Rhinebeck Bancorp, Inc.

Table of Contents

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended June 30, 2026

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File No. 001-38779

Rhinebeck Bancorp, Inc.

(Exact name of registrant as specified in its charter)


Maryland		83-2117268
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

2 Jefferson Plaza, Poughkeepsie, New York		12601
(Address of Principal Executive Offices)		(Zip Code)

(845) 454-8555

(Registrant’s telephone number)

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


Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.01 per share		RBKB		The NASDAQ Stock Market, LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

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


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

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

As of August 1, 2026, there were 15,635,966 shares of the Registrant’s common stock, par value $0.01 per share, outstanding.

Table of Contents

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION		1

Item 1.	Financial Statements (Unaudited)	1

	Consolidated Statements of Financial Condition at June 30, 2026 and December 31, 2025	1

	Consolidated Statements of Income for the Three and Six Months Ended June 30, 2026 and 2025	2

	Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2026 and 2025	3

	Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2026 and 2025	4

	Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025	5

	Notes to Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	40

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	52

Item 4.	Controls and Procedures	52

PART II. OTHER INFORMATION		53

Item 1.	Legal Proceedings	53

Item 1A.	Risk Factors	53

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	53

Item 3.	Defaults Upon Senior Securities	53

Item 4.	Mine Safety Disclosures	53

Item 5.	Other Information	54

Item 6.	Exhibits	54

	SIGNATURES	55

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1.

Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Financial Condition (Unaudited)

(In thousands, except share and per share data)


		June 30,			December 31,
		2026			2025
Assets
Cash and due from banks		$	20,974		$	15,893
Federal funds sold			279,963			83,157
Interest-bearing depository accounts			3,626			2,936
Total cash and cash equivalents			304,563			101,986

Available-for-sale securities (at fair value)			171,368			162,203
Loans receivable (net of allowance for credit losses of $7,695 and $8,353, respectively)			918,477			953,385
Federal Home Loan Bank stock			1,153			1,957
Accrued interest receivable			4,592			4,882
Cash surrender value of life insurance			31,397			30,996
Deferred tax assets (net of valuation allowance of $663 and $809, respectively)			4,623			4,941
Premises and equipment, net			13,249			13,621
Goodwill			2,235			2,235
Intangible assets, net			92			106
Other assets			18,303			25,454
Total assets		$	1,470,052		$	1,301,766
Liabilities and Stockholders’ Equity
Liabilities
Deposits
Non-interest bearing		$	242,774		$	227,272
Interest bearing			1,040,198			870,068
Total deposits			1,282,972			1,097,340

Mortgagors’ escrow accounts			13,206			9,399
Advances from the Federal Home Loan Bank			5,153			25,153
Subordinated debt			5,155			5,155
Accrued expenses and other liabilities			23,963			27,867
Total liabilities			1,330,449			1,164,914

Stockholders’ Equity
Preferred stock (par value $0.01 per share; 5,000,000 authorized, no shares issued)			—			—
Common stock (par value $0.01; authorized 25,000,000; issued and outstanding 11,180,786 and 11,141,033 at June 30, 2026 and December 31, 2025, respectively)			112			112
Additional paid-in capital			44,906			45,710
Unearned common stock held by the employee stock ownership plan			(2,728)			(2,837)
Retained earnings			105,976			101,797
Accumulated other comprehensive loss:
Net unrealized loss on available-for-sale securities, net of taxes			(6,840)			(6,255)
Defined benefit pension plan, net of taxes			(1,823)			(1,675)
Total accumulated other comprehensive loss			(8,663)			(7,930)
Total stockholders’ equity			139,603			136,852
Total liabilities and stockholders’ equity		$	1,470,052		$	1,301,766

See accompanying notes to unaudited consolidated financial statements

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Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Income (Unaudited)

(In thousands, except share and per share data)



		Three Months Ended June 30,						Six Months Ended June 30,
		2026			2025			2026			2025
Interest and Dividend Income
Interest and fees on loans		$	14,449		$	15,066		$	28,787		$	30,074
Interest and dividends on securities			1,360			1,275			2,772			2,626
Other interest income			1,204			414			2,065			693
Total interest and dividend income			17,013			16,755			33,624			33,393
Interest Expense
Interest expense on deposits			5,304			4,866			10,477			9,628
Interest expense on borrowings			77			397			321			1,236
Total interest expense			5,381			5,263			10,798			10,864
Net interest income			11,632			11,492			22,826			22,529
(Credit to) Provision for Credit Losses			(11)			(101)			60			252
Net interest income after (credit to) provision for credit losses			11,643			11,593			22,766			22,277
Non-interest Income
Service charges on deposit accounts			744			728			1,508			1,501
Net gain on sales of loans			—			69			—			107
Increase in cash surrender value of life insurance			203			194			401			382
Net gain on disposal of premises and equipment			15			—			22			—
Investment advisory income			424			269			727			605
Other			357			342			551			758
Total non-interest income			1,743			1,602			3,209			3,353
Non-interest Expense
Salaries and employee benefits			5,538			5,242			11,071			10,376
Occupancy			1,127			1,115			2,350			2,186
Data processing			605			534			1,214			1,059
Professional fees			636			492			1,029			969
Marketing			138			223			283			423
FDIC deposit insurance and other insurance			253			295			472			592
Amortization of intangible assets			7			17			14			37
Other			1,704			1,789			3,313			3,573
Total non-interest expense			10,008			9,707			19,746			19,215
Net income before income taxes			3,378			3,488			6,229			6,415
Net Provision for Income Taxes			762			762			1,397			1,401
Net income		$	2,616		$	2,726		$	4,832		$	5,014

Earnings per common share:
Basic		$	0.24		$	0.25		$	0.45		$	0.47
Diluted		$	0.24		$	0.25		$	0.44		$	0.46

Weighted average shares outstanding, basic			10,829,944			10,787,446			10,836,517			10,782,259
Weighted average shares outstanding, diluted			10,958,117			10,954,124			10,970,534			10,939,842

See accompanying notes to unaudited consolidated financial statements

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Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Comprehensive Income (Unaudited)

(In thousands, except share and per share data)


		Three Months Ended June 30,						Six Months Ended June 30,
		2026			2025			2026			2025
Net Income		$	2,616		$	2,726		$	4,832		$	5,014
Other Comprehensive Income
Unrealized holding (loss) gain arising during the period			(233)			1,021			(740)			3,287
Net unrealized (loss) gain on available for sale securities arising during the period			(233)			1,021			(740)			3,287
Tax effect			49			(214)			155			(690)
Unrealized (loss) gain on available for sale securities, net of tax			(184)			807			(585)			2,597
Defined benefit pension plan:
Actuarial losses arising during the period			(201)			(634)			(201)			(634)
Reclassification adjustment for amortization of net actuarial loss (a)			13			(74)			13			(74)
Total			(188)			(708)			(188)			(708)
Tax effect (b)			39			149			39			149
Defined benefit pension plan losses, net of tax			(149)			(559)			(149)			(559)
Other comprehensive (loss) income:			(333)			248			(734)			2,038
Total Comprehensive Income		$	2,283		$	2,974		$	4,098		$	7,052

(a)	Included in other non-interest expense on the consolidated statements of income.

(b)	Includes $3 for both the three and six months ended June 30, 2026 and ($15) for the three and six months ended June 30, 2025, for tax effect of amortization of net actuarial loss, which are included in the provision for income taxes on the consolidated statements of income.

See accompanying notes to unaudited consolidated financial statements

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Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In thousands, except share and per share data)


							Unearned						Accumulated
					Additional		Common						Other
		Common			Paid-in		Stock Held			Retained			Comprehensive
		Stock			Capital		by the ESOP			Earnings			Loss			Total
Balance at December 31, 2024		$	111		$	45,946	$	(3,055)		$	91,766		$	(12,935)		$	121,833

Net income			—			—		—			2,288			—			2,288
Other comprehensive income			—			—		—			—			1,790			1,790
ESOP shares committed to be allocated			—			—		55			—			—			55
Share-based compensation expense			—			9		—			—			—			9
Balance at March 31, 2025		$	111		$	45,955	$	(3,000)		$	94,054		$	(11,145)		$	125,975

Net income			—			—		—			2,726			—			2,726
Other comprehensive income			—			—		—			—			248			248
ESOP shares committed to be allocated			—			6		54			—			—			60
Share-based compensation expense			—			10		—			—			—			10
Exercise of options (37,000 shares)			—			—		—			—			—			—
Share redemption for tax withholding on exercised options (26,498 shares)			—			(62)		—			—			—			(62)
Balance at June 30, 2025		$	111		$	45,909	$	(2,946)		$	96,780		$	(10,897)		$	128,957


Balance at December 31, 2025		$	112		$	45,710	$	(2,837)		$	101,797		$	(7,930)		$	136,852

Net income			—			—		—			2,216			—			2,216
Other comprehensive loss			—			—		—			—			(400)			(400)
ESOP shares committed to be allocated			—			22		55			—			—			77
Share-based compensation expense			—			10		—			—			—			10
Exercise of options (38,365 shares)			—			107		—			—			—			107
Share redemption for tax withholding (9,422 shares)			—			—		—			—			—			—
Repurchase of common stock (17,003 shares)			—			(170)		—			(50)			—			(220)
Balance at March 31, 2026		$	112		$	45,679	$	(2,782)		$	103,963		$	(8,330)		$	138,642

Net income			—			—		—			2,616			—			2,616
Other comprehensive loss			—			—		—			—			(333)			(333)
ESOP shares committed to be allocated			—			34		54			—			—			88
Share-based compensation expense			—			65		—			—			—			65
Restricted stock granted (100,878 shares)			1			(1)		—			—			—			—
Exercise of options (31,365 shares)			—			117		—			—			—			117
Share redemption for tax withholding on exercised options (5,492 shares)			—			—		—			—			—			—
Repurchase of common stock (98,938)			(1)			(988)		—			(603)			—			(1,592)
Balance at June 30, 2026		$	112		$	44,906	$	(2,728)		$	105,976		$	(8,663)		$	139,603

See accompanying notes to unaudited consolidated financial statements

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Rhinebeck Bancorp, Inc. and Subsidiary

Consolidated Statements of Cash Flows (Unaudited)

(In thousands, except share and per share data)


		Six Months Ended June 30,
		2026			2025
Cash Flows from Operating Activities
Net income		$	4,832		$	5,014
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization and accretion of premiums and discounts on investments, net			(138)			(88)
Provision for credit losses			60			252
Loans originated for sale			—			(3,973)
Proceeds from sale of loans			—			3,145
Net gain on sale of loans			—			(107)
Amortization of intangible assets			14			37
Depreciation and amortization			662			622
Net gain from disposal of premises and equipment			(22)			—
Deferred income tax expense			513			946
Increase in cash surrender value of insurance			(401)			(382)
Net decrease (increase) in accrued interest receivable			290			(67)
Expense of earned ESOP shares			165			115
Share-based compensation expense			75			19
Net decrease in other assets			7,151			734
Net (decrease) increase in accrued expenses and other liabilities			(4,091)			474
Net cash provided by operating activities			9,110			6,741
Cash Flows from Investing Activities
Proceeds from maturities and principal repayments of securities			12,660			24,608
Purchases of securities			(22,427)			(2,626)
Net purchases of FHLB Stock			804			1,937
Net decrease in loans			34,847			11,659
Purchases of bank premises and equipment			(842)			(298)
Proceeds from disposal of premises and equipment			574			—
Net cash provided by investing activities			25,616			35,280
Cash Flows from Financing Activities
Net increase in demand deposits, NOW, money market and savings accounts			21,959			32,173
Net increase in time deposits			7,661			17,852
Net increase in mortgagors' escrow accounts			3,807			3,324
Net increase (decrease) in short-term debt			1,709			(45,000)
Proceeds from borrowings			—			1,830
Repayment of borrowings			(21,709)			—
Share redemption for tax withholding			—			(62)
Stock repurchases			(1,813)			—
Proceeds from exercise of stock options			225			—
Proceeds of stock subscriptions			156,012			—
Net cash provided by financing activities			167,851			10,117
Net increase in cash and cash equivalents			202,577			52,138
Cash and Cash Equivalents
Beginning balance			101,986			37,484
Ending balance		$	304,563		$	89,622
Supplemental Disclosures of Cash Flow Information
Cash paid for:
Interest		$	11,149		$	11,057
Income taxes		$	661		$	431

See accompanying notes to unaudited consolidated financial statements

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

1. Nature of Business and Significant Accounting Policies

On July 21, 2026, Rhinebeck Bancorp, MHC, the former mutual holding company parent of Rhinebeck Bancorp, Inc. (the “Company” or “Rhinebeck Bancorp”), completed its second-step conversion, after which Rhinebeck Bancorp, MHC ceased to exist. In connection with the second-step conversion, the Company conducted a public stock offering in which it sold 8,880,210 shares of its common stock at a price of $10.00 per share for gross proceeds of $88.8 million. As part of the transaction, each outstanding share of Rhinebeck Bancorp common stock owned by the public stockholders as of July 21, 2026 was converted into new shares of Rhinebeck Bancorp common stock based on an exchange ratio of 1.3978. Cash in lieu of fractional shares was paid at a rate of $10.00 per share. As a result of the offering and the exchange of shares, the Company had 15,635,966 shares outstanding. Earnings per share and other share information disclosed throughout this report is as of June 30, 2026, and therefore does not include the effect of the Company’s conversion and related stock offering.

The financial statements include the accounts of the Company, a stock holding company, and its wholly-owned subsidiary, Rhinebeck Bank (the “Bank”), a New York chartered stock savings bank. The primary purpose of the Company is to act as a holding company for the Bank. The Bank provides a full range of banking and financial services to consumer and commercial customers through its twelve branches and three representative offices located in Dutchess, Ulster, Orange, and Albany counties. Financial services, including investment advisory and financial product sales, are offered through a division of the Bank doing business as Rhinebeck Asset Management.

The unaudited consolidated financial statements reflect all adjustments, which in the opinion of management are necessary for a fair presentation of the results of the interim periods and are of a normal and recurring nature. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026 or for any other period.

The unaudited financial statements and other financial information contained in this Quarterly Report on Form 10-Q should be read in conjunction with the audited financial statements, and related notes, of the Company at and for the year ended December 31, 2025 contained in the Company’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission on March 13, 2026 (the “Annual Report on Form 10-K”).

For more information regarding the Company’s significant accounting policies, see the Notes to the Consolidated Financial Statements in the Annual Report on Form 10-K. As of June 30, 2026, the critical accounting policies of the Company have not changed materially from those disclosed in the Annual Report on Form 10-K. See Note 1 of the Consolidated Financial Statements – Nature of Business and Significant Accounting Policies.

