cbkm20260331

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 March 31, 2026

☐	Transition Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

Commission File No. 033-79130

CONSUMERS BANCORP, INC.

(Exact name of registrant as specified in its charter)

Ohio	34-1771400
(State or other jurisdiction	(I.R.S. Employer Identification No.)
of incorporation or organization)

614 East Lincoln Way, P.O. Box 256, Minerva, Ohio	44657
(Address of principal executive offices)	(Zip Code)

(330) 868-7701

(Registrant’s telephone number)

Not applicable

(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
None

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 filing 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 ☒

There were 3,144,775 shares of Registrant’s common stock, no par value, outstanding as of May 5, 2026.

CONSUMERS BANCORP, INC.

FORM 10-Q

QUARTER ENDED MARCH 31, 2026

Table of Contents

Page

Number (s)

Part I – Financial Information

Item 1 – Financial Statements
Consolidated Balance Sheets at March 31, 2026 (unaudited) and June 30, 2025	1

Consolidated Statements of Income for the three and nine months ended March 31, 2026 and 2025 (unaudited)	2

Consolidated Statements of Comprehensive Income for the three and nine months ended March 31, 2026 and 2025 (unaudited)	3

Statements of Changes in Shareholders’ Equity for the three and nine months ended March 31, 2026 and 2025 (unaudited)	4

Condensed Consolidated Statements of Cash Flows for the nine months ended March 31, 2026 and 2025 (unaudited)	5

Notes to the Consolidated Financial Statements (unaudited)	6-23

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	24-32

Item 3 – Not Applicable for Smaller Reporting Companies

Item 4 – Controls and Procedures	33
Part II – Other Information
Item 1 – Legal Proceedings	34

Item 1A – Not Applicable for Smaller Reporting Companies	34

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	34

Item 3 – Defaults Upon Senior Securities	34
,
Item 4 – Mine Safety Disclosure	34

Item 5 – Other Information	34

Item 6 – Exhibits	34

Signatures	35

PART I – FINANCIAL INFORMATION

Item 1 – Financial Statements

CONSUMERS BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)	March 31, 2026 (unaudited)			June 30, 2025
ASSETS
Cash on hand and noninterest-bearing deposits in financial institutions	$	17,219		$	19,377
Federal funds sold and interest-bearing deposits in financial institutions		102			531
Total cash and cash equivalents		17,321			19,908
Securities, available-for-sale		258,371			273,875
Securities, held-to-maturity (fair value of $4,556 at March 31, 2026 and $5,026 at June 30, 2025)		4,651			5,167
Equity securities, at fair value		—			392
Other equity securities, at cost		2,230			2,669
Loans held for sale		1,246			814
Total loans		904,057			813,458
Less allowance for credit losses		(8,868	)		(8,470	)
Net loans		895,189			804,988
Cash surrender value of life insurance		15,539			13,266
Premises and equipment, net		19,240			18,688
Goodwill		2,452			2,452
Core deposit intangible, net		259			301
Accrued interest receivable and other assets		21,670			22,488
Total assets	$	1,238,168		$	1,165,008

LIABILITIES
Deposits
Noninterest-bearing demand	$	247,075		$	239,692
Interest bearing demand		164,020			153,571
Savings		428,192			379,091
Time		270,597			264,464
Total deposits		1,109,884			1,036,818

Short-term borrowings		21,696			15,511
Federal Home Loan Bank advances		7,017			22,551
Accrued interest and other liabilities		12,717			13,857
Total liabilities		1,151,314			1,088,737
Commitments and contingent liabilities		—			—

SHAREHOLDERS’ EQUITY
Preferred stock (no par value, 350,000 shares authorized, none outstanding)		—			—
Common stock (no par value, 8,500,000 shares authorized; 3,193,414 shares issued as of March 31, 2026 and June 30, 2025, respectively)		21,851			21,590
Retained earnings		84,041			77,818
Treasury stock, at cost (48,639 common shares as of March 31, 2026 and June 30, 2025)		(528	)		(583	)
Accumulated other comprehensive loss		(18,510	)		(22,554	)
Total shareholders’ equity		86,854			76,271
Total liabilities and shareholders’ equity	$	1,238,168		$	1,165,008

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

	Three Months ended March 31,				Nine Months ended March 31,
(Dollars in thousands, except per share amounts)	2026		2025		2026			2025

