AFBI 10-Q Quarterly Report Sept. 30, 2025 | Alphaminr
Affinity Bancshares, Inc.
ALPHAMINR

AFBI 10-Q Quarter ended Sept. 30, 2025

Balance Sheet
Cash Flow
Income Statement
Debt
10-Q
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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 September 30, 2025

OR

☐

TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period

Commission File No. 001-39914

Affinity Bancshares, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Maryland

82-1147778

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

3175 Highway 278

Covington , Georgia

30014

(Address of Principal Executive Offices)

(Zip Code)

( 770 ) 786-7088

(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

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

AFBI

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 (§ 232.405 of this chapter) 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.

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 November 6, 2025 , 6,167,602 shares of the Registrant’s common stock, par value $0.01 per share, were outstanding.

Affinity Bancshares, Inc.

Form 10-Q

Table of Contents

Page

PART I. FINANCIAL INFORMATION

Item 1.

Financial Statements

2

Consolidated Balance Sheets at September 30, 2025 (unaudited) and December 31, 2024

2

Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2025 and 2024 (unaudited)

3

Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2025 and 2024 (unaudited)

4

Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended September 30, 2025 and 2024 (unaudited)

5

Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 (unaudited)

6

Notes to Unaudited Consolidated Financial Statements

7

Item 2.

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

22

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

32

Item 4.

Controls and Procedures

32

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings

33

Item 1A.

Risk Factors

33

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

33

Item 3.

Defaults Upon Senior Securities

33

Item 4.

Mine Safety Disclosures

33

Item 5.

Other Information

33

Item 6.

Exhibits

34

SIGNATURES

35

1

PART I – FINANCI AL INFORMATION

Item 1. Financi al Statements

AFFINITY BANCSHARES, INC.

C onsolidated Balance Sheets

September 30, 2025

December 31, 2024

(Dollars in thousands except per share amounts)

Assets

Cash and due from banks

$

6,092

$

7,092

Interest-earning deposits in other depository institutions

78,753

34,333

Cash and cash equivalents

84,845

41,425

Investment securities available-for-sale

44,668

36,502

Investment securities held-to-maturity (estimated fair value of $ 19,692 net of allowance for credit losses of $ 29 at September 30, 2025 and estimated fair value of $ 27,286 net of allowance for credit losses of $ 45 at December 31, 2024)

19,225

27,299

Other investments

6,254

6,175

Loans

729,539

714,115

Allowance for credit loss on loans

( 8,562

)

( 8,496

)

Net loans

720,977

705,619

Premises and equipment, net

2,955

3,261

Bank owned life insurance

16,795

16,487

Intangible assets

18,032

18,175

Other assets

11,470

11,874

Total assets

$

925,221

$

866,817

Liabilities and Stockholders' Equity

Liabilities:

Non-interest-bearing checking

$

150,613

$

151,395

Interest-bearing checking

86,824

73,841

Money market accounts

176,477

148,752

Savings accounts

93,938

76,053

Certificates of deposit

231,524

223,440

Total deposits

739,376

673,481

Federal Home Loan Bank advances and other borrowings

54,000

58,815

Accrued interest payable and other liabilities

6,440

5,406

Total liabilities

799,816

737,702

Stockholders' equity:

Common stock (par value $ 0.01 per share, 40,000,000 shares authorized;
6,193,686 issued and outstanding at September 30, 2025 and 6,409,598 issued and outstanding at December 31, 2024)

62

64

Preferred stock ( 10,000,000 shares authorized, no shares outstanding)

—

—

Additional paid in capital

59,584

62,355

Unearned ESOP shares

( 3,742

)

( 4,378

)

Retained earnings

73,976

76,786

Accumulated other comprehensive loss

( 4,475

)

( 5,712

)

Total stockholders' equity

125,405

129,115

Total liabilities and stockholders' equity

$

925,221

$

866,817

See accompanying notes to unaudited consolidated financial statements.

2

AFFINITY BANCSHARES, INC.

C onsolidated Statements of Income

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

(Dollars in thousands except per share amounts)

Interest income:

Loans, including fees

$

11,219

$

10,596

$

33,062

$

30,575

Investment securities

833

1,038

2,533

3,207

Interest-earning deposits

868

668

2,253

1,964

Total interest income

12,920

12,302

37,848

35,746

Interest expense:

Deposits

4,625

4,187

13,396

12,287

FHLB advances and other borrowings

525

701

1,567

1,727

Total interest expense

5,150

4,888

14,963

14,014

Net interest income before provision for credit losses

7,770

7,414

22,885

21,732

Provision for credit losses

12

—

79

213

Net interest income after provision for credit losses

7,758

7,414

22,806

21,519

Noninterest income:

Service charges on deposit accounts

367

364

1,020

1,150

Net gain on sale of other real estate owned

—

—

—

135

Other

221

202

589

570

Total noninterest income

588

566

1,609

1,855

Noninterest expenses:

Salaries and employee benefits

3,196

3,257

9,815

9,853

Occupancy

581

600

1,781

1,833

Data processing

531

520

1,624

1,538

Other

1,121

1,327

3,034

4,769

Total noninterest expenses

5,429

5,704

16,254

17,993

Income before income taxes

2,917

2,276

8,161

5,381

Income tax expense

700

546

1,960

1,285

Net income

$

2,217

$

1,730

$

6,201

$

4,096

Weighted average common shares outstanding

Basic

6,256,780

6,412,511

6,324,478

6,415,246

Diluted

6,427,697

6,611,468

6,481,644

6,555,096

Basic earnings per share

$

0.35

$

0.27

$

0.98

$

0.64

Diluted earnings per share

$

0.34

$

0.26

$

0.96

$

0.62

See accompanying notes to unaudited consolidated financial statements.

3

AFFINITY BANCSHARES, INC.

C onsolidated Statements of Comprehensive Income

(unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

(In thousands)

Net income

$

2,217

$

1,730

$

6,201

$

4,096

Other comprehensive income:

Net unrealized gains on available-for-sale securities, net of taxes of $ 178 , $ 423 , $ 417 and $ 537

526

1,253

1,237

1,584

Total other comprehensive income

526

1,253

1,237

1,584

Total comprehensive income

$

2,743

$

2,983

$

7,438

$

5,680

See accompanying notes to unaudited consolidated financial statements.

4

AFFINITY BANCSHARES, INC.

Consolidated Statements of Cha nges in Stockholders’ Equity

(unaudited)

Three Months Ended September 30, 2025 and 2024

Accumulated

Additional

Other

Common

Paid In

Unearned

Retained

Comprehensive

Stock

Capital

ESOP Shares

Earnings

Income (Loss)

Total

(In thousands)

Beginning balance June 30, 2025

$

63

$

61,197

$

( 3,915

)

$

71,756

$

( 5,001

)

$

124,100

ESOP loan payment and release of ESOP shares

—

158

173

—

—

331

Stock-based compensation expense

—

172

—

3

—

175

Change in unrealized loss on investment securities available-for-sale, net of tax

—

—

—

—

526

526

Common stock repurchase

( 1

)

( 1,943

)

—

—

—

( 1,944

)

Net income

—

—

—

2,217

—

2,217

Ending balance September 30, 2025

$

62

$

59,584

$

( 3,742

)

$

73,976

$

( 4,475

)

$

125,405

Beginning balance June 30, 2024

$

64

$

61,773

$

( 4,482

)

$

73,711

$

( 6,001

)

$

125,065

ESOP loan payment and release of ESOP shares

—

59

52

—

—

111

Stock-based compensation expense

—

217

—

—

—

217

Change in unrealized loss on investment securities available-for-sale, net of tax

—

—

—

—

1,253

1,253

Net income

—

—

—

1,730

—

1,730

Ending balance September 30, 2024

$

64

$

62,049

$

( 4,430

)

$

75,441

$

( 4,748

)

$

128,376

Nine Months Ended September 30, 2025 and 2024

Accumulated

Additional

Other

Common

Paid In

Unearned

Retained

Comprehensive

Stock

Capital

ESOP Shares

Earnings

Income (Loss)

Total

(In thousands)

Beginning balance December 31, 2024

$

64

$

62,355

$

( 4,378

)

$

76,786

$

( 5,712

)

$

129,115

ESOP loan payment and release of ESOP shares

—

543

636

( 216

)

—

963

Stock-based compensation expense

—

717

—

6

—

723

Exercise of stock options

—

59

—

—

—

59

Change in unrealized loss on investment securities available-for-sale, net of tax

—

—

—

—

1,237

1,237

Common stock repurchase

( 2

)

( 4,090

)

—

—

—

( 4,092

)

Dividend

—

—

—

( 8,801

)

—

( 8,801

)

Net income

—

—

—

6,201

—

6,201

Ending balance September 30, 2025

$

62

$

59,584

$

( 3,742

)

$

73,976

$

( 4,475

)

$

125,405

Beginning balance December 31, 2023

$

64

$

61,026

$

( 4,587

)

$

71,345

$

( 6,332

)

$

121,516

ESOP loan payment and release of ESOP shares

—

136

157

—

—

293

Stock-based compensation expense

—

887

—

—

—

887

Change in unrealized loss on investment securities available-for-sale, net of tax

—

—

—

—

1,584

1,584

Net income

—

—

—

4,096

—

4,096

Ending balance September 30, 2024

$

64

$

62,049

$

( 4,430

)

$

75,441

$

( 4,748

)

$

128,376

See accompanying notes to unaudited consolidated financial statements.

5

AFFINITY BANCSHARES, INC.

