The ACL - Loans is a valuation account that is deducted from the amortized cost basis of loans and leases to present the net amount expected to be collected on loans over the contractual term. Loans and leases are collectively referred to as “loans” for the purpose of discussing the allowance for credit losses. The ACL - Loans is adjusted by the provision for credit losses, which is reported in earnings, and reduced by charge offs for loans, net of recoveries. Provision for credit losses on loans reflects the totality of actions taken on all loans for a particular period including any necessary increases or decreases in the allowance related to changes in credit loss expectations associated with specific loans or pools of loans. Loans are charged off against the allowance when the uncollectibility of the loan is confirmed. Expected recoveries do not exceed the aggregate of amounts previously charged off and expected to be charged off.

The ACL - Loans represents the Company's best estimate of current expected credit losses (CECL) on loans using relevant available information, from internal and external sources, related to past events, current conditions, and reasonable and supportable forecasts. Historical credit loss experience provides the basis for the estimation of expected credit losses. The CECL calculation is performed and evaluated quarterly and losses are estimated over the expected life of the loan. The level of the ACL - Loans is believed to be adequate to absorb all expected future losses inherent in the loan portfolio at the measurement date.

In calculating the ACL - Loans, the loan portfolio is pooled into loan segments with similar risk characteristics. Common characteristics include the type or purpose of the loan, underlying collateral and historical/expected credit loss patterns. In developing the loan segments, the Company analyzes the degree of correlation in how loans within each portfolio respond when subjected to varying economic conditions and scenarios as well as other portfolio stress factors.

The expected credit losses are measured over the life of each loan segment utilizing the average charge-off methodology combined with economic forecast models to estimate the current expected credit loss inherent in the loan portfolio. This approach is also leveraged to estimate the expected credit losses associated with non-cancellable unfunded loan commitments incorporating expected utilization rates.

The Company sub-segments certain commercial loan portfolios by risk level where appropriate. The Company utilizes a one-year reasonable and supportable economic forecast period.

The Company qualitatively adjusts model results for risk factors that are not inherently considered in the historical losses, but are nonetheless relevant in assessing the expected credit losses within the loan portfolio. These adjustments may increase or decrease the estimate of expected credit losses based upon the assessed level of risk for each qualitative factor. The various risks that may be considered in making qualitative adjustments include, among other things, the impact of (i) changes in economic conditions, (ii) changes in the nature and volume of the loan portfolio, (iii) changes in the existence, growth and effect of any concentrations in credit, (iv) changes in lending policies and procedures, including changes in underwriting standards and practices for collections, write-offs, and recoveries, (v) changes in the quality of the credit review function, (vi) changes in the experience, ability and depth of lending management and staff, (vii) changes in the volume and severity of past due and adversely classified loans and the volume of nonaccrual loans, (viii) changes in the value of underlying collateral for collateral-dependent loans, and (ix) other environmental factors such as regulatory, legal and technological considerations, as well as competition.

In some cases, management may determine that an individual loan exhibits unique risk characteristics which differentiate the loan from other loans within the loan segments. In such cases, the loans are evaluated for expected credit losses on an individual basis and excluded from the collective evaluation. Specific reserves in the allowance for credit losses are determined by analyzing the borrower's ability to repay amounts owed, collateral deficiencies, the relative risk grade of the loan and economic conditions affecting the borrower's industry, among other things. A loan is considered to be collateral dependent when, based upon management's assessment, the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. In such cases, expected credit losses are based on the fair value of the collateral at the measurement date, adjusted for estimated selling costs if satisfaction of the loan depends on the sale of the collateral. The fair value of collateral supporting collateral dependent loans is evaluated on a quarterly basis.

The following tables present the activity in the ACL - Loans by portfolio segment for the three months ended March 31, 2026 and 2025 (unaudited).


