BVFL's Q3 Net Income Dips Slightly Amid Rising Interest Expenses

TL;DR

**BVFL's Q3 net income barely moved, but rising deposit costs and share buybacks are squeezing margins and equity – watch for continued pressure.**

AI Summary

BV Financial, Inc. reported a net income of $3.73 million for the three months ended September 30, 2025, a slight decrease from $3.798 million in the same period of 2024. For the nine months ended September 30, 2025, net income was $8.69 million, down from $9.771 million in the prior year. Total interest income increased to $12.527 million for the three-month period in 2025, up from $12.150 million in 2024, primarily driven by a rise in loan interest income to $11.519 million. However, total interest expense also increased to $3.177 million from $2.847 million, largely due to higher interest on deposits, which reached $2.712 million. The company recorded a recovery of provision for credit losses of $1.014 million for the three months ended September 30, 2025, compared to a recovery of $714,000 in 2024, indicating improved credit quality. Total assets slightly decreased to $909.386 million as of September 30, 2025, from $911.821 million at December 31, 2024, while total deposits increased to $663.790 million from $651.491 million. Stockholders' equity saw a decline to $190.210 million from $195.499 million, partly due to $18.022 million in repurchased shares during the nine-month period.

Why It Matters

BV Financial's slight dip in net income and overall asset base, coupled with increased interest expenses on deposits, signals a challenging interest rate environment for regional banks. For investors, the significant share repurchases totaling $18.022 million indicate management's confidence and a potential return of capital, but also contribute to the decline in total stockholders' equity. Employees and customers might see stability given the consistent loan growth and deposit base, but the competitive landscape for deposits remains fierce. The broader market will watch how smaller financial institutions like BVFL navigate rising funding costs and maintain profitability, setting a precedent for regional banking sector performance.

Risk Assessment

Risk Level: medium — The company faces medium risk due to declining net income for the nine months ended September 30, 2025, falling to $8.69 million from $9.771 million in 2024. Additionally, total stockholders' equity decreased by $5.289 million from December 31, 2024, to September 30, 2025, partly due to $18.022 million in share repurchases, which could impact capital ratios if not managed carefully.

Analyst Insight

Investors should monitor BVFL's net interest margin closely, as rising interest expenses on deposits are impacting profitability. Evaluate the long-term impact of share repurchases on capital adequacy and future growth prospects, considering the decline in total stockholders' equity.

Financial Highlights

total Assets

$909.386M

net Income

$3.73M

Revenue Breakdown

Key Numbers

• $3.73M — Net Income (Q3 2025) (Slight decrease from $3.798M in Q3 2024)
• $8.69M — Net Income (YTD Sep 2025) (Down from $9.771M in YTD Sep 2024)
• $12.527M — Total Interest Income (Q3 2025) (Increased from $12.150M in Q3 2024)
• $3.177M — Total Interest Expense (Q3 2025) (Increased from $2.847M in Q3 2024)
• $1.014M — Recovery of Credit Losses (Q3 2025) (Increased from $714K in Q3 2024, indicating improved credit quality)
• $909.386M — Total Assets (Sep 30, 2025) (Slight decrease from $911.821M at Dec 31, 2024)
• $663.790M — Total Deposits (Sep 30, 2025) (Increased from $651.491M at Dec 31, 2024)
• $190.210M — Total Stockholders' Equity (Sep 30, 2025) (Decreased from $195.499M at Dec 31, 2024)
• $18.022M — Repurchased Shares (YTD Sep 2025) (Significant capital return impacting equity)
• 8,903,927 — Common Stock Outstanding (Nov 7, 2025) (Reflects share repurchases)

Key Players & Entities

• BV Financial, Inc. (company) — Registrant and bank holding company
• Federal Reserve Board (regulator) — Regulates BV Financial as a bank holding company
• Federal Deposit Insurance Corporation (regulator) — Insures the Bank's deposits
• Federal Home Loan Bank of Atlanta (company) — Member of the Federal Home Loan Bank System
• NASDAQ Stock Market LLC (company) — Exchange where BVFL common stock is registered
• $3.73 million (dollar_amount) — Net income for Q3 2025
• $8.69 million (dollar_amount) — Net income for nine months ended September 30, 2025
• $18.022 million (dollar_amount) — Value of repurchased shares for nine months ended September 30, 2025
• $909.386 million (dollar_amount) — Total assets as of September 30, 2025
• $663.790 million (dollar_amount) — Total deposits as of September 30, 2025