C onsolidated Statements of Cash Flows

(unaudited)

Nine Months Ended September 30,

2025

2024

(In thousands)

Cash flows from operating activities:

Net income

$

6,201

$

4,096

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation, (accretion) and amortization

601

513

Stock-based compensation expense

723

887

Deferred income tax expense

—

241

Provision for credit losses

79

213

ESOP expense

963

293

Net gain on sale of other real estate owned

—

( 135

)

Increase in cash surrender value of bank owned life insurance

( 308

)

( 299

)

Change in:

Accrued interest receivable and other assets

( 14

)

29

Accrued interest payable and other liabilities

1,134

88

Net cash provided by operating activities

9,379

5,926

Cash flows from investing activities:

Purchases of investment securities available-for-sale

( 7,546

)

—

Purchases of premises and equipment

( 329

)

( 399

)

Proceeds from paydowns of investment securities available-for-sale

1,068

2,368

Proceeds from paydowns of investment securities held-to-maturity

8,147

2,076

Purchases of other investments

( 79

)

( 733

)

Net change in loans

( 15,466

)

( 38,091

)

Proceeds from sales of other real estate owned

—

2,985

Net cash used in investing activities

( 14,205

)

( 31,794

)

Cash flows from financing activities:

Net change in deposits

65,895

9,327

Common stock repurchase

( 4,092

)

—

Proceeds from FHLB advances

10,000

24,000

Repayment of FHLB advances

( 10,000

)

( 10,000

)

Proceeds from federal funds purchased

—

27

Repayment of federal funds purchased

—

( 27

)

Dividends paid to shareholders

( 8,801

)

—

Exercise of stock options

59

—

Proceeds from other borrowings

—

11,838

Repayment of other borrowings

( 4,815

)

( 7,023

)

Net cash provided by financing activities

48,246

28,142

Net change in cash and cash equivalents

43,420

2,274

Cash and cash equivalents at beginning of period

41,425

50,025

Cash and cash equivalents at end of period

$

84,845

$

52,299

Supplemental disclosures of cash flow information:

Cash paid for interest

14,532

13,916

Cash paid for income taxes

1,436

1,469

Change in unrealized loss on investment securities available-for-sale, net of tax

1,237

1,584

See accompanying notes to unaudited consolidated financial statements.

6

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

(1) Nature of Operations

Affinity Bancshares, Inc. (the “Company”) is a bank holding company headquartered in Covington, Georgia. The Company has one operating subsidiary, Affinity Bank, National Association (the “Bank”, and formerly named “Affinity Bank”), a national bank, conducting banking activities primarily in Newton County, Georgia and surrounding counties and in Cobb and Fulton Counties, Georgia and surrounding counties, and originating dental practice loans and indirect automobile loans throughout the Southeastern United States. The Bank offers such customary banking services as consumer and commercial checking accounts, savings accounts, certificates of deposit, mortgage, commercial and consumer loans, including indirect automobile loans, money transfers and a variety of other banking services. The Company was incorporated in 2020 to be the successor corporation to Community First Bancshares, Inc., a federal corporation, upon completion of the second-step mutual-to-stock conversion of Community First Bancshares, MHC, the top tier mutual holding company of Community First Bancshares, Inc, the former mid-tier holding company for the Bank.

Basis of Presentation

The accompanying unaudited consolidated financial statements and notes thereto contain all adjustments, consisting only of normal recurring adjustments, necessary to present fairly, in accordance with accounting principles generally accepted in the United States of America (“GAAP”), the financial position of the Company as of September 30, 2025 and the results of its operations and its cash flows for the periods presented. The interim consolidated financial information should be read in conjunction with the audited financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. The results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for a full year or for any other period.

Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. Material estimates common to the banking industry that are particularly susceptible to significant change in the near term include, but are not limited to, the determination of the allowance for credit losses, the valuation of other real estate acquired in connection with foreclosure or in satisfaction of loans and valuation allowances associated with the realization of deferred tax assets, which are based on future taxable income.

Summary of Significant Accounting Policie s – The accounting and reporting policies of the Company conform to GAAP and general practices within the banking industry. There have been no material changes or developments in the application of principles or in our evaluation of the accounting estimates and the underlying assumptions or methodologies that we believe to be Critical Accounting Policies as disclosed in the Company’s financial statements for the year ended December 31, 2024 included in the Company’s Annual Report on Form 10-K.

Earnings per Share

Basic earnings per common share are calculated by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common share are calculated by dividing net income available to common shareholders by the weighted average number of shares adjusted for the dilutive effect of common stock awards (outstanding stock options), if any. Presented below are the calculations for basic and diluted earnings per common share.

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

(Dollars in thousands except per share data)

Net income

$

2,217

$

1,730

$

6,201

$

4,096

Weighted average common shares outstanding

6,256,780

6,412,511

6,324,478

6,415,246

Effect of dilutive common stock awards

170,917

198,957

157,166

139,850

Diluted weighted average common shares outstanding

6,427,697

6,611,468

6,481,644

6,555,096

Basic earnings per common share

$

0.35

$

0.27

$

0.98

$

0.64

Diluted earnings per common share

0.34

$

0.26

0.96

0.62

7

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

There were 17,000 anti-dilutive options for the three and nine months ended September 30, 2025 and 10,000 and 110,000 anti-dilutive options for the three and nine months ended September 30, 2024 .

(2) Investment Securities

Investment securities available-for-sale at September 30, 2025 and December 31, 2024 are as follows: (in thousands)

September 30, 2025

Amortized Cost

Gross
Unrealized Gains

Gross
Unrealized Losses

Estimated Fair Value

U.S. Treasury securities

$

5,218

$

—

$

( 402

)

$

4,816

Municipal securities - tax exempt

515

—

( 79

)

436

Municipal securities - taxable

2,040

—

( 276

)

1,764

U. S. Government sponsored enterprises

11,837

—

( 2,931

)

8,906

Government agency mortgage-backed securities

17,907

54

( 2,072

)

15,889

Corporate securities

13,142

47

( 332

)

12,857

Total

$

50,659

$

101

$

( 6,092

)

$

44,668

December 31, 2024

U.S. Treasury securities

$

5,187

$

—

$

( 620

)

$

4,567

Municipal securities - tax exempt

520

—

( 87

)

433

Municipal securities - taxable

2,041

—

( 370

)

1,671

U. S. Government sponsored enterprises

11,837

—

( 3,356

)

8,481

Government agency mortgage-backed securities

15,076

—

( 2,732

)

12,344

Corporate securities

9,486

67

( 547

)

9,006

Total

$

44,147

$

67

$

( 7,712

)

$

36,502

Investment securities held-to-maturity at September 30, 2025 and December 31, 2024 are as follows: (in thousands)

September 30, 2025

Amortized Cost

Gross
Unrealized Gains

Gross
Unrealized Losses

Fair Value

Estimated Allowance for Credit Losses

Government agency mortgage-backed securities

$

661

$

—

$

( 79

)

$

582

$

—

Corporate securities

18,593

524

( 7

)

19,110

( 29

)

Total

$

19,254

$

524

$

( 86

)

$

19,692

$

( 29

)

December 31, 2024

Government agency mortgage-backed securities

$

715

$

—

$

( 103

)

$

612

$

—

Corporate securities

26,629

211

( 166

)

26,674

( 45

)

Total

$

27,344

$

211

$

( 269

)

$

27,286

$

( 45

)


Corporate securities account for the majority of the held-to-maturity portfolio as of September 30, 2025. These corporate securities are accounted for as securities, but are underwritten as loans with features that are typically found in commercial loans. Accordingly, the Bank monitors the credit quality of these corporate securities through quarterly credit reviews to determine impairment, if any. At September 30, 2025 , these securities are all rated as investment grade and the $ 29,000 of allowance for credit losses associated with these securities was calculated using a Moody's report on the cumulative default rates of the corporate issuers compared to $ 45,000 allowance for credit losses associated with these securities at December 31, 2024. During the three and nine months ended September 30, 2025 , $ 8,000 and $ 16,000 provision reversal was recorded and no provision was recorded for the three and nine months ended September 30, 2024.

8

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

Investment securities available-for-sale in an unrealized loss position at September 30, 2025 and December 31, 2024 are as follows: (in thousands)

Less Than 12 Months

12 Months or More

Total

September 30, 2025

Fair Value

Unrealized Loss

Fair Value

Unrealized Loss

Fair Value

Unrealized Loss

U.S. Treasury securities

$

—

$

—

$

4,816

$

( 402

)

$

4,816

$

( 402

)

Municipal securities - tax exempt

—

—

436

( 79

)

436

( 79

)

Municipal securities - taxable

—

—

1,764

( 276

)

1,764

( 276

)

U. S. Government sponsored enterprises

—

—

8,906

( 2,931

)

8,906

( 2,931

)

Government agency mortgage-backed securities

—

—

12,017

( 2,072

)

12,017

( 2,072

)

Corporate securities

3,113

( 18

)

5,187

( 314

)

8,300

( 332

)

Total

$

3,113

$

( 18

)

$

33,126

$

( 6,074

)

$

36,239

$

( 6,092

)

December 31, 2024

U.S. Treasury securities

$

—

$

—

$

4,567

$

( 620

)

$

4,567

$

( 620

)

Municipal securities - tax exempt

—

—

433

( 87

)

433

( 87

)

Municipal securities - taxable

—

—

1,671

( 370

)

1,671

( 370

)

U. S. Government sponsored enterprises

—

—

8,481

( 3,356

)

8,481

( 3,356

)

Government agency mortgage-backed securities

—

—

12,344

( 2,732

)

12,344

( 2,732

)

Corporate securities

—

—

5,446

( 547

)

5,446

( 547

)

Total

$

—

$

—

$

32,942

$

( 7,712

)

$

32,942

$

( 7,712

)

There was one available-for-sale security in an unrealized loss position for less than 12 months of $ 18,000 . There were 46 available-for-sale securities in an unrealized loss position for 12 months or greater totaling $ 6.1 million as of September 30, 2025 . The unrealized losses on the debt securities arose due to changing interest rates and market conditions and are considered to be temporary because of acceptable investment grades and are reviewed regularly. Four of the securities are agency bonds and five are U.S. Treasury bonds, so all of these are direct obligations of the U.S. Government. Twenty-four of the securities are mortgage-backed bonds that have the direct or implied backing of the U.S. Government. Three of the bonds are municipal securities and the remaining eleven securities are corporate securities that are either trust preferred securities or subordinated debentures where the Bank performs a credit review regularly and such review has raised no concerns.

Debt securities issued by U.S. government agencies, U.S. government-sponsored enterprises ("GSEs"), and the U.S. Treasury, including notes and mortgage-backed securities, accounted for the majority of the available-for-sale portfolio as of September 30, 2025, and the Bank expects no credit losses on these securities, given the explicit and implicit guarantees provided by the U.S. federal government. The available-for-sale portfolio also includes corporate securities, which are underwritten as loans with features that are typically found in commercial loans. Accordingly, the Bank monitors the credit quality of these corporate bonds through quarterly credit reviews to determine impairment, if any. The decline in fair value is attributable to changes in interest rates, and not credit quality, and the Bank does not have the intent to sell the U.S. government and agencies debt securities and the corporate securities and it is likely that it will not be required to sell the securities before their anticipated recovery, the Bank does not consider impairments on these securities to be credit related as of September 30, 2025.

