(1) General. OptimumBank Holdings, Inc. (the “Company”) is a bank holding company and owns 100% of OptimumBank (the “Bank”), a Florida-chartered community bank, OptimumHUD Loans, LLC (d/b/a) as OptimumFunding, LLC, a wholly owned non-bank subsidiary, and OptimumFinance, LLC, a wholly owned non-bank, asset-based lending subsidiary. The Bank’s deposits are insured up to applicable limits by the Federal Deposit Insurance Corporation (“FDIC”). The Bank offers a variety of community banking services to individual and corporate customers through its three banking offices located in Broward County and Miami-Dade County, Florida. The Bank also markets its deposit and electronic funds transfer services on a national basis to merchant cash advance providers.

Basis of Presentation. In the opinion of management, the accompanying condensed consolidated financial statements of the Company contain all adjustments (consisting principally of normal recurring accruals) necessary to present fairly the financial position at March 31, 2026, the results of operations for the three-month ended March 31, 2026 and 2025, and cash flows for the three-month periods ended March 31, 2026 and 2025. All significant intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the three-month ended March 31, 2026, are not necessarily indicative of the results to be expected for the full year of 2026.

Comprehensive Income. Accounting Principles Generally Accepted in the United States of America (“U.S. GAAP”) requires recognized revenue, expenses, gains and losses be included in net income. Although certain changes in assets and liabilities, such as unrealized gains and losses on available for sale debt securities are reported as a separate component of the equity section of the condensed consolidated balance sheets, such items along with net income, are components of comprehensive income.

Accumulated other comprehensive loss consists of the following (dollars in thousands):

 Schedule of Accumulated Other Comprehensive Loss 

Recently Adopted Accounting Pronouncements:

Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2023-09, “Income Taxes (Topic 740) Improvements to Income Tax Disclosures”. The Company adopted ASU 2023-09 during the year ended December 31, 2025. The amendments enhance income tax disclosures, primarily related to the rate reconciliation and income taxes paid. The adoption of this guidance was applied prospectively and did not have a material impact on the Company’s consolidated financial statements.

Accounting Pronouncements Not Yet Adopted:

FASB ASU No. 2023-06, “Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative”. This ASU amends the disclosure or presentation requirements related to various subtopics in the FASB ASC. The amendments in this ASU are expected to clarify or improve disclosure and presentation requirements of a variety of Codification Topics, allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the requirements, and align the requirements in the Codification with the SEC’s regulations. For entities subject to the SEC’s existing disclosure requirements and for entities required to file or furnish statements with or to the SEC in preparation for the sale of or for purposes of issuing securities that are not subject to contractual restrictions on transfer, the effective date for each amendment will be the date on which the SEC removes that related disclosure from its rules. For all other entities, the amendments will be effective two years later. However, if by June 30, 2027, the SEC has not removed the related disclosure from its regulations, the amendments will be removed from the Codification and not become effective for any entity.

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OPTIMUMBANK HOLDINGS, INC. AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements (Unaudited)

(1) General, Continued.

FASB ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures”. This amendment requires enhanced disaggregation of certain expense categories within the income statement to provide more detailed information about the nature and function of expenses. The objective is to improve the transparency and usefulness of financial statements for users by offering greater insight into the components of operating expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027. These changes may be applied prospectively or retroactively. Early adoption is permitted. The Company is currently evaluating the impact on its disclosures.

FASB ASU 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity”. This amendment determining the Accounting Acquirer in a Business Combination Involving a Variable Interest Entity. This update clarifies how to identify the accounting acquirer when a business combination involves a variable interest entity. The standard is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted. The standard is effective prospectively for business combinations occurring on or after the adoption date. The Company does not expect the adoption of this standard to have a material impact on its condensed consolidated financial statements.

FASB ASU 2025-06, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Capitalization and Disclosure Improvements”. This amendment provides updated guidance on the capitalization of costs related to internal-use software and expands the required disclosures. The objective is to clarify when capitalization is appropriate and to enhance the transparency of financial reporting related to internal-use software development. The amendments in this update are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. The Company is evaluating the impact of this guidance; adoption is not expected to have a material effect on the Company’s condensed consolidated financial statements.

FASB ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. ASU 2025-11 clarifies interim disclosure requirements and provides a comprehensive list of interim disclosures that are required by GAAP. The ASU also includes a disclosure principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The standard is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact of the changes to its condensed consolidated financial statements and existing disclosures.