	Three Months Ended March 31, 2026 (unaudited)
			Real Estate									Consumer
	Commercial		Single- family		Multi- family		Commercial		Construction		Home equity lines of credit		Other		Total

Allowance for credit losses
Balances, January 1, 2026	$	6,001	$	2,528	$	1,494	$	4,938	$	2,031	$	390	$	296	$	17,678
Provision (reversal) for credit losses		161		(96)		50		190		651		(12)		35		979
Recoveries on loans		51		10		—		—		—		—		—		61
Loans charged off		(77)		—		—		—		—		—		—		(77)
Balances, March 31, 2026	$	6,136	$	2,442	$	1,544	$	5,128	$	2,682	$	378	$	331	$	18,641


	Three Months Ended March 31, 2025 (unaudited)
			Real Estate									Consumer
	Commercial		Single-family		Multi-family		Commercial		Construction		Home equity lines of credit		Other		Total

Allowance for credit losses
Balances, January 1, 2025	$	7,005	$	2,787	$	1,382	$	3,918	$	1,741	$	371	$	270	$	17,474
Provision (reversal) for credit losses		831		(276)		(171)		(44)		11		19		(18)		352
Recoveries on loans		61		9		—		—		—		1		—		71
Loans charged off		(67)		(27)		—		—		—		—		—		(94)
Balances, March 31, 2025	$	7,830	$	2,493	$	1,211	$	3,874	$	1,752	$	391	$	252	$	17,803

Determining fair value for collateral dependent loans requires obtaining a current independent appraisal of the collateral and applying a discount factor, which includes selling costs if applicable, to the value. The fair value of real estate is generally based on appraisals by qualified licensed appraisers. The appraisers typically determine the value of the real estate by utilizing an income or market valuation approach. If an appraisal is not available, the fair value may be determined by using a cash flow analysis. The fair value of other collateral such as business assets is typically ascertained by assessing, either singularly or some combination of, asset appraisals, accounts receivable aging reports, inventory listings and/or customer financial statements. Both appraised values and values based on the borrower’s financial information are discounted as considered appropriate based on age and quality of the information and current market conditions.

Of the $20,313 of nonaccrual loans at March 31, 2026, $5,054 was guaranteed by the Small Business Administration (SBA).

Of the $15,329 of nonaccrual loans at December 31, 2025, $5,085 was guaranteed by the SBA.

Nonaccrual loans include both smaller balance single-family mortgage loans, consumer loans and commercial loans and leases that are collectively evaluated for impairment and individually evaluated loans. There were no loans 90 days or more past due and still accruing interest at March 31, 2026 or December 31, 2025.

The following table presents the aging of the recorded investment in past due loans and leases by class of loans as of March 31, 2026 (unaudited):


	30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days or more Past Due		Total Past Due		Loans Not Past Due		Nonaccrual Loans Not 90 days or more Past Due
Commercial	$	5,000	$	—	$	4,200	$	9,200	$	368,964	$	8,853
Real estate:
Single-family residential		1,160		—		2,002		3,162		414,223		—
Multi-family residential		—		—		—		—		161,088		—
Commercial:
Non-owner occupied		—		—		—		—		310,119		—
Owner occupied		—		—		5,163		5,163		206,785		—
Land		—		—		—		—		38,804		—
Construction		—		—		—		—		217,192		—
Consumer:
Home equity lines of credit		—		—		—		—		41,452		95
Other		—		—		—		—		3,751		—
Total	$	6,160	$	-	$	11,365	$	17,525	$	1,762,378	$	8,948

The following table presents the aging of the recorded investment in past due loans and leases by class of loans as of December 31, 2025:


	30 - 59 Days Past Due		60 - 89 Days Past Due		90 Days or more Past Due		Total Past Due		Loans Not Past Due		Nonaccrual Loans Not 90 days or more Past Due
Commercial	$	320	$	452	$	3,511	$	4,283	$	365,147	$	4,670
Real estate:
Single-family residential		892		719		1,847		3,458		424,447		—
Multi-family residential		—		—		—		—		170,972		—
Commercial:
Non-owner occupied		—		—		—		—		288,891		—
Owner occupied		—		—		5,204		5,204		199,212		—
Land		—		—		—		—		40,616		—
Construction		—		—		—		—		208,936		—
Consumer:
Home equity lines of credit		—		—		—		—		41,983		97
Other		—		—		—		—		3,383		—
Total	$	1,212	$	1,171	$	10,562	$	12,945	$	1,743,587	$	4,767

During the three months ended March 31, 2026, and March 31, 2025, the Company did not modify any loans to borrowers experiencing financial difficulties.

