Pathfinder Bancorp, Inc. Announces Third Quarter 2025 Results

2025-10-30 04:17:22

(MENAFN- GlobeNewsWire - Nasdaq) Results reflect ongoing efforts to mitigate credit risk and enhance asset quality metrics for the long term, as well as the continued growth of Pathfinder's core deposit franchise, deliberate liability pricing, net interest margin resilience, and operating expense discipline

OSWEGO, N.Y., Oct. 30, 2025 (GLOBE NEWSWIRE) -- Pathfinder Bancorp, Inc. (“Pathfinder” or the“Company”) (NASDAQ: PBHC) announced its financial results for the third quarter ended September 30, 2025.

The holding company for Pathfinder Bank (“the Bank”) reported net income attributable to common shareholders of $626,000, or $0.10 per diluted share in the third quarter of 2025, compared to $31,000 or less than $0.01 per diluted share in the second quarter of 2025. The Company recorded a net loss attributable to common shareholders of $4.6 million or $0.75 per share in the third quarter of 2024.

Third Quarter 2025 Highlights and Key Developments

Provision expense was $3.5 million, compared to $1.2 million in the quarter ended June 30, 2025 (the "linked quarter") and $9.0 million in the year-ago period, reflecting proactive measures that remain ongoing to mitigate credit risk and enhance asset quality metrics for the long term. These include a prudent increase in reserves during the third quarter of 2025, in conjunction with an ongoing comprehensive portfolio review that the Company initiated in September, encompassing performing and nonperforming loans of $500,000 or more, representing approximately 90% of all outstandings. This review is expected to be completed by the end of 2025.
Allowance for credit losses increased to $18.7 million at period end, increasing $2.7 million during the third quarter and $1.4 million from September 30, 2024. Net charge offs (“NCOs”) were $670,000 in the third quarter of 2025, declining 74.2% from the linked quarter and 92.3% from the year-ago period.
Loans totaled $898.5 million at period end, compared to $909.7 million on June 30, 2025, and $921.7 million on September 30, 2024. Commercial loans were $543.7 million or 60.5% of total loans at period end, compared to $549.1 million on June 30, 2025, and $534.5 million on September 30, 2024.
Total deposits grew to $1.23 billion at period end, compared to $1.22 billion on June 30, 2025, and $1.20 billion on September 30, 2024. During the third quarter of 2025, total balances increased on growth in core deposits, more than offsetting reductions in higher-cost time deposits. Core deposits grew to $960.1 million, or 78.37% of total deposits at period end, from $958.8 million on June 30, 2025, and $926.4 million on September 30, 2024.
Net interest income was $11.6 million and net interest margin (“NIM”) was 3.34%, including loan and investment prepayment penalties contributing a combined $260,000 to net interest income and 7 basis points to NIM. For the linked quarter, net interest income and NIM were $10.8 million and 3.11%, respectively. In the year-ago period, a catch-up interest payment contributed $887,000 to net interest income of $11.7 million and 25 basis points to NIM of 3.34%.
Noninterest income was $1.5 million, including a net death benefit of $32,000 on bank owned life insurance (“BOLI”). For the linked quarter, noninterest income was negative $1.5 million, including a pre-tax loss of $3.1 million recorded as a lower of cost or market adjustment to loans held for sale (“LOCOM HFS adjustment”). In the year-ago period, noninterest income was $1.7 million, including a net death benefit of $175,000 on BOLI.
The efficiency ratio was 68.77%, compared to 65.66% in the linked quarter and 75.78% in the year-ago period. The efficiency ratio, which is not a financial metric under generally accepted accounting principles (“GAAP”), is a measure that the Company believes is helpful to understanding its level of non-interest expense as a percentage of total revenue.
Pre-tax, pre-provision (“PTPP”) net income was $4.1 million, compared to $4.2 million in the linked quarter and $3.3 million in the year-ago period. PTPP net income, which is not a financial metric under GAAP, is a measure that the Company believes is helpful to understanding profitability without giving effect to income taxes and provision for credit losses.

“Recent asset quality related to certain legacy loans has resulted in unacceptable levels of credit volatility,” said President and Chief Executive Officer James A. Dowd.“We're committed to advancing our dynamic credit risk management framework, emphasizing enhanced portfolio analytics, rigorous policy standards, stringent underwriting criteria, and a measured approach to new loan production that favors local consumer and small and mid-sized businesses lending over highly concentrated credit relationships. In addition, we initiated a new, comprehensive review of the entire loan portfolio, scheduled to be completed by year end, which we believe will enable us to make significant strides toward reducing the volatility of credit costs in 2026 and beyond, clearing a path for consistent and sustainable improvement in earnings over time.”

Dowd added,“Third quarter results also underscore the benefits of our disciplined approach to balance sheet management. We've made steady progress in expanding Pathfinder's core deposit base across our Oswego and Onondaga county markets with a deliberate approach to pricing, providing the Bank with a stable, relationship-driven source of funding to support community-based lending.”

Net Interest Income and Net Interest Margin
Third quarter 2025 net interest income was $11.6 million, an increase of $786,000, or 7.3%, from the second quarter of 2025. An increase in interest and dividend income of $554,000 from the linked quarter was attributed to an average yield increase of 16 basis points on all interest-earning assets. A 34 basis point increase in loan yields included a 9 basis point benefit from $200,000 in loan prepayment penalty income in the third quarter of 2025. An overall 14 basis point decrease in taxable securities yield included a 5 basis point benefit from $60,000 in investment prepayment penalty income in the third quarter of 2025. In addition, average balances of loans, taxable securities and tax-exempt securities declined by $4.6 million, $3.8 million and $334,000, respectively. The increases in loan interest income, dividends, and federal funds sold and interest-earning deposits were $693,000, $23,000, and $63,000, respectively, partially offset by decreases in taxable and tax-exempt securities income of $215,000 and $10,000, respectively. A decrease in interest expense from the second quarter of 2025 of $232,000 was primarily attributed to a 7 basis point decline in the average cost of total interest-bearing liabilities, highlighted by a 10 basis point reduction in the cost of interest-bearing deposits that resulted from the Bank's deliberate pricing adjustments.