The amortized cost and estimated fair value of investment securities available-for-sale and held-to-maturity at September 30, 2025, by contractual maturity, are shown below. Maturities of mortgage-backed securities may differ from contractual

9

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

maturities because borrowers may have the right to call or prepay certain obligations with or without call or prepayment penalties. Therefore, these securities are not included in the maturity categories. (in thousands)

Available-for-Sale

Held-to-Maturity

Amortized

Estimated

Amortized

Estimated

Cost

Fair Value

Cost

Fair Value

Within 1 year

$

1,000

$

994

$

1,000

$

1,003

Greater than 1 to 5 years

9,230

8,870

9,507

9,763

Greater than 5 to 10 years

12,192

11,307

8,086

8,344

Greater than 10 years

10,330

7,608

—

—

32,752

28,779

18,593

19,110

Government agency mortgage-backed securities

17,907

15,889

661

582

Total

$

50,659

$

44,668

$

19,254

$

19,692

There were no sales of investment securities available-for-sale during the three and nine months ended September 30, 2025 and 2024.

Available-for-sale securities with a carrying value of approximately $ 5.9 million and $ 9.6 million were pledged to secure public deposits at September 30, 2025 and December 31, 2024 , respectively.

(3) Loans and Allowance for Credit Losses

Major classifications of loans, by collateral code, at September 30, 2025 and December 31, 2024 are summarized as follows: (in thousands)

September 30, 2025

December 31, 2024

Commercial (secured by real estate - owner occupied)

$

163,796

$

156,923

Commercial (secured by real estate - non-owner occupied)

164,015

166,662

Commercial and industrial

146,212

148,150

Construction, land and acquisition & development

74,463

67,622

Residential mortgage 1-4 family

48,512

54,142

Consumer installment

132,541

120,616

Total

729,539

714,115

Less allowance for credit losses

( 8,562

)

( 8,496

)

Total loans, net

$

720,977

$

705,619

The Bank grants loans and extensions of credit to individuals and a variety of firms and corporations located primarily in the Atlanta, Georgia Metropolitan Statistical Area. A substantial portion of the loan portfolio is collateralized by improved and unimproved real estate and is dependent upon the real estate market. The Bank also conducts lending within professional markets, with a primary focus on the dental industry in Georgia and adjoining states. The majority of these loans are commercial and industrial credits for practice acquisitions and equipment financing with the remainder being owner-occupied real estate. Accrued interest on loans totaled $ 2.2 million on September 30, 2025 and $ 2.3 million on December 31, 2024 and is included in other assets on the consolidated balance sheet.

10

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

The following table presents the balance in the allowance for credit losses as of and for the three and nine months ended September 30, 2025 and 2024 (in thousands)

Commercial
(Secured by Real
Estate - Owner Occupied)

Commercial
(Secured by Real Estate - Non-Owner Occupied)

Commercial
and Industrial

Construction,
Land and
Acquisition & Development

Residential
Mortgage

Consumer
Installment

Unallocated

Total

Allowance for Credit Loss

Beginning balance June 30, 2025

$

1,136

$

1,115

$

1,805

$

1,435

$

1,188

$

1,800

$

63

$

8,542

Provision

( 20

)

( 7

)

( 49

)

26

( 49

)

84

85

70

Charge-offs

—

—

—

—

—

( 76

)

—

( 76

)

Recoveries

—

—

2

—

—

24

—

26

Ending balance September 30, 2025

$

1,116

$

1,108

$

1,758

$

1,461

$

1,139

$

1,832

$

148

$

8,562

Allowance for Credit Loss

Beginning balance, December 31, 2024

$

1,082

$

1,115

$

1,753

$

1,134

$

1,227

$

1,632

$

553

$

8,496

Provision

34

( 7

)

3

327

( 115

)

358

( 405

)

195

Charge-offs

—

—

—

—

—

( 220

)

—

( 220

)

Recoveries

—

—

2

—

27

62

—

91

Ending balance, September 30, 2025

$

1,116

$

1,108

$

1,758

$

1,461

$

1,139

$

1,832

$

148

$

8,562

Allowance for Credit Loss

Beginning balance, June 30, 2024

$

1,309

$

1,319

$

1,707

$

1,176

$

1,106

$

1,550

$

294

$

8,461

Provision

4

52

24

39

( 38

)

93

( 174

)

—

Charge-offs

—

—

—

—

—

( 75

)

—

( 75

)

Recoveries

—

—

—

—

—

12

—

12

Ending balance, September 30, 2024

$

1,313

$

1,371

$

1,731

$

1,215

$

1,068

$

1,580

$

120

$

8,398

Allowance for Credit Loss

Beginning balance, December 31, 2023

$

1,397

$

1,298

$

1,806

$

927

$

1,038

$

1,534

$

921

$

8,921

Provision

( 84

)

238

( 75

)

288

80

354

( 801

)

—

Charge-offs

—

( 165

)

—

—

( 50

)

( 372

)

—

( 587

)

Recoveries

—

—

—

—

—

64

—

64

Ending balance, September 30, 2024

$

1,313

$

1,371

$

1,731

$

1,215

$

1,068

$

1,580

$

120

$

8,398

Allowance for credit loss on unfunded commitments for the three and nine months ended September 30, 2025 and 2024 is summarized below:

For the Three Months Ended

For the Nine Months Ended

September 30, 2025

September 30, 2024

September 30, 2025

September 30, 2024

(in thousands)

Beginning balance

$

694

$

531

$

744

$

531

Provision

( 50

)

213

( 100

)

213

Ending Balance

$

644

$

744

$

644

$

744

The Bank individually evaluates loans meeting a certain threshold for impairment that are on nonaccrual status or are rated substandard (as described below).

Collateral-Dependent Loans
We classify a loan as collateral-dependent when our borrower is experiencing financial difficulty, and we expect repayment to be provided substantially through the operation or sale of collateral. Our commercial loans have collateral that is comprised of

11

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

real estate and business assets. Our consumer loans have collateral that is substantially comprised of residential real estate. There were no significant changes in the extent to which collateral secures our collateral-dependent loans as of September 30, 2025 and December 31, 2024 , respectively, and we had $ 2.4 million and $ 2.0 million, respectively, of collateral-dependent loans without an allowance and no collateral-dependent loans with an allowance at September 30, 2025 and December 31, 2024.

The following table presents the aging of the recorded investment in past due loans, as well as the recorded investment in nonaccrual loans, as of September 30, 2025 and December 31, 2024 by class of loans: (in thousands)

September 30, 2025

30 -59
Days
Past Due

60- 89
Days
Past Due

90 Days
or Greater
Past Due

Total Accruing Loans
Past Due

Nonaccrual with Allowance

Nonaccrual without Allowance

Current

Total

Commercial (secured by real estate - owner occupied)

$

—

$

—

$

—

$

—

$

—

$

1,814

$

161,982

$

163,796

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

133

163,882

164,015

Commercial and industrial

—

—

—

—

—

574

145,638

146,212

Construction, land and acquisition &
development

—

—

—

—

—

15

74,448

74,463

Residential mortgage

124

—

—

124

—

2,247

46,141

48,512

Consumer installment

97

—

—

97

—

300

132,144

132,541

Total

$

221

$

—

$

—

$

221

$

—

$

5,083

$

724,235

$

729,539

December 31, 2024

30 -59
Days
Past Due

60- 89
Days
Past Due

90 Days
or Greater
Past Due

Total Accruing Loans
Past Due

Nonaccrual with Allowance

Nonaccrual without Allowance

Current

Total

Commercial (secured by real estate - owner occupied)

$

370

$

320

$

—

$

690

$

—

$

1,996

$

154,237

$

156,923

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

152

166,510

166,662

Commercial and industrial

1

—

—

1

—

—

148,149

148,150

Construction, land and acquisition &
development

—

—

—

—

—

17

67,605

67,622

Residential mortgage

1,117

97

—

1,214

—

2,313

50,615

54,142

Consumer installment

526

76

—

602

—

299

119,715

120,616

Total

$

2,014

$

493

$

—

$

2,507

$

—

$

4,777

$

706,831

$

714,115

During the nine months ended September 30, 2025 , there were three commercial loan modifications to borrowers with financial difficulty. One loan, secured by real estate - owner occupied, totaled $ 1.8 million that was previously modified in third quarter of 2024. The loan modification provided for a six-month period with reduced fixed payments of $ 5,000 for the first three months and $ 7,500 for the second three months. Two new loans were added as financial difficulty modifications during the three months ending September 30, 2025. The additional two loans, commercial and industrial loans, consist of one commercial relationship that totaled $ 574,000 . Both loans are secured by the guarantor’s businesses with secondary collateral being the guarantor’s primary residence. The loan modification provided for six interest-only payments. Following the six interest-only payments, the loan is scheduled to resume with principal and interest payments.

12

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

No loan modifications made to a borrower with financial difficulty subsequently defaulted during the three and nine months ended September 30, 2025 and 2024.

The Bank 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 Bank analyzes loans individually by classifying the loans as to credit risk. This analysis is performed on a continuous basis. The Bank uses the following definitions for its risk ratings:

Special Mention. Loans have potential weaknesses that may, if not corrected, weaken or inadequately protect the Bank's credit position at some future date. Weaknesses are generally the result of deviation from prudent lending practices, such as over advances on collateral. Credits in this category should, within a 12-month period, move to Pass if improved or drop to Substandard if poor trends continue.

Substandard. Inadequately protected by the current net worth and paying capacity of the obligor, or by the collateral pledged, if any. Loans have a well-defined weakness or weaknesses such as primary source of repayment is gone or severely impaired or cash flow is insufficient to reduce debt. There is a distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans have the same weaknesses as those classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable. The likelihood of a loss on an asset or portion of an asset classified Doubtful is high.

Loss. Loans considered uncollectible and of such little value that the continuance as a Bank asset is not warranted. This does not mean that the loan has no recovery or salvage value, but rather the asset should be charged off even though partial recovery may be possible in the future.

