loans All Loans
1 Year 1-5 5-15 >15 1 Year 1-5 5-15 >15
(In Thousands) or Less Years Years Years Total or Less Years Years Years Total Total
Commercial and industrial $ 4,466 $ 20,998 $ 11,553 $ 208 $ 37,225 $ 15,570 $ 3,274 $ 22,610 $ 13,988 $ 55,442 $ 92,667
Commercial real estate:
Commercial mortgages 4,233 3,951 23,622 11,870 43,676 16,330 7,573 68,388 211,396 303,687 347,363
Student housing 1,996 - 2,027 - 4,023 1,673 5,312 15,427 21,566 43,978 48,001
Residential real estate 7,582 8,418 55,602 44,510 116,112 13,193 4,499 51,824 477,557 547,073 663,185
Consumer and other 1,268 5,167 2,255 312 9,002 47 724 3,216 5,652 9,639 18,641
Total $ 19,545 $ 38,534 $ 95,059 $ 56,900 $ 210,038 $ 46,813 $ 21,382 $ 161,465 $ 730,159 $ 959,819 $ 1,169,857

See Note 3 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding the Corporation's loan portfolio as of September 30, 2025.

Asset Quality

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are stated at the amount of unpaid principal, net of deferred loan fees and costs, and reduced by the allowance for credit losses. The allowance for credit losses is established through a provision for credit losses charged to earnings.

The Corporation has established and consistently applies loan policies and procedures designed to foster sound underwriting and credit monitoring practices. Credit risk is managed through the efforts of loan officers, the Chief Credit Officer, the loan review function, as well as oversight from the Board of Directors. Management continually evaluates its credit risk management practices to ensure problems in the loan portfolio are addressed in a timely manner, although, as is the case with any financial institution, a certain degree of credit risk is dependent in part on local and general economic conditions that are beyond management's control. Under the Corporation's risk rating system, loans are rated pass, special mention, substandard, doubtful, or loss, with all categories reviewed regularly as part of the risk management practices.

Non-performing loans are monitored on an ongoing basis as part of the Corporation's loan review process. Additionally, work-outs for non-performing loans and foreclosed assets held for sale are actively monitored through the Bank's Credit Department. A potential loss on a non-performing asset is generally determined by comparing the outstanding loan balance to the fair market value of the pledged collateral, less estimated cost to sell.

Management actively manages non-performing loans in an effort to mitigate loss to the Corporation by working with customers to develop strategies to resolve borrower difficulties, through sale or liquidation of collateral, foreclosure and other appropriate means. In addition, management monitors employment and economic conditions within its market area, as weakening of conditions could result in real estate devaluations and an increase in loan delinquencies, which could negatively impact asset quality and cause an increase in the provision for credit losses.

The following table presents information about non-performing assets, as of September 30, 2025 and December 31, 2024:

Non-performing Assets

September 30, December 31,
(dollars in thousands) 2025 2024
Non-accrual loans $ 15,466 $ 10,047
Loans past due 90 days or more and still accruing - -
Total non-performing loans 15,466 10,047
Foreclosed assets held for sale 70 70
Total non-performing assets $ 15,536 $ 10,117
Non-performing loans as a percentage of total loans, gross 1.32% 0.89%
Non-performing assets as a percentage of total assets 0.94% 0.63%
Allowance for credit losses as a percentage of total loans, gross 0.90% 0.88%
Allowance for credit losses to non-performing assets 67.89% 97.44%

Total non-performing assets amounted to $15,536,000, or 0.94% of total assets at September 30, 2025, as compared to $10,117,000, or 0.63% of total assets at December 31, 2024. For the nine months ended September 30, 2025, the Corporation experienced increases in non-accrual loans in all major loan classifications, however, the most significant increases were in commercial real estate and residential real estate loans which increased $2.1 million and $2.9 million, respectively.

Residential real estate non-accrual loans are generally related to a homogenous population of well secured loans collateralized by 1-4 family residential properties. With respect to commercial real estate non-accrual loans, the Corporation has experienced a limited number of large commercial relationships that have required significant monitoring and workout efforts. As a result, these relationships may significantly impact the total amount of allowance required on individual loans and may significantly impact the provision for credit losses and the amount of total charge-offs reported in any one period.

Management believes it has been conservative in its decisions concerning identification of loans requiring individual evaluation for credit loss, estimates of loss, and nonaccrual status; however, the actual losses realized from these relationships could vary materially from the allowances calculated as of September 30, 2025. Management continues to closely monitor its loan relationships for credit losses and will adjust its estimates of loss and decisions concerning nonaccrual status, if appropriate.

Allowance for Credit Losses

The allowance for credit losses was $10.5 million at September 30, 2025, compared to $9.9 million at December 31, 2024. The allowance equaled 0.90% of total loans, net of unearned fees and costs and unamortized fair value adjustments, at September 30, 2025 as compared to 0.88% at December 31, 2024. The allowance for credit losses is analyzed quarterly and reviewed by the Corporation's Board of Directors. Regular loan meetings with the Corporation's Board of Directors reviewed new loans over specified thresholds. Delinquent loans, loan exceptions and certain large loans are addressed by the full Board no less than monthly to determine compliance with policies.

The following tables present the allocation of the allowance for credit losses as of September 30, 2025 and December 31, 2024:

September 30, 2025 December 31, 2024
(dollars in thousands) Allowance
for Credit
Losses 		Percent of
Allowance 		Percent
of Loans
to
Gross
Loans 		Allowance
for Credit
Losses 		Percent of
Allowance 		Percent
of Loans
to
Gross
Loans
Commercial and industrial $ 1,095 10.4% 7.9% $ 931 9.4% 8.3%
Commercial real estate 6,559 62.2% 33.8% 6,869 69.7% 33.0%
Residential real estate 2,731 25.9% 56.7% 1,850 18.8% 56.7%
Consumer and other 163 1.5% 1.6% 208 2.1% 1.9%
Total $ 10,548 100.0% 100.0% $ 9,858 100.0% 100.0%

The most significant changes in the allowance for credit losses on an individual segment basis from December 31, 2024 to September 30, 2025 include an increase in residential real estate loans from $1,850,000, or 18.8% of the total allowance, at December 31, 2024 to $2,731,000, or 25.9% of the total allowance, at September 30, 2025, as well as a decrease in commercial real estate loans from $6,869,000, or 69.7% of the total allowance, at December 31, 2024 to $6,559,000, or 62.2% of the total allowance, at September 30, 2025. The increase for residential real estate loans includes the impact of increases in non-accrual loans which impacted probability of default calculations and levels of individually evaluated loans and related individually evaluated allowance levels as well as changes in qualitative factors related to the nature of the loan portfolio, volume and severity of past due loans, loan grade migration, changes in lending staff, changes in lending policies and procedures and forecasted economic conditions. The decrease for commercial real estate loans includes the impact of lower individually evaluated allowances related to student housing loans due to a decrease in loan balances, an increase in the volume of collateral dependent loans with no allowance required due to higher overall nonperforming commercial real estate loan balances as well as a decrease in allowance levels for commercial construction loans due to decreases in volume and loss rates utilized. The impact of these items was partially offset by changes in qualitative factors consistent with residential real estate loans as noted above.