NIM was 3.34% in the third quarter of 2025, compared to 3.11% in the second quarter of 2025. The increase of 23 basis points reflected lower average interest-bearing deposit costs in the third quarter of 2025, as well as 7 basis points attributed to prepayment penalty income.

Third quarter 2025 net interest income was $11.6 million, a decrease of $132,000, or 1.1%, from the year-ago period, or an increase of $755,000, or 7.0%, when excluding an $887,000 third quarter 2024 catch-up interest payment associated with purchased loan pool positions. A decrease in interest and dividend income of $1.5 million was attributed to the third quarter 2024 catch-up interest payment, as well as declines in the average yield on total interest-bearing assets, loans, and fed funds sold and interest-bearing deposits of 36 basis points, 22 basis points, and 148 basis points, respectively. Average loan balances also declined by $7.7 million from the year-ago period, with a corresponding decrease in loan interest income of $626,000. A decrease in interest expense of $1.3 million was primarily attributed to a 45 basis point decline in the average cost of total interest-bearing liabilities, highlighted by a 39 basis point reduction in the cost of interest bearing deposits, as well as paydowns of brokered deposits and borrowings utilizing a portion of the low-cost liquidity provided by core deposits acquired as part of last year's East Syracuse branch transaction.

NIM was 3.34% in the third quarter of 2025 with 7 basis points attributed to prepayment penalty income, compared to 3.34% in the third quarter of 2024 with 25 basis points from the catch-up interest payment received in the third quarter of 2024. As a result of the declining rate environment and the 2024 East Syracuse branch acquisition, NIM reflected lower average deposit and borrowing costs in the third quarter of 2025, offset by lower average yields on earning assets, as compared to the year-ago period.

Noninterest Income
Third quarter 2025 noninterest income totaled $1.5 million. In the linked quarter, noninterest income was negative $1.5 million, reflecting a pre-tax loss of $3.1 million on the sale of nonperforming and classified loans recorded as a second quarter 2025 LOCOM HFS adjustment. In the year-ago period, noninterest income was $1.7 million, including $367,000 in third quarter 2024 revenue from the insurance agency business sold in October 2024.

Compared to the linked quarter, third quarter 2025 noninterest income reflected increases of $130,000 in earnings and gain on BOLI driven by a $32,000 net death benefit, as well as the timing of new policy purchases and like-kind exchanges of existing policies. In addition, third quarter 2025 noninterest income, compared to the linked quarter, included increases in debit card interchange fees of $37,000 and service charges on deposit accounts of $24,000. Compared to the linked quarter, third quarter 2025 noninterest income also reflected gains on sales of loans and foreclosed real estate of $38,000, an increase in loan servicing fees of $16,000, a decrease of $275,000 in net unrealized gains on marketable equity securities, and a $12,000 increase in net realized losses on sales and redemptions of investment securities.

Compared to the third quarter of 2024, noninterest income reflected a decrease of $75,000 in earnings and gains on BOLI. The decline reflects the impact of new BOLI policy purchases made during the current year and differences in net death benefits recorded in the third quarter of 2025 and the year-ago period of $32,000 and $175,000, respectively. In addition, third quarter 2025 noninterest income, compared to the year-ago period, included a $12,000 increase in service charges on deposit accounts and a decrease of $83,000 in debit card interchange fees. Compared to the year-ago period, third quarter 2025 noninterest income also reflected increases of $83,000 in net unrealized gains on marketable equity securities, $34,000 in loan servicing fees, and $31,000 in gains on sales of loans and foreclosed real estate, as well as a decrease of $176,000 in net realized losses on sales and redemptions of investment securities.

Noninterest Expense
Noninterest expense totaled $8.9 million in the third quarter of 2025, increasing $875,000 from $8.1 million in the linked quarter and decreasing $1.3 million from $10.3 million in the year-ago period. The decrease from the year-ago period was primarily due to $1.6 million in one-time transaction-related expenses for last year's East Syracuse branch acquisition, in addition to $308,000 in costs associated with the insurance agency business sold in October 2024.

Salaries and benefits were $5.0 million in the third quarter of 2025, increasing $480,000 from the linked quarter and $46,000 from the year-ago period. The increase from the second quarter of 2025 was due to one additional workday in the quarter driving an additional $100,000 of salaries, an increase in medical claims of $146,000 expected to be reimbursed by stop loss insurance, an increase in retirement plan costs of $89,000, as well as an increase of $152,000 related to reduced salary deferrals linked to reduced loan origination activities. The increase of $46,000 from the year-ago period was primarily due to an increase in medical claims expected to be reimbursed by stop loss insurance.

Building and occupancy was $1.4 million in the third quarter of 2025, increasing $169,000 from the linked quarter and $265,000 from the year-ago quarter. The increase from the linked quarter reflected a $133,000 increase due to periodic building maintenance, as well as increases in property taxes of $17,000 and utilities costs of $7,000. The increase from the year-ago period was primarily due to a $121,000 increase in building maintenance during the third quarter of 2025, and higher costs related to building and land leases, property taxes, and utilities of $54,000, $46,000, and $27,000, respectively. These increases from the year-ago period were primarily due to timing of ongoing facilities-related costs associated with operating the East Syracuse branch acquired early in the third quarter of 2024.