Basis of Financial Statements Presentation

The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and general practices within the banking industry. In preparing the consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities, as of the date of the consolidated statements of financial condition and reported amounts of revenues and expenses for the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for credit losses (“ACL”).

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the Company and the Bank. All significant intercompany accounts and transactions have been eliminated in consolidation.

Reclassifications

Certain amounts in the prior year consolidated financial statements may be reclassified as required to conform to the current year’s presentation. These reclassifications have no effect on our previously reported net income or stockholders’ equity.

Impact of Recent Accounting Pronouncements

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-06, which amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification. In annual periods, this requires disclosure of an entity’s accounting policy related to where in the statement of cash flows the entity presents cash flows associated with derivative instruments and the related gains and losses. This also requires disclosure of the methods used in the diluted earnings per share computation for each dilutive security and clarifies that certain disclosures should be made during interim periods. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company is evaluating the impact of this ASU but does not expect it to have a material impact on the Company’s consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures,” which requires disaggregated disclosure of income statement expenses for public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. The ASU requires new financial statement disclosures in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense captions. The guidance will be effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. Upon adoption, ASU 2024-03 may be applied prospectively or retrospectively. The Company is evaluating the impact of this ASU but does not expect it to have a material impact on the Company’s consolidated financial statements.

In November 2025, the FASB issued ASU 2025-08, “Financial Instruments—Credit Losses (Topic 326): Purchased Loans,” which amends the accounting for acquired loans by introducing a category of purchased seasoned loans and expanding the use of the gross-up approach, requiring qualifying acquired loans to be recorded at purchase price plus an allowance for expected credit losses rather than recognizing a Day-1 provision through earnings. ASU 2025-08 is effective for annual reporting periods beginning after December 15, 2026, including interim periods within those annual periods, and is to be applied prospectively, with early adoption permitted. The Company is evaluating the impact of this ASU but does not expect it to have a material impact on the Company’s consolidated financial statements.

In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting Improvements,” which updates the hedge accounting guidance to improve alignment between hedge accounting and an entity’s risk management activities and to clarify and simplify the application of certain hedge accounting requirements. ASU 2025-09 is effective for annual reporting periods beginning after December 15, 2026, including interim periods within those annual reporting periods, with early adoption permitted. The Company is evaluating the impact of this ASU but does not expect it to have a material impact on the Company’s consolidated financial statements.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

2. Investment Securities

The amortized cost, gross unrealized gains and losses and fair values of available for sale securities are as follows:


		June 30, 2026
					Gross			Gross
					Unrealized			Unrealized
		Amortized Cost			Gains			Losses			Fair Value
U.S. Treasury securities		$	54,313		$	22		$	(289)		$	54,046
U.S. government agency mortgage-backed securities–residential			90,434			38			(7,594)			82,878
U.S. government agency securities			16,597			—			(184)			16,413
Municipal securities⁽¹⁾			2,204			—			(123)			2,081
Corporate bonds			16,149			52			(421)			15,780
Other			329			—			(159)			170
Total		$	180,026		$	112		$	(8,770)		$	171,368


		December 31, 2025
					Gross			Gross
					Unrealized			Unrealized
		Amortized Cost			Gains			Losses			Fair Value
U.S. Treasury securities		$	35,692		$	147		$	(11)		$	35,828
U.S. government agency mortgage-backed securities–residential			95,787			80			(6,887)			88,980
U.S. government agency securities			18,541			9			(198)			18,352
Municipal securities⁽¹⁾			2,205			—			(123)			2,082
Corporate bonds			17,309			38			(758)			16,589
Other			587			—			(215)			372
Total		$	170,121		$	274		$	(8,192)		$	162,203

⁽¹⁾	The issuers of municipal securities are all within New York State.

The following tables present the fair value and unrealized losses of the Company’s available for sale securities with gross unrealized losses aggregated by the length of time the individual securities have been in a continuous unrealized

loss position:


		June 30, 2026
		Less Than 12 Months						12 Months or Longer						Total
					Unrealized						Unrealized						Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
U.S. Treasury securities		$	42,398		$	(289)		$	—		$	—		$	42,398		$	(289)
U.S. government agency mortgage-backed securities-residential			24,710			(398)			52,983			(7,196)			77,693			(7,594)
U.S. government agency securities			6,580			(16)			9,832			(168)			16,412			(184)
Municipal securities			522			(8)			1,474			(115)			1,996			(123)
Corporate bonds			3,222			(28)			9,282			(393)			12,504			(421)
Other									153			(159)			153			(159)
Total		$	77,432		$	(739)		$	73,724		$	(8,031)		$	151,156		$	(8,770)

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)


		December 31, 2025
		Less Than 12 Months						12 Months or Longer						Total
					Unrealized						Unrealized						Unrealized
		Fair Value			Losses			Fair Value			Losses			Fair Value			Losses
U.S. Treasury securities		$	12,909		$	(11)		$	—		$	—		$	12,909		$	(11)
U.S. government agency mortgage-backed securities-residential			9,846			(24)			64,740			(6,863)			74,586			(6,887)
U.S. government agency securities			—			—			11,803			(198)			11,803			(198)
Municipal securities			—			—			1,997			(123)			1,997			(123)
Corporate bonds			1,235			(14)			12,570			(744)			13,805			(758)
Other			352			(215)			—			—			352			(215)
Total		$	24,342		$	(264)		$	91,110		$	(7,928)		$	115,452		$	(8,192)

At June 30, 2026, the Company had 171 individual available for sale securities in an unrealized loss position with unrealized losses totaling $8,770 with an aggregate depreciation of 5.48% from the Company’s amortized cost.

The Company evaluates securities in an unrealized loss position for impairment related to credit losses on at least a quarterly basis. Securities in unrealized loss positions are first assessed as to whether we intend to sell, or if it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis. If one of the criteria is met, the security’s amortized cost basis is written down to fair value through current earnings. For securities that do not meet these criteria, the Company evaluates whether the decline in fair value resulted from credit losses or other factors. If this assessment indicates that a credit loss exists, we compare the present value of cash flows expected to be collected from the security with the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis for the security, a credit loss exists and an allowance for credit losses is recorded, limited to the amount that the fair value of the security is less than its amortized cost basis. Unrealized losses on asset-backed securities, state and municipal securities, and corporate bonds have not been recognized into income because the issuers are of high credit quality, we do not intend to sell and it is likely that we will not be required to sell the securities prior to their anticipated recovery. The decline in fair value is largely due to changes in interest rates and other market conditions. The issuers continue to make timely principal and interest payments on the securities. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income, net of applicable taxes. No allowance for credit losses for available for sale securities was recorded as of June 30, 2026.

Federal agency obligations, residential mortgage-backed pass-through securities and commercial mortgage-backed pass-through securities are issued by U.S. Government agencies and U.S. Government sponsored enterprises. Although a government guarantee exists on these investments, these entities are not legally backed by the full faith and credit of the federal government. Nonetheless, at this time we do not foresee any set of circumstances in which the government would not fund its commitments on these investments.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The amortized cost and fair value of available for sale debt securities at June 30, 2026 and December 31, 2025, by contractual maturities, are presented below. Actual maturities of mortgage-backed securities may differ from contractual maturities because the mortgages underlying the securities may be called or repaid without any penalties. Because mortgage-backed securities are not due at a single maturity date, they are not included in the maturity categories in the following maturity summary:


		June 30, 2026						December 31, 2025
		Amortized Cost			Fair Value			Amortized Cost			Fair Value
Maturity:
Within 1 year		$	18,875		$	18,814		$	13,939		$	13,850
After 1 but within 5 years			57,455			56,929			45,425			45,358
After 5 but within 10 years			12,933			12,577			14,383			13,643
After 10 years			—			—			—			—
Total Maturities			89,263			88,320			73,747			72,851
Mortgage-backed securities			90,434			82,878			95,787			88,980
Other			329			170			587			372
Total		$	180,026		$	171,368		$	170,121		$	162,203

At June 30, 2026 and December 31, 2025, available for sale securities with a carrying value of $96,795 and $106,500, respectively, were pledged to secure Federal Home Loan Bank of New York (the “FHLB”) borrowings. In addition, at June 30, 2026 and December 31, 2025, $977 and $978 of available for sale securities were pledged to secure borrowings at the Federal Reserve Bank of New York (the “FRB”), respectively.

During the six months ended June 30, 2026, there were no sales of available for sale securities and no realized gains or losses.

The Company elected not to measure an allowance for credit losses for accrued interest receivable, because a timely write-off policy exists. A security is placed on non-accrual status at the time any principal or interest payments become more than 90 days delinquent or if full collection of interest or principal becomes uncertain. Accrued interest for a security placed on non-accrual status is reversed against interest income. There were no securities on non-accrual status, and therefore, there was no accrued interest related to securities reversed against interest income for the periods ended June 30, 2026 or December 31, 2025. Total accrued interest receivable on available for sale securities totaled $773 and $714 at June 30, 2026 and December 31, 2025, respectively, and was reported in accrued interest receivable on the consolidated statements of financial condition of this Quarterly Report on Form 10-Q.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

3. Loans and Allowance for Credit Losses

A summary of the Company’s loan portfolio is as follows:


		June 30,			December 31,
		2026			2025
Commercial real estate loans:
Non-residential		$	417,065		$	417,808
Multi-family			99,582			107,938
Construction			6,462			8,982
Commercial and industrial loans			87,165			91,526
Residential real estate loans			106,824			100,086
Consumer loans:
Indirect automobile			188,112			213,802
Home equity			11,947			12,290
Other consumer			5,816			5,733
Total gross loans			922,973			958,165
Dealer reserves			3,199			3,573
Allowance for credit losses			(7,695)			(8,353)
Total net loans		$	918,477		$	953,385

The following tables present the classes of the loan portfolio summarized by the aging categories of performing loans and non-accrual loans:


		June 30, 2026
											Greater Than
					30-59 Days			60-89 Days			90 Days Past			Total Loans
		Current			Past Due			Past Due			Due			Receivable			Non-accrual
Commercial real estate:
Non-residential		$	415,365		$	—		$	16		$	1,684		$	417,065		$	1,684
Multifamily			99,582			—			—			—			99,582			—
Construction			6,462			—			—			—			6,462			—
Commercial and industrial			86,892			36			227			10			87,165			10
Residential real estate			106,130			325			—			369			106,824			1,176
Consumer:
Indirect automobile			181,600			5,126			979			407			188,112			506
Home equity			11,771			164			—			12			11,947			12
Other consumer			5,659			154			3			—			5,816			—
Total		$	913,461		$	5,805		$	1,225		$	2,482		$	922,973		$	3,388

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)


		December 31, 2025
											Greater Than
					30-59 Days			60-89 Days			90 Days Past			Total Loans
		Current			Past Due			Past Due			Due			Receivable			Non-accrual
Commercial real estate:
Non-residential		$	415,286		$	837		$	17		$	1,668		$	417,808		$	1,668
Multifamily			107,938			—			—			—			107,938			—
Construction			8,982			—			—			—			8,982			—
Commercial and industrial			91,241			263			—			22			91,526			22
Residential real estate			98,355			1,157			184			390			100,086			1,255
Consumer:
Indirect automobile			204,192			7,831			1,072			707			213,802			740
Home equity			12,075			170			45			—			12,290			—
Other consumer			5,561			134			23			15			5,733			15
Total		$	943,630		$	10,392		$	1,341		$	2,802		$	958,165		$	3,700

All of our non-accrual loans are individually analyzed for credit loss. The Company has one individually analyzed home equity loan of $98 that was accruing interest at June 30, 2026.

The following table presents the Company’s amortized cost basis of non-accrual loans for which there is no related ACL:


	June 30, 2026		December 31, 2025
Commercial real estate:
Non-residential	$	1,684	$	1,668
Commercial and industrial		—		22
Residential real estate		1,176		1,255
Consumer:
Indirect automobile		97		110
Home equity		12		—
Total	$	2,969	$	3,055

The following table presents the Company’s amortized cost basis of only those non-accrual loans with a related ACL:


	June 30, 2026				December 31, 2025
	Non-accrual loans		Related ACL		Non-accrual loans		Related ACL
Commercial and industrial	$	10	$	10	$	—	$	—
Consumer:
Indirect automobile		409		146		630		226
Other consumer		—		7		15		14
Total	$	419	$	163	$	645	$	240

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

During the six months ended June 30, 2026, $34 in accrued interest was reversed for non-accrual loans. The total accrued interest receivable associated with loans totaled $3,819 and $4,168 at June 30, 2026 and December 31, 2025, respectively, and was reported in accrued interest receivable on the consolidated statements of financial condition.

Residential mortgage and consumer loans secured by residential real estate properties in formal foreclosure proceedings totaled $58 at June 30, 2026 and $0 at December 31, 2025.

The Company transfers a portion of its originated commercial real estate loans to participating lenders. The amounts transferred have been accounted for as sales and are therefore not included in the Company’s accompanying statements of financial condition. The Company and participating lenders share ratably in any gains or losses that may result from a loan’s performance under its contractual terms. The Company continues to service the loans on behalf of the participating lenders and, as such, collects cash payments from the borrowers, remits payments to participating lenders and disburses required escrow funds to relevant parties. At June 30, 2026 and December 31, 2025, the Company was servicing loans for participants aggregating $51,784 and $52,240, respectively.

The Company also services certain loans that it has sold to third parties. The aggregate balances of loans serviced for others were $240,518 and $250,311 as of June 30, 2026 and December 31, 2025, respectively. Included in these are loans serviced for the Federal Home Loan Mortgage Corporation with recourse provisions, whereby the Company is obligated to bear all costs when a default, including foreclosure, occurs. At June 30, 2026 and December 31, 2025, the maximum contingent liability associated with loans sold with recourse was $470 and $473, respectively, which is not recorded in the consolidated financial statements. Losses are borne in priority order by the borrower, private mortgage insurance and the Company. As of June 30, 2026, the Company has not repurchased any loans or incurred any losses under these recourse provisions.