Interest and dividend income
Loans, including fees	$	12,691	$	10,550	$	37,333		$	32,407
Securities, taxable		1,577		1,740		4,957			4,939
Securities, tax-exempt		523		442		1,499			1,322
Equity securities		—		8		17			25
Other equity securities		35		40		119			123
Federal funds sold and other interest-bearing deposits		80		128		181			461
Total interest and dividend income		14,906		12,908		44,106			39,277
Interest expense
Deposits		4,735		4,305		14,217			13,940
Short-term borrowings		88		65		265			383
Federal Home Loan Bank advances		17		19		108			73
Total interest expense		4,840		4,389		14,590			14,396
Net interest income		10,066		8,519		29,516			24,881
Provision for credit losses on loans		160		495		655			657
Provision for credit losses on unfunded commitments		50		15		160			10
Net interest income after provision for credit losses		9,856		8,009		28,701			24,214

Noninterest income
Service charges on deposit accounts		423		416		1,312			1,310
Debit card interchange income		647		586		1,979			1,856
Mortgage banking activity		95		72		364			262
Bank owned life insurance income		121		97		353			289
Securities losses, net		—		—		(7	)		—
Other		146		107		483			316
Total noninterest income		1,432		1,278		4,484			4,033

Noninterest expenses
Salaries and employee benefits		4,481		3,976		13,311			11,559
Occupancy and equipment		1,118		968		3,211			2,747
Data processing expenses		247		220		693			641
Debit card processing expenses		372		359		1,153			1,032
Professional and director fees		302		277		926			858
FDIC assessments		211		182		616			596
Franchise taxes		165		132		452			372
Marketing and advertising		245		234		698			609
Telephone and network communications		84		77		251			245
Amortization of intangible		14		14		42			42
Other		708		723		2,130			1,930
Total noninterest expenses		7,947		7,162		23,483			20,631
Income before income taxes		3,341		2,125		9,702			7,616
Income tax expense		524		274		1,496			1,242
Net income	$	2,817	$	1,851	$	8,206		$	6,374

Basic and diluted earnings per share	$	0.90	$	0.59	$	2.61		$	2.04

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(Dollars in thousands)	Three Months Ended March 31,						Nine Months Ended March 31,
	2026			2025			2026			2025

Net income	$	2,817		$	1,851		$	8,206		$	6,374

Other comprehensive income (loss), net of tax:
Net change in unrealized losses on securities available-for-sale:
Unrealized (losses) gains arising during the period		(1,906	)		3,278			5,111			5,896
Reclassification adjustment for net losses included in income		—			—			7			—
Net unrealized (losses) gains		(1,906	)		3,278			5,118			5,896
Income tax effect		401			(687	)		(1,074	)		(1,238	)
Other comprehensive (loss) income		(1,505	)		2,591			4,044			4,658

Total comprehensive income	$	1,312		$	4,442		$	12,250		$	11,032

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

(Dollars in thousands, except per share data)	Common Stock		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Loss			Total Shareholders’ Equity
Balance, December 31, 2025	$	21,774	$	81,885		$	(528	)	$	(17,005	)	$	86,126
Net income		—		2,817			—			—			2,817
Other comprehensive income		—		—			—			(1,505	)		(1,505	)
Restricted stock expense		77		—			—			—			77
Cash dividends declared ($0.21 per share)		—		(661	)		—			—			(661	)
Balance, March 31, 2026	$	21,851	$	84,041		$	(528	)	$	(18,510	)	$	86,854

(Dollars in thousands, except per share data)	Common Stock		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Total Shareholders’ Equity
Balance, December 31, 2024	$	21,521	$	74,867		$	(583	)	$	(26,265	)	$	69,540
Net income		—		1,851			—			—			1,851
Other comprehensive income		—		—			—			2,591			2,591
Restricted stock expense		70		—			—			—			70
Cash dividends declared ($0.19 per share)		—		(595	)		—			—			(595	)
Balance, March 31, 2025	$	21,591	$	76,123		$	(583	)	$	(23,674	)	$	73,457

(Dollars in thousands, except per share data)	Common Stock		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Total Shareholders’ Equity
Balance, June 30, 2025	$	21,590	$	77,818		$	(583	)	$	(22,554	)	$	76,271
Net income		—		8,206			—			—			8,206
Other comprehensive income		—		—			—			4,044			4,044
Restricted stock expense		230		—			—			—			230
Vesting of 4,602 shares associated with restricted stock awards		31					55						86
Cash dividends declared ($0.63 per share)		—		(1,983	)		—			—			(1,983	)
Balance, March 31, 2026	$	21,851	$	84,041		$	(528	)	$	(18,510	)	$	86,854