FAQ

Risk Factors

• Bank Holding Company Regulation [medium — regulatory]: BV Financial is a registered bank holding company subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System. This subjects the company to various compliance requirements and potential changes in regulatory frameworks.
• Interest Rate Sensitivity [medium — financial]: The company's net income is sensitive to changes in interest rates, as evidenced by the increase in both interest income and interest expense. Higher interest on deposits ($2.712M in Q3 2025) outpaced the growth in loan interest income, impacting net interest margin.
• Stock Repurchases [medium — financial]: The company repurchased $18.022 million in shares during the nine-month period ended September 30, 2025. While this can return capital to shareholders, it also contributed to a decline in total stockholders' equity from $195.499 million to $190.210 million.
• Credit Risk Management [medium — operational]: While the company reported a recovery of provision for credit losses ($1.014M in Q3 2025 vs $714K in Q3 2024), indicating improved credit quality, the origination of various loan types (real estate, construction, commercial, consumer) inherently carries credit risk.
• Deposit Competition [medium — market]: The increase in interest expense on deposits suggests potential competition for funding. Attracting and retaining deposits is crucial for funding loan origination, and rising deposit costs can pressure profitability.

Industry Context

BV Financial operates as a community-oriented financial institution primarily focused on attracting deposits and originating various types of loans. The competitive landscape likely involves other regional and community banks, as well as larger financial institutions, vying for both depositors and borrowers. Trends such as rising interest rates, increasing deposit costs, and evolving regulatory environments are key factors impacting profitability and strategy.

Regulatory Implications

As a registered bank holding company, BV Financial is subject to stringent oversight by the Federal Reserve Board. Changes in capital requirements, lending standards, or consumer protection regulations could impact its operations and profitability. Compliance with these regulations is a significant operational consideration.

What Investors Should Do

1. Monitor Net Interest Margin Trends
2. Analyze Share Repurchase Strategy
3. Assess Credit Quality Trends
4. Evaluate Asset Growth vs. Funding Growth

Key Dates

• 2025-09-30: End of third quarter reporting period — Key financial results for the quarter and nine months ended this date were reported, showing a slight decrease in net income and mixed performance in interest income/expense.
• 2025-07-31: End of second quarter reporting period — Financial results for the first half of the year would have been reported, contributing to the year-to-date figures.
• 2023-07-31: Company's mutual to stock conversion consummated — Marked the transition to a fully-public stock holding company structure, impacting share structure and ownership.

Glossary

Provision for Credit Losses

An expense set aside by a financial institution to cover potential loan defaults and uncollectible debts. A recovery indicates that previously estimated losses were higher than actual realized losses. (A recovery of $1.014M in Q3 2025 suggests improved credit quality or better-than-expected loan performance compared to prior estimates.)

Bank Holding Company

A company that owns or controls one or more banks. These entities are subject to regulation by the Federal Reserve Board. (BV Financial operates under this structure, indicating regulatory oversight from the Federal Reserve Board.)

Mutual Holding Company (MHC)

A company structure where a mutual organization (like a savings bank) reorganizes to allow for public stock ownership while retaining some mutual characteristics. BV Financial transitioned from this structure. (Provides historical context for the company's ownership structure and its recent conversion to a fully public entity.)

Federal Deposit Insurance Corporation (FDIC)

A U.S. government agency that insures deposits in banks and savings associations. It also supervises financial institutions for safety, soundness, and consumer protection. (Ensures the safety of customer deposits up to legal limits, providing confidence to depositors.)

Year-Over-Year Comparison

Compared to the prior year's comparable periods, BV Financial reported a slight decrease in net income for both the third quarter ($3.73M vs $3.798M) and year-to-date ($8.69M vs $9.771M). While total interest income saw a modest increase, driven by loan interest, a larger rise in interest expense, particularly on deposits, compressed margins. The company did show improved credit quality, evidenced by a larger recovery of provision for credit losses. Total assets remained relatively stable, but stockholders' equity declined due to significant share repurchases.

Key Financial Figures

• $0.01 — ch registered Common Stock, par value $0.01 per share BVFL The NASDAQ Stock Mar

Filing Documents

• bvfl-20250930.htm (10-Q) — 7228KB
• bvfl-ex10_1.htm (EX-10.1) — 247KB
• bvfl-ex31_1.htm (EX-31.1) — 27KB
• bvfl-ex31_2.htm (EX-31.2) — 27KB
• bvfl-ex31_3.htm (EX-31.3) — 27KB
• bvfl-ex32.htm (EX-32) — 18KB
• 0001193125-25-279386.txt ( ) — 33115KB
• bvfl-20250930.xsd (EX-101.SCH) — 1817KB
• bvfl-20250930_htm.xml (XML) — 10756KB

Financial Statements (Unaudited)

Financial Statements (Unaudited) Consolidated Balance Sheets 1 Consolidated Statements of Income 2 Consolidated Statements of Comprehensive Income 3 Consolidated Statements of Changes in Stockholders' Equity 4 Consolidated Statements of Cash Flows 6 Notes to Unaudited Consolidated Financial Statements 7 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 36 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 47 Item 4.