Upon the Company’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan) is charged-off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the allowance for credit losses is adjusted by the same amount.

The Company categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt, such as current financial information, historical payment experience, credit documentation, public information and current economic trends, among other factors. Management analyzes loans individually by classifying the loans as to credit risk. This analysis includes commercial, commercial real estate and multi-family residential real estate loans. Internal loan reviews for these loan types are performed at least annually, and more often for loans with higher credit risk. Adjustments to loan risk ratings are made based on the reviews and at any time information is received that may affect risk ratings. The following definitions are used for risk ratings:

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of CFBank’s credit position at some future date.

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that there will be some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable.

Loans not meeting the criteria to be classified into one of the above categories are considered to be “not rated” or “pass-rated” loans. Loans listed as not rated are primarily groups of homogeneous loans. Past due information is the primary credit indicator for groups of homogenous loans. Loans listed as pass-rated loans are loans that are subject to internal loan reviews and are determined not to meet the criteria required to be classified as special mention, substandard or doubtful.

The following table summarizes the risk grading of the Company’s loan portfolio by loan class and by year of origination for the years indicated as of March 31, 2026. Consumer and Single-family residential loans are not risk graded. For purposes of this disclosure, those loans are classified in the following manner: loans that are 89 days or less past due and accruing are “performing” loans and loans greater than 89 days past due or in nonaccrual are “nonperforming” loans.


	Term Loans (amortized cost basis by origination year)
(unaudited)	2026		2025		2024		2023		2022		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Commercial
Pass	$	19,206	$	55,968	$	25,631	$	19,623	$	39,146	$	82,073	$	96,927	$	3,206	$	341,780
Special Mention		—		—		—		—		29		2,695		22,328		—		25,052
Substandard		—		—		1,328		139		5,069		4,361		50		—		10,947
Doubtful		—		—		—		—		385		—		—		—		385
Total Commercial		19,206		55,968		26,959		19,762		44,629		89,129		119,305		3,206		378,164
Gross charge-offs during the three months ended March 31, 2026		—		—		—		—		—		77		—		—		77
Real estate loans:
Single-family residential
Payment performance
Performing		973		17,847		22,255		24,344		99,968		249,996		—		—		415,383
Nonperforming		—		—		156		193		400		1,253		—		—		2,002
Total Single-family residential loans		973		17,847		22,411		24,537		100,368		251,249		—		—		417,385
Multi-family residential
Pass		3,798		16,117		27,160		30,123		18,086		57,186		—		—		152,470
Special Mention		—		—		—		—		—		8,618		—		—		8,618
Total Multi-family residential loans		3,798		16,117		27,160		30,123		18,086		65,804		—		—		161,088
Commercial:
Non-owner occupied
Pass		35,306		84,648		11,083		41,192		42,119		90,802		—		—		305,150
Special Mention		—		—		—		—		—		4,969		—		—		4,969
Total Non-owner occupied loans		35,306		84,648		11,083		41,192		42,119		95,771		—		—		310,119
Owner occupied
Pass		12,825		31,000		14,118		39,196		42,172		69,985		—		—		209,296
Special Mention		—		—		823		—		—		—		—		—		823
Substandard		—		—		—		—		1,829		—		—		—		1,829
Total Owner occupied loans		12,825		31,000		14,941		39,196		44,001		69,985		—		—		211,948
Land
Pass		3,334		19,462		11,015		615		—		4,378		—		—		38,804
Total Land loans		3,334		19,462		11,015		615		—		4,378		—		—		38,804
Construction
Performing		—		777		—		—		—		—		—		—		777
Pass		13,749		44,898		107,851		24,293		21,448		2,169		—		—		214,408
Special Mention		—		—		343		1,664		—		—		—		—		2,007
Total Construction loans		13,749		45,675		108,194		25,957		21,448		2,169		—		—		217,192
Total Real Estate loans		69,985		214,749		194,804		161,620		226,022		489,356		—		—		1,356,536
Consumer:
Home equity lines of credit:
Payment performance
Performing		—		—		—		—		—		—		40,817		540		41,357
Nonperforming		—		—		—		—		—		10		85		—		95
Total Home equity lines of credit		—		—		—		—		—		10		40,902		540		41,452
Other
Performing		—		—		461		—		—		136		3,154		—		3,751
Total Other consumer loans		—		—		461		—		—		136		3,154		—		3,751
Total loans	$	89,191	$	270,717	$	222,224	$	181,382	$	270,651	$	578,631	$	163,361	$	3,746	$	1,779,903
Total gross charge-offs during the three months ended March 31, 2026	$	—	$	—	$	—	$	—	$	—	$	77	$	—	$	—	$	77