See Note 3 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding the Corporation's allowance for credit losses as of September 30, 2025.

Deposits

Deposits are the primary source of funds for the Corporation's lending and investing activities. The Corporation provides a range of deposit services to businesses and individuals, including noninterest-bearing checking accounts, interest-bearing checking accounts, savings accounts, money market accounts and time deposits. These accounts generally earn interest at rates the Corporation establishes based on market factors and the anticipated amount and timing of funding needs. The establishment or continuity of a core deposit relationship can be a factor in loan pricing decisions. While the Corporation's primary focus is on establishing customer relationships to attract core deposits, at times, the Corporation may use brokered deposits and other wholesale deposits to supplement its funding sources. As of September 30, 2025, the Corporation held no brokered deposits.

The following tables summarize the average balances outstanding and average interest rates for each major category of deposits for the three and nine months ended September 30, 2025 and 2024, respectively:

For the Three Months Ended
September 30, 2025 September 30, 2024
Average Average Average Average Balance Change
Balance Rate Balance Rate Amount %
(In Thousands)
Non-interest bearing $ 273,870 -% $ 263,322 -% $ 10,548 4.0%
Savings 194,417 0.03 196,138 0.03 (1,721 ) (0.9 )
Interest-bearing demand deposits 440,018 2.29 352,629 2.31 87,389 24.8
Money market deposits 105,762 1.98 113,131 2.23 (7,369 ) (6.5 )
Time deposits 365,505 3.44 344,704 3.96 20,801 6.0
Total deposits $ 1,379,572 1.80% $ 1,269,924 1.92% $ 109,648 8.6%
For the Nine Months Ended
September 30, 2025 September 30, 2024
Average Average Average Average Balance Change
Balance Rate Balance Rate Amount %
(In Thousands)
Non-interest bearing $ 270,428 -% $ 259,940 -% $ 10,488 4.0%
Savings 194,750 0.03 199,776 0.03 (5,026 ) (2.5 )
Interest-bearing demand deposits 415,247 2.26 308,869 1.92 106,378 34.4
Money market deposits 104,349 1.91 109,679 2.08 (5,330 ) (4.9 )
Time deposits 360,770 3.54 337,989 4.01 22,781 6.7
Total deposits $ 1,345,544 1.80% $ 1,216,253 1.79% $ 129,291 10.6%

The Corporation believes its deposit product offerings are properly structured to attract and retain core low-cost deposit relationships. The average cost of interest-bearing deposits for the three and nine months ended September 30, 2025 was 2.24% and 2.25%, respectively. The average cost of interest-bearing deposits for the three and nine months ended September 30, 2024 was 2.42% and 2.28%, respectively.

At September 30, 2025, estimated uninsured deposits, or the portion of deposit accounts which exceeded the Federal Deposit Corporation insurance limit, totaled $385.8 million. Of this amount, $162.6 million was collateralized by securities pledged by the Corporation or letters of credit issued through the Federal Home Loan Bank of Pittsburgh. Time deposits of $250,000 or more totaled approximately $92.2 million at September 30, 2025.

See Note 4 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding the Corporation's deposits as of September 30, 2025.

Borrowings

Short-term borrowings consist primarily of securities sold under agreements to repurchase and periodic overnight or short-term Federal Home Loan Bank advances. Average short-term borrowings amounted to 1.5% and 7.9% of total interest-bearing liabilities for the three months ended September 30, 2025 and 2024, respectively, and 2.8% and 11.8% of total interest-bearing liabilities for the nine months ended September 30, 2025 and 2024, respectively. These changes were primarily related to the migration of customer repurchase agreements as well as a paydown in short-term FHLB borrowings during 2024 and 2025.

Long-term borrowings consist of advances due to the FHLB - Pittsburgh. Under terms of a blanket agreement, the loans are secured by certain qualifying assets of the Bank which consist principally of first mortgage loans. The carrying value of these collateralized items was $857.0 million at September 30, 2025. The Bank has lines of credit with the Federal Reserve Bank Discount Window, FHLB - Pittsburgh, and Atlantic Community Bankers Bank in the aggregate amount of $612.1 million at September 30, 2025. The unused portion of these lines of credit was $555.9 million at September 30, 2025.

See Note 5 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding the Corporation's borrowings as of September 30, 2025.

Capital Resources

Management believes, as of September 30, 2025, that Journey Bank meets all capital adequacy requirements to which it is subject. Management annually performs stress testing on its regulatory capital levels and expects Journey Bank to maintain capital levels that exceed the regulatory standards for well-capitalized institutions for the next 12 months and for the foreseeable future.

Future dividend payments and repurchases of common stock will depend upon maintenance of a strong financial condition, future earnings and capital and regulatory requirements. In addition, Journey Bank is subject to restrictions on the amount of dividends that may be paid without approval of banking regulatory authorities. Further, although Muncy Columbia Financial Corporation is not subject to the specific consolidated capital requirements, its ability to pay dividends, repurchase stock or engage in other activities may be limited by the Federal Reserve if it fails to hold sufficient capital commensurate with its overall risk profile.