The balances of capitalized servicing rights included in other assets at June 30, 2026 and December 31, 2025 were $1,094 and $1,262, respectively. Fair value exceeds carrying value, and thus, no impairment charges related to servicing rights were recognized during the six months ended June 30, 2026 or the year ended December 31, 2025.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Activity in the Company’s ACL for loans for the three and six months ended June 30, 2026 is summarized in the tables below:


	Three months ended June 30, 2026
	Balance at									Provision for			Balance at
	beginning of									(credit to)			end of
	period			Charge-offs			Recoveries			credit losses			period
Commercial real estate:
Non-residential	$	3,064		$	—		$	—		$	58		$	3,122
Multifamily		463			—			—			(43)			420
Construction		—			—			—			—			—
Commercial and industrial		737			(1)			—			(161)			575
Residential real estate		742			—			—			40			782
Consumer:
Indirect automobile		2,721			(495)			380			35			2,641
Home equity		87			—			—			—			87
Other consumer		74			(9)			22			(19)			68
Total	$	7,888		$	(505)		$	402		$	(90)		$	7,695

	Six months ended June 30, 2026
	Balance at									(Credit to)			Balance at
	beginning of									provision for			end of
	period			Charge-offs			Recoveries			credit losses			period
Commercial real estate:
Non-residential	$	3,142		$	—		$	—		$	(20)		$	3,122
Multifamily		490			—			—			(70)			420
Commercial and industrial		762			(1)			11			(197)			575
Residential real estate		739			—			—			43			782
Consumer:
Indirect automobile		3,050			(1,363)			714			240			2,641
Home equity		90			—			—			(3)			87
Other consumer		80			(40)			29			(1)			68
Total	$	8,353		$	(1,404)		$	754		$	(8)		$	7,695

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Activity in the Company’s ACL for loans for the three and six months ended June 30, 2025 is summarized in the tables below.


	Three months ended June 30, 2025
	Balance at									Provision for			Balance at
	beginning of									(credit to)			end of
	period			Charge-offs			Recoveries			credit losses			period
Commercial real estate:
Non-residential	$	2,717		$	—		$	—		$	60		$	2,777
Multifamily		332			—			—			1			333
Construction		—			—			—			—			—
Commercial and industrial		673			—			—			(25)			648
Residential real estate		612			—			—			110			722
Consumer:
Indirect automobile		3,911			(476)			408			(267)			3,576
Home equity		87			—			—			1			88
Other consumer		74			(31)			8			36			87
Total	$	8,406		$	(507)		$	416		$	(84)		$	8,231

	Six months ended June 30, 2025
	Balance at									Provision for			Balance at
	beginning of									(credit to)			end of
	period			Charge-offs			Recoveries			credit losses			period
Commercial real estate:
Non-residential	$	2,675		$	—		$	—		$	102		$	2,777
Multifamily		313			—			—			20			333
Commercial and industrial		684			(175)			3			136			648
Residential real estate		575			—			—			147			722
Consumer:
Indirect automobile		4,133			(1,260)			834			(131)			3,576
Home equity		84			—			—			4			88
Other consumer		75			(31)			28			15			87
Total	$	8,539		$	(1,466)		$	865		$	293		$	8,231

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The Company has also recorded an ACL for unfunded commitments, which was recorded in other liabilities. The provision for unfunded commitments is recorded within the provision for credit losses on the Company’s income statement. Activity in the Company’s ACL for unfunded commitments for the three and six months ended June 30, 2026 is summarized in the tables below.


	Three months ended June 30, 2026
	Balance at			Provision for			Balance at
	beginning of			(credit to)			end of
	period			credit losses			period
Commercial real estate:
Non-residential	$	19		$	82		$	101
Commercial and industrial		100			—			100
Residential real estate		3			(2)			1
Consumer:
Home equity		17			—			17
Other consumer		2			(1)			1
Total	$	141		$	79		$	220


	Six months ended June 30, 2026
	Balance at			Provision for			Balance at
	beginning of			(credit to)			end of
	period			credit losses			period
Commercial real estate:
Non-residential	$	19		$	82		$	101
Commercial and industrial		111			(11)			100
Residential real estate		3			(2)			1
Consumer:
Home equity		17			—			17
Other consumer		2			(1)			1
Total	$	152		$	68		$	220

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Activity in the Company’s ACL for unfunded commitments for the three and six months ended June 30, 2025 is summarized in the tables below.


	Three months ended June 30, 2025
	Balance at			(Credit to)			Balance at
	beginning of			provision for			end of
	period			credit losses			period
Commercial real estate:
Non-residential	$	92		$	(19)		$	73
Commercial and industrial		103			4			107
Residential real estate		5			(2)			3
Consumer:
Home equity		18			—			18
Other consumer		2			—			2
Total	$	220		$	(17)		$	203


	Six months ended June 30, 2025
	Balance at			(Credit to)			Balance at
	beginning of			provision for			end of
	period			credit losses			period
Commercial real estate:
Non-residential	$	119		$	(46)		$	73
Commercial and industrial		104			3			107
Residential real estate		1			2			3
Consumer:
Home equity		18			—			18
Other consumer		2			—			2
Total	$	244		$	(41)		$	203

The following table summarizes the (credit to) provision for credit losses for the three and six months ended June 30, 2026 and 2025:


		Three Months Ended June 30,						Six Months Ended June 30,
		2026			2025			2026			2025
(Credit to) provision for credit losses - loans		$	(90)		$	(84)		$	(8)		$	293
Provision for (credit to) credit losses - unfunded commitments			79			(17)			68			(41)
(Credit to) provision for credit losses		$	(11)		$	(101)		$	60		$	252

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

In the normal course of business, the Company grants loans to officers, directors and other related parties. Balances and activity of such loans during the periods presented were not material.

On an annual basis, or more often if needed, the Company formally reviews the ratings on all commercial real estate, multifamily, construction and commercial loans. To assist in the review process, the Company engages an independent third-party to review a significant portion of loans within these segments. Consumer loans are rated as performing or non-performing based on payment status in accordance with regulatory retail credit guidance. Management uses the results of these reviews as part of its annual review process. In addition, management utilizes delinquency reports, the watch list and other loan reports to monitor credit quality of other loan segments.

Credit Quality Indicators. 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. The Company analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on all loans at origination and is updated on a quarterly basis for loans risk rated Watch, Special Mention, Substandard, or Doubtful.

The Company uses the following definitions for risk ratings:

Watch – Loans classified as watch exhibit weaknesses that require more than usual monitoring. Issues may include deteriorating financial condition, payments made after due date but within 30 days, adverse industry conditions or management problems.

Special Mention – Loans classified as special mention exhibit signs of further deterioration but still generally make payments within 30 days. This is a transitional rating and loans should typically not be rated Special Mention for more than 12 months.

Substandard – Loans classified as substandard possess weaknesses that jeopardize the ultimate collection of the principal and interest outstanding. These loans exhibit continued financial losses, ongoing delinquency, overall poor financial condition, and/or insufficient collateral. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful – Loans classified as non-performing have all the weaknesses of substandard loans, and have deteriorated to the level that there is a high probability of substantial loss.

Loans not meeting the criteria above that are analyzed individually as part of the above-described process are considered Pass rated loans.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The following table presents the credit risk profile of the Company’s loan portfolio (excluding loans in process) based on rating category, as well as gross write-offs for the six months ended June 30, 2026, and by fiscal year of origination as of June 30, 2026.


													Revolving
	Loans by Origination Year												Loans
	2026		2025		2024		2023		2022		Prior		Amortized Cost		Total
Commercial construction
Pass	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Watch		801		923		4,738		-		-		-		-		6,462
Total commercial construction		801		923		4,738		-		-		-		-		6,462

Commercial non-residential
Pass	$	18,605	$	52,456	$	42,907	$	31,049	$	33,521	$	90,807	$	-	$	269,345
Watch		498		16,444		16,334		14,799		21,123		48,998		-		118,196
Special mention		-		-		-		22,885		2,279		-		-		25,164
Substandard		-		-		-		-		2,304		2,056		-		4,360
Total commercial non-residential		19,103		68,900		59,241		68,733		59,227		141,861		-		417,065

Multifamily
Pass	$	-	$	10,892	$	733	$	582	$	17,708	$	27,584	$	-	$	57,499
Watch		-		989		5,600		10,197		10,616		14,681		-		42,083
Total multifamily		-		11,881		6,333		10,779		28,324		42,265		-		99,582

Residential
Performing	$	11,224	$	20,226	$	14,316	$	24,350	$	19,639	$	15,893	$	-	$	105,648
Non-performing		-		-		-		-		284		892		-		1,176
Total residential		11,224		20,226		14,316		24,350		19,923		16,785		-		106,824

Commercial and industrial
Pass	$	4,504	$	6,027	$	4,823	$	4,721	$	12,826	$	4,552	$	12,519	$	49,972
Watch		2,028		6,805		4,266		1,183		2,367		842		19,159		36,650
Special mention		-		-		82		46		-		-		374		502
Substandard		-		-		-		-		-		-		41		41
Total commercial and industrial		6,532		12,832		9,171		5,950		15,193		5,394		32,093		87,165
Current-period gross write-offs				-		-		-		-		1		-		1

Indirect automobile
Performing	$	28,678	$	38,401	$	31,219	$	35,684	$	40,254	$	13,370	$	-	$	187,606
Non-performing		-		75		113		77		113		128		-		506
Total indirect automobile		28,678		38,476		31,332		35,761		40,367		13,498		-		188,112
Current-period gross write-offs		-		142		342		447		275		157		-		1,363

Home equity
Performing	$	127	$	665	$	201	$	-	$	-	$	2,865	$	8,077	$	11,935
Non-performing		-		-		-		-		-		12		-		12
Total home equity		127		665		201		-		-		2,877		8,077		11,947

Other consumer
Performing	$	1,801	$	1,445	$	1,101	$	658	$	541	$	66	$	204	$	5,816
Total other consumer		1,801		1,445		1,101		658		541		66		204		5,816
Current-period gross write-offs		-		-		19		9		11		1		-		40

Total Loans
Pass/performing	$	64,939	$	130,112	$	95,300	$	97,044	$	124,489	$	155,137	$	20,800	$	687,821
Watch		3,327		25,161		30,938		26,179		34,106		64,521		19,159		203,391
Special mention		-		-		82		22,931		2,279		-		374		25,666
Substandard		-		-		-		-		2,304		2,056		41		4,401
Non-performing		-		75		113		77		397		1,032		-		1,694
Total Loans	$	68,266	$	155,348	$	126,433	$	146,231	$	163,575	$	222,746	$	40,374	$	922,973
Total Current-period gross write-offs	$	-	$	142	$	361	$	456	$	286	$	159	$	-	$	1,404

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The following table presents the credit risk profile of the Company’s loan portfolio (excluding loans in process) based on rating category, as well as gross write-offs for the year ended December 31, 2025, and by fiscal year of origination as of December 31, 2025.


													Revolving
	Loans by Origination Year												Loans
	2025		2024		2023		2022		2021		Prior		Amortized Cost		Total
Commercial construction
Pass	$	2,037	$	-	$	-	$	-	$	-	$	-	$	-	$	2,037
Watch		775		6,170		-		-		-		-		-		6,945
Total commercial construction		2,812		6,170		-		-		-		-		-		8,982

Commercial non-residential
Pass	$	63,489	$	44,835	$	36,178	$	34,652	$	25,438	$	74,392	$	-	$	278,984
Watch		16,602		11,894		10,164		23,344		3,343		46,157		-		111,504
Special mention		-		-		22,921		-		-		-		-		22,921
Substandard		-		-		-		2,315		-		2,084		-		4,399
Total commercial non-residential		80,091		56,729		69,263		60,311		28,781		122,633		-		417,808
Current-period gross write-offs		-		-		-		629		-		-		-		629

Multifamily
Pass	$	10,986	$	738	$	590	$	18,086	$	27,949	$	7,063	$	-	$	65,412
Watch		996		5,627		10,210		10,756		5,514		9,423		-		42,526
Total multifamily		11,982		6,365		10,800		28,842		33,463		16,486		-		107,938

Residential
Performing	$	21,114	$	14,402	$	25,795	$	20,184	$	1,720	$	15,616	$	-	$	98,831
Non-performing		-		-		-		292		-		963		-		1,255
Total residential		21,114		14,402		25,795		20,476		1,720		16,579		-		100,086

Commercial and industrial
Pass	$	8,011	$	6,937	$	6,533	$	14,284	$	5,559	$	512	$	18,818	$	60,654
Watch		6,305		3,014		783		4,689		190		939		14,186		30,106
Special mention		-		-		-		455		-		-		250		705
Substandard		-		-		-		-		22		-		39		61
Total commercial and industrial		14,316		9,951		7,316		19,428		5,771		1,451		33,293		91,526
Current-period gross write-offs				11		151		8		-		165		-		335

Indirect automobile
Performing	$	44,776	$	38,583	$	47,088	$	58,044	$	19,391	$	5,180	$	-	$	213,062
Non-performing		41		104		120		320		87		68		-		740
Total indirect automobile		44,817		38,687		47,208		58,364		19,478		5,248		-		213,802
Current-period gross write-offs		86		428		500		1,026		463		129		-		2,632

Home equity
Performing	$	680	$	206	$	-	$	-	$	-	$	3,213	$	8,191	$	12,290
Total home equity		680		206		-		-		-		3,213		8,191		12,290

Other consumer
Performing	$	1,987	$	1,483	$	975	$	907	$	139	$	7	$	220	$	5,718
Non-performing		-		5		10		-		-		-		-		15
Total other consumer		1,987		1,488		985		907		139		7		220		5,733
Current-period gross write-offs		33		18		15		24		-		-		-		90

Total Loans
Pass/performing	$	153,080	$	107,184	$	117,159	$	146,157	$	80,196	$	105,983	$	27,229	$	736,988
Watch		24,678		26,705		21,157		38,789		9,047		56,519		14,186		191,081
Special mention		-		-		22,921		455		-		-		250		23,626
Substandard		-		-		-		2,315		22		2,084		39		4,460
Non-performing		41		109		130		612		87		1,031		-		2,010
Total Loans	$	177,799	$	133,998	$	161,367	$	188,328	$	89,352	$	165,617	$	41,704	$	958,165
Total Current-period gross write-offs	$	119	$	457	$	666	$	1,687	$	463	$	294	$	-	$	3,686

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

4. Goodwill and Intangible Assets

The Company evaluates goodwill annually in the fourth quarter of the fiscal year or more often if events occur or circumstances change that indicate an impairment may exist. Management has determined that no write-down was required for the first six months of 2026 or 2025.

The changes in the carrying value of the customer list and core deposit intangibles, net of accumulated amortization and impairment, are as follows:


		Six months ended June 30,
		2026			2025
Beginning balance		$	106		$	166
Amortization			(14)			(37)

Ending balance		$	92		$	129

Core deposit intangibles represent the estimated fair value of acquired customer deposit relationships on the date of acquisition and are amortized over their estimated useful lives. Purchased customer accounts primarily consist of records and files that contain information about investment holdings. The values assigned to customer lists and core deposit intangibles are based upon the application of the income approach. The Company recognized $7 and $17 of amortization expense related to its intangible assets for the three months ended June 30, 2026 and 2025, respectively. The Company recognized $14 and $37 of amortization expense related to its intangible assets for the six months ended June 30, 2026 and 2025, respectively.