13

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be Pass rated loans. As of September 30, 2025 and December 31, 2024, and based on the most recent analysis performed, the risk category and year of origination of loans by class of loans is as follows: (in thousands)

September 30, 2025

2025

2024

2023

2022

2021

Prior

Revolvers

Total

Pass

Commercial (secured by real estate - owner occupied)

$

14,709

$

17,242

$

13,566

$

24,195

$

19,710

$

68,904

$

3,380

$

161,706

Commercial (secured by real estate - non-owner occupied)

7,501

36,852

24,120

35,172

26,195

25,865

7,651

163,356

Commercial and industrial

13,535

27,013

19,427

18,091

22,440

38,275

6,857

145,638

Construction, land and acquisition & development

19,384

42,803

8,455

2,878

477

451

—

74,448

Residential mortgage

1,720

3,463

4,790

5,475

1,953

22,220

6,389

46,010

Consumer installment

51,427

36,486

18,615

19,110

5,336

974

141

132,089

Total pass

108,276

163,859

88,973

104,921

76,111

156,689

24,418

723,247

Special Mention

Commercial (secured by real estate - owner occupied)

—

—

—

—

—

276

—

276

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

526

—

526

Commercial and industrial

—

—

—

—

—

—

—

—

Construction, land and acquisition & development

—

—

—

—

—

—

—

—

Residential mortgage

—

—

—

—

—

115

—

115

Consumer installment

—

23

32

79

16

2

—

152

Total special mention

—

23

32

79

16

919

—

1,069

Substandard

Commercial (secured by real estate - owner occupied)

—

—

—

—

—

1,814

—

1,814

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

133

—

133

Commercial and industrial

339

—

—

—

—

235

—

574

Construction, land and acquisition & development

—

—

—

—

—

15

—

15

Residential mortgage

—

—

—

170

90

2,127

—

2,387

Consumer installment

—

—

31

200

67

2

—

300

Total substandard

339

—

31

370

157

4,326

—

5,223

Total

$

108,615

$

163,882

$

89,036

$

105,370

$

76,284

$

161,934

$

24,418

$

729,539

Current year to date period gross charge-offs

Commercial (secured by real estate - owner occupied)

$

—

$

—

$

—

$

—

$

—

$

—

$

—

$

—

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

—

—

—

Commercial and industrial

—

—

—

—

—

—

—

—

Construction, land and acquisition & development

—

—

—

—

—

—

—

—

Residential mortgage

—

—

—

—

—

—

—

—

Consumer installment

—

29

59

98

34

—

—

220

Total current period gross write-offs

$

—

$

29

$

59

$

98

$

34

$

—

$

—

$

220

14

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

December 31, 2024

2024

2023

2022

2021

2020

Prior

Revolvers

Total

Pass

Commercial (secured by real estate - owner occupied)

$

14,663

$

13,787

$

24,695

$

20,821

$

20,742

$

55,399

$

4,519

$

154,626

Commercial (secured by real estate - non-owner occupied)

39,237

24,280

39,334

27,344

4,710

24,269

6,776

165,950

Commercial and industrial

24,559

20,808

18,352

26,309

13,280

33,914

10,928

148,150

Construction, land and acquisition & development

43,503

16,831

5,770

1,026

101

374

—

67,605

Residential mortgage

4,127

6,605

5,970

2,022

1,478

24,811

6,345

51,358

Consumer installment

50,830

27,834

29,226

9,488

2,022

597

101

120,098

Total pass

176,919

110,145

123,347

87,010

42,333

139,364

28,669

707,787

Special Mention

Commercial (secured by real estate - owner occupied)

—

—

—

—

—

301

—

301

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

534

—

534

Commercial and industrial

—

—

—

—

—

—

—

—

Construction, land and acquisition & development

—

—

—

—

—

—

—

—

Residential mortgage

—

—

—

—

—

212

—

212

Consumer installment

6

80

76

48

8

—

—

218

Total special mention

6

80

76

48

8

1,047

—

1,265

Substandard

Commercial (secured by real estate - owner occupied)

—

—

—

—

—

1,996

—

1,996

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

178

—

178

Commercial and industrial

—

—

—

—

—

—

—

—

Construction, land and acquisition & development

—

—

—

—

17

—

—

17

Residential mortgage

—

—

185

185

96

2,106

—

2,572

Consumer installment

—

90

50

153

3

4

—

300

Total substandard

—

90

235

338

116

4,284

—

5,063

Total

$

176,925

$

110,315

$

123,658

$

87,396

$

42,457

$

144,695

$

28,669

$

714,115

Gross charge-offs

Commercial (secured by real estate - owner occupied)

$

—

$

—

$

—

$

—

$

—

$

—

$

—

$

—

Commercial (secured by real estate - non-owner occupied)

—

—

—

—

—

164

—

164

Commercial and industrial

—

—

—

—

—

—

—

—

Construction, land and acquisition & development

—

—

—

—

—

—

—

—

Residential mortgage

—

—

5

—

—

45

—

50

Consumer installment

6

76

360

79

—

6

—

527

Total current period gross write-offs

$

6

$

76

$

365

$

79

$

—

$

215

$

—

$

741

(4) Intangible Assets

The core deposit premium intangible asset had a gross carrying amount of $ 1.9 million and accumulated amortization of $ 1.1 million at September 30, 2025 . The core deposit premium intangible asset had a gross carrying amount of $ 1.9 million and accumulated amortization of $ 956,000 at December 31, 2024 . Aggregate amortization expense was $ 47,000 and $ 143,000 for the three and nine months ended September 30, 2025 and 2024.

Goodwill acquired through acquisition was $ 17.2 million at September 30, 2025 and 2024 . No impairment loss was recognized during the nine months ended September 30, 2025 and 2024 .

15

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

(5) Deposits

The aggregate amount of certificates of deposit ("CDs") of $250,000 or more, the standard FDIC deposit insurance coverage limit per depositor, was approximately $ 37.4 million at September 30, 2025 , and $ 35.2 million at December 31, 2024. Due to the FDIC insurance coverage rules and limits for a depositor's specific group of deposit accounts, it is important to note that not all deposits in excess of $ 250,000 are uninsured.

Brokered CDs totaled $ 92.5 million and had a weighted average rate of 4.44 % and a weighted average maturity of 18 months at September 30, 2025 and $ 106.3 million and had a weighted average rate of 4.50 % and a weighted average maturity of 19 months at December 31, 2024.

(6) Borrowings

The following Federal Home Loan Bank ("FHLB") advances, which required monthly or quarterly interest payments, were outstanding at September 30, 2025.

Advance Date

Advance

Interest Rate

Maturity

Rate

Call Feature

1/6/2023

$

10,000,000

4.22

%

1/6/2026

Fixed

N/A

1/6/2023

10,000,000

3.94

%

1/6/2028

Fixed

N/A

10/25/2023

10,000,000

3.99

%

10/25/2028

Convertible

10/27/2025

7/11/2024

14,000,000

3.50

%

7/11/2029

Convertible

10/14/2025

6/13/2025

10,000,000

3.48

%

6/13/2029

Convertible

N/A

$

54,000,000

At September 30, 2025 and December 31, 2024 , the FHLB advances were collateralized by certain loans which totaled approximately $ 442.1 million and $ 434.5 million, and by the Company’s investment in FHLB stock which totaled approximately $ 3.2 million and $ 3.2 million at September 30, 2025 and December 31, 2024, respectively.

The Company had one FHLB letter of credit of $ 13.0 million and $ 12.5 million, used to collateralize public deposits, outstanding at September 30, 2025 and December 31, 2024.

The Company has Federal Funds unsecured lines of credit totaling $ 32.5 million. No amount was borrowed under these lines as of September 30, 2025 and December 31, 2024.

The Company also has a line of $ 59.6 million and $ 65.1 million with the Federal Reserve Bank secured by $ 81.6 million and $ 84.0 million in loans and investment securities as of September 30, 2025 and December 31, 2024 , respectively. There was $ 0 and $ 4.8 million outstanding under the Federal Reserve's Bank Term Funding Program at September 30, 2025 and December 31, 2024 , respectively. The advance was paid in full on maturity date in the first quarter of 2025.

16

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

(7) Employee Stock Ownership Plan

The Company sponsors an employee stock ownership plan (“ESOP”) that covers all employees who meet certain service requirements. The Company makes annual contributions to the ESOP in amounts as defined by the plan document. These contributions are used to pay debt service and purchase additional shares. Certain ESOP shares are pledged as collateral for debt. As the debt is repaid, shares are released from collateral and allocated to active employees, based on the proportion of debt service paid in the year.

In 2017, the ESOP borrowed $ 3.0 million payable to the Company for the purpose of purchasing shares of the Company’s common stock. A total of 295,499 shares were purchased with the loan proceeds as part of the Company’s initial stock offering. In 2021, the ESOP borrowed $ 3.0 million payable to the Company for the purpose of purchasing additional shares of the Company’s common stock. A total of 225,721 shares were purchased with the loan proceeds as part of the Company’s second stock offering. Total ESOP expense for the three months ended September 30, 2025 was approximately $ 331,000 with $ 220,000 of the expense related to the special dividend paid in first quarter of 2025. Total ESOP expense for the nine months ended September 30, 2025 was approximately $ 963,000 with $ 641,000 of the expense related to the special dividend paid in first quarter of 2025. Total ESOP expense for the three and nine months ended September 30, 2024 was approximately $ 111,000 and $ 293,000 . The balance of the note payable of the ESOP was approximately $ 4.2 million and $ 5.0 million at September 30, 2025 and December 31, 2024, respectively. Because the source of the loan payments is contributions received by the ESOP from the Company, the related note receivable is shown as a reduction of stockholders’ equity. As of September 30, 2025 and December 31, 2024 , 122,000 shares had been released.

(8) Stock-Based Compensation

In 2018, shareholders approved the Company’s 2018 Equity Incentive Plan, which authorizes the issuance of up to 133,987 shares of common stock pursuant to restricted stock grants and up to 334,970 shares of common stock pursuant to the exercise of options.

In 2022, shareholders approved the Company’s 2022 Equity Incentive Plan, which authorizes the issuance of up to 148,060 shares of common stock pursuant to restricted stock grants and up to 370,150 shares of common stock pursuant to the exercise of options.

A Black-Scholes model is utilized to estimate the fair value of stock option grants, while the market price of the Company’s stock at the date of grant is used to estimate the fair value of restricted stock awards for the stock granted in first quarter of 2025.

Dividend yield

0

%

Expected volatility

28.16

%

Risk-free interest rate

4.28

%

Expected average life

7.50

Weighted average per share fair value

$

7.73

A summary of the Company’s stock option activity is summarized below.