The following table reflects the Bank's actual capital amounts and ratios at September 30, 2025 and December 31, 2024:

Journey Bank Minimum Required
For Capital
Adequacy Purposes 		Minimum Required For
Capital Adequacy Purposes
with Conservation Buffer 		Minimum Required To
Be Well Capitalized
Under Prompt
Corrective Action
Regulations
(Dollars in Thousands) Amount Ratio Ratio Ratio Ratio
September 30, 2025
Total capital (to risk-weighted assets) $ 165,092 16.70% 8.00% 10.50% 10.00%
Tier I capital (to risk-weighted assets) 155,117 15.69% 6.00% 8.50% 8.00%
Tier I common equity (to risk-weighted assets) 155,117 15.69% 4.50% 7.00% 6.50%
Tier I capital (to average assets) 155,117 9.62% 4.00% 4.00% 5.00%
Total risk-weighted assets 988,483
Total average assets 1,611,947
Journey Bank Minimum Required
For Capital
Adequacy Purposes 		Minimum Required For
Capital Adequacy Purposes
with Conservation Buffer 		Minimum Required To
Be Well Capitalized
Under Prompt
Corrective Action
Regulations
(Dollars in Thousands) Amount Ratio Ratio Ratio Ratio
December 31, 2024
Total capital (to risk-weighted assets) $ 152,703 16.03% 8.00% 10.50% 10.00%
Tier I capital (to risk-weighted assets) 143,417 15.06% 6.00% 8.50% 8.00%
Tier I common equity (to risk-weighted assets) 143,417 15.06% 4.50% 7.00% 6.50%
Tier I capital (to average assets) 143,417 9.10% 4.00% 4.00% 5.00%
Total risk-weighted assets 952,452
Total average assets 1,576,746

RESULTS OF OPERATIONS

Net income for the three months ended September 30, 2025 was $6,719,000, or $1.90 per share, compared to $5,056,000, or $1.42 per share, for the three months ended September 30, 2024. Net income for the nine months ended September 30, 2025 was $16,832,000, or $4.76 per share compared to $13,799,000, or $3.86 per share for the same period in 2024. The increase in net income for the three and nine months ended September 30, 2025, compared to the same periods in 2024, was primarily attributable to a significant increase in net interest income, partially offset by an increase in non-interest expense.

Net interest income increased $2.9 million, or 22.5% to $15.7 million for the three months ended September 30, 2025, from $12.8 million for the same period in 2024. Non-interest income was $2.9 million for the three months ended September 30, 2025, an increase of $0.2 million, or 6.5%, from $2.7 million for the same period in 2024, which primarily reflected increases in gain on sale of loans and other non-interest income partially offset by a decrease in gains on marketable equity securities. Non-interest expense was $10.0 million for the three months ended September 30, 2025, an increase of $0.6 million, or 6.5%, from $9.4 million for the same period in 2024, which was primarily related to increases in professional fees, automated teller machine and interchange expenses and other non-interest expense.

Net interest income increased $7.3 million, or 19.6% to $44.3 million for the nine months ended September 30, 2025, from $37.1 million for the same period in 2024. Non-interest income was $7.6 million for the nine months ended September 30, 2025, a decrease of $0.1 million, or 1.2%, from $7.7 million for the same period in 2024, which primarily reflected increases in service charges and fees and trust income offset by decreases in realized losses on available-for-sale debt securities, net, and other non-interest income. Non-interest expense was $30.9 million for the nine months ended September 30, 2025, an increase of $2.7 million, or 9.6%, from $28.2 million for the same period in 2024, which was primarily related to increases in salaries and employee benefits, Pennsylvania shares tax and professional fees, partially offset by a decrease in merger-related expenses.

For the three and nine months ended September 30, 2025, the annualized return on average assets was 1.63% and 1.39%, respectively, compared to 1.26% and 1.13%, respectively, for the comparable periods of 2024. The annualized return on average equity was 14.81% and 12.88%, respectively, for the three and nine months ended September 30, 2025, compared to 12.34% and 11.39%, respectively, for the comparable periods of 2024. For the three months ended September 30, 2025 the Corporation declared and paid dividends to holders of common stock of $0.45 per share as compared to $0.44 for the same period of 2024. For the nine months ended September 30, 2025 the Corporation declared and paid dividends to holders of common stock of $1.85 per share, which includes the impact of a special one-time cash dividend of $0.50 per share, as compared to $1.32 for the same period of 2024.

Net Interest Income

Net interest income is the difference between (i) interest income, interest and fees on interest-earning assets, and (ii) interest expense, interest paid on deposits and borrowed funds. Net interest income represents the largest component of the Corporation's operating income and, as such, is the primary determinant of profitability. Net interest income is impacted by variations in the volume, rate and composition of earning assets and interest-bearing liabilities, changes in general market interest rates and the level of non-performing assets. Interest income is shown on a fully tax-equivalent basis using the corporate statutory tax rate of 21.0% in 2025 and 2024.

Tax-equivalent net interest income increased $2.9 million, or 22.0%, to $15.9 million for the three months ended September 30, 2025 compared to $13.1 million for the same period in 2024. The increase in tax-equivalent net interest income was due to an increase in tax-equivalent interest income reflecting higher earning asset volumes and yields, along with a decrease in interest expense which resulted primarily from a significant decrease in average borrowings coupled with a decrease in the average rate paid on total interest-bearing liabilities. Tax-equivalent net interest margin, a key measurement used in the banking industry to measure income from earning assets relative to the cost to fund those assets, is calculated by dividing tax-equivalent net interest income by average interest-earning assets. The Corporation's tax-equivalent net interest margin increased 67 basis points to 4.15% for the three months ended September 30, 2025 compared to 3.48% for the same period of 2024, which was largely caused by increases in yields on earning assets along with a decrease in total in cost of funds. Additionally, interest rate spread, the difference between the average yield on interest-earning assets, shown on a fully tax-equivalent basis, and the average cost of interest-bearing liabilities, increased 72 basis points to 3.59% for the three months ended September 30, 2025 compared to 2.87% for the same period in 2024.

Tax-equivalent interest income increased $1.8 million, or 8.6%, to $22.9 million for the three months ended September 30, 2025 from $21.1 million for the same period in 2024, which was largely caused by growth in average earning assets, coupled with an increase in the tax-equivalent yield on average earning assets. Average earning assets increased $32.3 million, or 2.2%, to $1.525 billion for the three months ended September 30, 2025 from $1.493 billion for the same period in 2024, resulting in a corresponding increase to tax-equivalent interest income of $1.0 million. Specifically, average loans increased $50.6 million, or 4.5%, to $1.175 billion for the three months ended September 30, 2025 from $1.124 billion for the same period in 2024, which reflected strong organic loan growth. Total investment securities averaged $318.4 million for the three months ended September 30, 2025, a decrease of $43.0 million, or 11.9%, compared to $361.4 million for the same period in 2024, which contributed to a net decrease of $0.2 million in tax-equivalent interest income. The tax-equivalent yield on earning assets increased 34 basis points to 5.96% for the three months ended September 30, 2025 from 5.62% for the same period in 2024, which resulted in a corresponding increase in tax-equivalent interest income of $0.8 million. The Corporation's tax-equivalent yield on loans increased 6 basis points to 6.70% for the three months ended September 30, 2025 compared to 6.64% for the same period in 2024, resulting in a corresponding increase in tax-equivalent interest income of $0.2 million, due primarily to the origination of new loans at higher yields and the continued repricing of existing variable rate loans in the Corporation's portfolio. Meanwhile, the tax-equivalent yield on investment securities increased 94 basis points to 3.38% for the three months ended September 30, 2025 from 2.44% for the same period in 2024 and caused a corresponding increase to tax-equivalent interest income of $0.7 million.

