Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 840

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 2
Chunk 840
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 upon the occurrence
of specific events defined within the trust indenture. Bancorp 34 has the option to defer interest payments on the subordinated debentures
from time to time, for a period not to exceed five consecutive years. Bancorp 34 has elected not to defer interest payments on the subordinated
debentures. The trust preferred securities have a variable rate of interest, reset quarterly on the 23rd of each February, May, August,
and November, equal to the sum of 3-month CME term SOFR plus 1.70%. As of December 31, 2024, the rate was 6.48%. Bancorp 34’s investment
in the common stock of the trust is $155,000, which is included in other investments and is accounted for as an unconsolidated cost-method
investment. Bancorp 34 is not considered the primary beneficiary of this trust, and therefore the trust is not consolidated in the financial
statements. Rather the subordinated debentures are shown as a liability. The remaining Merger-related fair value mark on the CBOA Financial
Statutory Trust #1 subordinated debt was $952,000 as of December 31, 2024.

Maturities of outstanding borrowings as
of December 31, 2024, were (dollars in thousands):

Schedule of maturities
of outstanding borrowings

    One year or less 
    $0 
  
    Over one through three years 
     0 
  
    Over three through five years 
     0 
  
    Over five through ten years 
     23,500 
  
    Over ten years 
     5,000 
  
    Totals 
    $28,500 

NOTE 8 –
FINANCIAL INSTRUMENTS WITH OFF BALANCE SHEET RISK

In the normal course of business, and from
time to time, the Bank has had outstanding commitments to extend credit and standby letters of credit which, consistent with GAAP,
are not reflected in the accompanying consolidated financial statements. The Bank’s exposure to credit loss in the event of
nonperformance by the other party to the financial instruments for commitments to extend credit and standby letters of credit is represented
by the contractual or notional amounts of those instruments. The Bank uses the same credit policies in making commitments as it does
for instruments that are included in the consolidated balance sheets.

Contractual or notional amounts of financial
instruments representing off