As of June 30, 2026, the future amortization expense for amortizable intangible assets for the years ended December 31, was as follows:


2026		$	15
2027			21
2028			16
2029			13
2030			11
Thereafter			16
Total		$	92

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

5. Deposits

Deposits balances are summarized as follows:


		June 30,			December 31,
		2026			2025
Non-interest bearing demand deposits		$	242,774		$	227,272
Interest bearing accounts:
Subscription Deposits			156,012			—
NOW⁽¹⁾			131,312			123,576
Savings			132,765			127,219
Money market			235,508			242,333
Time certificates of deposit			384,601			376,940
Total interest bearing accounts			1,040,198			870,068
Total deposits		$	1,282,972		$	1,097,340

(1)

Negotiable order of withdrawal

The Company participates in a reciprocal deposit program with other financial institutions that provides access to Federal Deposit Insurance Corporation (the “FDIC”) insurance for deposit products with aggregate amounts exceeding the current limits for depositors. At June 30, 2026 and December 31, 2025, total reciprocal deposits were $37,571 and $35,638, respectively. Included in time certificates of deposit at June 30, 2026 and December 31, 2025 were reciprocal deposits totaling $23,278 and $21,854, respectively, with original maturities of one to three years. Reciprocal deposits included in money market accounts totaled $14,293 and $13,784 at June 30, 2026 and December 31, 2025, respectively.

The Company had no brokered deposits at either June 30, 2026 or December 31, 2025. Time certificates of deposit in denominations of $250 or greater were $106,414 and $99,659 as of June 30, 2026 and December 31, 2025, respectively.

Contractual maturities of time certificates of deposit at June 30, 2026 are summarized below:


	June 30,
	2026
Within 1 year	$	342,693
1 – 2 years		39,104
2 – 3 years		1,585
3 – 4 years		954
4 – 5 years		265
Total	$	384,601

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

6. Long-Term Debt and FHLB Stock

FHLB Borrowings and Stock

The Bank is a member of the FHLB. Borrowings with the FHLB require collateralization through the pledge of specific loans and securities. The Bank also has access to a preapproved secured line of credit with the FHLB, which was not to exceed $734,922 and $650,791 at June 30, 2026 and December 31, 2025, respectively. At June 30, 2026, the Bank had pledged $523,284 of assets to the FHLB, which resulted in a secured line of credit of $365,095. At December 31, 2025, the Bank had pledged $514,823 of assets to the FHLB, which resulted in a secured line of credit of $306,410. At June 30, 2026 and December 31, 2025, the Company had no outstanding overnight line of credit balances with the FHLB. These borrowings would mature the following business day. The Company also had structured borrowings of $5,153. The outstanding principal amounts and the related terms and rates of FHLB advances at June 30, 2026 were as follows:


Term		Principal			Maturity		Rate		Due in one year			Long term
Fixed medium-term		$	1,233		September 21, 2026		5.20	%	$	1,233		$	—
Fixed medium-term			381		November 9, 2026		5.04	%		381			—
Fixed medium-term			969		May 3, 2027		4.99	%		969			—
Fixed medium-term			740		June 21, 2027		4.73	%		740			—
Fixed medium-term			1,830		June 27, 2028		3.91	%		—			1,830
Total		$	5,153		Weighted Average Rate		4.62	%	$	3,323		$	1,830

The Bank is required to maintain an investment in FHLB capital stock, as collateral, in an amount equal to a certain percentage of its outstanding debt. FHLB stock is considered restricted stock and is carried at cost. The Bank evaluates FHLB stock for impairment based on the ultimate recovery ability of the cost. No impairment was recognized at either June 30, 2026 or December 31, 2025.

Subordinated Debt

In addition to the Bank, the Company has one other wholly-owned subsidiary, RSB Capital Trust I (the “Trust”). In 2005, the Trust issued $5,000 of pooled trust preferred securities in a private placement and issued 155 shares of common stock at $1 par value per share, to the Company. The Trust, which has no independent assets or operations, was formed in 2005 for the sole purpose of issuing trust preferred securities and investing the proceeds in an equivalent amount of junior subordinated debentures. The proceeds from the issuance of the trust preferred securities were down-streamed to the Bank and are currently considered Tier 1 capital for determining the Bank’s capital ratios. The duration of the Trust is 30 years.

The subordinated debt securities of $5,155 are unsecured obligations of the Company and are subordinate and junior in right of payment to all present and future senior indebtedness of the Company. The Company has entered into a guarantee, which together with its obligations under the subordinated debt securities and the declaration of trust governing the Trust, including its obligations to pay costs, expenses, debts and liabilities, provides a full and unconditional guarantee of amounts on the capital securities. The rate on the subordinated debentures, which bear interest at the three-month term Secured Overnight Financing Rate plus 2% and a relative spread adjustment of 0.26%, was 5.90% and 6.14% at June 30, 2026 and December 31, 2025, respectively. The subordinated debentures mature on May 23, 2035.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Other Borrowings

The Bank has an unsecured, uncommitted $10,000 line of credit with Zions Bank. There were no advances outstanding under this line of credit at either June 30, 2026 or December 31, 2025.

The Bank also has an unsecured, uncommitted $50,000 line of credit with Pacific Coast Bankers Bank. There were no advances outstanding under this line of credit at either June 30, 2026 or December 31, 2025.

Additionally, at June 30, 2026 and December 31, 2025, the Bank had available funds of $136,838 and $155,646, respectively, under the Federal Reserve Bank’s discount window. There were no advances outstanding under this line of credit at either June 30, 2026 or December 31, 2025.

7. Employee Benefits

Pension Plan

The Bank maintains a noncontributory defined benefit pension plan covering substantially all of its employees 21 years of age or older who had completed at least one year of service as of June 30, 2012, the effective date on which the Board of Directors of the Bank voted to freeze the defined benefit plan.

The following table sets forth the plan’s funded status and amounts recognized in the Company’s consolidated statements of financial condition:


	June 30,		December 31,
	2026		2025
Projected and accumulated benefit obligation	$	(16,435)	$	(16,707)
Plan assets at fair value		18,550		18,902
Funded status included in accrued expenses and other liabilities	$	2,115	$	2,195

The net periodic pension cost and amounts recognized in other expense are as follows:


	Six months ended June 30,
	2026		2025
Interest cost	$	443	$	445
Expected return on plan assets		(563)		(491)
Amortization of unrecognized loss		13		74
Net periodic (benefit) cost	$	(107)	$	28

The expected long-term rate of return on plan assets has been determined by applying historical average investment returns from published indexes relating to the current allocation of assets in the plan. Plan assets are invested in pooled separate accounts consisting of underlying investments in two diversified investment funds.

As of June 30, 2026, the investment funds included two fixed income bond funds, each with its own investment objectives, investment strategies and risks, as detailed in the Company’s investment policy statement. The Company determines the appropriate strategic asset allocation versus plan liabilities, as governed by the investment policy statement.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The assets of the plan are invested under the supervision of the Company’s investment committee in accordance with the investment policy statement. The investment options of the plan are chosen in a manner consistent with generally accepted standards of fiduciary responsibility. The investment performance of the Company’s individual investment managers, with the assistance of the Company’s investment consultant, is monitored on a quarterly basis and is reviewed at least annually relative to the objectives and guidelines as stated in the Company’s investment policy statement.

The Company did not contribute to the plan in the first six months of 2026 or 2025.

The fair value of the Company’s pension plan assets, by fair value hierarchy, are as follows:


	June 30, 2026
	Level 1		Level 2		Level 3		Total
Assets:
Investment in separate accounts
Fixed income	$	18,550	$	—	$	—	$	18,550
Total assets at fair value	$	18,550	$	—	$	—	$	18,550


	December 31, 2025
	Level 1		Level 2		Level 3		Total
Assets:
Investment in separate accounts
Fixed income	$	12,732	$	—	$	—	$	12,732
Equity		6,170		—		—		6,170
Total assets at fair value	$	18,902	$	—	$	—	$	18,902

The pooled separate accounts are valued at the net asset per unit, based on either the observable net asset value of the underlying investment or the net asset value of the underlying pool of securities. Net asset value is based on the value of the underlying assets owned by the fund, minus its liabilities, and then divided by the number of shares outstanding.

For a detailed disclosure on the Bank’s pension and employee benefits plans, please refer to Note 9 of the Company’s Consolidated Financial Statements for the year ended December 31, 2025 included in the Annual Report on Form 10-K.

Defined Contribution Plan

The Bank sponsors a 401(k) defined contribution plan. Participants are permitted, in accordance with the provisions of Section 401(k) of the Internal Revenue Code, to contribute up to 25% of their earnings (as defined) into the plan with the Bank matching up to 6%, subject to Internal Revenue Service limitations. The Bank’s contributions charged to operations amounted to $560 and $569 for the six months ended June 30, 2026 and 2025, respectively.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Deferred Compensation Arrangements

Directors’ Plan, (formerly the “Trustees Plan”)

The Bank’s Deferred Compensation Plan for Fees of Directors, as amended and restated effective January 1, 2005 (the “Directors’ Plan”), covers directors who elect to defer receipt of all or a portion of their fees until separation from service. Upon resignation, retirement, or death, the participant’s total deferred compensation, including earnings thereon, will be paid out. At June 30, 2026 and December 31, 2025, total amounts due to participants of $2,107 and $3,429, respectively, were included in accrued expenses and other liabilities. Total expenses related to the Directors’ Plan were $161 and $177 for the six months ended June 30, 2026 and 2025, respectively, which were included in other non-interest expense in the consolidated statements of income.

Executive Long-Term Incentive and Retention Plan

The Bank maintained an Executive Long-Term Incentive and Retention Plan (the “Executive Plan”). Participation in the Executive Plan was limited to officers of the Company designated as participants by the Board of Directors. Under the Executive Plan, the Board of Directors was permitted to grant annual incentive awards equal to a percentage of a participant’s base salary at the rate in effect on the last day of the Executive Plan year, as determined by the Board of Directors based on the attainment of criteria established annually by the Board of Directors. Incentive awards under the Executive Plan were credited to the participant’s incentive benefit account as of the last day of the Executive Plan year to which the award relates and earned interest at a rate determined annually by the Board of Directors. Participants vested in their benefit accounts in accordance with the vesting schedule approved by the Board of Directors, which ranged from one to five years of service. At June 30, 2026 and December 31, 2025, $1,912 and $1,630, respectively, was included in accrued expenses and other liabilities, which represents the cumulative amounts deferred and earnings thereon. The Company recognized expenses of $644 and $455 for the six months ended June 30, 2026 and 2025, respectively, related to this plan, which are included in salaries and employee benefits expense and other non-interest expense in the consolidated statements of income.

On May 19, 2026, the Board of Directors of the Bank terminated the Executive Plan.

Group Term Replacement Plan

Under the terms of the “Group Term Replacement Plan,” the Company provides postretirement life insurance benefits to certain officers. The liability related to these postretirement benefits is accrued over the individual participants’ service period and aggregated $1,785 and $1,761 at June 30, 2026 and December 31, 2025, respectively. The Company recognized expenses of $24 for each of the six months ended June 30, 2026 and 2025 related to this plan, which are included in salaries and employee benefits expense in the consolidated statements of income.

Other Director and Officer Postretirement Benefits

The Company has fee continuation agreements with certain directors and a supplemental retirement agreement with an executive officer, each of which provide fixed postretirement benefits to be paid to the directors or the officer, or their beneficiaries, for periods ranging from 15 to 20 years. In addition, the Company has agreements with certain directors which provide certain postretirement life insurance benefits. The liability related to these postretirement benefits is accrued over the individual participants’ service period and aggregated $2,170 and $2,154 at June 30, 2026 and December 31, 2025, respectively. The Company recognized expenses of $23 and $69 for the six months ended June 30, 2026 and 2025, respectively, related to these benefits, which are included in other non-interest expenses in the consolidated statements of income.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Employee Stock Ownership Plan

On January 1, 2019, the Bank established an Employee Stock Ownership Plan (“ESOP”) to provide Company stock to eligible employees. The plan is a tax-qualified retirement plan for the benefit of Bank employees. On January 16, 2019, the Company granted a loan to the ESOP to purchase 436,425 shares of the Company’s common stock at a price of $10.00 per share. The loan obtained by the ESOP from the Company is payable annually over 20 years at a rate per annum equal to the Prime Rate, reset annually on January 1st (6.75% at January 1, 2026). Loan payments are funded by cash contributions from the Bank. The loan is secured by the shares purchased, which are held in a suspense account for allocation among participants as the loan is repaid. The balance of the ESOP loan at June 30, 2026 was $3,335. Contributions are allocated to eligible participants on the basis of compensation, subject to federal tax limits. The number of shares committed to be released annually is 21,821 through 2039.

Shares held by the ESOP include the following:


	June 30,		December 31,
	2026		2025
Allocated	152,747		130,926
Committed to be allocated	10,908		21,821
Unallocated	272,770		283,678
Paid out to participants	(28,945)		(28,945)
Total shares	407,480		407,480

The fair value of unallocated shares was $4,722 at June 30, 2026.

Total compensation expense recognized in connection with the ESOP was $164 and $115 for the six months ended June 30, 2026 and 2025, respectively.

Share-Based Compensation Plan

On May 26, 2020, stockholders of the Company approved the 2020 Equity Incentive Plan (the “2020 EIP”). The 2020 EIP authorizes the issuance to participants of up to 763,743 shares of Rhinebeck Bancorp common stock pursuant to grants of incentive and non-qualified stock options, restricted stock awards and restricted stock units. Of this number, the maximum number of shares of Rhinebeck Bancorp common stock that may be issued under the 2020 EIP pursuant to the exercise of stock options is 545,531 shares, and the maximum number of shares of Rhinebeck Bancorp common stock that may be issued as restricted stock awards or restricted stock units is 218,212 shares. These amounts represented 4.90% and 1.96%, respectively, of the number of shares of common stock issued in the initial stock offering of Rhinebeck Bancorp in 2018.

Pursuant to terms of the 2020 EIP, on August 25, 2020, the Board of Directors granted restricted stock and stock options to employees and directors. All of the awards granted vest annually over a three-year period from the date of the grant and the term of each option is ten years. Since the effective date of the 2025 Equity Incentive Plan (“2025 EIP”), no further grants of equity awards are permitted under the 2020 Equity Plan.

On May 21, 2025, stockholders of the Company approved the 2025 EIP. The 2025 EIP authorizes the issuance to participants of up to 600,000 shares of Rhinebeck Bancorp common stock pursuant to grants of incentive and non-qualified stock options, restricted stock awards and restricted stock units.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Pursuant to terms of the 2025 EIP, on May 26, 2026, the Board of Directors granted restricted stock to employees and directors. All of the awards granted vest annually over a three-year period from the date of the grant.

The fair value of each option granted under the 2020 EIP is estimated on the date of grant using the Black-Scholes Option-Pricing Model. The expected volatility is based on the historical volatility of a peer group of comparable SEC-reporting bank holding companies. The dividend yield assumption is based on the Company’s expectation of dividend payouts. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the date of grant. The Company has elected to recognize forfeitures as they occur.