Interest expense decreased $1.1 million, or 13.3%, to $7.0 million for the three months ended September 30, 2025 from $8.0 million for the same period in 2024, which was primarily from a significant decrease in average borrowings, coupled with a lower overall cost of funds. Average borrowed funds, which is largely comprised of customer repurchase agreements and FHLB of Pittsburgh advances, averaged $61.2 million for the three months ended September 30, 2025, a decrease of $94.0 million from $155.2 million for the same period in 2024. Lower volumes of average borrowed funds resulted in a corresponding decrease in interest expense of $1.2 million. Total average interest-bearing deposits increased $99.1 million, or 9.8%, to $1.106 billion for the three months ended September 30, 2025, compared to $1.007 billion for the same period in 2024, which resulted in a corresponding increase in interest expense of $0.8 million. For the three months ended September 30, 2025, the Corporation's cost of funds decreased 39 basis points to 2.36% from 2.75% for the same period in 2024. The average rate paid on total borrowings decreased 33 basis points to 4.50% for the three months ended September 30, 2025 from 4.83% for the same period in 2024. The average rate paid on total interest-bearing deposits decreased 18 basis points to 2.24% for the three months ended September 30, 2025 from 2.42% for the same period in 2024, which resulted in a corresponding decrease in interest expense of $0.6 million.

On a year-to-date basis, tax equivalent net interest income increased $7.3 million, or 19.3%, to $45.2 million for the nine months ended September 30, 2025, from $37.9 million for the comparable period of 2024. The increase in tax-equivalent net interest income for the year-to-date period was largely due to a $4.3 million, or 6.9%, increase in tax equivalent interest income, to $66.0 million, from $61.7 million for 2024, combined with a decrease in interest expense of $3.0 million, or 12.7%, to $20.8 million for the nine months ended September 30, 2025, from $23.8 million for the nine months ended September 30, 2024. Similar to the quarterly period, the $4.3 million or 6.9%, increase in year-to-date tax equivalent interest income was primarily due to higher earning-asset yields, coupled with an increase in average earning assets balances. The tax-equivalent yield on average earning assets increased 31 basis points to 5.85% for the nine months ended September 30, 2025 from 5.54% for the same period in 2024, which resulted in a corresponding increase of $1.9 million to tax-equivalent interest income. The tax-equivalent yield on loans increased 10 basis points, while the tax-equivalent yield on investments increased 59 basis points comparing the year-to-date periods of 2025 and 2024, which resulted in corresponding increases in tax-equivalent interest income of $0.8 million and $1.2 million, respectively. Regarding earning-asset volumes, total average earning assets increased $19.1 million, or 1.3%, to $1.509 billion for the nine months ended September 30, 2025, from $1.490 billion for the same period of 2024, which resulted in a corresponding increase in tax-equivalent interest income of $2.4 million. Similar to the quarterly period, this was primarily due to an increase in average total loans which increased $51.2 million, or 4.6%, to $1.162 billion for the nine months ended September 30, 2025, from $1.111 billion for the same comparable period of 2024, which was primarily as a result of strong organic loan demand. This increase resulted in a corresponding increase in tax-equivalent interest income of $2.5 million.

The $3.0 million, or 12.7%, decrease in year-to-date interest expense was largely due to a significant decrease in average total borrowings. Average borrowed funds averaged $80.2 million for the nine months ended September 30, 2025, a decrease of $123.7 million from $203.9 million for the same period in 2024. Lower volumes of average borrowed funds resulted in a corresponding decrease in interest expense of $4.5 million. This decrease was partially offset by an increase in interest-bearing deposit volumes. Comparing the year-to-date periods of 2025 and 2024, average interest-bearing deposits increased $118.8 million, or 12.4%, to $1.075 billion from $956.3 million, respectively, increasing interest expense by $2.1 million.

The following Average Balance Sheet and Rate Analysis tables presents the average assets, actual income or expense and the average yield on assets, liabilities and stockholders' equity for the three and nine months ended September 30, 2025 and 2024.

AVERAGE BALANCE SHEET AND RATE ANALYSIS

THREE MONTHS ENDED SEPTEMBER 30,

2025 2024
(In Thousands) Average
Balance 		Interest Average
Rate 		Average
Balance 		Interest Average
Rate
ASSETS: (1) (1)
Tax-exempt loans $ 39,442 $ 470 4.73% $ 43,579 $ 524 4.78%
All other loans 1,135,079 19,365 6.77% 1,080,350 18,234 6.71%
Total loans (2)(3)(4) 1,174,521 19,835 6.70% 1,123,929 18,758 6.64%
Taxable securities 240,268 1,647 2.72% 282,418 1,184 1.67%
Tax-exempt securities (3) 78,184 1,069 5.42% 79,028 1,037 5.22%
Total securities 318,452 2,716 3.38% 361,446 2,221 2.44%
Interest-bearing deposits in other banks 32,403 348 4.26% 7,746 110 5.65%
Total interest-earning assets 1,525,376 22,899 5.96% 1,493,121 21,089 5.62%
Other assets 111,828 108,904
TOTAL ASSETS $ 1,637,204 $ 1,602,025
LIABILITIES:
Savings $ 194,417 15 0.03% $ 196,138 15 0.03%
Now deposits 440,018 2,543 2.29% 352,629 2,051 2.31%
Money market deposits 105,762 527 1.98% 113,131 635 2.23%
Time deposits 365,505 3,170 3.44% 344,704 3,432 3.96%
Total interest-bearing deposits 1,105,702 6,255 2.24% 1,006,602 6,133 2.42%
Short-term borrowings 17,163 168 3.88% 91,431 1,093 4.76%
Long-term borrowings 44,072 527 4.74% 63,814 791 4.93%
Total borrowings 61,235 695 4.50% 155,245 1,884 4.83%
Total interest-bearing liabilities 1,166,937 6,950 2.36% 1,161,847 8,017 2.75%
Noninterest-bearing deposits 273,870 263,322
Other liabilities 16,387 13,836
Stockholders' equity 180,010 163,020
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 1,637,204 $ 1,602,025
Interest rate spread (6) 3.59% 2.87%
Net interest income/margin (5) $ 15,949 4.15% $ 13,072 3.48%

(1) Average volume information was compared using daily averages for interest-earning and bearing accounts.