Data processing expense was $641,000 in the third quarter of 2025, decreasing $26,000 from the linked quarter and $31,000 from the year-ago period. The decrease from the linked quarter reflects lower costs primarily associated with check and ATM processing charges. The decrease from the year-ago period was driven by decreases of $78,000 in data processing supplies and $24,000 in ATM processing costs, partially offset by year-over-year increases in recurring data processing costs amounting to $71,000, primarily due to software upgrades completed as part of the Company's ongoing technology modernization initiatives.

FDIC assessment expense was $171,000 in the third quarter of 2025 and zero in the linked quarter due to modest over-accruals in prior periods, compared to $228,000 in the year-ago period.

Annualized noninterest expense represented 2.40% of average assets in the third quarter of 2025, compared to 2.18% and 2.75% in the linked and year-ago periods. The efficiency ratio was 68.77%, compared to 65.66% and 75.78% in the linked and year-ago periods, respectively. The efficiency ratio, which is not a financial metric under GAAP, is a measure that the Company believes is helpful to understanding its level of non-interest expense as a percentage of total revenue.

Net Income
For the third quarter of 2025, net income attributable to common shareholders was $626,000, or $0.10 per basic and diluted share. Linked quarter net income was $31,000, or less than $0.01 per basic and diluted share. For the third quarter of 2024 the company reported a net loss of $4.6 million or $0.75 per basic and diluted share.

Statement of Financial Condition
As of September 30, 2025, the Company's statement of financial condition reflects total assets of $1.47 billion, compared to $1.51 billion and $1.48 billion recorded on June 30, 2025, and September 30, 2024, respectively.

Loans totaled $898.5 million on September 30, 2025, decreasing $11.2 million or 1.2% during the third quarter and $23.1 million or 2.5% from one year prior. Consumer and residential loans totaled $356.2 million on September 30, 2025, decreasing $6.0 million or 1.6% during the third quarter and $32.5 million or 8.4% from one year prior. Commercial loans totaled $543.7 million on September 30, 2025, decreasing $5.4 million or 1.0% during the third quarter and increasing $9.2 million or 1.7% from one year prior.

With respect to liabilities, deposits totaled $1.23 billion on September 30, 2025, increasing 0.3% during the third quarter and 2.4% from one year prior.

Shareholders' equity totaled $126.3 million on September 30, 2025, increasing $1.9 million or 1.5% in the third quarter and increasing $6.1 million or 5.1% from one year prior. The third quarter 2025 increase primarily reflects a $1.6 million decrease in accumulated other comprehensive loss (“AOCL”), a $4,000 decrease in retained earnings, and a $329,000 increase in additional paid in capital. Noncontrolling interest, previously included in equity in the Statements of Financial Condition, was eliminated in October 2024 upon the sale of the Company's 51% insurance agency ownership interest.

Asset Quality
The Company's asset quality metrics reflect ongoing efforts the Bank is undertaking as part of its commitment to continuously improve its credit risk management approach.

Nonperforming loans were $23.3 million, or 2.59% of total loans on September 30, 2025, compared to $11.7 million or 1.28% on June 30, 2025, and $16.2 million or 1.75% on September 30, 2024. The increase is the result of two loans associated with two local commercial relationships dating back to 2021 moving to nonperforming status.

NCOs after recoveries declined to $670,000, or an annualized 0.30% of average loans in the third quarter of 2025, from $2.6 million or 1.14% in the linked quarter and $8.7 million or 3.82% in the year-ago period.

Provision for credit loss expense was $3.5 million in the third quarter of 2025, reflecting an increase in credit loss reserves in the period. The increase is the result of two large commercial real estate relationships. The provision was $1.2 million and $9.0 million in the linked and year-ago quarters, respectively.

The Company believes it is sufficiently collateralized and reserved, with an Allowance for Credit Losses (“ACL”) of $18.7 million on September 30, 2025, compared to $16.0 million on June 30, 2025, and $17.3 million on September 30, 2024. As a percentage of total loans, ACL represented 2.08% on September 30, 2025, 1.76% on June 30, 2025, and 1.87% on September 30, 2024.

Liquidity
The Company has diligently ensured a strong liquidity profile as of September 30, 2025 to meet its ongoing financial obligations. The Bank's liquidity management, as evaluated by its cash reserves and operational cash flows from loan repayments and investment securities, remains robust and is effectively managed by the institution's leadership.

The Bank's analysis indicates that expected cash inflows from loans and investment securities are more than sufficient to meet all projected financial obligations. Total deposits were $1.23 billion on September 30, 2025, compared to $1.22 billion on June 30, 2025, and $1.20 billion on September 30, 2024. Core deposits represented 78.37% of total deposits on September 30, 2025, compared to 78.47% on June 30, 2025, and 77.45% on September 30, 2024. The Bank continues to implement strategic initiatives to enhance its core deposit franchise, including targeted marketing campaigns and customer engagement programs aimed at deepening banking relationships and enhancing deposit stability.

On September 30, 2025, Pathfinder Bancorp had an available additional funding capacity of $138.3 million with the Federal Home Loan Bank of New York, which complements its liquidity reserves. Moreover, the Bank maintains additional unused credit lines totaling $53.3 million, which provide a buffer for additional funding needs. These facilities, including access to the Federal Reserve's Discount Window, are part of a comprehensive liquidity strategy that ensures flexibility and readiness to respond to any funding requirements.

Cash Dividend Declared
On September 29, 2025, Pathfinder's Board of Directors declared a cash dividend of $0.10 per share for holders of both voting common and non-voting common stock.

In addition, this dividend also extends to the notional shares of the Company's warrants. Shareholders registered by October 17, 2025 will be eligible for the dividend, which is scheduled for disbursement on November 7, 2025. This distribution aligns with Pathfinder Bancorp's philosophy of consistent and reliable delivery of shareholder value.

Evaluating the Company's market performance, the closing stock price as of September 30, 2025 stood at $15.68 per share. This positions the annualized dividend yield at 2.55%.