Stock Options

Option Shares Outstanding

Weighted Average Exercise Price

Weighted Average Remaining Life (Years)

Aggregate Intrinsic Value (in thousands)

Outstanding - December 31, 2024

640,766

$

12.58

6.75

$

5,724

Exercised

11,921

12.98

Forfeited

13,406

14.38

Outstanding March 31, 2025

615,439

12.53

6.49

$

3,582

Exercisable - March 31, 2025

361,473

$

11.56

5.72

$

2,453

Granted

7,000

18.53

Outstanding June 30, 2025

622,439

12.60

6.28

$

3,513

Exercisable - June 30, 2025

401,568

$

11.44

5.49

$

2,729

Outstanding September 30, 2025

622,439

12.60

6.03

$

4,079

Exercisable - September 30, 2025

432,953

$

11.68

5.34

$

3,235

17

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

Intrinsic value represents the amount by which the fair market value of the underlying stock exceeds the exercise price of the stock options.

A summary of the Company’s restricted stock activity is summarized below.

Restricted Stock

Restricted Shares Outstanding

Weighted Average Grant Date Fair Value

Outstanding - December 31, 2023

166,591

$

13.46

Vested

( 3,467

)

Outstanding - March 31, 2024

163,124

13.44

Vested

( 27,174

)

Outstanding - June 30, 2024

135,950

14.06

Vested*

( 20,867

)

Oustanding, September 30, 2024

115,083

13.92

Outstanding, December 31, 2024

107,609

13.88

Vested *

( 3,466

)

Outstanding March 31, 2025

104,143

13.86

Vested *

( 18,824

)

Outstanding June 30, 2025

85,319

14.72

Vested*

( 20,866

)

Outstanding September 30, 2025

64,453

14.67

* The terms of the restricted stock agreements permit the surrender of shares to the Company upon vesting in order to satisfy applicable tax withholding requirements at the minimum statutory withholding rate, and accordingly, 1,919 and 3,786 shares were surrendered during the three and nine months ended September 30, 2025 .

The Company recognized approximately $ 175,000 , $ 217,000 , $ 723,000 and $ 887,000 , of stock-based compensation expense during the three months ended September 30, 2025 and 2024 and nine months ended September 30, 2025 and 2024 respectively, associated with its common stock awards granted to directors and officers. This expense is net of approximately $ 105,000 and $ 0 during the three months ended September 30, 2025 and 2024 , respectively, for shares surrendered to satisfy applicable tax withholding requirements. This expense is net of approximately $ 139,000 and $ 0 during the nine months ended September 30, 2025 and 2024 respectively for shares surrendered to satisfy applicable tax withholding requirements.

As of September 30, 2025 , there was approximately $ 1.7 million of unrecognized compensation cost related to equity award grants. The cost is expected to be recognized over the weighted average remaining vesting period of approximately 1.12 years.

(9) Fair Value Measurements and Disclosures

The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. From time to time, the Company may be required to record at fair value other assets on a nonrecurring basis, such as collateral dependent loans and other real estate owned. These nonrecurring fair value adjustments typically involve application of the lower of cost or market accounting or write-downs of individual assets. Additionally, the Company is required to disclose, but not record, the fair value of other financial instruments.

18

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

Fair Value Hierarchy

The Company groups assets and liabilities at fair value in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:

Level 1 – Valuation is based upon quoted prices for identical instruments traded in active markets.

Level 2 – Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market.

Level 3 – Valuation is generated from model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include use of option pricing models, discounted cash flow models and similar techniques.

Following are descriptions of valuation methodologies used for assets and liabilities recorded at fair value.

Cash and Cash Equivalents

The carrying value of cash and cash equivalents is a reasonable estimate of fair value.

Investment Securities Available-for-Sale

Available-for-sale securities are recorded at market value. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, and U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter market funds. Level 2 securities include mortgage-backed securities issued by government sponsored enterprises and state, county and municipal bonds. Securities classified as Level 3 include asset-backed securities in less liquid markets.

Other Investments

The carrying value of other investments includes FHLB stock and First National Bankers Bank stock and approximates fair value.

Loans

The Company does not record loans at fair value on a recurring basis, unless a loan is considered collateral dependent and a specific reserve may be required to be established within the allowance for credit losses. Loans for which it is probable that payment of interest and principal will not be made in accordance with the contractual terms of the loan agreement are considered individually evaluated. Once a loan is identified as collateral dependent, management measures impairment in accordance with GAAP. The fair value of collateral dependent loans is estimated using one of three methods, including collateral value, market value of similar debt, and discounted cash flows. Those collateral dependent loans not requiring an allowance represent loans for which the fair value of the expected repayments or collateral exceeds the recorded investments in such loans. In accordance with GAAP, collateral dependent loans where an allowance is established based on the fair value of collateral require classification in the fair value hierarchy. When the fair value of the collateral is based on an observable market price, the Company records the collateral dependent loan as nonrecurring Level 2. When an appraised value is used or an appraisal is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Company records the collateral dependent loan as nonrecurring Level 3. For disclosure purposes, the fair value of fixed rate loans which are not considered collateral dependent is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings. For non collateral dependent variable rate loans, the carrying amount is a reasonable estimate of fair value for disclosure purposes.

19

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

Other Real Estate Owned

Other real estate owned properties are adjusted to fair value upon transfer of the loans to other real estate. Subsequently, other real estate assets are 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. When the fair value of the collateral is based on an observable market price, the Bank records the other real estate as nonrecurring Level 2. When an appraised value is used or an appraisal is not available or management determines the fair value of the collateral is further impaired below the appraised value and there is no observable market price, the Bank records the other real estate asset as nonrecurring Level 3.

Deposits

The fair value of savings accounts, interest bearing checking accounts, non-interest bearing checking accounts and market rate checking accounts is the amount payable on demand at the reporting date, while the fair value of fixed maturity certificates of deposit is estimated by discounting the future cash flows using current rates at which comparable certificates would be issued.

FHLB Advances and Other Borrowings

FHLB advances are carried at cost and the fair value is obtained from the Federal Home Loan Bank of Atlanta. Federal Funds Purchased are carried at cost and because they are overnight funds, the carrying value is a reasonable estimate of fair value.

Commitments to Extend Credit

Commitments to extend credit are short-term and, therefore, the carrying value and the fair value are considered immaterial for disclosure.

Assets Recorded at Fair Value on a Recurring Basis

The Company’s only assets recorded at fair value on a recurring basis are available-for-sale securities that had fair values of approximately $ 44.7 million and $ 36.5 million at September 30, 2025 and December 31, 2024, respectively. They are classified as Level 2.

Assets Recorded at Fair Value on a Nonrecurring Basis

The Company may be required, from time to time, to measure certain assets at fair value on a nonrecurring basis in accordance with GAAP. These include assets that are measured at the lower of cost or market that were recognized at fair value below cost at the end of the period. Assets measured at fair value on a nonrecurring basis are included in the table below as of September 30, 2025 and December 31, 2024 (in thousands).

September 30, 2025

Level 1

Level 2

Level 3

Total

Other real estate owned

$

—

$

—

$

—

$

—

Collateral dependent loans

—

—

2,388

2,388

Total assets at fair value

$

—

$

—

$

2,388

$

2,388

December 31, 2024

Level 1

Level 2

Level 3

Total

Other real estate owned

$

—

$

—

$

—

$

—

Collateral dependent loans

—

—

2,000

2,000

Total assets at fair value

$

—

$

—

$

2,000

$

2,000

20

AFFINITY BANCSHARES, INC.

Notes to Unaudited Consolidated Financial Statements

The carrying amounts and estimated fair values (in thousands) of the Company’s financial instruments at September 30, 2025 and December 31, 2024 are as follows:

September 30, 2025

December 31, 2024

Carrying

Estimated

Carrying

Estimated

Amount

Fair Value

Amount

Fair Value

Financial assets:

Cash and cash equivalents

Level 1

$

84,845

$

84,845

$

41,425

$

41,425

Investment securities available-for-sale

Level 2

44,668

44,668

36,502

36,502

Investment securities held-to-maturity

Level 2

19,225

19,692

27,299

27,286

Other investments

Level 3

6,254

6,254

6,175

6,175

Loans, net

Level 3

720,977

719,208

705,619

693,346

Financial liabilities:

Deposits

Level 3

739,376

740,035

673,481

672,708

FHLB advances and other borrowings

Level 3

54,000

53,747

58,815

58,944

Limitations

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on many judgments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on existing on and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Significant assets and liabilities that are not considered financial instruments include deferred income taxes and premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates.

21

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 September 30, 2025 and December 31, 2024 and for the three and nine months ended September 30, 2025 and 2024 is intended to assist in understanding the financial condition and results of operations of the Company. The information contained in this section should be read in conjunction with the unaudited consolidated 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 contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “assume,” “plan,” “seek,” “expect,” “will,” “may,” “should,” “indicate,” “would,” “contemplate,” “continue,” “target” 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;
•
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. Accordingly, you should not place undue reliance on such statements. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this report.

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:

•
general economic conditions, either nationally or in our market areas, that are worse than expected;
•
changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance for credit losses;
•
our ability to access cost-effective funding;
•
changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio;
•
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 and change our business strategies;
•
competition among depository and other financial institutions, including with respect to service charges and fees;
•
inflation and changes in the interest rate environment that reduce our margins and yields, our mortgage banking revenues, the fair value of financial instruments or our level of loan originations, or increase the level of defaults, losses and prepayments on loans we have made and make;
•
adverse changes in the securities or secondary mortgage markets;
•
changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements;
•
changes in tax laws and the effects of tariffs and retaliatory responses;
•
changes in the quality or composition of our loan or investment portfolios;
•
technological changes that may be more difficult or expensive than expected;
•
failure or breaches of our IT security systems;
•
the inability of third-party providers to perform as expected;

22

•
our ability to manage market risk, credit risk and operational risk in the current economic environment;
•
our ability to introduce new products and services, enter new markets successfully and capitalize on growth opportunities;
•
our ability to successfully integrate into our operations any assets, liabilities, customers, systems and management personnel we may acquire and our ability to realize related revenue synergies and cost savings within expected time frames, and any goodwill charges related thereto;
•
changes in consumer spending, borrowing and savings habits;
•
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 retain key employees;
•
the effects of global or national war, conflict or acts of terrorism;
•
the potential effects of new or increased tariffs and trade restrictions;
•
changes in the value of our goodwill or other intangible assets;
•
risks related to the COVID-19 pandemic or any other public health emergency;
•
the effects of any Federal government shutdown;
•
our compensation expense associated with equity allocated or awarded to our employees; and
•
changes in the financial condition, results of operations or future prospects of issuers of securities that we own.

Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements.

Summary of Significant Accounting Policies

A summary of our accounting policies is described in Note 1 of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. There have been no material changes to our significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 under “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Comparison of Financial Condition at September 30, 2025 and December 31, 2024

Total assets increased $58.4 million, or 6.7%, to $925.2 million at September 30, 2025 from $866.8 million at December 31, 2024, due primarily to increases in loans and cash and cash equivalents.