Controls and Procedures

Controls and Procedures 47 PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 48 Item 1A.

Risk Factors

Risk Factors 48 Item 2. Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities 48 Item 3. Defaults Upon Senior Securities 48 Item 4. Mine Safety Disclosures 48 Item 5. Other Information 48 Item 6. Exhibits 49

Signatures

Signatures 50 BV FINANCIAL, INC. AND SUBSIDIARIES CONSOLIDATED BAL ANCE SHEETS September 30, 2025 December 31, 2024 (dollars in thousands, except per share amounts) (unaudited) Assets Cash $ 6,061 $ 5,842 Interest-bearing deposits in other banks 57,485 64,658 Cash and cash equivalents 63,546 70,500 Equity investment 405 391 Securities available for sale 34,482 37,259 Securities held to maturity (fair value of $ 5,131 and $ 5,171 , ACL of $ 2 and $ 4 ) 5,784 5,979 Total loans 746,072 737,760 Allowance for credit losses ( 8,197 ) ( 8,522 ) Net loans 737,875 729,238 Foreclosed real estate — 159 Premises and equipment, net 12,686 13,224 Federal Home Loan Bank of Atlanta stock, at cost 656 1,366 Investment in life insurance 20,347 20,058 Accrued interest receivable 3,049 3,161 Goodwill 14,420 14,420 Intangible assets, net 696 831 Deferred tax assets, net 9,267 8,899 Other assets 6,173 6,336 Total assets $ 909,386 $ 911,821 Liabilities and Stockholders' Equity Liabilities Noninterest-bearing deposits $ 134,742 $ 129,724 Interest-bearing deposits 529,048 521,767 Total deposits 663,790 651,491 FHLB borrowings — 15,000 Subordinated debentures 35,000 34,883 Other liabilities 20,386 14,948 Total liabilities 719,176 716,322 Stockholders' equity Preferred stock, $ 0.01 par value; 1,000,000 shares authorized; none issued or outstanding; Common stock, $ 0.01 par value; 45,000,000 shares authorized at September 30, 2025 and December 31, 2024; 9,536,094 shares issued and outstanding as of September 30, 2025 and 10,645,284 issued and outstanding as of December 31, 2024 95 106 Paid-in capital 80,151 94,679 Retained earnings 118,185 109,495 Unearned common stock held by employee stock ownership plan ( 7,023 ) ( 7,160 ) Accumulated other comprehensive loss ( 1,198

Business

Business BV Financial was organized as a federal corporation and savings and loan holding company in January 2005 as part of the mutual holding company reorganization of Bay-Vanguard Federal Savings Bank. In February 2019, the Company became a Maryland-chartered corporation and a bank holding company. Prior to consummation of its mutual to stock conversion in July 2023, BayVanguard, M.H.C., Inc. (the "MHC") a Maryland-chartered mutual holding company, owned 86.3 % of the outstanding common stock of the Company. On January 19, 2023, the MHC adopted a Plan of Conversion and Reorganization pursuant to which the MHC reorganized from the two-tier mutual holding company structure to the fully-public stock holding company structure (the "Conversion"). The Conversion was consummated on July 31, 2023 on which date the MHC ceased to exist. As part of the Conversion, the Company sold 9,798,980 shares of its common stock at a price of $ 10.00 per share. Each outstanding share of Company common stock owned by the public stockholders of the Company were converted into new shares of Company common stock based on an exchange ratio of 1.5309 -to-1. The Company had 11,375,803 shares of Company common stock outstanding as a result of the Conversion. The Company is a registered bank holding company subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System (the "Federal Reserve Board"). The Bank is headquartered in Baltimore, Maryland and is a full-service community-oriented financial institution dedicated to serving the financial service needs of consumers and businesses. The Bank is engaged primarily in the business of attracting deposits from the general public and using such funds to originate one- to- four-family real estate, construction, multi-family, commercial real estate, farm, marine loans, commercial and consumer loans. The Bank's deposits are insured up to the applicable legal limits by the Federal Deposit Insuranc

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