The following table summarizes the risk grading of the Company’s loan portfolio by loan class and by year of origination for the years indicated as of December 31, 2025. Consumer and Single-family residential loans are not risk graded. For purposes of this disclosure, those loans are classified in the following manner: loans that are 89 days or less past due and accruing are “performing” loans.


	Term Loans (amortized cost basis by origination year)
	2025		2024		2023		2022		2021		Prior		Revolving loans amortized cost basis		Revolving loans converted to term		Total
Commercial
Pass	$	59,943	$	25,874	$	20,473	$	41,457	$	62,332	$	29,045	$	112,874	$	3,122	$	355,120
Special Mention		—		—		—		5,000		—		2,850		—		—		7,850
Substandard		—		1,328		139		69		4,129		360		50		—		6,075
Doubtful		—		—		—		385		—		—		—		—		385
Total Commercial		59,943		27,202		20,612		46,911		66,461		32,255		112,924		3,122		369,430
Gross charge-offs for the year ended December 31, 2025		—		—		-		7,165		284		—		—		—		7,449
Real estate loans:
Single-family residential
Payment performance
Performing		17,419		26,174		25,165		103,688		200,985		52,627		—		—		426,058
Nonperforming		—		—		193		401		690		563		—		—		1,847
Total Single-family residential loans		17,419		26,174		25,358		104,089		201,675		53,190		—		—		427,905
Gross charge-offs for the year ended December 31, 2025		—		—		27		—		—		—		—		—		27
Multi-family residential
Pass		19,972		27,195		30,168		18,151		46,905		19,915		—		—		162,306
Special Mention		—		—		—		—		—		8,666		—		—		8,666
Total Multi-family residential loans		19,972		27,195		30,168		18,151		46,905		28,581		—		—		170,972
Commercial:
Non-owner occupied
Pass		81,898		9,473		41,336		52,740		46,575		56,869		—		—		288,891
Total Non-owner occupied loans		81,898		9,473		41,336		52,740		46,575		56,869		—		—		288,891
Owner occupied
Pass		28,005		15,062		40,533		43,567		38,965		36,444		—		—		202,576
Substandard		—		—		—		1,840		—		—		—		—		1,840
Total Owner occupied loans		28,005		15,062		40,533		45,407		38,965		36,444		—		—		204,416
Land
Pass		18,042		17,507		617		—		4,450		—		—		—		40,616
Total Land loans		18,042		17,507		617		—		4,450		—		—		—		40,616
Construction
Performing		632		—		—		—		—		—		—		—		632
Pass		34,143		95,801		50,775		22,400		3,178		—		—		—		206,297
Special Mention		—		343		1,664		—		—		—		—		—		2,007
Total Construction loans		34,775		96,144		52,439		22,400		3,178		—		—		—		208,936
Total Real Estate loans		200,111		191,555		190,451		242,787		341,748		175,084		—		—		1,341,736
Consumer:
Home equity lines of credit:
Payment performance
Performing		—		—		—		—		—		—		41,279		607		41,886
Nonperforming		—		—		—		—		—		—		87		10		97
Total Home equity lines of credit		—		—		—		—		—		—		41,366		617		41,983
Other
Payment performance
Performing		—		468		—		—		—		136		2,278		501		3,383
Nonperforming		—		—		—		—		—		—		—		-		-
Total Other consumer loans		—		468		—		-		—		136		2,278		501		3,383
Gross charge-offs for the year ended December 31, 2025		—		—		—		—		—		—		—		—		-
Total loans	$	260,054	$	219,225	$	211,063	$	289,698	$	408,209	$	207,475	$	156,568	$	4,240	$	1,756,532
Total gross charge-offs during the year ended December 31, 2025	$	—	$	—	$	27	$	7,165	$	284	$	—	$	—	$	—	$	7,476