Gross loans increased $15.4 million, or 2.2%, to $729.5 million at September 30, 2025 from $714.1 million at December 31, 2024. Construction loans increased $6.8 million, or 10.1%, to $74.5 million at September 30, 2025 from $67.6 million at December 31, 2024. Owner-occupied commercial real estate loans increased $6.9 million or 4.4%, and consumer installment loans increased $11.9 million or 9.9%. We experienced decreases in residential mortgage loans of $5.6 million or 10.4%, and in nonowner-occupied commercial real estate loans of $2.6 million or 1.6%.

Total deposits increased $65.9 million, or 9.8%, to $739.4 million at September 30, 2025 from $673.5 million at December 31, 2024, reflecting increases in all deposit types. Demand deposits increased $12.2 million, or 5.4%, and money market and savings accounts increased $45.6 million, or 20.3%, as a result of our business customers' cyclical demands at year-end. Our certificates of deposit include brokered deposits at September 30, 2025, totaling $92.5 million, which had an average life of 18 months and an average interest rate of 4.44%. The loan-to-deposit ratio at September 30, 2025 was 98.7%, as compared to 106.0% at December 31, 2024.

We had $54.0 million of FHLB advances at September 30, 2025, and $54.0 million of FHLB advances and $4.8 million in other borrowings at December 31, 2024.

Stockholders’ equity decreased by $3.7 million, or 2.9%, to $125.4 million at September 30, 2025 compared to $129.1 million at December 31, 2024, primarily due to a special dividend payment in the first quarter of $1.50 per share totaling $8.8 million, as well as $4.1 million in common stock repurchased, offset by net income of $6.2 million during the nine months of 2025, ESOP related and

23

stock compensation expense of $1.7 million and a change in unrealized gain on investment securities available-for-sale, net of tax, of $1.2 million.

Average Balance Sheets

The following tables set forth average balance sheets, average annualized yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. All average balances are monthly average balances. Non-accrual loans were included in the computation of average balances. The yields set forth below include the effect of deferred fees, discounts, and premiums that are amortized or accreted to interest income or interest expense.

For the Three Months Ended September 30,

2025

2024

Average
Outstanding
Balance

Interest

Average
Yield/Rate

Average
Outstanding
Balance

Interest

Average
Yield/Rate

(Dollars in thousands)

Interest-earning assets:

Loans

$

733,069

$

11,219

6.07

%

$

698,877

$

10,596

6.03

%

Investment securities held-to-maturity

22,802

370

6.44

%

33,235

511

6.12

%

Investment securities available-for-sale

40,993

365

3.53

%

47,600

435

3.64

%

Interest-earning deposits and federal funds

80,003

868

4.30

%

52,250

668

5.09

%

Other investments

6,250

98

6.22

%

6,091

92

6.01

%

Total interest-earning assets

883,117

12,920

5.80

%

838,053

12,302

5.84

%

Non-interest-earning assets

48,683

47,471

Total assets

$

931,800

$

885,524

Interest-bearing liabilities:

Interest-bearing checking accounts

$

86,092

$

123

0.57

%

$

87,569

$

127

0.58

%

Money market accounts

169,791

1,302

3.04

%

149,321

1,238

3.30

%

Savings accounts

92,570

702

3.01

%

71,003

509

2.85

%

Certificates of deposit

246,510

2,498

4.02

%

217,307

2,313

4.23

%

Total interest-bearing deposits

594,963

4,625

3.08

%

525,200

4,187

3.17

%

FHLB advances and other borrowings

54,000

525

3.86

%

63,323

701

4.40

%

Total interest-bearing liabilities

648,963

5,150

3.15

%

588,523

4,888

3.30

%

Non-interest-bearing liabilities

157,684

170,197

Total liabilities

806,647

758,720

Total stockholders' equity

125,153

126,804

Total liabilities and stockholders' equity

$

931,800

$

885,524

Net interest rate spread

2.65

%

2.54

%

Net interest income

$

7,770

$

7,414

Net interest margin

3.49

%

3.52

%

24

For the Nine Months Ended September 30,

2025

2024

Average
Outstanding
Balance

Interest

Average
Yield/Rate

Average
Outstanding
Balance

Interest

Average
Yield/Rate

(Dollars in thousands)

Interest-earning assets:

Loans

$

725,044

$

33,062

6.10

%

$

681,876

$

30,575

5.99

%

Investment securities held-to-maturity

25,640

1,202

6.27

%

33,892

1,567

6.18

%

Investment securities available-for-sale

39,980

1,044

3.49

%

47,783

1,377

3.85

%

Interest-earning deposits and federal funds

70,650

2,253

4.26

%

51,105

1,964

5.13

%

Other investments

6,221

287

6.17

%

5,676

263

6.19

%

Total interest-earning assets

867,535

37,848

5.83

%

820,332

35,746

5.82

%

Non-interest-earning assets

48,139

50,238

Total assets

$

915,674

$

870,570

Interest-bearing liabilities:

Interest-bearing checking accounts

$

83,870

$

305

0.49

%

$

88,243

$

344

0.52

%

Money market accounts

164,295

3,723

3.03

%

145,284

3,496

3.21

%

Savings accounts

85,144

1,849

2.90

%

73,056

1,563

2.86

%

Certificates of deposit

247,174

7,519

4.07

%

218,641

6,884

4.21

%

Total interest-bearing deposits

580,483

13,396

3.09

%

525,224

12,287

3.12

%

FHLB advances and other borrowings

54,282

1,567

3.86

%

53,857

1,727

4.28

%

Total interest-bearing liabilities

634,765

14,963

3.15

%

579,081

14,014

3.23

%

Non-interest-bearing liabilities

154,574

166,911

Total liabilities

789,339

745,992

Total stockholders' equity

126,335

124,578

Total liabilities and stockholders' equity

$

915,674

$

870,570

Net interest rate spread

2.68

%

2.59

%

Net interest income

$

22,885

$

21,732

Net interest margin

3.53

%

3.54

%

Rate/Volume Analysis

The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. 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 total column represents the sum of the prior 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.

25

Three Months Ended September 30,
2025 vs. 2024

Nine Months Ended September 30,
2025 vs. 2024

Increase (Decrease) Due to

Total

Increase (Decrease) Due to

Total

Increase

Increase

Volume

Rate

(Decrease)

Volume

Rate

(Decrease)

(In thousands)

Interest-earning assets:

Loans

$

618

$

5

$

623

$

2,443

$

44

$

2,487

Investment securities held-to-maturity

(285

)

144

(141

)

(411

)

46

(365

)

Investment securities available-for-sale

(70

)

—

(70

)

(327

)

(6

)

(333

)

Interest-earning deposits and federal funds

1,419

(1,219

)

200

1,472

(1,183

)

289

Other investments

6

—

6

27

(3

)

24

Total interest-earning assets

1,688

(1,070

)

618

3,204

(1,102

)

2,102

Interest-bearing liabilities:

Interest-bearing checking accounts

(4

)

—

(4

)

(39

)

—

(39

)

Money market accounts

914

(850

)

64

820

(593

)

227

Savings accounts

192

1

193

285

1

286

Certificates of deposit

1,218

(1,033

)

185

1,304

(669

)

635

Total interest-bearing deposits

2,320

(1,882

)

438

2,370

(1,261

)

1,109

FHLB advances and other borrowings

(171

)

(5

)

(176

)

195

(355

)

(160

)

Total interest-bearing liabilities

2,149

(1,887

)

262

2,565

(1,616

)

949

Change in net interest income

$

(461

)

$

817

$

356

$

639

$

514

$

1,153

Comparison of Operating Results for the Three Months Ended September 30, 2025 and 2024

General. Net income was $2.2 million for the three months ended September 30, 2025, compared to $1.7 million for the three months ended September 30, 2024. The increase was caused by an increase in net interest income and a decrease in noninterest expenses.

Interest Income. Interest income increased $618,000, or 5.0%, to $12.9 million for the three months ended September 30, 2025 from $12.3 million for the three months ended September 30, 2024. The increase was primarily due to an increase in income from loans, partially offset by a decrease in income from investment securities. Interest income on loans increased $623,000, or 5.9%, to $11.2 million for the three months ended September 30, 2025 from $10.6 million for the three months ended September 30, 2024. Our average balance of loans increased by $34.2 million, or 4.9%, to $733.1 million for the three months ended September 30, 2025 from $698.9 million for the three months ended September 30, 2024. The average balance of loans increased due to steady loan demand.

Interest income on interest-earning deposits and federal funds increased $200,000 to $868,000 for the three months ended September 30, 2025 from $668,000 for the three months ended September 30, 2024. The yields we received on these funds decreased to 4.30% from 5.09% due to the continued changes in the interest rate environment . The average balance of interest-earning deposits and federal funds increased $27.8 million to $80.0 million for the three months ended September 30, 2025 compared to $52.3 million for the three months ended September 30, 2024, as we had corresponding increases in saving and money market deposits.

Interest income on available-for-sale and held-to-maturity securities decreased $211,000 to $735,000 for the three months ended September 30, 2025 from $946,000 for the three months ended September 30, 2024. The average balance of securities was $63.8 million for the nine months ended September 30, 2025 compared to $80.8 million for the nine months ended September 30, 2024.

26

Interest Expense. Interest expense increased $262,000 to $5.2 million for the three months ended September 30, 2025, compared to $4.9 million for the three months ended September 30, 2024, primarily due to increases in the average balances of interest-bearing liabilities.

Interest expense on deposits increased $438,000 to $4.6 million for the three months ended September 30, 2025 from $4.2 million for the three months ended September 30, 2024. Interest expense on certificates of deposit increased $185,000 to $2.5 million for the three months ended September 30, 2025. The average rate we paid on certificates of deposit decreased 21 basis points to 4.02% for the three months ended September 30, 2025 from 4.23% for the three months ended September 30, 2024, due to the continued changes in the interest rate environment, while the average balance increased by $29.2 million to $246.5 million for the three months ended September 30, 2025 from $217.3 million for the three months ended September 30, 2024.

Interest expense on borrowings decreased $176,000 to $525,000 for the three months ended September 30, 2025 from $701,000 for the three months ended September 30, 2024, due to a decrease in average borrowings of $9.3 million.