(2) Interest on loans includes loan fee income.

(3) Tax exempt interest revenue is shown on a tax-equivalent basis using a statutory federal income tax rate of 21 percent for 2025 and 2024.

(4) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

(5) Net interest margin is computed by dividing annualized tax-equivalent net interest income by total interest earning assets.

(6) Interest rate spread represents the difference between the average rate earned on interest-earning assets and the average rate paid on interest-bearing liabilities.

AVERAGE BALANCE SHEET AND RATE ANALYSIS

NINE MONTHS ENDED SEPTEMBER 30,

2025 2024
(In Thousands) Average
Balance 		Interest Average
Rate 		Average
Balance 		Interest Average
Rate
ASSETS: (1) (1)
Tax-exempt loans $ 41,227 $ 1,491 4.83% $ 41,312 $ 1,375 4.45%
All other loans 1,120,688 56,454 6.74% 1,069,391 53,231 6.65%
Total loans (2)(3)(4) 1,161,915 57,945 6.67% 1,110,703 54,606 6.57%
Taxable securities 252,482 4,388 2.32% 294,122 3,792 1.72%
Tax-exempt securities (3) 79,013 3,197 5.41% 78,865 3,092 5.24%
Total securities 331,495 7,585 3.06% 372,987 6,884 2.47%
Interest-bearing deposits in other banks 15,279 483 4.23% 5,875 238 5.41%
Total interest-earning assets 1,508,689 66,013 5.85% 1,489,565 61,728 5.54%
Other assets 107,209 100,828
TOTAL ASSETS $ 1,615,898 $ 1,590,393
LIABILITIES:
Savings $ 194,750 44 0.03% $ 199,776 46 0.03%
Now deposits 415,247 7,016 2.26% 308,869 4,450 1.92%
Money market deposits 104,349 1,491 1.91% 109,679 1,706 2.08%
Time deposits 360,770 9,542 3.54% 337,989 10,151 4.01%
Total interest-bearing deposits 1,075,116 18,093 2.25% 956,313 16,353 2.28%
Short-term borrowings 31,945 963 4.03% 137,198 5,017 4.88%
Long-term borrowings 48,259 1,721 4.77% 66,695 2,436 4.88%
Total borrowings 80,204 2,684 4.47% 203,893 7,453 4.88%
Total interest-bearing liabilities 1,155,320 20,777 2.40% 1,160,206 23,806 2.74%
Noninterest-bearing deposits 270,428 259,940
Other liabilities 15,362 13,065
Stockholders' equity 174,788 157,182
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 1,615,898 $ 1,590,393
Interest rate spread (6) 3.45% 2.79%
Net interest income/margin (5) $ 45,236 4.01% $ 37,922 3.40%

(1) Average volume information was compared using daily averages for interest-earning and bearing accounts.

(2) Interest on loans includes loan fee income.

(3) Tax exempt interest revenue is shown on a tax-equivalent basis using a statutory federal income tax rate of 21 percent for 2025 and 2024.

(4) Nonaccrual loans have been included with loans for the purpose of analyzing net interest earnings.

(5) Net interest margin is computed by dividing annualized tax-equivalent net interest income by total interest earning assets.

(6) Interest rate spread represents the difference between the average rate earned on interest-earning assets and the average rate paid on interest-bearing liabilities.

Reconcilement of Taxable Equivalent Net Interest Income
For the Three Months
Ended September 30, 		For the Nine Months
Ended September 30,
2025 2024 2025 2024
(In Thousands)
Total interest income $ 22,601 $ 20,791 $ 65,104 $ 60,875
Total interest expense 6,950 8,017 20,777 23,806
Net interest income 15,651 12,774 44,327 37,069
Tax equivalent adjustment 298 298 909 853
Net interest income
(fully taxable equivalent) $ 15,949 $ 13,072 $ 45,236 $ 37,922

Rate/Volume Analysis

To enhance the understanding of the effects of volumes (the average balance of earning assets and costing liabilities) and average interest rate fluctuations on the Consolidated Balance Sheets as it pertains to net interest income, the table below reflects these changes for the three and nine months ended September 30, 2025 versus September 30, 2024:

Three Months Ended September 30, Nine Months Ended September 30,
2025 vs 2024 2025 vs 2024
Increase (Decrease) Increase (Decrease)
Due to Due to
(In Thousands) Volume Rate Net Volume Rate Net
Interest income:
Loans, tax-exempt $ (44 ) $ (10 ) $ (54 ) $ (2 ) $ 118 $ 116
Loans 926 205 1,131 2,551 672 3,223
Taxable investment securities (181 ) 644 463 (536 ) 1,132 596
Tax-exempt investment securities 2 30 32 6 99 105
Interest bearing deposits 339 (101 ) 238 381 (136 ) 245
Total interest-earning assets 1,042 768 1,810 2,400 1,885 4,285
Interest expense:
Savings - - - (1 ) (1 ) (2 )
NOW deposits 564 (72 ) 492 1,531 1,035 2,566
Money market deposits (40 ) (68 ) (108 ) (83 ) (132 ) (215 )
Time deposits 236 (498 ) (262 ) 684 (1,293 ) (609 )
Short-term borrowings (895 ) (30 ) (925 ) (3,845 ) (209 ) (4,054 )
Long-term borrowings, FHLB (260 ) (4 ) (264 ) (673 ) (42 ) (715 )
Total interest-bearing liabilities (395 ) (672 ) (1,067 ) (2,387 ) (642 ) (3,029 )
Change in net interest income $ 1,437 $ 1,440 $ 2,877 $ 4,787 $ 2,527 $ 7,314

Provision for Credit Losses

A summary of the provision for credit losses for the three and nine months ended September 30, 2025 and 2024, is as follows:

For the Three Months For the Nine Months
Ended September 30, Ended September 30,
(In Thousands) 2025 2024 2025 2024
Provision for credit losses:
Loans receivable $ 475 $ 151 $ 841 $ 288
Off-balance sheet exposures 4 - 2 (18 )
Total provision for credit losses $ 479 $ 151 $ 843 $ 270

For the three months ended September 30, 2025, there was a provision for credit losses of $479,000, an increase of $328,000 in expense compared to a provision for credit losses of $151,000 for the three months ended September 30, 2024. The provision for the three months ended September 30, 2025 included expense related to loans receivable of $475,000 and expense related to off-balance sheet exposures of $4,000. For the nine months ended September 30, 2025, there was a provision for credit losses of $843,000, an increase of $573,000 in expense compared to a provision for credit losses of $270,000 for the nine months ended September 30, 2024. The provision for the nine months ended September 30, 2025 included expense related to loans receivable of $841,000 and expense related to off-balance sheet exposures of $2,000.