A summary of options under the 2020 EIP as of June 30, 2026 is presented below:


		Weighted -		Weighted-Average
	Number of	Average		Remaining Contractual
	Shares	Exercise Price		Term (in Years)
Options outstanding at beginning of year	258,830	$	6.57	4.15
Exercised	(69,730)		6.57	-
Expired	(2,000)		6.57	-
Options outstanding at June 30, 2026	187,100	$	6.57	4.16
Options exercisable at June 30, 2026	187,100	$	6.57	4.16

At June 30, 2026, the aggregate intrinsic value of the stock options exercised was $654, and the aggregate intrinsic value of the stock options outstanding was $2,024. These values fluctuate based on changes in the fair market value of the Company’s stock. The aggregate intrinsic value of the stock options outstanding represents the total pre-tax intrinsic value (i.e., the difference between the Company’s closing stock price on the last trading day of period and the weighted-average exercise price, multiplied by the number of shares) that would have been issued had all option holders exercised their options on June 30, 2026.

As of June 30, 2026, there was no unrecognized compensation cost related to the nonvested stock options granted under the 2020 EIP, as all options were fully vested at June 30, 2026.

There were no options granted or outstanding under the 2025 EIP as of June 30, 2026.

The following table summarizes the Company’s restricted stock activity for the six months ended June 30, 2026:


				Weighted-Average
	Number			Grant Date
	of Shares			Fair Value per Share
Non-vested restricted stock at beginning of year	10,000		$	7.94
Granted	100,878			15.40
Non-vested restricted stock at June 30, 2026	110,878		$	14.73

As of June 30, 2026, there was $1,539 of unrecognized compensation cost related to the nonvested restricted stock awards granted under the 2020 and 2025 EIPs. The cost is expected to be recognized over the remaining period of 2.85 years.

For the six months ended June 30, 2026 and 2025, share-based compensation of options and restricted stock under the 2020 and 2025 EIPs totaled $75 and $20, respectively.

Table of Contents

Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

8. Leases

As of June 30, 2026, the Company leased real estate for seven branch offices and one administrative office under various lease agreements. All of our leases are classified as operating leases.

The calculated amount of the right-of-use assets and lease liabilities are impacted by the length of the lease term and the discount rate used to present the value of the minimum lease payments. The Company’s leases have maturities which range from 2030 to 2048, some of which include lessee options to extend the lease term. If the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the right-of-use asset and lease liability. The weighted average remaining life of the lease terms for these leases was 14.7 years and 15.2 years as of June 30, 2026 and December 31, 2025, respectively. As most of our leases do not provide an implicit rate, the Company used its incremental borrowing rate, the rate of interest to borrow on a collateralized basis for a similar term, at each lease commencement date. The weighted average discount rate for operating leases as of June 30, 2026 and December 31, 2025 was 4.15% and 4.12%, respectively.

For the six months ended June 30, 2026 and 2025, total operating lease costs were $369 and $410, respectively, and were included in occupancy and other expense. The ROU asset, included in other assets, was $5,937 and $6,045 and the corresponding lease liability, included in accrued expenses and other liabilities was $6,049 and $6,144 as of June 30, 2026 and December 31, 2025, respectively.

Future minimum payments for operating leases with initial or remaining terms of one year or more as of June 30, 2026 were as follows:


Years ending December 31:
2026	$	355
2027		715
2028		701
2029		654
2030		604
Thereafter		5,497
Total future minimum lease payments		8,526
Amounts representing interest		(2,477)
Present Value of Net Future Minimum Lease Payments	$	6,049

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

9. Commitments and Contingencies and Derivatives

Legal Matters

The Company is involved in various legal proceedings which have arisen in the normal course of business. Management believes that resolution of these matters will not have a material effect on the Company’s financial condition or results of operations.

Employment Agreements

The Company has entered into employment agreements with certain officers. The agreements provide for base salaries and incentive compensation based on performance criteria outlined in the agreements. The agreements also provide for insurance and various other benefits.

Financial Instruments with Off-Balance-Sheet Risk

In the normal course of business, the Company is a party to financial instruments with off-balance-sheet risk to meet the financing needs of its customers. These financial instruments include standby letters of credit and commitments to extend credit, which include new loan commitments, undisbursed portions of construction loans and other lines of credit and loans sold with recourse. We are obligated under a recourse provision associated with certain first mortgage renovation loans sold in the secondary market to bear all costs when a default, including a foreclosure, occurs. These financial instruments involve, to varying degrees, elements of interest rate risk in excess of the amounts recognized in the statements of financial condition. The contractual amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments.

Financial instruments whose contract amounts represent off-balance sheet credit risk are as follows:


	June 30,		December 31,
	2026		2025
Commitments to extend credit summarized as follows:
Future loan commitments	$	1,674	$	1,688
Undisbursed construction loans		17,529		3,946
Undisbursed home equity lines of credit		9,526		9,735
Undisbursed commercial and other line of credit		96,358		74,207
Standby letters of credit		4,340		5,014
Credit card lines		12,010		10,697
Loans sold with recourse		470		473
Total	$	141,907	$	105,760

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party. Since these commitments could expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements.

The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company upon an extension of credit, is based on management’s credit evaluation of the counterparty. Collateral held varies but may include residential and commercial property, deposits and securities.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Interest Rate Swaps

The Company enters into interest rate swaps that allow commercial loan customers to effectively convert a variable-rate loan agreement to a fixed-rate loan agreement. Under these agreements, the Company simultaneously enters into a variable-rate loan and an interest rate swap agreement with a customer. The Company then enters into a corresponding and offsetting swap agreement with a third party to hedge the exposure created by the customer agreements. The interest rate swaps with both the customers and third parties are not designated as hedges under FASB ASC Topic 815, Derivatives and Hedging, and are marked to market through earnings. The fair values of the swaps are recorded as both an asset and a liability, in other assets and other liabilities, respectively, in equal amounts for these transactions. The accrued interest receivable and payable of $113 and $115 related to our swaps is recorded in other assets and other liabilities as of June 30, 2026 and December 31, 2025, respectively.

Summary information regarding these derivatives is presented below:


	June 30,			December 31,
	2026			2025
Notational amount	$	228,344		$	240,092
Fair value	$	5,523		$	7,204
Weighted average pay rates		5.65	%		5.77	%
Weighted average receive rates		5.73	%		6.03	%
Weighted average maturity (in years)		5.02			5.41

Number of Contracts		41			42

In addition, as of June 30, 2026, the Company has one forward rate swap with a notional value of $15,000 and a fair value of $170 with an effective date of November 1, 2027. This forward swap has a fixed weighted average pay rate of 6.42% and the related weighted average adjustable receive rate will be determined at the time the forward swap becomes effective. There were no contracted forward rate swaps at December 31, 2025.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

10. Regulatory Matters

The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities and certain off-balance-sheet items, as calculated under regulatory accounting practices. The Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the tables below) of total, common equity Tier 1 and additional Tier I capital (as defined in 12 C.F.R. § 324.20) to risk-weighted assets and of Tier I capital to average assets. Management believes, as of June 30, 2026 and December 31, 2025, that the Bank met all capital adequacy requirements to which it was subject.

The most recent notification from the FDIC categorized the Bank as “well capitalized” under the regulatory framework. To be categorized as well capitalized, the Bank must maintain minimum total risk-based, common equity Tier 1, Tier I risk-based and Tier I leverage ratios as set forth in the table below. There are no conditions or events since then which management believes have changed the Bank’s category.

The Bank’s actual capital amounts and ratios were:


									To be Well Capitalized under
					For Capital Adequacy				Prompt Corrective Action
	Actual				Purposes				Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio

	June 30, 2026
Rhinebeck Bank
Total capital (to risk-weighted assets)	$	153,134	15.41	%	$	79,497	8.00	%	$	99,371	10.00	%
Tier 1 capital (to risk-weighted assets)		145,219	14.61	%		59,623	6.00	%		79,497	8.00	%
Common equity tier one capital (to risk weighted assets)		145,219	14.61	%		44,717	4.50	%		64,591	6.50	%
Tier 1 capital (to average assets)		145,219	10.93	%		53,154	4.00	%		66,443	5.00	%


	December 31, 2025
Rhinebeck Bank
Total capital (to risk-weighted assets)	$	147,671	14.40	%	$	82,039	8.00	%	$	102,549	10.00	%
Tier 1 capital (to risk-weighted assets)		139,166	13.57	%		61,529	6.00	%		82,039	8.00	%
Common equity tier one capital (to risk weighted assets)		139,166	13.57	%		46,147	4.50	%		66,657	6.50	%
Tier 1 capital (to average assets)		139,166	10.62	%		52,423	4.00	%		65,529	5.00	%

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

11. Fair Value

The Company uses fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. A description of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial and non-financial instruments not recorded at fair value, is set forth below.

Cash and Cash Equivalents

The carrying amount is a reasonable estimate of fair value.

Available for Sale Securities

Where quoted prices are available in an active market for identical securities, securities are classified within Level 1 of the valuation hierarchy. Level 1 securities include marketable equity securities and U.S. Treasury obligations. If quoted prices are not available, then fair values are estimated by using pricing models (i.e., matrix pricing) or quoted prices of securities with similar characteristics and are classified within Level 2 of the valuation hierarchy. Examples of such instruments include government agency bonds, mortgage-backed securities and municipal bonds. Level 3 securities include securities for which significant unobservable inputs are utilized. Available for sale securities are recorded at fair value on a recurring basis.

FHLB Stock

The carrying value of FHLB stock approximates fair value based on the redemption provisions of the FHLB.

Loans

Loans receivable are carried at cost. For variable rate loans, which reprice frequently, carrying values are a reasonable estimate of fair values adjusted for credit losses inherent in the portfolios. The fair value of fixed rate loans is estimated by discounting the future cash flows using the year end rates, estimated using local market data, at which similar loans would be made to borrowers with similar credit ratings and for the same remaining maturities, adjusted for credit losses inherent in the portfolios. The Company does not record loans at fair value on a recurring basis. However, from time to time, nonrecurring fair value adjustments to collateral-dependent individually analyzed loans are recorded to reflect partial write-downs based on the observable market price or current appraised value of collateral.

Other Real Estate Owned

Other real estate owned represents real estate acquired through foreclosure and is carried at fair value less estimated selling costs. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. These assets are included as Level 3 fair values, based upon the lowest level of input that is utilized in the fair value measurements.

Accrued Interest

The carrying amounts of accrued interest approximate fair value.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

Mortgage Servicing Rights

The fair value of mortgage servicing rights is based on a valuation model that calculates the present value of estimated future net servicing income. Mortgage servicing rights are carried at the lower of amortized cost or estimated fair value and are included in other assets on the consolidated statements of financial condition.

Deposits

Deposit liabilities are carried at cost. The fair value of NOW, savings and money market deposits is the amount payable on demand at the reporting date. The fair value of time certificates of deposit is estimated using a discounted cash flow calculation that applies interest rates currently being offered for deposits of similar remaining maturities estimated using local market data to a schedule of aggregated expected maturities on such deposits.

Mortgagors’ Escrow Accounts

The fair value is estimated using a discounted cash flow calculation that applies interest rates currently being offered on deposited escrow accounts of similarly expected maturities.

Advances from the FHLB

The fair value of the advances is estimated using a discounted cash flow calculation that applies current FHLB interest rates for advances of similar maturity to a schedule of maturities of such advances.

Subordinated Debt

Based on the floating rate characteristic of these instruments, the carrying value is considered to approximate fair value.

Off-Balance-Sheet Instruments

Fair values for off-balance-sheet lending commitments are based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standings. Such amounts are not significant.

Loan Level Interest Rate Swaps

The fair value is based on settlement values adjusted for credit risks associated with the counterparties and the Company and observable market interest rate curves.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The following tables detail the assets that are carried at fair value on a recurring basis as of the periods shown and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine the fair value:


					Quoted Prices in
					Active Markets			Significant			Significant
					for Identical			Observable			Unobservable
		Balance			Assets (Level 1)			Inputs (Level 2)			Inputs (Level 3)

		June 30, 2026
Assets:
U.S. Treasury securities		$	54,046		$	54,046		$	—		$	—
U.S. government agency mortgage-backed securities-residential			82,878			—			82,878			—
U.S. government agency securities			16,413			—			16,413			—
Municipal securities			2,081			—			1,996			85
Corporate bonds			15,780			—			15,780			—
Other			170			—			170			—
Total available for sale securities			171,368			54,046			117,237			85
Loan level interest rate swaps			5,523			—			5,523			—
Total assets		$	176,891		$	54,046		$	122,760		$	85
Liabilities:
Loan level interest rate swaps		$	5,523		$	—		$	5,523		$	—
Total liabilities		$	5,523		$	—		$	5,523		$	—


		December 31, 2025
Assets:
U.S. Treasury securities		$	35,828	$	35,828	$	—	$	—
U.S. government agency mortgage-backed securities – residential			88,980		—		88,980		—
U.S. government agency securities			18,352		—		18,352		—
Municipal securities			2,082		—		1,997		85
Corporate bonds			16,589		—		16,589		—
Other			372		—		372		—
Total available for sale securities			162,203		35,828		126,290		85
Loan level interest rate swaps			7,204		—		7,204		—
Total assets		$	169,407	$	35,828	$	133,494	$	85
Liabilities:
Loan level interest rate swaps		$	7,204	$	—	$	7,204	$	—
Total liabilities		$	7,204	$	—	$	7,204	$	—

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The following tables detail the assets carried at fair value and measured at fair value on a nonrecurring basis as of June 30, 2026 and December 31, 2025, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine the fair value:


			Quoted Prices in
			Active Markets		Significant		Significant
			for Identical		Observable		Unobservable
	Balance		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)

	June 30, 2026
Individually analyzed loans, with specific reserves	$	256	$	—	$	—	$	256
Total	$	256	$	—	$	—	$	256


	December 31, 2025
Individually analyzed loans, with specific reserves	$	405	$	—	$	—	$	405
Total	$	405	$	—	$	—	$	405

Loans that were individually analyzed using the fair value of the collateral had recorded investments of $419 and $645 with valuation allowances of $163 and $240 and fair values of $256 and $405 at June 30, 2026 and December 31, 2025, respectively. The valuation allowance represents specific allocations to the allowance for credit losses.