About Pathfinder Bancorp, Inc.
Pathfinder Bancorp, Inc. (NASDAQ: PBHC) is the bank holding company for Pathfinder Bank, which serves Central New York customers throughout Oswego, Syracuse, and their neighboring communities. Strategically located branches, as well as diversified consumer, mortgage, and commercial loan portfolios, reflect the state-chartered Bank's commitment to in-market relationships and local customer service. The Company also offers investment services to individuals and businesses. More information is available at pathfinderbank and

Forward-Looking Statements
Certain statements contained herein are“forward looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are generally identified by use of the words“believe,”“expect,”“intend,”“anticipate,”“estimate,”“project” or similar expressions, or future or conditional verbs, such as“will,”“would,”“should,”“could,” or“may.” These forward-looking statements are based on current beliefs and expectations of the Company's and the Bank's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's and the Bank's control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause such differences to exist include, but are not limited to: risks related to the real estate and economic environment, particularly in the market areas in which the Company and the Bank operate; fiscal and monetary policies of the U.S. Government; inflation; changes in government regulations affecting financial institutions, including regulatory compliance costs and capital requirements; fluctuations in the adequacy of the allowance for credit losses; decreases in deposit levels necessitating increased borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity, fraud and natural disasters; the risk that the Company may not be successful in the implementation of its business strategy; changes in prevailing interest rates; credit risk management; asset-liability management; and other risks described in the Company's filings with the Securities and Exchange Commission, which are available at the SEC's website,

This release contains non-GAAP financial measures. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a registrant's historical or future financial performance, financial position, or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet, or statement of cash flows (or equivalent statements) of the registrant; or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to the requirements of Regulation G, the Company has provided reconciliations within the release of the non-GAAP financial measures to the most directly comparable GAAP financial measure.


PATHFINDER BANCORP, INC.
Selected Financial Information (Unaudited)
(Amounts in thousands, except per share amounts)

	2025			2024
SELECTED BALANCE SHEET DATA:	September 30,			June 30,			March 31,		December 31,		September 30,
ASSETS:
Cash and due from banks	$	19,317			$	16,183		$	18,606		$	13,963		$	18,923
Interest-earning deposits		21,255				15,292			32,862			17,609			16,401
Total cash and cash equivalents		40,572				31,475			51,468			31,572			35,324
Available-for-sale securities, at fair value		294,457				300,951			284,051			269,331			271,977
Held-to-maturity securities, at amortized cost		142,538				157,892			155,704			158,683			161,385
Marketable equity securities, at fair value		5,352				4,881			4,401			4,076			3,872
Federal Home Loan Bank stock, at cost		3,488				5,278			2,906			4,590			5,401
Loans held-for-sale		-				3,161			-			-			-
Loans, net of deferred fees		898,520				909,723			912,150			918,986			921,660
Less: Allowance for credit losses		18,654				15,983			17,407			17,243			17,274
Loans receivable, net		879,866				893,740			894,743			901,743			904,386
Premises and equipment, net		18,760				19,047			19,233			19,009			18,989
Operating lease right-of-use assets		1,124				1,115			1,356			1,391			1,425
Finance lease right-of-use assets		16,082				16,280			16,478			16,676			16,873
Accrued interest receivable		6,498				6,889			6,748			6,881			6,806
Foreclosed real estate		137				83			-			-			-
Intangible assets, net		5,518				5,675			5,832			5,989			6,217
Goodwill		5,056				5,056			5,056			5,056			5,752
Bank owned life insurance		31,145				31,045			24,889			24,727			24,560
Other assets		21,675				22,551			22,472			25,150			20,159
Total assets	$	1,472,268			$	1,505,119		$	1,495,337		$	1,474,874		$	1,483,126

LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits:
Interest-bearing deposits	$	1,028,782			$	1,030,155		$	1,061,166		$	990,805		$	986,103
Noninterest-bearing deposits		196,299				191,732			203,314			213,719			210,110
Total deposits		1,225,081				1,221,887			1,264,480			1,204,524			1,196,213
Short-term borrowings		38,000				75,500			27,000			61,000			60,315
Long-term borrowings		18,702				20,977			17,628			27,068			39,769
Subordinated debt		30,258				30,206			30,156			30,107			30,057
Accrued interest payable		1,134				813			844			546			236
Operating lease liabilities		1,326				1,313			1,560			1,591			1,621
Finance lease liabilities		16,479				16,566			16,655			16,745			16,829
Other liabilities		14,949				13,444			12,118			11,810			16,986
Total liabilities		1,345,929				1,380,706			1,370,441			1,353,391			1,362,026
Shareholders' equity:
Voting common stock shares issued and outstanding		4,794,225				4,788,109			4,761,182			4,745,366			4,719,788
Voting common stock	$	48			$	48		$	48		$	47		$	47
Non-voting common stock		14				14			14			14			14
Additional paid in capital		53,974				53,645			53,103			52,750			53,231
Retained earnings		79,560				79,564			80,163			77,816			73,670
Accumulated other comprehensive loss		(7,257	)			(8,858	)		(8,432	)		(9,144	)		(6,716	)
Total Pathfinder Bancorp, Inc. shareholders' equity		126,339				124,413			124,896			121,483			120,246
Noncontrolling interest		-				-			-			-			854
Total equity		126,339				124,413			124,896			121,483			121,100
Total liabilities and shareholders' equity	$	1,472,268			$	1,505,119		$	1,495,337		$	1,474,874		$	1,483,126

^{The above information is unaudited and preliminary, based on the Company's data available at the time of presentation.}