The provision amounts for the three and nine months ended September 30, 2025 and 2024 primarily reflect an increase in volume in the loan portfolio, increases in non-accrual loans which impacted probability of default calculations and changes in qualitative factors related to the nature of the loan portfolio, volume and severity of past due loans, loan grade migration, changes in lending staff, changes in lending policies and procedures and forecasted economic conditions.

See Note 3 within the Corporation's Notes to the Unaudited Consolidated Financial Statements which are included in this Quarterly Report on Form 10-Q for more information regarding the Corporation's allowance for credit losses as of September 30, 2025.

Non-interest Income

Total non-interest income increased $177,000 to $2,892,000 for the third quarter 2025, compared to the third quarter 2024 amount of $2,715,000. This change was primarily due to increases in gain on sale of loans and other non-interest income of $111,000 and $81,000, respectively, due to an increase in mortgage sale activity and a one-time gain of $120,000 related to a bank-owned life insurance claim. These increases were partially offset by a decrease in gains on marketable equity securities of $115,000 due to market value changes comparing the third quarter 2025 to the third quarter 2024.

For the nine months ended September 30, 2025, total non-interest income decreased $92,000 or 1.2% to $7,574,000, compared to $7,666,000 for the nine months ended September 30, 2024. Realized losses on available-for-sale debt securities, net, resulted in a decrease of $418,000 which was partially offset by increases in service charges and fees and trust income of $196,000 and $133,000, respectively. Other non-interest income decreased $214,000 or 14.4% due primarily to one-time events during the nine months ended September 30, 2024, including incentives received in conjunction with the launch of a debit card reissuance project as well as a governmental grant recorded in conjunction with the completion of a solar energy project.

For the Three Months Ended
September 30, 2025 September 30, 2024 Change
(In Thousands) Amount % Total Amount % Total Amount %
Service charges and fees $ 774 26.8 % $ 727 26.8 % $ 47 6.5 %
Interchange fees 671 23.2 664 24.5 7 1.1
Gain on sale of loans 186 6.4 75 2.8 111 148.0
Earnings on bank-owned life insurance 235 8.1 236 8.7 (1 ) (0.4 )
Brokerage 215 7.4 193 7.1 22 11.4
Trust 268 9.3 243 9.0 25 10.3
Gains on marketable equity securities 48 1.7 163 6.0 (115 ) (70.6 )
Realized losses on available-for-sale debt securities, net - - - - - -
Other non-interest income 495 17.1 414 15.1 81 19.6
Total non-interest income $ 2,892 100.0 % $ 2,715 100.0 % $ 177 6.5 %
For the Nine Months Ended
September 30, 2025 September 30, 2024 Change
(In Thousands) Amount % Total Amount % Total Amount %
Service charges and fees $ 2,205 29.1 % $ 2,009 26.2 % $ 196 9.8 %
Interchange fees 1,967 26.0 1,970 25.7 (3 ) (0.2 )
Gain on sale of loans 340 4.5 244 3.2 96 39.3
Earnings on bank-owned life insurance 699 9.2 692 9.0 7 1.0
Brokerage 700 9.2 609 7.9 91 14.9
Trust 786 10.4 653 8.5 133 20.4
Gains on marketable equity securities 28 0.4 8 0.1 20 250.0
Realized losses on available-for-sale debt securities, net (426 ) (5.6 ) (8 ) (0.1 ) (418 ) 5,225.0
Other non-interest income 1,275 16.8 1,489 19.5 (214 ) (14.4 )
Total non-interest income $ 7,574 100.0 % $ 7,666 100.0 % $ (92 ) (1.2 )%

Non-interest Expense

Total non-interest expense increased $611,000 from $9,367,000 for the third quarter 2024, to $9,978,000 for the third quarter 2025. Significant variances included an increase in professional fees of $132,000 due primarily to higher legal and consulting costs, an increase in automated teller machine and interchange of $123,000 due primarily to higher debit card marketing expenses and an increase in other non-interest expense of $175,000 due primarily to higher overall marketing and advertising costs comparing the third quarter 2025 to the third quarter 2024.

For the nine months ended September 30, 2025, total non-interest expense increased $2,718,000 or 9.6% to $30,925,000, compared to $28,207,000 for the nine months ended September 30, 2024. Salaries and employee benefits expense of $16,103,000 for the nine months ended September 30, 2025 increased $1,957,000 from $14,146,000 for the same period of 2024. The Corporation recorded one-time pretax expenses totaling $1,295,000 in conjunction with the retirement of its Executive Chairman during the three months ended March 31, 2025. Additionally, health insurance expenses associated with the Corporation's partially self-funded health insurance plan were $545,000 higher in the nine months ended September 30, 2025 than the same period of 2024. In addition to the increase in salaries and employee benefits expense, Pennsylvania shares tax expense increased $247,000 or 35.7% for the nine months ended September 30, 2025 due to increased capital levels and professional fees increased $218,000, consistent with the quarterly variance noted above.

One standard to measure non-interest expense is to express annualized non-interest expense as a percentage of average total assets. For the three and nine months ended September 30, 2025 this percentage was 2.42% and 2.33%, respectively, compared to 2.56% and 2.37%, respectively, for the three and nine months ended September 30, 2024.