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which the Company has utilized Level 3 inputs to determine fair value:


	Quantitative Information About Level 3 Fair Value Measurements
	Fair Value		Valuation		Unobservable		Range
	Estimate		Techniques		Input		(Weighted Average)

	June 30, 2026
Individually analyzed loans, with specific reserves	$	256	Appraisal of collateral	⁽¹⁾	Liquidation expenses	⁽³⁾	0% to 8%
					Appraisal adjustments	⁽²⁾	0% to 20%

	December 31, 2025
Individually analyzed loans, with specific reserves	$	405	Appraisal of collateral	⁽¹⁾	Liquidation expenses	⁽³⁾	0% to 8%
					Appraisal adjustments	⁽²⁾	0% to 20%

(1)	Fair value is generally through independent appraisals of the underlying collateral that generally include various level 3 inputs which are not identifiable.

(2)	Appraisals may be adjusted by management for qualitative factors such as economic conditions and estimated liquidation expenses. The range of liquidation expenses and other appraisal adjustments are presented as a percentage of the appraised value.

(3)	Estimated costs to sell.

The estimated fair value amounts for 2026 and 2025 have been measured as of their respective reporting dates and have not been reevaluated or updated for purposes of these financial statements subsequent to those respective dates. As such, the estimated fair values of these financial instruments subsequent to the respective reporting dates may be different than amounts reported at each year-end.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

The information presented should not be interpreted as an estimate of the fair value of the entire Company since a fair value calculation is only required for a limited portion of the Company’s assets and liabilities. Due to the wide range of valuation techniques and the degree of subjectivity used in making the estimates, comparisons between the Company’s disclosures and those of other companies may not be meaningful.

As of the following dates, the carrying value and fair values of the Company’s financial instruments were:


			Fair Value Measurements at
			June 30, 2026 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	304,563	$	304,563	$	—	$	—	$	304,563
Available for sale securities		171,368		54,046		117,237		85		171,368
Loan level interest rate swaps		5,523		—		5,523		—		5,523
FHLB stock		1,153		—		1,153		—		1,153
Loans, net		918,477		—		—		913,956		913,956
Accrued interest receivable		4,592		—		4,592		—		4,592
Mortgage servicing rights		1,094		—		—		3,982		3,982
Financial Liabilities:
Deposits	$	1,282,972	$	—	$	1,212,523	$	—	$	1,212,523
Mortgagors' escrow accounts		13,206		—		13,206		—		13,206
FHLB advances		5,153		—		4,922		—		4,922
Subordinated debt		5,155		—		5,155		—		5,155
Loan level interest rate swaps		5,523		—		5,523		—		5,523
Accrued interest payable		722		—		722		—		722


			Fair Value Measurements at
			December 31, 2025 Using
	Carrying Value		Level 1		Level 2		Level 3		Total
Financial Assets:
Cash and cash equivalents	$	101,986	$	101,986	$	—	$	—	$	101,986
Available for sale securities		162,203		35,828		126,290		85		162,203
Loan level interest rate swaps		7,204		—		7,204		—		7,204
FHLB stock		1,957		—		1,957		—		1,957
Loans, net		953,385		—		—		944,816		944,816
Accrued interest receivable		4,882		—		4,882		—		4,882
Mortgage servicing rights		1,262		—		—		3,926		3,926
Financial Liabilities:
Deposits	$	1,097,340	$	—	$	1,053,275	$	—	$	1,053,275
Mortgagors' escrow accounts		9,399		—		9,399		—		9,399
FHLB advances		25,153		—		26,982		—		26,982
Subordinated debt		5,155		—		5,155		—		5,155
Loan level interest rate swaps		7,204		—		7,204		—		7,204
Accrued interest payable		918		—		918		—		918

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

12. Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss at June 30, 2026 and December 31, 2025 were as follows:


	June 30,		December 31,
	2026		2025
Securities available for sale:
Net unrealized loss on securities available for sale	$	(8,658)	$	(7,918)
Related deferred tax⁽¹⁾		1,818		1,663
Net accumulated other comprehensive loss		(6,840)		(6,255)
Defined benefit pension plan:
Unrecognized net actuarial loss and prior service cost		(2,308)		(2,120)
Related deferred tax⁽¹⁾		485		445
Net accumulated other comprehensive loss		(1,823)		(1,675)
Total accumulated other comprehensive loss	$	(8,663)	$	(7,930)

(1) Related deferred tax is calculated using an income tax rate of 21.0%.

13. Segment Reporting

The Company is a bank holding company, whose principal activity is the ownership and management of its wholly-owned subsidiary, Rhinebeck Bank. As a community-focused financial institution, the Company’s operations primarily involve offering loan and deposit products and providing financial advisory services to customers. Since management evaluates performance and makes strategic decisions based on a single, integrated banking operation, the Company is considered to have one reportable segment for financial reporting purposes.

Management makes operating decisions and assesses performance based on an ongoing review of these banking operations. The accounting policies of the banking operations segment are the same as those described in the summary of significant accounting policies. The Company's reportable segment is determined by the Chief Executive Officer, who serves as the chief operating decision maker (the “CODM”). The CODM assesses the Company's products and services, which primarily consist of banking operations, and evaluates performance based on financial data provided.

Interest income from loans and other earning assets, and income from fee-based businesses provide banking operation revenue. Interest expense on deposits and other sources of funding, provisions for credit losses, and operating expenses, primarily salaries and employee benefits, occupancy, furniture and equipment, and data processing and communications, provide the significant expenses of banking operations. The Company currently operates as a single-segment and all operations are domestic.

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Rhinebeck Bancorp, Inc. and Subsidiary

Notes to Consolidated Financial Statements (Unaudited)

(Dollars in thousands, except share and per share data)

14. Earnings Per Share

Basic earnings per share represent income available to common stockholders divided by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed in a manner similar to that of basic earnings per share except that the weighted-average number of common shares outstanding is increased to include the number of incremental shares (computed using the treasury method) that would have been outstanding if all potentially dilutive common stock equivalents (such as options) were issued during the period. There were no anti-dilutive options for the three and six months ended June 30, 2026 or 2025. Options with an exercise price greater than the average market price of the common shares are considered anti-dilutive. Unearned ESOP shares are not deemed outstanding for earnings per share calculations.


		Three Months Ended June 30,					Six Months Ended June 30,
		2026			2025		2026		2025
Net income applicable to common stock		$	2,616		$	2,726	$	4,832	$	5,014

Average number of common shares outstanding			11,105,457			11,084,776		11,114,757		11,082,316
Less: Average unearned ESOP shares			275,513			297,330		278,240		300,057
Average number of common shares outstanding used to calculate basic earnings per common share			10,829,944			10,787,446		10,836,517		10,782,259
Additional common stock equivalents (nonvested stock) used to calculate diluted earnings per share			9,874			7,297		6,678		6,467
Additional common stock equivalents (stock options) used to calculate diluted earnings per share			118,299			159,381		127,339		151,116
Weighted-average common shares and common stock equivalents used to calculate diluted earnings per share			10,958,117			10,954,124		10,970,534		10,939,842

Earnings per common share:
Basic		$	0.24		$	0.25	$	0.45	$	0.47
Diluted		$	0.24		$	0.25	$	0.44	$	0.46

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

General

Management’s discussion and analysis of financial condition and results of operations at June 30, 2026 and December 31, 2025, and for the three and six months ended June 30, 2026 and 2025, is intended to assist in understanding the financial condition and results of operations of the Company and the Bank. The information contained in this section should be read in conjunction with the unaudited financial statements and the notes thereto appearing in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Cautionary Note Regarding Forward-Looking Statements

This report may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which can be identified by the use of words such as “estimate,” “approximate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “predict,” “forecast,” “improve,” “continue,” “will,” “would,” “should,” “could,” “may” and words of similar meaning. These forward-looking statements include, but are not limited to:

statements of our goals, intentions and expectations;

statements regarding our business plans, prospects, growth and operating strategies, and financial condition and results of operation;

statements regarding the quality of our loan and investment portfolios; and

estimates of our risks and future costs and benefits.

These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Forward-looking statements, by their nature, are subject to risks and uncertainties.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

●

our ability to effectively deploy the net proceeds from the stock offering in a manner that generates acceptable returns on equity and avoids prolonged periods of excess capital;

●

regulatory restrictions applicable to the Company following completion of the mutual-to-stock conversion, including limitations on stock repurchases, dividends, and being acquired during the post-conversion period;

●

general economic conditions, either nationally or in our market area, including potential recessionary conditions or slowed economic growth caused by supply chain disruption or otherwise;

●

changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio;

●

changes in the level and direction of loan delinquencies and charge-offs and changes in the estimates or methodology used in the calculation of the allowance for credit losses;

●

our ability to access cost-effective funding;

●

fluctuations in real estate values and both residential and commercial real estate market conditions;

●

demand for loans and deposits in our market area;

●

our ability to implement our business strategies;

●

our ability to manage or reduce expenses;

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●

competition among depository and other financial institutions;

●

inflation and changes in market interest rates that affect our margins and yields, the fair value of financial instruments, our volume of loan originations and loan sales, or the level of defaults, losses and prepayments on loans, whether held in portfolio or sold in the secondary market;

●

adverse changes in the securities markets;

●

changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, Federal Deposit Insurance Corporation premiums and capital requirements, and changes in the monetary and fiscal policies of the Board of Governors of the Federal Reserve System;

●

the imposition of tariffs or other domestic or international governmental policies, trade restrictions and retaliatory measures impacting our borrowers and the broader economy;

●

the impact of a shutdown of the U.S. government, debt ceiling impasses or fiscal uncertainty;

●

negative financial impact from potential supervisory action, regulatory penalties and/or settlements;

●

our ability to manage interest rate risk, market risk, credit risk and operational risk;

●

our ability to enter new markets successfully and capitalize on growth opportunities;

●

our ability to successfully integrate into our operations any assets, liabilities or systems we may acquire, as well as new management personnel or customers, and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto;

●

changes in investor sentiment and consumer spending, borrowing and savings habits;

●

the current or anticipated impact of military conflict, terrorism or other geopolitical events;

●

changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;

●

our ability to attract or retain key employees;

●

risks associated with cybersecurity threats, data breaches, ransomware attacks, or other failures in our operational or security systems and infrastructure, including the risks arising from our dependence on third-party service providers and vendors;

●

the failure to maintain current technologies and to successfully implement future information technology enhancements and the operational risks associated with the adoption of artificial intelligence and other emerging technologies;

●

our compensation expense associated with equity allocated or awarded to our employees;

●

changes in the financial condition, results of operations or prospects of issuers of securities that we own; and

●

conditions relating to pandemics, or other public health emergencies.

Additional factors that may affect our results are discussed in our Annual Report on Form 10-K under the heading “Risk Factors.” Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. Accordingly, you should not place undue reliance on such statements.

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Recent Events

On July 21, 2026, the Company completed its second-step conversion, and became a fully public stock holding company. In connection therewith, the Company sold 8,880,210 shares of common stock at a purchase price of $10.00 per share, generating gross offering proceeds of $88.8 million. Because the offering was oversubscribed, the Company subsequently returned approximately $71.5 million to subscribers at closing.

Concurrent with the offering, existing public shares of common stock were exchanged for new shares of common stock of the Company at an exchange ratio of 1.3978. Cash was paid in lieu of fractional shares at a rate of $10.00 per share. Upon completion of the offering and share exchange, the Company had 15,635,966 shares of common stock outstanding, and the new shares commenced trading on the Nasdaq Capital Market under the symbol “RBKB” on July 22, 2026.

This significant capital influx substantially increases our net worth and liquidity position. The net proceeds from the offering will provide additional capital to support future loan growth, expand our branch network, enhance products and services, and fund general corporate purposes. Additionally, because the offering was oversubscribed, the Employee Stock Ownership Plan (ESOP) was unable to purchase shares directly in the offering. The ESOP purchased 355,208 shares at an average cost of $12.28 per share in the open market following the transaction.

Critical Accounting Policies

Our most significant accounting policies are described in Note 1 to the Consolidated Financial Statements in our Annual Report on Form 10-K. Certain of these accounting policies require management to use significant judgment and estimates, which can have a material impact on the carrying value of certain assets and liabilities. We consider these policies to be our critical accounting estimates. The judgment and assumptions made are based upon historical experience, future forecasts, and/or other factors that management believes to be reasonable. Because of the nature of the judgment and assumptions, actual results could differ from estimates, which could have a material effect on our financial condition and results of operations. We consider the allowance for credit losses to be our most critical accounting policy.

Allowance for Credit Losses

The Company's allowance for credit losses is its estimate of expected lifetime credit losses currently expected in the loan portfolio, on unfunded lending commitments, and on its available-for-sale securities portfolio over the expected life of those assets. While these estimates are based on substantive methods for determining the required allowance, actual outcomes may differ significantly from estimated results, especially when determining required allowances for larger, complex commercial credits or unfunded lending commitments to commercial borrowers. Consumer loans, including indirect automobile loans and single family residential real estate loans, are smaller and generally behave in a similar manner, and loss estimates for these credits are considered more predictable. Additionally, the allowance for credit losses calculation utilizes a forward-looking forecast of macroeconomic conditions, which may differ significantly from actual results. Further discussion of the methodology used in establishing the allowance is provided in Note 3 to the Notes to the Consolidated Financial Statements included in this Quarterly Report on Form 10-Q and in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” in the Annual Report on Form 10-K.

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Comparison of Financial Condition at June 30, 2026 and December 31, 2025

Total Assets. Total assets increased by $168.3 million, or 12.9%, to $1.47 billion as of June 30, 2026, due primarily to an increase in cash and cash equivalents of $202.6 million, or 198.6%, and an increase in available for sale securities of $9.2 million, or 5.7%. This increase was partially offset by a decrease in loans receivable of $34.9 million, or 3.7%, to $918.5 million, and a decrease in other assets of $7.2 million, or 28.1%.

Cash and Cash Equivalents. Cash and cash equivalents increased $202.6 million, or 198.6%, to $304.6 million at June 30, 2026 from $102.0 million at December 31, 2025, primarily due to $156.0 million in stock subscriptions, as well as increases in deposits held at the FHLB, FRB and other interest-bearing depository accounts. The increase was primarily driven by deposit growth.

Investment Securities Available for Sale. Available for sale securities increased $9.2 million, or 5.7%, to $171.4 million at June 30, 2026 from $162.2 million at December 31, 2025, primarily due to $22.4 million in purchases (primarily in U.S. Treasury securities), partially offset by $12.7 million in paydowns, calls, and maturities and a $740,000 increase in unrealized losses.

Net Loans. Net loans receivable decreased $34.9 million, or 3.7%, to $918.5 million at June 30, 2026, compared to $953.4 million at December 31, 2025 reflecting a strategic $25.7 million reduction in indirect automobile loans to reduce this concentration in the portfolio. At June 30, 2026, indirect automobile loans were 12.8% of total assets, compared to 16.4% at December 31, 2025. Commercial real estate loans decreased $11.6 million, while residential real estate loans increased $6.7 million. Non-accrual loans decreased by $312,000, or 8.4%, from $3.7 million at December 31, 2025 to $3.4 million at June 30, 2026.