	Nine Months Ended September 30,			2025			2024
SELECTED INCOME STATEMENT DATA:	2025			2024			Q3		Q2		Q1			Q4			Q3
Interest and dividend income:
Loans, including fees	$	40,577			$	39,182		$	13,799		$	13,106			$	13,672		$	13,523		$	14,425
Debt securities:
Taxable		16,014				17,007			5,307			5,522				5,185			5,312			5,664
Tax-exempt		1,322				1,475			455			465				402			445			469
Dividends		158				456			44			21				93			164			149
Federal funds sold and interest-earning deposits		288				711			131			68				89			82			492
Total interest and dividend income		58,359				58,831			19,736			19,182				19,441			19,526			21,199
Interest expense:
Interest on deposits		21,220				22,670			6,957			7,318				6,945			7,823			7,633
Interest on short-term borrowings		1,606				3,476			566			495				545			700			1,136
Interest on long-term borrowings		264				597			127			72				65			136			202
Interest on subordinated debt		1,444				1,476			486			483				475			490			496
Total interest expense		24,534				28,219			8,136			8,368				8,030			9,149			9,467
Net interest income		33,825				30,612			11,600			10,814				11,411			10,377			11,732
Provision for (benefit from) credit losses:
Loans		5,018				10,118			3,341			1,173				504			988			9,104
Held-to-maturity securities		5				(90	)		-			5				-			(5	)		(31	)
Unfunded commitments		126				(43	)		154			19				(47	)		5			(104	)
Total provision for credit losses		5,149				9,985			3,495			1,197				457			988			8,969
Net interest income after provision for credit losses		28,676				20,627			8,105			9,617				10,954			9,389			2,763
Noninterest income:
Service charges on deposit accounts		1,158				1,031			404			380				374			405			392
Earnings and gain on bank owned life insurance		604				685			286			156				162			169			361
Loan servicing fees		311				279			113			97				101			96			79
Net realized (losses) gains on sales and redemptions of investment securities		(20	)			(320	)		(12	)		-				(8	)		249			(188	)
Gain on asset sale^{1 & 2}		-				-			-			-				-			3,169			-
Net unrealized gains on marketable equity securities		783				31			145			420				218			166			62
Gains on sales of loans and foreclosed real estate		269				148			121			83				65			39			90
Fair value adjustment to loans held-for-sale³		(3,064	)			-			-			(3,064	)			-			-			-
Loss on sale of premises and equipment		-				(13	)		-			-				-			-			(13	)
Debit card interchange fees		398				610			217			180				1			265			300
Insurance agency revenue¹		-				1,024			-			-				-			49			367
Other charges, commissions & fees		743				1,180			229			230				284			299			257
Total noninterest (loss) income		1,182				4,655			1,503			(1,518	)			1,197			4,906			1,707
Noninterest expense:
Salaries and employee benefits		13,980				13,687			5,005			4,525				4,450			4,123			4,959
Building and occupancy		3,976				2,864			1,399			1,230				1,347			1,254			1,134
Data processing		1,974				1,750			641			667				666			721			672
Professional and other services		2,093				3,078			709			778				606			608			1,820
Advertising		304				386			86			77				141			218			165
FDIC assessments		400				685			171			-				229			231			228
Audits and exams		306				416			132			60				114			123			123
Amortization expense		470				137			156			157				157			27			129
Insurance agency expense¹		-				825			-			-				-			456			308
Community service activities		49				111			10			28				11			19			20
Foreclosed real estate expenses		76				82			26			29				21			20			27
Other expenses		1,802				1,852			601			510				691			744			674
Total noninterest expense		25,430				25,873			8,936			8,061				8,433			8,544			10,259
Income (loss) before provision for income taxes		4,428				(591	)		672			38				3,718			5,751			(5,789	)
Provision (benefit) for income taxes		797				(160	)		46			7				744			492			(1,173	)
Net income (loss) attributable to noncontrolling interest and Pathfinder Bancorp, Inc.		3,631				(431	)		626			31				2,974			5,259			(4,616	)
Net income attributable to noncontrolling interest¹		-				93			-			-				-			1,352			28
Net income (loss) attributable to Pathfinder Bancorp Inc.	$	3,631			$	(524	)	$	626		$	31			$	2,974		$	3,907		$	(4,644	)
Voting Earnings per common share - basic	$	0.58			$	(0.09	)	$	0.10		$	-			$	0.48		$	0.63		$	(0.75	)
Voting Earnings per common share - diluted⁴	$	0.57			$	(0.09	)	$	0.10		$	-			$	0.47		$	0.63		$	(0.75	)
Series A Non-Voting Earnings per common share- basic	$	0.58			$	(0.09	)	$	0.10		$	-			$	0.48		$	0.63		$	(0.75	)
Series A Non-Voting Earnings per common share- diluted⁴	$	0.57			$	(0.09	)	$	0.10		$	-			$	0.47		$	0.63		$	(0.75	)
Dividends per common share (Voting and Series A Non-Voting)	$	0.30			$	0.30		$	0.10		$	0.10			$	0.10		$	0.10		$	0.10

¹Although the Company owned 51% of its membership interest in FitzGibbons Agency, LLC (“Agency”) the Company is required to consolidate 100% of the Agency within the consolidated financial statements. The Company sold its 51% membership interest in the Agency in October 2024.
²The $3,169,000 consolidated gain on asset sale equals $1,616,000 associated with the Company's 51% interest in the Agency plus $1,553,000 associated with the 49% noncontrolling interest.
³The loss reflects a valuation adjustment“Lower-of-cost-or-market" adjustment on loans held for sale to their estimated market value based on active sale negotiations.
⁴Diluted earnings per share for the first quarter of 2025 has been updated to $0.47, from the $0.41 reported previously.

The above information is unaudited and preliminary, based on the Company's data available at the time of presentation.