For the Three Months Ended
September 30, 2025 September 30, 2024 Change
(In Thousands) Amount % Total Amount % Total Amount %
Salaries and employee benefits $ 4,799 48.1 % $ 4,704 50.2 % $ 95 2.0 %
Occupancy 644 6.5 644 6.9 - -
Furniture and equipment 418 4.2 448 4.8 (30 ) (6.7 )
Pennsylvania shares tax 336 3.4 251 2.7 85 (33.9 )
Professional fees 491 4.9 359 3.8 132 36.8
Director's fees 165 1.7 103 1.1 62 60.2
Federal deposit insurance 217 2.2 187 2.0 30 16.0
Data processing and telecommunications 877 8.8 848 9.1 29 3.4
Automated teller machine and interchange 230 2.3 107 1.1 123 115.0
Merger-related expenses - - 43 0.5 (43 ) (100.0 )
Amortization of intangibles 511 5.1 558 6.0 (47 ) (8.4 )
Other non-interest expense 1,290 12.8 1,115 11.8 175 15.7
Total non-interest expense $ 9,978 100.0 % $ 9,367 100.0 % $ 611 6.5 %
For the Nine Months Ended
September 30, 2025 September 30, 2024 Change
(In Thousands) Amount % Total Amount % Total Amount %
Salaries and employee benefits $ 16,103 52.1 % $ 14,146 50.2 % $ 1,957 13.8 %
Occupancy 2,004 6.5 1,843 6.5 161 8.7
Furniture and equipment 1,304 4.2 1,238 4.4 66 5.3
Pennsylvania shares tax 938 3.0 691 2.4 247 35.7
Professional fees 1,353 4.4 1,135 4.0 218 19.2
Director's fees 483 1.6 342 1.2 141 41.2
Federal deposit insurance 652 2.1 595 2.1 57 9.6
Data processing and telecommunications 2,794 9.0 2,672 9.5 122 4.6
Automated teller machine and interchange 595 1.9 475 1.7 120 25.3
Merger-related expenses - - 340 1.2 (340 ) (100.0 )
Amortization of intangibles 1,532 5.0 1,656 5.9 (124 ) (7.5 )
Other non-interest expense 3,167 10.2 3,074 10.9 93 3.0
Total non-interest expense $ 30,925 100.0 % $ 28,207 100.0 % $ 2,718 9.6 %

LIQUIDITY

Liquidity is the ability to quickly raise cash at a reasonable cost. An adequate liquidity position permits the Bank to pay creditors, compensate for unforeseen deposit fluctuations and fund unexpected loan demand. The Bank's primary sources of funds are deposits, securities sold under agreements to repurchase, principal repayments of securities and outstanding loans, funds provided from operations, and day-to-day FHLB - Pittsburgh borrowings. In addition, the Bank invests excess funds in short-term interest-earning assets such as overnight deposits or U.S. agency securities, which provide liquidity to meet lending requirements. While scheduled payments from the amortization of loans and securities and short-term investments are relatively predictable sources of funds, general interest rates, economic conditions and competition greatly influence deposit flows and repayments on loans and mortgage-backed securities.

The Bank strives to maintain sufficient liquidity to fund operations, loan demand and to satisfy fluctuations in deposit levels. The Bank is required to have enough investments that qualify as liquid assets in order to maintain sufficient liquidity to ensure safe and sound banking operations. Liquidity may increase or decrease depending upon the availability of funds and comparative yields on investments in relation to the return on loans. The Bank attempts to maintain adequate but not excessive liquidity, and liquidity management is both a daily and long-term function of its business management. The Bank manages its liquidity in accordance with a board of directors-approved asset liability policy and liquidity contingency plan, which are administered by its asset-liability committee ("ALCO"). ALCO reports interest rate sensitivity, liquidity, capital and investment-related matters on a quarterly basis to the Bank's board of directors.

The Bank reviews cash flow projections regularly and updates them in order to maintain liquid assets at levels believed to meet the requirements of normal operations, including loan commitments and potential deposit outflows from maturing certificates of deposit and savings withdrawals. While deposits and securities sold under agreements to repurchase are its primary source of funds, when needed it is also able to generate cash through borrowings from the FHLB. At September 30, 2025, the Bank had remaining available capacity with FHLB, subject to certain collateral restrictions, of $536.3 million.

Liquidity management is required to ensure that adequate funds will be available to meet anticipated and unanticipated deposit withdrawals, debt service payments, investment commitments, commercial and consumer loan demand, and ongoing operating expenses. Funding sources include principal repayments on loans, sale of assets, growth in time and core deposits, short and long-term borrowings, investment securities coming due, loan prepayments and repurchase agreements. Regular loan payments are a dependable source of funds, while the sale of investment securities, deposit growth and loan prepayments are significantly influenced by general economic conditions and the level of interest rates.

The statement of cash flows presents the change in cash and cash equivalents from operating, investing and financing activities. Cash and due from banks and interest-bearing deposits in other banks, which comprise cash and cash equivalents, are the Corporation's most liquid assets. Cash and cash equivalents totaled $45.3 million at September 30, 2025, an increase of $27.9 million from $17.4 million at December 31, 2024, as net cash inflows reported from operating and financing activities outpaced net cash outflows from investing activities for the nine months ended September 30, 2025.

Net cash outflows from investing activities used $20.6 million of cash and cash equivalents during the nine months ended September 30, 2025. Accounting for the majority of the net cash outflows was $85.5 million related to proceeds from sales, paydowns, calls and maturities of available-for-sale debt securities which was offset by purchases of available-for-sale debt securities of $69.6 million and a net increase in loans of $36.9 million, which reflected strong loan demand. Financing activities provided $31.1 million in net cash, which resulted primarily from a decrease in short-term borrowings, consisting of customer repurchase agreements and short-term FHLB borrowings, of $51.5 million along with a repayment of long-term borrowings of $15.2 million. These outflows were offset by a $104.2 million increase in deposits. Operating activities include net income, adjusted for the effects of non-cash transactions including, among others, depreciation and amortization and the provision for credit losses, and is the primary source of cash flows from operations. For the nine months ended September 30, 2025, operating activities provided the Corporation with $17.4 million in net cash, which primarily reflected net income of $16.8 million.

The Corporation regularly analyzes its ability to generate adequate amounts of cash to meet its short and long-term cash requirements and plans. As part of its quarterly asset liability management procedures, the Corporation performs liquidity cash flow forecasts in various base level and stress scenarios to monitor future cash needs. As of September 30, 2025, the Corporation is expected to maintain a level cash balance over the next 12 months. The Corporation has not identified any known demands, commitments, events or uncertainties that would result or that are reasonably likely to result in its liquidity position materially increasing or decreasing over the next 12 months. The Corporation's long-term cash needs are regularly analyzed through its strategic planning process, which includes a detailed review of liquidity and funding needs.