Other Assets. Other assets decreased by $7.2 million, or 28.1%, from $25.5 million at December 31, 2025 to $18.3 million as of June 30, 2026, driven primarily by a $3.0 million reduction in swap collateral, a $1.7 million decrease in the fair value of swaps, and a $1.5 million decline in deferred trustee fees resulting from the retirement of two directors.

Total Liabilities. Total liabilities increased $165.5 million, or 14.2%, to $1.33 billion at June 30, 2026, primarily driven by a $185.6 million, or 16.9%, increase in deposits which included $156.0 million in stock subscription deposits, and a $3.8 million increase in mortgagors’ escrow accounts. The increases were offset by a reduction in borrowings of $20.0 million, or 79.5%, and a $3.9 million, or 14.0%, decrease in accrued expenses and other liabilities, primarily due to deferred subscription costs and a decrease in the fair value of swaps.

Deposits. Deposits increased $185.6 million, or 16.9%, to $1.28 billion at June 30, 2026. Interest-bearing deposits increased $170.1 million, or 19.6%, while non-interest-bearing deposits increased $15.5 million, or 6.8%. The increase in interest-bearing deposits was primarily due to subscription deposits of $156.0 million, of which approximately $71.5 million (including interest) was subsequently returned to subscribers at closing due to oversubscription. This was augmented by increases in certificates of deposit of $7.7 million, NOW accounts of $7.7 million and savings accounts of $5.5 million. These increases were partially offset by a decrease in money market accounts of $6.8 million.

We participate in reciprocal deposit programs, obtained through the Certificate Deposit Account Registry Service (CDARS) and IntraFi Cash Service (ICS) networks, that provide access to FDIC-insured deposit products in aggregate amounts exceeding the current limits for depositors. This allows us to maintain deposits that might otherwise be uninsured. Our reciprocal deposits obtained through the CDARS and ICS networks totaled $37.6 million and $35.6 million at June 30, 2026 and December 31, 2025, respectively. We had no brokered deposits at either June 30, 2026 or December 31, 2025.

Mortgagors’ Escrow Accounts. Mortgagors’ escrow accounts increased $3.8 million, or 40.5%, to $13.2 million at June 30, 2026, from $9.4 million at December 31, 2025, primarily due to the timing of property tax and insurance disbursements.

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Advances from the Federal Home Loan Bank. FHLB advances declined $20.0 million, or 79.5%, to $5.2 million at June 30, 2026 from $25.2 million at December 31, 2025. The reduction reflects the Company’s use of excess liquidity from increased cash balances and increased deposits to pay down borrowings.

Stockholders’ Equity. Stockholders' equity increased $2.8 million, or 2.0%, to $139.6 million at June 30, 2026. The increase was primarily due to $4.8 million in net income partially offset by a $1.8 million repurchase of common stock and a $733,000 increase in the total accumulated other comprehensive loss. The Company’s book value per share was $12.49 at June 30, 2026, compared to $12.28 at December 31, 2025. The ratio of stockholders’ equity to total assets decreased to 9.50% from 10.51% over the same period. Unearned common stock held by the ESOP was $2.7 million at June 30, 2026 and $2.8 million at December 31, 2025.

Comparison of Operating Results for the Three and Six Months Ended June 30, 2026 and 2025

Net Income. Net income for the second quarter of 2026 was $2.6 million, compared to $2.7 million for the second quarter of 2025. Diluted earnings per share were $0.24 for the second quarter of 2026, compared to $0.25 for the same quarter of 2025. Interest and dividend income increased $258,000, or 1.5%, while interest expense increased $118,000, or 2.2%. The provision for credit losses increased $90,000, or 89.1%. Non-interest income increased $141,000, or 8.8%, and non-interest expense increased $301,000, or 3.1%. The provision for income taxes remained unchanged between the comparable quarters.

Net income for the first six months of 2026 was $4.8 million, compared to $5.0 million for the first six months of 2025. Diluted earnings per share were $0.44 for the first half of 2026, compared to $0.46 for the same period of 2025. Interest and dividend income increased $231,000, or 0.7%, while interest expense decreased $66,000, or 0.6%. The provision for credit losses decreased $192,000, or 76.2%. Non-interest income decreased $144,000, or 4.3%, and non-interest expense increased $531,000, or 2.8%. The provision for income taxes decreased $4,000 between the comparable six month periods.

Net Interest Income. Net interest income increased $140,000, or 1.2%, to $11.6 million for the three months ended June 30, 2026 compared to 2025. The increase was primarily due to higher interest-earning asset balances and lower costs on interest-bearing liabilities, partially offset by lower yields on interest-earning assets and higher interest-bearing liability balances. The net interest margin decreased by 19 basis points to 3.78% and the interest rate spread decreased by 13 basis points from 3.33% for the three months ended June 30, 2025 to 3.20% for the three months ended June 30, 2026. The ratio of average interest-earning assets to average interest-bearing liabilities decreased 2.05% to 133.06%.

Net interest income increased $297,000, or 1.3%, to $22.8 million for the six months ended June 30, 2026 compared to $22.3 million for the six months ended June 30, 2025. The increase was primarily due to higher interest-earning assets and lower costs on interest-bearing liabilities, offset by a decreased yield on interest-earning assets and an increase in the balance of interest-bearing liabilities. The net interest margin decreased by 11 basis points to 3.77% and the interest rate spread decreased by five basis points from 3.23% for the six months ended June 30, 2025 to 3.18% for the six months ended June 30, 2026. The ratio of average interest-earning assets to average interest-bearing liabilities decreased 1.08% to 133.47%.

Interest Income. Interest income increased $258,000, or 1.5%, to $17.0 million for the three months ended June 30, 2026. The increase was primarily due to an increase in average balance of interest-earning assets, partially offset by a decrease in the yield on interest-earning assets. The increase in the average balance of interest-earning assets was primarily due to an increase in the average balance of interest-bearing depository accounts and federal funds sold, which increased $92.5 million, or 246.6%, to $130.1 million, and was partially offset by a decrease of $37.5 million, or 3.8% in the average balance of loans when comparing the three months ended June 30, 2026 and 2025. The average yield on interest-earning assets decreased by 26 basis points to 5.52%, while the average balance of interest-earning assets increased by $73.5 million, or 6.3%, to $1.24 billion. The average yield on interest-bearing depository accounts and federal funds sold decreased by 71 basis points, to 3.71%, the average yield on loans decreased two basis points, to 6.16%, and the average yield on available for sale securities decreased nine basis points, to 3.28%.

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Interest income increased $231,000, or 0.7%, to $33.6 million for the six months ended June 30, 2026. The increase was primarily due to an increase in average balance of interest-earning assets, partially offset by a decrease in the yield on interest-earning assets. The increase in the average balance of interest-earning assets was primarily due to an increase in the average balance of interest-bearing depository accounts and federal funds sold, which increased $78.0 million, or 236.2%, and was partially offset by a decrease of $39.8 million, or 4.0% in the average balance of loans, when comparing the six months ended June 30, 2026 and 2025. The average yield on interest-earning assets decreased by 19 basis points to 5.56%, while the average balance of interest-earning assets increased by $48.2 million, or 4.1%, to $1.22 billion. The average yield on interest-bearing depository accounts and federal funds sold decreased by 48 basis points, to 3.75%, the average yield on loans decreased two basis points, to 6.14%, while the average yield on available for sale securities increased six basis points, to 3.37%.

Interest Expense. Interest expense increased $118,000, or 2.2%, to $5.4 million for the three months ended June 30, 2026, compared to $5.3 million for the same quarter in 2025. The average balance of total interest-bearing liabilities increased $68.4 million, or 8.0%, to $928.4 million, primarily due to a $96.8 million increase in the average balance of deposits partially offset by a $28.5 million decrease in the average balance of FHLB advances, which decreased from $33.7 million to $5.2 million. The average cost of interest-bearing liabilities decreased by 13 basis points, to 2.32%, reflecting lower funding costs, primarily due to the receipt of subscription deposits maintained at a low savings rate, and a decrease in borrowings.

Interest expense decreased $66,000, or 0.6%, to $10.8 million for the six months ended June 30, 2026, compared to $10.9 million for the same six-month period in 2025. The average cost of interest-bearing liabilities decreased by 14 basis points, to 2.38%, reflecting lower funding costs, a decrease in borrowings and lower market interest rates. The average balance of total interest-bearing liabilities increased $43.1 million, or 5.0%, to $914.1 million, primarily due to an $82.9 million increase in the average balance of deposits partially offset by a $39.8 million decline in the average balance of FHLB advances, which decreased from $54.2 million to $14.4 million. The average cost of these advances also declined by 1.66%, from 3.95% to 2.29% for the first half of 2025 and 2026, respectively.

Provision for Credit Losses. The provision for credit losses increased by $90,000, or 89.1%, from a $101,000 credit for the quarter ended June 30, 2025 to an $11,000 credit for the current quarter, driven by a lower amount of automobile loans and low non-performing loan levels. Net charge-offs increased $12,000, from $91,000 for the second quarter of 2025 to $103,000 for the second quarter of 2026. The increase was primarily due to increased net charge-offs of $47,000 in indirect automobile loans, substantially offset by decreased net charge-offs of $36,000 in consumer loans.

The provision for credit losses decreased by $192,000, or 76.2%, from $252,000 for the six months ended June 30, 2025 to $60,000 for the six months ended June 30, 2026. The decrease in the provision was primarily due to lower loan balances, particularly indirect automobile loans. Net charge-offs increased $49,000, or 8.2% to $650,000 for the first six months of 2026 as compared to $601,000 for the first six months of 2025. The increase was primarily due to increased net charge-offs in indirect automobile loans of $223,000, substantially offset by a decrease of $182,000 in net charge-offs of commercial loans.

Non-Interest Income. Non-interest income totaled $1.7 million for the three months ended June 30, 2026, an increase of $141,000, or 8.8%, from the comparable period in 2025, due primarily to an increase of $155,000, or 57.6%, in investment advisory fee income offset by a $69,000 decrease in net gain on sale of loans as we discontinued originating residential mortgage loans directly.

Non-interest income totaled $3.2 million for the six months ended June 30, 2026, a decrease of $144,000, or 4.3%, from the comparable period in 2025, driven primarily by a decrease of $207,000, or 27.3%, in other non-interest income and a $107,000 decrease in net gain on sales of loans. These decreases were partially offset by an increase in investment advisory income of $122,000.

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Non-Interest Expense. For the three months ended June 30, 2026, non-interest expense totaled $10.0 million, an increase of $301,000, or 3.1%, compared to the same period in 2025. This increase was primarily driven by increases in: salaries and employee benefits of $296,000, professional fees of $144,000, and data processing costs of $71,000. These increases were partially offset by decreases in other non-interest expenses of $85,000, marketing expenses of $85,000, and FDIC deposit insurance and other insurance expenses of $42,000.

For the six months ended June 30, 2026, non-interest expense totaled $19.7 million, an increase of $531,000, or 2.8%, compared to $19.2 million for the same period in 2025. The variance was primarily driven by a $695,000, or 6.7%, increase in salaries and employee benefits, reflecting increased compensation and medical insurance costs, and higher occupancy and data processing expenses, which rose $164,000 and $155,000, respectively. These operational increases were partially offset by a $260,000 decrease in other expenses, a $140,000 decrease in marketing expenses, and a $120,000 decrease in FDIC deposit insurance costs.

Income Taxes. The provision for income taxes remained at $762,000 for the three months ended June 30, 2026 and 2025. The effective tax rate was 22.56% for the three months ended June 30, 2026 as compared to 21.85% for the three months ended June 30, 2025.

The provision for income taxes decreased $4,000 to $1.4 million for the six months ended June 30, 2026. The effective tax rate was 22.43% for the six months ended June 30, 2026 as compared to 21.84% for the six months ended June 30, 2025.

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Average Balance Sheets for the Three and Six Months Ended June 30, 2026 and 2025

The following tables set forth average balance sheets, average yields and costs, and certain other information for the periods indicated. All average balances are daily average balances, the yields set forth below include the effect of deferred fees and discounts and premiums that are amortized or accreted to interest income (dollars in thousands).


	For the Three Months Ended June 30,
	2026						2025
	Average		Interest and				Average		Interest and
	Balance		Dividends		Yield/Cost⁽³⁾		Balance		Dividends		Yield/Cost⁽³⁾
Assets:
Interest-bearing depository accounts and federal funds sold	$	130,061	$	1,204	3.71	%	$	37,527	$	414	4.42	%
Loans⁽¹⁾		940,474		14,449	6.16	%		978,022		15,066	6.18	%
Available-for-sale securities		163,432		1,338	3.28	%		143,756		1,208	3.37	%
Other interest-earning assets		1,303		22	6.77	%		2,496		67	10.77	%
Total interest-earning assets		1,235,270		17,013	5.52	%		1,161,801		16,755	5.78	%
Non-interest-earning assets		87,498						87,246
Total assets	$	1,322,768					$	1,249,047
Liabilities and equity:
Subscription Deposits	$	20,824	$	8	0.15	%	$	—	$	—	—	%
NOW accounts		131,146		80	0.24	%		118,195		58	0.20	%
Money market accounts		238,920		1,523	2.56	%		215,295		1,353	2.52	%
Savings accounts		130,554		120	0.37	%		134,314		130	0.39	%
Certificates of deposit		385,544		3,543	3.69	%		342,425		3,295	3.86	%
Total interest-bearing deposits		906,988		5,274	2.33	%		810,229		4,836	2.39	%
Escrow accounts		11,060		30	1.09	%		10,847		30	1.11	%
Federal Home Loan Bank advances		5,154		—	—	%		33,686		311	3.70	%
Subordinated debt		5,155		77	5.99	%		5,155		86	6.69	%
Total other interest-bearing liabilities		21,369		107	2.01	%		49,688		427	3.45	%
Total interest-bearing liabilities		928,357		5,381	2.32	%		859,917		5,263	2.45	%
Non-interest-bearing deposits		231,793						231,573
Other non-interest-bearing liabilities		23,753						29,950
Total liabilities		1,183,903						1,121,440
Total stockholders’ equity		138,865						127,607
Total liabilities and stockholders’ equity	$	1,322,768					$	1,249,047
Net interest income			$	11,632					$	11,492
Interest rate spread					3.20	%					3.33	%
Net interest margin⁽²⁾					3.78	%					3.97	%
Average interest-earning assets to average interest-bearing liabilities					133.06	%					135.11	%

⁽¹⁾	Non-accruing loans are included in the outstanding loan balance. Deferred loan fees included in interest income totaled $52,000 and $86,000 for the three months ended June 30, 2026 and 2025, respectively.

⁽²⁾	Represents the difference between interest earned and interest paid, divided by average total interest-earning assets.