	Nine Months Ended September 30,			2025			2024
FINANCIAL HIGHLIGHTS:	2025			2024			Q3		Q2		Q1			Q4			Q3
Selected Ratios:
Return on average assets		0.33	%			-0.05	%		0.17	%		0.01	%			0.81	%		1.07	%		-1.25	%
Return on average common equity		3.87	%			-0.57	%		1.98	%		0.10	%			9.64	%		12.85	%		-14.79	%
Return on average equity		3.87	%			-0.57	%		1.98	%		0.10	%			9.64	%		12.85	%		-14.79	%
Return on average tangible common equity¹		6.42	%			-0.59	%		2.17	%		0.11	%			10.52	%		14.17	%		-15.28	%
Net interest margin		3.25	%			2.97	%		3.34	%		3.11	%			3.31	%		3.02	%		3.34	%
Loans / deposits		73.34	%			77.05	%		73.34	%		74.45	%			72.14	%		76.29	%		77.05	%
Core deposits/deposits²		78.37	%			77.45	%		78.37	%		78.47	%			78.31	%		76.86	%		77.45	%
Annualized non-interest expense / average assets		2.30	%			2.39	%		2.40	%		2.18	%			2.33	%		2.33	%		2.75	%
Commercial real estate / risk-based capital³		174.67	%			189.47	%		174.67	%		183.34	%			182.62	%		186.73	%		189.47	%
Efficiency ratio¹		67.24	%			73.01	%		68.77	%		65.66	%			67.19	%		72.25	%		75.78	%

Other Selected Data:
Average yield on loans		5.94	%			5.82	%		6.09	%		5.75	%			5.97	%		5.87	%		6.31	%
Average cost of interest bearing deposits		2.76	%			3.12	%		2.71	%		2.81	%			2.76	%		3.12	%		3.11	%
Average cost of total deposits, including non-interest bearing		2.31	%			2.64	%		2.28	%		2.37	%			2.29	%		2.59	%		2.59	%
Deposits/branch⁴	$	102,090			$	99,684		$	102,090		$	101,824			$	105,373		$	100,377		$	99,684
Pre-tax, pre-provision net income¹	$	12,392			$	9,566		$	4,058		$	4,216			$	4,118		$	3,282		$	3,278
Total revenue¹	$	37,822			$	35,439		$	12,994		$	12,277			$	12,551		$	11,826		$	13,537

Share and Per Share Data:
Cash dividends per share	$	0.30			$	0.30		$	0.10		$	0.10			$	0.10		$	0.10		$	0.10
Book value per common share	$	20.46			$	19.71		$	20.46		$	20.17			$	20.33		$	19.83		$	19.71
Tangible book value per common share¹	$	18.75			$	17.75		$	18.75		$	18.43			$	18.56		$	18.03		$	17.75
Basic and diluted weighted average shares outstanding - Voting		4,769				4,708			4,790			4,769				4,749			4,733			4,714
Basic earnings per share - Voting⁵	$	0.58			$	(0.09	)	$	0.10		$	-			$	0.48		$	0.63		$	(0.75	)
Diluted earnings per share - Voting^{5 & 6}	$	0.57			$	(0.09	)	$	0.10		$	-			$	0.47		$	0.63		$	(0.75	)
Basic and diluted weighted average shares outstanding - Series A Non-Voting		1,380				1,380			1,380			1,380				1,380			1,380			1,380
Basic earnings per share - Series A Non-Voting⁵	$	0.58			$	(0.09	)	$	0.10		$	-			$	0.48		$	0.63		$	(0.75	)
Diluted earnings per share - Series A Non-Voting^{5 & 6}	$	0.57			$	(0.09	)	$	0.10		$	-			$	0.47		$	0.63		$	(0.75	)
Common shares outstanding at period end		6,175				6,100			6,175			6,168				6,141			6,126			6,100

Pathfinder Bancorp, Inc. Capital Ratios:
Company tangible common equity to tangible assets¹		7.92	%			7.36	%		7.92	%		7.61	%			7.68	%		7.54	%		7.36	%
Company Total Core Capital (to Risk-Weighted Assets)		15.81	%			15.55	%		15.81	%		15.97	%			15.89	%		15.66	%		15.55	%
Company Tier 1 Capital (to Risk-Weighted Assets)		12.17	%			11.84	%		12.17	%		12.31	%			12.24	%		12.00	%		11.84	%
Company Tier 1 Common Equity (to Risk-Weighted Assets)		11.68	%			11.33	%		11.68	%		11.81	%			11.75	%		11.51	%		11.33	%
Company Tier 1 Capital (to Assets)		8.79	%			8.29	%		8.79	%		8.75	%			8.82	%		8.64	%		8.29	%

Pathfinder Bank Capital Ratios:
Bank Total Core Capital (to Risk-Weighted Assets)		14.71	%			14.52	%		14.71	%		14.87	%			14.86	%		14.65	%		14.52	%
Bank Tier 1 Capital (to Risk-Weighted Assets)		13.45	%			13.26	%		13.45	%		13.62	%			13.61	%		13.40	%		13.26	%
Bank Tier 1 Common Equity (to Risk-Weighted Assets)		13.45	%			13.26	%		13.45	%		13.62	%			13.61	%		13.40	%		13.26	%
Bank Tier 1 Capital (to Assets)		9.72	%			9.13	%		9.72	%		9.68	%			9.80	%		9.64	%		9.13	%

¹Non-GAAP financial metrics. See non-GAAP reconciliation included herein for the most directly comparable GAAP measures.
²Non-brokered deposits excluding certificates of deposit of $250,000 or more.
³Construction and development, multifamily, and non-owner occupied CRE loans as a percentage of Pathfinder Bank total capital.
⁴Includes 11 full-service branches and one motor bank for periods after June 30, 2024. Includes 10 full-service branches and one motor bank for all periods prior.
⁵Basic and diluted earnings per share are calculated based upon the two-class method. Weighted average shares outstanding do not include unallocated ESOP shares.
⁶Diluted earnings per share for the first quarter of 2025 has been updated to $0.47, from the $0.41 reported previously.