We manage liquidity on a daily basis. We believe that our liquidity is sufficient to meet present and future financial obligations and commitments on a timely basis. However, see potential liquidity risk factors at Item 1A - Risk Factors of the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024 and refer to the Consolidated Statements of Cash Flows in this Form 10-Q.

INTEREST RATE RISK MANAGEMENT

Interest rate risk management involves managing the extent to which interest-sensitive assets and interest-sensitive liabilities are matched. Interest rate sensitivity is the relationship between market interest rates and earnings volatility due to the repricing characteristics of assets and liabilities. The Bank's net interest income is affected by changes in the level of market interest rates. In order to maintain consistent earnings performance, the Bank seeks to manage, to the extent possible, the repricing characteristics of its assets and liabilities.

One major objective of the Bank when managing the rate sensitivity of its assets and liabilities is to stabilize net interest income. The management of and authority to assume interest rate risk is the responsibility of the Bank's ALCO, which is comprised of senior management and Board members. ALCO meets quarterly to monitor the ratio of interest sensitive assets to interest sensitive liabilities. The process to review interest rate risk is a regular part of management of the Bank. Consistent policies and practices of measuring and reporting interest rate risk exposure, particularly regarding the treatment of noncontractual assets and liabilities, are in effect. In addition, there is an annual process to review the interest rate risk policy with the Board of Directors which includes limits on the impact to earnings from shifts in interest rates.

The ratio between assets and liabilities repricing in specific time intervals is referred to as an interest rate sensitivity gap. Interest rate sensitivity gaps can be managed to take advantage of the slope of the yield curve as well as forecasted changes in the level of interest rate changes.

To manage the interest sensitivity position, an asset/liability model called "gap analysis" is used to monitor the difference in the volume of the Bank's interest sensitive assets and liabilities that mature or reprice within given periods. A positive gap (asset sensitive) indicates that more assets reprice during a given period compared to liabilities, while a negative gap (liability sensitive) has the opposite effect. The Bank employs computerized net interest income simulation modeling to assist in quantifying interest rate risk exposure. This process measures and quantifies the impact on net interest income through varying interest rate changes and balance sheet compositions. The use of this model assists the ALCO to gauge the effects of the interest rate changes on interest sensitive assets and liabilities in order to determine what impact these rate changes will have upon our net interest spread. At September 30, 2025, our cumulative gap positions were within the internal risk management guidelines.

In addition to gap analysis, the Bank uses net interest income simulations and economic value of equity ("EVE") simulations as the primary tools in measuring and managing the Bank's position and considers balance sheet forecasts, the Bank's liquidity position, the economic environment, anticipated direction of interest rates and the Bank's earnings sensitivity to changes in these rates in its modeling. In addition, ALCO has established policy tolerance limits for acceptable negative changes in net interest income. Furthermore, as part of its ongoing monitoring, ALCO requires annual back testing of modeling results, which involves after-the-fact comparisons of projections with the Bank's actual performance to measure the validity of assumptions used in the modeling techniques.

The following table illustrates the simulated impact of parallel and instantaneous interest rate shocks of +100, +200, +300, -100, -200, and -300 basis points on net interest income and the change in economic value over a one-year time horizon from the September 30, 2025 levels:

Rates +100 Rates +200 Rates +300 Rates -100 Rates -200 Rates -300
Simulation
Results 		Policy
Limit 		Simulation
Results 		Policy
Limit 		Simulation
Results 		Policy
Limit 		Simulation
Results 		Policy
Limit 		Simulation
Results 		Policy
Limit 		Simulation
Results 		Policy Limit
Earnings at risk:
Percent change in net interest income 2.92 % -10.00 % -1.40 % -15.00 % -6.00 % -20.00 % 8.76 % -10.00 % 9.67 % -15.00 % 11.80 % -20.00 %
Economic value at risk:
Percent change in economic value of equity -6.67 % -15.00 % -14.55 % -25.00 % -23.34 % -30.00 % 3.08 % -15.00 % 4.17 % -25.00 % 5.61 % -30.00 %

Model results from the simulation at September 30, 2025 indicated that the Bank was projected to see an increase in net interest income over a one-year horizon in any of the rate shock scenarios, with the exception of the +200 and +300 scenarios, which showed 1.40% and 6.00% decreases, respectively. The percent change in EVE is expected to decrease in all rates up scenarios and increase in all rates down scenarios. All modeled exposures to net interest income and EVE for the next twelve-month horizon are within internal ALCO policy guidelines.

This analysis does not represent a forecast for the Bank and should not be relied upon as being indicative of expected operating results. These simulations are based on numerous assumptions, including but not limited to, the nature and timing of interest rate levels, prepayments on loans and securities, deposit decay rates, pricing decisions on loans and deposits, reinvestment/replacements of asset and liability cash flows, and other factors. While assumptions reflect current economic and local market conditions, the Bank cannot make any assurances as to the predictive nature of these assumptions, including changes in interest rates, customer preferences, competition and liquidity needs, or what actions ALCO might take in responding to these changes.

It is our opinion that the asset/liability mix and the interest rate risk associated with the balance sheet are within manageable parameters. Additionally, the Bank's ALCO meets quarterly with an asset liability management consultant.

IMPACT OF INFLATION AND CHANGING PRICES

The preparation of financial statements in conformity with U.S. GAAP requires management to measure the Corporation's financial position and operating results primarily in terms of historic dollars. Changes in the relative value of money due to inflation or recession are generally not considered. The effect of inflation on the Corporation's operations is primarily related to increases in operating expenses. Management considers changes in interest rates to impact our financial condition and results of operations to a far greater degree than changes in prices due to inflation. Although interest rates are greatly influenced by changes in the inflation rate, they do not necessarily change at the same rate or in the same magnitude as the inflation rate. The Corporation manages interest rate risk in several ways. There can be no assurance that the Corporation will not be materially adversely affected by future changes in interest rates, as interest rates are highly sensitive to many factors that are beyond its control. Additionally, inflation may adversely impact the financial condition of the Corporation's borrowers and could impact their ability to repay their loans, which could negatively affect the Corporation's asset quality through higher delinquency rates and increased charge-offs. Management will carefully consider the impact of inflation and rising interest rates on the Corporation's borrowers in managing credit risk related to the loan portfolio.

Muncy Columbia Financial Corporation published this content on November 07, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on November 07, 2025 at 16:00 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]