Company: NECB
Filing Date: 2025-03-11
Form Type: 8-K/A
Source: 0001104659-25-022616
Chunk: 2

Company: NorthEast Community Bancorp, Inc./MD/
Filing Date: 2025-03-11
Form: 8-K/A
Chunk 2
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 the borrower. The borrower is currently incarcerated and waiting for sentencing on
March 18, 2025.

As a result of these developments,
management determined the loan is uncollectible and has completely charged-off the $1.0 million loan effective as of December 31, 2024
due to the magnitude of the borrower’s outstanding debts to other lenders and the borrower’s incarceration for a possible
extended period thereby rendering loan repayment highly unlikely. We intend to pursue all available remedies to us.

The charge-off resulted in
a $717,000 decrease, net of taxes, to fourth quarter 2024 net income and to 2024 annual net income, comprising primarily of an increase
of $1.0 million in provision for credit loss, offset by a decrease of $283,000 in provision for income taxes. The Company also decreased
total loans by $1.0 million and total stockholders’ equity by $717,000, partially offset by an increase in other assets of $283,000.

Management has discussed the matters disclosed
in this Amendment with S.R. Snodgrass, P.C., the Company’s independent registered public accountant firm, and with the Company’s
Board of Directors and Audit Committee.

The information contained
in this Item 2.02 is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed
incorporated by reference in any filing under the Securities Act of 1933 (the “Securities Act”), or the Exchange Act, except
as expressly set forth by specific reference in such filing.

Cautionary Note Regarding Forward-Looking Statements

This report contains certain
forward-looking statements. Forward-looking statements include statements regarding anticipated future events and can be identified by
the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,”
“anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,”
“would,” “should,” “could,” or “may.” These statements are based upon the current beliefs
and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially
from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause actual results to differ
material