⁽³⁾	Annualized.

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	For the Six Months Ended June 30,
	2026						2025
	Average		Interest and				Average		Interest and
	Balance		Dividends		Yield/Cost⁽³⁾		Balance		Dividends		Yield/Cost⁽³⁾

	(Dollars in thousands)
Assets:
Interest-bearing depository accounts	$	110,962	$	2,065	3.75	%	$	33,003	$	693	4.23	%
Loans⁽¹⁾		945,212		28,787	6.14	%		984,984		30,074	6.16	%
Available-for-sale securities		162,181		2,712	3.37	%		150,450		2,469	3.31	%
Other interest-earning assets		1,676		60	7.22	%		3,417		157	9.27	%
Total interest-earning assets		1,220,031		33,624	5.56	%		1,171,854		33,393	5.75	%
Non-interest-earning assets		87,789						87,172
Total assets	$	1,307,820					$	1,259,026
Liabilities and equity:
Subscription Deposits	$	10,412	$	8	0.15	%	$	—	$	—	—	%
NOW accounts		127,035		152	0.24	%		122,118		111	0.18	%
Money market accounts		236,019		2,981	2.55	%		210,683		2,588	2.48	%
Savings accounts		129,980		249	0.39	%		133,635		254	0.38	%
Certificates of deposit		381,839		7,037	3.72	%		335,917		6,625	3.98	%
Total interest-bearing deposits		885,285		10,427	2.38	%		802,353		9,578	2.41	%
Escrow accounts		9,219		50	1.09	%		9,220		51	1.12	%
Federal Home Loan Bank advances		14,416		164	2.29	%		54,211		1,063	3.95	%
Subordinated debt		5,155		157	6.14	%		5,155		172	6.73	%
Total other interest-bearing liabilities		28,790		371	2.60	%		68,586		1,286	3.78	%
Total interest-bearing liabilities		914,075		10,798	2.38	%		870,939		10,864	2.52	%
Non-interest-bearing deposits		229,573						232,926
Other non-interest-bearing liabilities		25,638						29,379
Total liabilities		1,169,286						1,133,244
Total stockholders’ equity		138,534						125,782
Total liabilities and stockholders’ equity	$	1,307,820					$	1,259,026
Net interest income			$	22,826					$	22,529
Interest rate spread					3.18	%					3.23	%
Net interest margin⁽²⁾					3.77	%					3.88	%
Average interest-earning assets to average interest-bearing liabilities					133.47	%					134.55	%

⁽¹⁾	Non-accruing loans are included in the outstanding loan balance. Deferred loan fees included in interest income totaled $84,000 and $140,000 for the six months ended June 30, 2026 and 2025, respectively.

⁽²⁾	Represents the difference between interest earned and interest paid, divided by average total interest-earning assets.

⁽³⁾	Annualized.

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Rate/Volume Analysis

The following table presents the effects of changing rates and volumes on our net interest income for the period indicated (in thousands). The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the rate and volume columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. The Company did not have any excludable out-of-period items or adjustments.


	Three Months Ended June 30, 2026						Six Months Ended June 30, 2026
	Compared to Three Months Ended						Compared to Six Months Ended
	June 30, 2025						June 30, 2025
	Increase (Decrease)						Increase (Decrease)
	Due to						Due to
	Volume		Rate		Net		Volume		Rate		Net
Interest income:
Interest bearing depository accounts	$	866	$	(76)	$	790	$	1,459	$	(87)	$	1,372
Loans receivable		(576)		(41)		(617)		(1,211)		(76)		(1,287)
Available for sale securities		161		(31)		130		195		47		242
Other interest-earning assets		(25)		(20)		(45)		(67)		(29)		(96)
Total interest-earning assets		426		(168)		258		376		(145)		231
Interest expense:
Deposits		452		(14)		438		864		(15)		849
Escrow accounts		—		—		—		—		—		—
Federal Home Loan Bank advances		(143)		(168)		(311)		(572)		(327)		(899)
Subordinated debt		—		(9)		(9)		—		(16)		(16)
Total interest-bearing liabilities		309		(191)		118		292		(358)		(66)
Net increase in net interest income	$	117	$	23	$	140	$	84	$	213	$	297

Management of Market Risk

General. The majority of our assets and liabilities are monetary in nature. Consequently, our most significant form of market risk is interest rate risk. Our assets, consisting primarily of loans and securities, have longer maturities than our liabilities, consisting primarily of deposits and Federal Home Loan Bank advances. As a result, a principal part of our business strategy is to manage our exposure to changes in market interest rates. Accordingly, the Board of Directors maintains a management-level Asset/Liability Management Committee (the “ALCO”), which takes primary responsibility for reviewing the Company’s asset/liability management process and related procedures, establishing and monitoring reporting systems and ascertaining that established asset/liability strategies are being maintained. On at least a quarterly basis, the ALCO reviews and reports to the Board asset/liability management outcomes from various modeling scenarios. The ALCO also implements any changes in strategies and reviews the performance of any specific asset/liability management actions that have been implemented.

We manage our interest rate risk to minimize the exposure of our earnings and capital to changes in market interest rates. We have implemented the following strategies to manage our interest rate risk: originating loans with adjustable interest rates or with shorter terms, promoting core deposit products, and adjusting the interest rates and maturities of funding sources, as necessary. By following these strategies, we believe that we are better positioned to react to changes in market interest rates.

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Net Economic Value Simulation. We analyze the Bank’s sensitivity to changes in interest rates through a net economic value of equity (“EVE”) model. EVE represents the present value of the expected cash flows from our assets less the present value of the expected cash flows arising from our liabilities adjusted for the value of off-balance sheet contracts. The EVE ratio represents the dollar amount of our EVE divided by the present value of our total assets for a given interest rate scenario. EVE attempts to quantify our economic value using a discounted cash flow methodology while the EVE ratio reflects that value as a form of capital ratio. We estimate what our EVE would be at a specific date. We then forecast what the EVE might be at the same date throughout a series of interest rate scenarios representing immediate and permanent, parallel shifts in the yield curve. We currently calculate the EVE under scenarios where interest rates increase and decrease 100, 200, 300 and 400 basis points from current market rates.

The following table presents the estimated changes in the Bank’s EVE that would result from changes in market interest rates at June 30, 2026.


							Net Economic Value as a
	Net Economic Value						Percentage of Assets
	Dollar		Dollar		Percent		EVE		Percent
Basis Point Change in Interest Rates	Amount		Change		Change		Ratio		Change

	(Dollars in thousands)
400	$	264,929	$	33,059	14.3	%	19.10	%	20.7	%
300		257,228		25,358	10.9	%	18.30	%	15.7	%
200		250,162		18,292	7.9	%	17.57	%	11.0	%
100		242,247		10,377	4.5	%	16.77	%	6.0	%
0		231,870		—	—	%	15.82	%	—	%
(100)		217,316		(14,554)	(6.3)	%	14.62	%	(7.6)	%
(200)		198,529		(33,341)	(14.4)	%	13.16	%	(16.8)	%
(300)		176,131		(55,739)	(24.0)	%	11.49	%	(27.4)	%
(400)		149,078		(82,792)	(35.7)	%	9.55	%	(39.7)	%

Certain shortcomings are inherent in the methodologies used in the above interest rate risk measurements. Modeling changes require making certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. The above table assumes that the composition of our interest-sensitive assets and liabilities existing at the date indicated remains constant uniformly across the yield curve regardless of the duration or repricing of specific assets and liabilities. Accordingly, although the table provides an indication of our interest rate risk exposure at a point in time, such measurements are not intended to and do not provide a precise forecast of the effect of changes in market interest rates on our EVE and will likely differ from actual results.

Liquidity Management

On July 21, 2026, the Company completed its second-step conversion and public stock offering, generating approximately $88.8 million in gross proceeds through the sale of 8,880,210 shares at $10.00 per share. This capital infusion significantly enhances the Company’s overall liquidity position and regulatory capital, aligning with our strategic goals to support planned growth, improve stock liquidity, facilitate the ability to pay public stockholder dividends, enhance capital market accessibility, and support future mergers and acquisitions. As of June 30, 2026, these offering proceeds were not reflected in the reported financial statements or liquidity management ratios.

We maintain liquid assets at levels we consider adequate to meet both our short-term and long-term liquidity needs. We adjust our liquidity levels to fund deposit outflows, repay our borrowings and to fund loan commitments. We also adjust liquidity as appropriate to meet asset and liability management objectives.

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Our primary sources of liquidity are the July 21, 2026 offering proceeds, deposits, amortization and prepayment of loans and mortgage-backed securities, maturities, sales and calls of investment securities and other short-term investments, earnings, funds provided from operations, as well as access to FHLB advances and other borrowings. While scheduled principal repayments on loans and mortgage-backed securities are a relatively predictable source of funds, deposit flows and loan and security sales and prepayments are greatly influenced by market interest rates, economic conditions, and rates offered by our competition. We set the interest rates on our deposits to maintain a desired level of total deposits.

As reflected in the Consolidated Statements of Cash Flows, net cash provided by operating activities was $9.1 million for the six months ended June 30, 2026, compared to $6.7 million for the same period in 2025. These amounts differ from our net income because of a variety of cash receipts and disbursements that did not affect net income for the respective periods. Net cash provided by investing activities totaled $25.6 million in the first six months of 2026, a decrease from $35.3 million in the prior-year period, driven primarily by security purchases and a decrease in net loans. Cash provided by financing activities was $167.9 million for the six months ended June 30, 2026, compared to $10.1 million for the same period in 2025, resulting primarily from the $156.0 million in proceeds from stock subscriptions and changes in deposit balances and debt repayments. As a result of these activities, cash and cash equivalents increased by $202.6 million to $304.6 million as of June 30, 2026, from a beginning balance of $102.0 million.

At June 30, 2026, we had the following main sources of availability of liquid funds and borrowings:


(In thousands)	Total
Available liquid funds:
Unrestricted cash and cash equivalents	$	148,551
Unencumbered securities		79,277
Availability of borrowings:
Zions Bank line of credit		10,000
Pacific Coast Bankers Bank line of credit		50,000
FHLB secured line of credit		359,942
FRB secured line of credit		136,838
Total available sources of funds	$	784,608

The Bank has access to a preapproved secured line of credit with the FHLB. At June 30, 2026, the Bank had pledged $523.3 million of assets to the FHLB, which resulted in a secured line of credit of $365.1 million. At June 30, 2026, the Bank had borrowed $5.2 million under this line, with remaining secured borrowing capacity of $359.9 million.

We also have commitments and obligations under our post-retirement plan and other benefit plans and our off-balance sheet financial instruments, as described in Note 7 and Note 9 to the consolidated financial statements of this Quarterly Report on Form 10-Q.

Impact of Inflation and Changing Prices

The financial statements and related notes of the Company have been prepared in accordance with GAAP. GAAP generally requires the measurement of financial condition and operating results in terms of historical dollars without consideration for changes in the relative purchasing power of money over time due to inflation. The impact of inflation is reflected in the increased cost of our operations. Unlike industrial companies, our assets and liabilities are primarily monetary in nature. As a result, changes in market interest rates have a greater impact on performance than the effects of inflation.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

For information regarding market risk, see “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Management of Market Risk.”

Item 4. Controls and Procedures

An evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended) as of June 30, 2026. Based on that evaluation, the Company’s management, including the Chief Executive Officer and the Chief Financial Officer, concluded that the Company’s disclosure controls and procedures were effective.

There were no changes in the Company’s internal controls over financial reporting during the quarter ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings

We are periodically involved in legal proceedings, such as employment-related claims against us, claims to enforce liens, foreclosure or condemnation proceedings on properties in which we hold security interests, claims involving the making and servicing of real property loans, and other issues incidental to our business. As of the date of this Quarterly Report on Form 10-Q, we are not a party to any pending legal proceedings that we believe would have a material effect on our financial condition, results of operations or cash flows.

Item 1A. Risk Factors

The discussion of risk factors relevant to the Company under the heading “Risk Factors” in the prospectus filed on May 22, 2026 with the SEC pursuant to Rule 424(b)(3) of the Securities Act of 1933, as amended, is incorporated herein by reference. There have been no material changes to risk factors relevant to the Company’s operations since that prospectus. Additional risks not presently known to the Company, or that the Company currently deems immaterial, may also adversely affect the business, financial condition or results of operations.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

In September 2022, the Board approved a stock repurchase plan pursuant to which the Company is authorized to repurchase up to 247,506 shares of its common stock, of which no shares remained available for repurchase as of June 30, 2026.

In July 2025, the Board approved a stock repurchase plan pursuant to which the Company is authorized to repurchase up to 540,000 shares of its common stock, of which 463,457 shares remain available for repurchase. However, the Company is not permitted to repurchase its shares for one year following the completion of its second-step conversion, which was completed on July 21, 2026.

The following table provides information regarding repurchases of the Company’s common stock during the quarter ended June 30, 2026:


Period	Total Number of Shares	Average Price Paid per share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
April 1 - 30, 2026	1,900	$	16.29	1,900	560,495
May 1 - 31, 2026	97,038	$	16.09	97,038	463,457
June 1 - 30, 2026	-		-	-	463,457
Total	98,938	$	16.09	98,938	463,457

There were no sales of unregistered securities during the quarter ended June 30, 2026.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

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Item 5. Other Information

(c) Director and Section 16 Officer Rule 10b5-1 Trading Arrangements

During the three months ended June 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits


2.0	Plan of Conversion and Reorganization of Rhinebeck Bancorp, MHC (Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of Rhinebeck Bancorp, Inc. (File No. 001-38779), filed with the Securities and Exchange Commission on February 10, 2026.)

3.1	Amended and Restated Articles of Incorporation of Rhinebeck Bancorp, Inc.

3.2	Bylaws of Rhinebeck Bancorp, Inc. (Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K of Rhinebeck Bancorp, Inc. (File no. 001-38779), filed with the Securities and Exchange Commission on September 27, 2019.)

4.0	Form of Common Stock Certificate of Rhinebeck Bancorp, Inc. (Incorporated by reference to Exhibit 4 to the Registration Statement on Form S-1 of Rhinebeck Bancorp, Inc. (File no. 333-294283), originally filed with the Securities and Exchange Commission on March 13, 2026.)

31.1	Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certification required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.0	The following materials for the period ended June 30, 2026, formatted in inline XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Financial Condition, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements

104.0	The cover page from Rhinebeck Bancorp’s Form 10-Q for the quarterly period ended June 30, 2026, formatted in inline XBRL (contained in Exhibit 101.0)

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	RHINEBECK BANCORP, INC.

Date: August 13, 2026		/s/ Matthew J. Smith
		Matthew J. Smith President and Chief Executive Officer

Date: August 13, 2026		/s/ Kevin Nihill
		Kevin Nihill Chief Financial Officer