The above information is unaudited and preliminary, based on the Company's data available at the time of presentation.

	Nine Months Ended September 30,			2025			2024
ASSET QUALITY:	2025			2024			Q3		Q2		Q1			Q4			Q3
Total loan charge-offs	$	4,275			$	8,992		$	923		$	2,844			$	508		$	1,191		$	8,812
Total recoveries		668				174			253			247				168			171			90
Net loan charge-offs		3,607				8,818			670			2,597				340			1,020			8,722
Allowance for credit losses at period end		18,654				17,274			18,654			15,983				17,407			17,243			17,274
Nonperforming loans at period end		23,305				16,170			23,305			11,689				13,232			22,084			16,170
Nonperforming assets at period end	$	23,442			$	16,170		$	23,442		$	11,772			$	13,232		$	22,084		$	16,170
Annualized net loan charge-offs to average loans		0.53	%			1.31	%		0.30	%		1.14	%			0.15	%		0.44	%		3.82	%
Allowance for credit losses to period end loans		2.08	%			1.87	%		2.08	%		1.76	%			1.91	%		1.88	%		1.87	%
Allowance for credit losses to nonperforming loans		80.04	%			106.83	%		80.04	%		136.74	%			131.55	%		78.08	%		106.83	%
Nonperforming loans to period end loans		2.59	%			1.75	%		2.59	%		1.28	%			1.45	%		2.40	%		1.75	%
Nonperforming assets to period end assets		1.59	%			1.09	%		1.59	%		0.78	%			0.88	%		1.50	%		1.09	%

	2025			2024
LOAN COMPOSITION:	September 30,			June 30,			March 31,		December 31,		September 30,
1-4 family first-lien residential mortgages	$	238,975			$	240,833		$	243,854		$	251,373		$	255,235
Residential construction		1,406				3,520			3,162			4,864			4,077
Commercial real estate		371,683				381,575			381,479			377,619			378,805
Commercial lines of credit		79,021				75,487			65,074			67,602			64,672
Other commercial and industrial		86,687				85,578			91,644			89,800			88,247
Paycheck protection program loans		74				85			96			113			125
Tax exempt commercial loans		6,229				6,349			4,446			4,544			2,658
Home equity and junior liens		50,106				49,339			52,315			51,948			52,709
Other consumer		65,694				68,439			71,681			72,710			76,703
Subtotal loans		899,875				911,205			913,751			920,573			923,231
Deferred loan fees		(1,355	)			(1,482	)		(1,601	)		(1,587	)		(1,571	)
Total loans	$	898,520			$	909,723		$	912,150		$	918,986		$	921,660

	2025		2024
DEPOSIT COMPOSITION:	September 30,		June 30,			March 31,		December 31,	September 30,
Savings accounts	$	123,958		$	129,252		$	129,898	$	128,753	$	129,053
Time accounts		333,211			341,063			349,673		360,716		352,729
Time accounts in excess of $250,000		143,026			144,355			149,922		142,473		140,181
Money management accounts		9,539			9,902			10,774		11,583		11,520
MMDA accounts		298,653			278,919			306,281		239,016		250,007
Demand deposit interest-bearing		115,274			120,083			109,941		101,080		97,344
Demand deposit noninterest-bearing		196,299			191,732			203,314		213,719		210,110
Mortgage escrow funds		5,121			6,581			4,677		7,184		5,269
Total deposits	$	1,225,081		$	1,221,887		$	1,264,480	$	1,204,524	$	1,196,213

The above information is unaudited and preliminary, based on the Company's data available at the time of presentation.

	Nine Months Ended September 30,			2025				2024
SELECTED AVERAGE BALANCES:	2025			2024			Q3			Q2		Q3
Interest-earning assets:
Loans	$	911,419			$	898,361			$	906,759		$	911,347		$	914,467
Taxable investment securities		427,656				427,311				431,227			435,022			415,751
Tax-exempt investment securities		34,254				29,499				33,980			34,314			30,382
Fed funds sold and interest-earning deposits		13,306				20,161				16,866			10,070			42,897
Total interest-earning assets		1,386,635				1,375,332				1,388,832			1,390,753			1,403,497
Noninterest-earning assets:
Other assets		116,001				99,200				114,837			118,280			103,856
Allowance for credit losses		(16,777	)			(16,511	)			(15,595	)		(17,342	)		(16,537	)
Net unrealized losses on available-for-sale securities		(10,245	)			(10,184	)			(9,949	)		(10,838	)		(9,161	)
Total assets	$	1,475,614			$	1,447,837			$	1,478,125		$	1,480,853		$	1,481,655
Interest-bearing liabilities:
NOW accounts	$	115,494			$	100,922			$	120,696		$	113,994		$	102,868
Money management accounts		10,435				11,782				10,105			10,302			11,828
MMDA accounts		277,306				217,580				276,599			298,907			227,247
Savings and club accounts		129,059				115,875				127,696			129,736			127,262
Time deposits		493,033				521,832				490,735			489,490			514,050
Subordinated loans		30,174				29,978				30,225			30,173			30,025
Borrowings		68,656				129,943				73,556			61,803			122,129
Total interest-bearing liabilities		1,124,157				1,127,912				1,129,612			1,134,405			1,135,409
Noninterest-bearing liabilities:
Demand deposits		197,053				177,202				192,982			192,186			195,765
Other liabilities		29,436				19,382				29,320			29,037			24,855
Total liabilities		1,350,646				1,324,496				1,351,914			1,355,628			1,356,029
Shareholders' equity		124,968				123,341				126,211			125,225			125,626
Total liabilities & shareholders' equity	$	1,475,614			$	1,447,837			$	1,478,125		$	1,480,853		$	1,481,655