Net Interest Income. Net interest income before provision for credit losses increased $356,000, or 4.8%, to $7.8 million for the three months ended September 30, 2025 compared to $7.4 million for the three months ended September 30, 2024. Our net interest rate spread decreased to 2.65% for the three months ended September 30, 2025 from 2.54% for the three months ended September 30, 2024, and our net interest margin decreased to 3.49% for the three months ended September 30, 2025 from 3.52% for the three months ended September 30, 2024, as the yields we earned on our interest-earning assets decreased. Yield on interest bearing assets decreased four basis points, outpacing decrease in rate paid on interest bearing liabilities by 11 basis points.

Provision for Credit Losses. The provision for credit losses consists of provisions for credit losses for loans and unfunded loan commitments, as well as held-to-maturity securities.

Provisions for credit losses for loans are charged to operations to establish an allowance for credit losses at a level necessary to absorb known and inherent losses in our loan portfolio that are both probable and reasonably estimable at the date of the consolidated financial statements. In evaluating the level of the allowance for credit losses for loans, management analyzes several qualitative loan portfolio risk factors including, but not limited to, management’s ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and non-accrual loans, existing risk characteristics of specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses.

Provisions for credit losses for unfunded commitments are charged to operations to establish an allowance for credit losses for contractual obligations to extend credit. The estimate includes consideration of the likelihood that funding will occur and an estimate of expected credit losses on commitments expected to be funded over its estimated life. The estimate is influenced by historical loss experience, adjusted for current risk characteristics, and economic factors.

Provisions for credit losses for held-to-maturity securities are also charged to operations to establish an allowance on a collective basis by major security type. The estimate of expected credit losses for held-to-maturity securities considers historical credit loss information that is adjusted for current conditions and reasonable and supportable forecasts.

After an evaluation of these factors, we recorded a provision for credit losses of $12,000 for the three months ended September 30, 2025, and no provision for the three months ended September 30, 2024. For the three months ended September 30, 2025, we recorded $70,000 in provision for credit losses for loans, a provision reversal for credit losses for unfunded commitments of $50,000, and a provision reversal for credit losses for held to maturity securities of $8,000 for three months ended September 30, 2025. Our allowance for credit losses on loans was $8.6 million at September 30, 2025, $8.5 million at December 31, 2024 and $8.4 million at September 30, 2024. The allowance for credit losses on loans to total loans was 1.17% at September 30, 2025 compared to 1.19% at December 31, 2024. The allowance for credit losses to non-performing loans was 168.44% at September 30, 2025 compared to 177.9% at December 31, 2024. Net loan charge-offs were $50,000 for the three months ended September 30, 2025, compared to net loan charge-offs of $63,000 for the three months ended September 30, 2024.

To the best of our knowledge, we have recorded all credit losses that are both probable and reasonable to estimate at September 30, 2025. However, future changes in the factors described above, including, but not limited to, actual loss experience with respect to our loan portfolio, could result in material increases in our provision for credit losses. In addition, the Office of the Comptroller of the Currency, as an integral part of its examination process, periodically reviews our allowance for credit losses, and as a result of such reviews, we may have to adjust our allowance for credit losses. However, regulatory agencies are not directly

27

involved in the process of establishing the allowance for credit losses as the process is our responsibility and any increase or decrease in the allowance is the responsibility of management.

Noninterest Income. Noninterest income increased $22,000, or 3.9%, to $588,000 for the three months ended September 30, 2025 from $566,000 for the three months ended September 30, 2024 due to an increase in other noninterest income.

Noninterest Expenses. Non-interest expenses information is as follows.

Three Months Ended September 30,

Change

2025

2024

Amount

Percent

(Dollars in thousands)

Salaries and employee benefits

$

3,196

$

3,257

(61

)

(1.9

)%

Occupancy

581

600

(19

)

(3.2

)%

Data processing

531

520

11

2.1

%

Other

1,121

1,327

(206

)

(15.5

)%

Total non-interest expenses

$

5,429

$

5,704

$

(275

)

(4.8

)%

Other fees decreased by $206,000 to $1.1 million for the three months ended September 30, 2025, due to a decrease in professional fees. The decrease in professional fees was attributable to costs in the prior year related to a prospective merger transaction that was ultimately not completed.

Income Tax Expense. We recorded income tax expense of $700,000 for the three months ended September 30, 2025 compared to $546,000 for the three months ended September 30, 2024. The effective tax rate was 24.0% for both periods.

Comparison of Operating Results for the Nine Months Ended September 30, 2025 and 2024

General. Net income was $6.2 million for the nine months ended September 30, 2025 compared to $4.1 million for the nine months ended September 30, 2024. The increase was caused by an increase in net interest income and a decrease in noninterest expenses that were partially offset by a decrease in noninterest income.

Interest Income. Interest income increased $2.1 million, or 5.9%, to $37.9 million for the nine months ended September 30, 2025 from $35.7 million for the nine months ended September 30, 2024. The increase was due to increases in income from loans and interest-earning deposits partially offset by a decrease in income from investment securities. Interest income on loans increased $2.5 million, or 8.1%, to $33.1 million for the nine months ended September 30, 2025 from $30.6 million for the nine months ended September 30, 2024. Our average balance of loans increased by $43.1 million, or 6.3%, to $725.0 million for the nine months ended September 30, 2025 from $681.9 million for the nine months ended September 30, 2024. The average balance of loans increased due to steady loan demand. The average yield on loans increased 11 basis points to 6.10% for the current period, as compared to 5.99% for the prior year period, due to the loans being originated or repricing at higher yields during the current period.


Interest income on interest-earning deposits and federal funds increased $289,000 to $2.3 million for the nine months ended September 30, 2025 from $2.0 million for the nine months ended September 30, 2024. The average balance of interest-earning deposits and federal funds increased $19.5 million to $70.7 million for the nine months ended September 30, 2025 compared to $51.1 million for the nine months ended September 30, 2024, as we held excess cash to increase liquidity. The yields we received on these funds decreased to 4.26% from 5.13% due to the continued changes in the interest rate environment.

Interest income on available-for-sale and held-to-maturity securities decreased $698,000 to $2.2 million for the nine months ended September 30, 2025 from $2.9 million for the nine months ended September 30, 2024. The average balance of securities was $65.6 million for the nine months ended September 30, 2025 compared to $81.7 million for the nine months ended September 30, 2024.

Interest Expense. Interest expense increased $949,000 to $15.0 million for the nine months ended September 30, 2025, compared to $14.0 million for the nine months ended September 30, 2024.



We recognized increases in most categories of interest expense. The largest increase was in interest expense on certificates of deposit, which increased $635,000 to $7.5 million for the nine months ended September 30, 2025. The average rate we paid on certificates of deposit decreased 14 basis points to 4.07% for the nine months ended September 30, 2025 from 4.21% for the nine months ended September 30, 2024, due to the continued changes in the interest rate environment. In addition, the average balance of certificates of deposit increased to $247.1 million for the nine months ended September 30, 2025, up $28.5 million from $218.6

28

million for the nine months ended September 30, 2024, as customers increased deposits in higher-yielding accounts due to the current interest rate environment. We also experienced an increase in interest expense on money market and savings accounts of $513,000 to $5.6 million for the nine months ended September 30, 2025 primarily due to increases in average balance of $31.1 million to $249.9 million.


Net Interest Income. Net interest income increased $1.2 million, or 5.3%, to $22.9 million for the nine months ended September 30, 2025 compared to $21.7 million for the nine months ended September 30, 2024. Our net interest rate spread increased to 2.68% for the nine months ended September 30, 2025 from 2.59% for the nine months ended September 30, 2024, and our net interest margin decreased only one basis point to 3.53% for nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.

Provision for Credit Losses. The provisions for credit losses consists of provisions for credit losses for loans and unfunded loan commitments, as well as held-to-maturity securities.

After an evaluation of the factors described above, we recorded provisions for credit losses of $79,000 and $213,000 for the nine months ended September 30, 2025 and 2024, respectively.For the nine months ended September 30, 2025, we recorded $195,000 in provision for credit losses for loans, a provision reversal for credit losses for unfunded commitments of $100,000 and a provision reversal for credit losses for held to maturity securities of $16,000. Our allowance for credit losses on loans was $8.6 million at September 30, 2025, $8.5 million at December 31, 2024 and $8.4 million at September 30, 2024. The allowance for credit losses on loans to total loans was 1.17% at September 30, 2025 compared to 1.19% at December 31, 2024 and 1.20% at September 30, 2024. Net charge-offs were $129,000 for the nine months ended September 30, 2025, compared to net charge-offs of $523,000 for the nine months ended September 30, 2024.

Noninterest Income. Noninterest income decreased $246,000 to $1.6 million for the nine months ended September 30, 2025 compared to $1.9 million for the nine months ended September 30, 2024, due to a decline in merchant services volume and gain on sale of other real estate that was recorded in prior year.

.

Noninterest Expenses Noninterest expenses information is as follows.

Nine Months Ended
September 30,

Change

2025

2024

Amount

Percent

(Dollars in thousands)

Salaries and employee benefits

$

9,815

$

9,853

$

(38

)

(0.4

)%

Occupancy

1,781

1,833

(52

)

(2.8

)%

Data processing

1,624

1,538

86

5.6

%

Other

3,034

4,769

(1,735

)

(36.4

)%

Total non-interest expenses

$

16,254

$

17,993

$

(1,739

)

(9.7

)%

Other fees decreased by $1.7 million to $3.0 million for the nine months ended September 30, 2025. The decrease was mainly related to a decrease in professional fees attributable to costs in the prior year related to a prospective merger transaction that was ultimately not completed.

Income Tax Expense. We recorded income tax expense of $2.0 million with effective tax rate of 24.0% for the nine months ended September 30, 2025 compared to $1.2 million with effective tax rate of 23.9% for the nine months ended September 30, 2024.

Management of Market Risk

General. Our most significant form of market risk is interest rate risk because, as a financial institution, the majority of our assets and liabilities are sensitive to changes in interest rates. Therefore, a principal part of our operations is to manage interest rate risk and limit the exposure of our financial condition and results of operations to changes in market interest rates. Our Asset/Liability Management Committee is responsible for evaluating the interest rate risk inherent in our assets and liabilities, for determining the level of risk that is appropriate, given our business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the policy and guidelines approved by our board of directors. We currently utilize a third-party modeling program, prepared on a quarterly basis, to evaluate our sensitivity to changing interest rates, given our business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the board of directors.