	Nine Months Ended September 30,			2025			2024
SELECTED AVERAGE YIELDS:	2025			2024		Q3		Q2		Q3
Interest-earning assets:
Loans		5.94	%		5.82	%		6.09	%		5.75	%	6.31	%
Taxable investment securities		5.04	%		5.45	%		4.96	%		5.10	%	5.59	%
Tax-exempt investment securities		5.15	%		6.67	%		5.36	%		5.42	%	6.17	%
Fed funds sold and interest-earning deposits		2.89	%		4.70	%		3.11	%		2.70	%	4.59	%
Total interest-earning assets		5.61	%		5.70	%		5.68	%		5.52	%	6.04	%
Interest-bearing liabilities:
NOW accounts		1.11	%		1.06	%		1.02	%		1.25	%	1.09	%
Money management accounts		0.11	%		0.11	%		0.12	%		0.12	%	0.10	%
MMDA accounts		3.17	%		3.64	%		3.20	%		3.25	%	3.54	%
Savings and club accounts		0.25	%		0.26	%		0.26	%		0.25	%	0.25	%
Time deposits		3.63	%		4.01	%		3.55	%		3.64	%	4.09	%
Subordinated loans		6.38	%		6.56	%		6.43	%		6.40	%	6.61	%
Borrowings		3.63	%		4.18	%		3.77	%		3.67	%	4.38	%
Total interest-bearing liabilities		2.91	%		3.34	%		2.88	%		2.95	%	3.34	%
Net interest rate spread		2.70	%		2.36	%		2.80	%		2.57	%	2.70	%
Net interest margin		3.25	%		2.97	%		3.34	%		3.11	%	3.34	%
Ratio of average interest-earning assets to average interest-bearing liabilities		123.35	%		121.94	%		122.95	%		122.60	%	123.61	%

The above information is unaudited and preliminary based on the Company's data available at the time of presentation.

	Nine Months Ended September 30,			2025			2024
NON-GAAP RECONCILIATIONS:	2025			2024			Q3			Q2			Q1			Q4			Q3
Tangible book value per common share:
Total equity							$	126,339			$	124,413			$	124,896			$	121,483			$	120,246
Intangible assets								(10,574	)			(10,731	)			(10,888	)			(11,045	)			(11,969	)
Tangible common equity (non-GAAP)								115,765				113,682				114,008				110,438				108,277
Common shares outstanding								6,175				6,168				6,144				6,126				6,100
Tangible book value per common share (non-GAAP)							$	18.75			$	18.43			$	18.56			$	18.03			$	17.75
Tangible common equity to tangible assets:
Tangible common equity (non-GAAP)							$	115,765			$	113,682			$	114,008			$	110,438			$	108,277
Tangible assets								1,461,694				1,494,388				1,484,449				1,463,829				1,471,157
Tangible common equity to tangible assets ratio (non-GAAP)								7.92	%			7.61	%			7.68	%			7.54	%			7.36	%
Return on average tangible common equity:
Average shareholders' equity	$	124,968			$	123,341			$	126,211			$	125,225			$	123,438			$	121,589			$	125,626
Average intangible assets		10,833				4,642				10,677				10,834				10,991				11,907				4,691
Average tangible equity (non-GAAP)		114,135				118,699				115,534				114,391				112,447				109,682				120,935
Net income (loss)		3,631				(524	)			626				31				2,974				3,907				(4,644	)
Net income (loss), annualized	$	7,322			$	(700	)		$	2,511			$	124			$	11,831			$	15,543			$	(18,475	)
Return on average tangible common equity (non-GAAP)¹		6.42	%			-0.59	%			2.17	%			0.11	%			10.52	%			14.17	%			-15.28	%
Revenue, pre-tax, pre-provision net income, and efficiency ratio:
Net interest income	$	33,825			$	30,612			$	11,600			$	10,814			$	11,411			$	10,377			$	11,732
Total noninterest income		1,182				4,655				1,503				(1,518	)			1,197				4,906				1,707
Net realized (gains) losses on sales and redemptions of investment securities		(20	)			(320	)			(12	)			-				(8	)			249				(188	)
Gains on sales of loans and foreclosed real estate		269				148				121				83				65				39				90
Fair value adjustment to loans held-for-sale²		(3,064	)			-				-				(3,064	)			-				-				-
Gain on asset sale		-				-				-				-				-				3,169				-
Revenue (non-GAAP)³		37,822				35,439				12,994				12,277				12,551				11,826				13,537
Total non-interest expense		25,430				25,873				8,936				8,061				8,433				8,544				10,259
Pre-tax, pre-provision net income (non-GAAP)⁴	$	12,392			$	9,566			$	4,058			$	4,216			$	4,118			$	3,282			$	3,278
Efficiency ratio (non-GAAP)⁵		67.24	%			73.01	%			68.77	%			65.66	%			67.19	%			72.25	%			75.78	%

¹Return on average tangible common equity equals annualized net income (loss) divided by average tangible equity
²The loss reflects a valuation adjustment“Lower-of-cost-or-market" adjustment on loans held for sale to the estimated market value based on sale negotiation terms.
³Revenue equals net interest income plus total noninterest income less net realized gains or losses on sales and redemptions of investment securities, sales of loans and foreclosed real estate, and a gain on the October 2024 sale of the Company's insurance agency asset
⁴Pre-tax, pre-provision net income equals revenue less total non-interest expense
5 Efficiency ratio equals noninterest expense divided by revenue

The above information is unaudited and preliminary based on the Company's data available at the time of presentation.

Investor/Media Contacts
James A. Dowd, President, CEO
Justin K. Bigham, Senior Vice President, CFO
Telephone: (315) 343-0057

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