29

We have sought to manage our interest rate risk in order to minimize the exposure of our earnings and capital to changes in interest rates. We have implemented the following strategies to manage our interest rate risk:

•
limiting our reliance on non-core/wholesale funding sources;
•
growing our volume of transaction deposit accounts;
•
increasing our investment securities portfolio, with an average maturity of less than 15 years;
•
diversifying our loan portfolio by adding more commercial-related loans and consumer loans, which typically have shorter maturities and/or balloon payments; and
•
continuing to price our one-to-four family residential real estate loan products in a way that encourages borrowers to select our balloon loans as opposed to longer-term, fixed-rate loans.

By following these strategies, we believe that we are better positioned to react to increases in market interest rates. In addition, we originate adjustable-rate, one-to-four-family residential real estate loans and home equity loans and lines of credit.

We do not engage in hedging activities, such as engaging in futures, options or swap transactions, or investing in high-risk mortgage derivatives, such as collateralized mortgage obligation residual interests, real estate mortgage investment conduit residual interests or stripped mortgage-backed securities.

Net Interest Income. We analyze our sensitivity to changes in interest rates through a net interest income model. Net interest income is the difference between the interest income we earn on our interest-earning assets, such as loans and securities, and the interest we pay on our interest-bearing liabilities, such as deposits and borrowings. We estimate what our net interest income would be for a 12-month period. We then calculate what the net interest income would be for the same period under the assumptions that the United States Treasury yield curve increases or decreases instantaneously by 200 and 400 basis point increments, with changes in interest rates representing immediate and permanent, parallel shifts in the yield curve. A basis point equals one-hundredth of one percent, and 100 basis points equals one percent. An increase in interest rates from 3% to 4% would mean, for example, a 100 basis point increase in the “Change in Interest Rates” column below.

The table below sets forth, as of September 30, 2025, the calculation of the estimated changes in our net interest income that would result from the designated immediate changes in the United States Treasury yield curve.

Change in Interest Rates
(basis points) (1)

Net Interest Income
Year 1 Forecast

Year 1 Change
from Level

(Dollars in thousands)

+400

$

32,288

(5.22

)%

+200

33,268

(2.34

)%

Level

34,066

—

-200

33,199

(2.55

)%

-400

31,959

(6.19

)%

(1) Assumes an immediate uniform change in interest rates at all maturities.

The table above indicates that at September 30, 2025, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 2.34% decrease in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would have experienced a 2.55% decrease in net interest income. At September 30, 2024, in the event of an instantaneous parallel 200 basis point increase in interest rates, we would have experienced a 0.15% increase in net interest income, and in the event of an instantaneous 200 basis point decrease in interest rates, we would have experienced a 4.20% decrease in net interest income.

30

Certain shortcomings are inherent in the methodologies used in the above interest rate risk measurement. 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. In this regard, the net interest income table presented assumes that the composition of our interest-sensitive assets and liabilities existing at the beginning of a period remains constant over the period being measured and assumes that a particular change in interest rates is reflected uniformly across the yield curve regardless of the duration or repricing of specific assets and liabilities. Accordingly, although the net interest income table provides an indication of our interest rate risk exposure at a particular 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 net interest income and will differ from actual results. Furthermore, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in different degrees to changes in market interest rates. Additionally, certain assets, such as adjustable-rate loans, have features that restrict changes in interest rates both on a short-term basis and over the life of the asset.

Interest rate risk calculations also may not reflect the fair values of financial instruments. For example, decreases in market interest rates can increase the fair values of our loans, deposits and borrowings.

Liquidity and Capital Resources

Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, proceeds from the sale of loans, and proceeds from maturities of securities. We also have the ability to borrow from the Federal Home Loan Bank of Atlanta. At September 30, 2025, we had a $233.2 million line of credit with the Federal Home Loan Bank of Atlanta, with advances of $54.0 million outstanding and a $13.0 million letter of credit outstanding, and we had a $5.0 million unsecured federal funds line of credit, a $7.5 million unsecured federal funds line of credit, and a $20.0 million unsecured federal funds line of credit. We also had a line of $59.6 million with the Federal Reserve Bank secured by $81.6 million in loans.

While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition. Our most liquid assets are cash and short-term investments including interest-bearing demand deposits. The levels of these assets are dependent on our operating, financing, lending, and investing activities during any given period.

Our cash flows are comprised of three primary classifications: cash flows from operating activities, investing activities, and financing activities. Net cash provided by operating activities was $9.4 million for the nine months ended September 30, 2025, compared to $5.9 million for the nine months ended September 30, 2024. Net cash used in investing activities was $14.2 million for the nine months ended September 30, 2025, compared to $31.8 million for the nine months ended September 30, 2024. Net cash used in investing activities typically consists primarily of disbursements for loan originations and any purchases of investment securities. Net cash provided by financing activities, which consists primarily of activity in deposit accounts and proceeds/repayments of borrowings and dividends, was $48.2 million for the nine months ended September 30, 2025, which reflected increases in deposits accounts of $65.9 million, partially offset by dividend payments of $8.8 million, repaying $4.8 million in borrowings, and stock repurchases of $4.1 million, compared to net cash provided by financing activities of $28.1 million for the nine months ended September 30, 2024.

We are committed to maintaining a strong liquidity position. We monitor our liquidity position on a daily basis. We anticipate that we will have sufficient funds to meet our current funding commitments. Based on our deposit retention experience and current pricing strategy, we anticipate that a significant portion of maturing time deposits will be retained.

31

At September 30, 2025, we exceeded all of our regulatory capital requirements and the Bank was categorized as “well capitalized.” Management is not aware of any conditions or events since the most recent notification that would change our category. The Bank’s actual capital amounts and ratios for September 30, 2025 and December 31, 2024 are presented in the table below (in thousands).

For Capital

To Be Well Capitalized

Adequacy

Under Prompt Corrective

Actual

Purposes

Action Provisions

Amount

Ratio

Amount

Ratio

Amount

Ratio

As of September 30, 2025:

Common Equity Tier 1 (to Risk Weighted Assets)

$

98,839

12.08

%

$

36,819

4.50

%

$

53,183

6.50

%

Total Capital (to Risk Weighted Assets)

108,092

13.21

%

65,461

8.00

%

81,826

10.00

%

Tier I Capital (to Risk Weighted Assets)

98,839

12.08

%

49,092

6.00

%

65,461

8.00

%

Tier I Capital (to Average Assets)

98,839

10.76

%

36,743

4.00

%

45,929

5.00

%

As of December 31, 2024:

Common Equity Tier 1 (to Risk Weighted Assets)

$

103,955

12.96

%

$

36,095

4.50

%

$

52,138

6.50

%

Total Capital (to Risk Weighted Assets)

113,256

14.12

%

64,168

8.00

%

80,210

10.00

%

Tier I Capital (to Risk Weighted Assets)

103,955

12.96

%

48,127

6.00

%

64,168

8.00

%

Tier I Capital (to Average Assets)

103,955

12.01

%

34,623

4.00

%

43,279

5.00

%

Off-Balance Sheet Arrangements and Aggregate Contractual Obligations

Commitments. As a financial services provider, we routinely are a party to various financial instruments with off-balance-sheet risks, such as commitments to extend credit and unused lines of credit. While these contractual obligations represent our future cash requirements, a significant portion of commitments to extend credit may expire without being drawn upon. Such commitments are subject to the same credit policies and approval process accorded to loans we make. At September 30, 2025, we had outstanding commitments to originate loans of $80.7 million. We anticipate that we will have sufficient funds available to meet our current lending commitments. Time deposits that are scheduled to mature in less than one year from September 30, 2025 totaled $132.0 million. Management expects that a substantial portion of the maturing time deposits will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize FHLB advances or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.

Contractual Obligations. In the ordinary course of our operations, we enter into certain contractual obligations. Such obligations include data processing services, operating leases for premises and equipment, agreements with respect to borrowed funds and deposit liabilities.

Item 3. Quantitative and Qualitati ve Disclosures About Market Risk

The information required by this item is included in Part 1, Item 2 of this quarterly report under “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 and Exchange Act of 1934, as amended) as of September 30, 2025. 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.

During the quarter ended September 30, 2025, there have been no changes in the Company’s internal controls over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

32

PART II – OTHE R INFORMATION

At September 30, 2025, we were not involved in any legal proceedings the outcome of which would be material to our financial condition or results of operations.

Item 1A. Ri sk Factors

Not applicable for smaller reporting companies.

Item 2. Unregistered Sales of Equi ty Securities and Use of Proceeds

The following table sets forth information in connection with repurchases of shares of the Company's common stock during the three months ended September 30, 2025:

Period

Total Number of Shares Purchased

Average Price Paid per Share

Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)

Maximum Number of Shares That May Yet Be Purchased Under Plans or Programs (1)

July 1, 2025 through July 31, 2025

998

$

18.47

998

199,959

August 1, 2025 through August 31, 2025

98,736

19.44

98,736

101,223

September 1, 2025 through September 30, 2025

—

—

—

101,223

99,734

19.43

99,734

101,223

The Company's Board of Directors approved a stock repurchase program on March 7, 2025, which authorized the repurchase of up to 320,480 shares of the Company's common stock (approximately 5.0% of the then-outstanding shares). As of September 30, 2025, the Company had repurchased 219,257 shares pursuant to the plan. There is no expiration date for the stock repurchase plan.

Item 3. Defaults Upo n Senior Securities

None.

Item 4. Mine Saf ety Disclosures

Not applicable.

Item 5. O ther Information

During the three months ended September 30, 2025 , none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as that term is used in Securities and Exchange Commission regulations.

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Item 6. E xhibits

Exhibit

Number

Description

3.1

Articles of Incorporation of Affinity Bancshares, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1, as amended (Commission File No. 333-248745)

3.2

Bylaws of Affinity Bancshares, Inc.(incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1, as amended (Commission File No. 333-248745)

31.1

Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32

Written Statement 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 quarter ended September 30, 2025, formatted in inline XBRL (Extensible Business Reporting Language): (i) Balance Sheets, (ii) Statements of Income, (iii) Statements of Comprehensive Income, (iv) Statements of Changes in Stockholders’ Equity, (v) Statements of Cash Flows, and (vi) Notes to Financial Statements

104.0

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

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SIGNA TURES

Pursuant to the requirements 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.

AFFINITY BANCSHARES, INC.

Date:

November 10, 2025

/s/ Edward J. Cooney

Edward J. Cooney

President and Chief Executive Officer

Date:

November 10, 2025

/s/ Brandi Pajot

Brandi Pajot

Senior Vice President and Chief Financial Officer

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