(Dollars in thousands, except per share data)	Common Stock		Retained Earnings			Treasury Stock			Accumulated Other Comprehensive Income (Loss)			Total Shareholders’ Equity
Balance, June 30, 2024	$	21,178	$	71,534		$	(695	)	$	(28,332	)	$	63,685
Net income		—		6,374			—			—			6,374
Other comprehensive income		—		—			—			4,658			4,658
Vesting of 8,159 shares associated with restricted stock awards		53		—			112			—			165
Issuance of 258 stock-based incentive plan shares		—		—			—			—			—
Restricted stock expense		213		—			—			—			213
Issuance of 8,087 shares associated with dividend reinvestment plan and stock purchase plan		147		—			—			—			147
Cash dividends declared ($0.57 per share)		—		(1,785	)		—			—			(1,785	)
Balance, March 31, 2025	$	21,591	$	76,123		$	(583	)	$	(23,674	)	$	73,457

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands)	Nine Months Ended March 31,
	2026			2025
Cash flows from operating activities
Net cash from operating activities	$	7,611		$	6,394
Cash flow from investing activities
Purchases of securities, available-for-sale		(14,249	)		(32,890	)
Maturities, calls and principal pay downs of securities, available-for-sale		33,616			29,260
Sale of securities, available-for-sale		1,504			—
Principal pay downs of securities, held-to-maturity		516			550
Redemption of equity security		400			—
Net change in Federal Home Loan Bank stock, at cost		439			114
Net increase in loans		(90,856	)		(9,332	)
Purchase of bank owned life insurance		(1,920	)		(2,375	)
Premises and equipment purchases		(1,382	)		(2,747	)
Net cash used in investing activities		(71,932	)		(17,420	)
Cash flow from financing activities
Net increase in deposit accounts		73,066			52,529
Net change in short-term borrowings		6,185			(13,509	)
Proceeds from Federal Home Loan advances		3,000			—
Repayments of Federal Home Loan Bank advances		(18,534	)		(9,644	)
Proceeds from dividend reinvestment and stock purchase plan		—			147
Dividends paid		(1,983	)		(1,785	)
Net cash from financing activities		61,734			27,738
(Decrease) increase in cash or cash equivalents		(2,587	)		16,712
Cash and cash equivalents, beginning of period		19,908			17,723
Cash and cash equivalents, end of period	$	17,321		$	34,435

Supplemental disclosure of cash flow information:
Cash paid during the period:
Interest	$	14,795		$	14,558
Federal income taxes		1,350			1,330
Non-cash items:
Transfer from loans to repossessed assets		—			76
Issuance of treasury stock for vested restricted stock awards		86			165

See accompanying notes to consolidated financial statements.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited)

Note 1 – Summary of Significant Accounting Policies:

Nature of Operations: Consumers Bancorp, Inc. (the Company) is a bank holding company headquartered in Minerva, Ohio that provides, through its banking subsidiary, Consumers National Bank (the Bank), a broad array of products and services throughout its primary market area of Carroll, Columbiana, Jefferson, Mahoning, Stark, Summit, and contiguous counties in Ohio, Pennsylvania, and West Virginia. The Bank’s business involves attracting deposits from businesses and individual customers and using such deposits to originate commercial, mortgage and consumer loans in its primary market area. CNB Investment Co. is a wholly-owned subsidiary of the Bank that was formed in November 2024 for the primary purpose of investing in municipal securities and is disclosed as part of the Bank.

Basis of Presentation: The consolidated financial statements for interim periods are unaudited and reflect all adjustments (consisting of only normal recurring adjustments), which, in the opinion of management, are necessary to present fairly the financial position and results of operations and cash flows for the periods presented. The unaudited financial statements are presented in accordance with the requirements of Form 10-Q and do not include all disclosures normally required by accounting principles generally accepted in the United States of America. The financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended June 30, 2025. The results of operations for the interim period disclosed herein are not necessarily indicative of the results that may be expected for a full year.

The consolidated financial statements include the accounts of the Company and the Bank. All significant inter-company transactions and accounts have been eliminated in consolidation.

Segment Information: The Company adopted Accounting Standards Update 2023-07 “Segment Reporting (Topic 280) - Improvement to Reportable Segment Disclosures” (ASU 2023-07) as of January 1, 2025. The Company's operations have been evaluated for segment reporting and management has determined operations are managed along one operating segment, banking. While the Company’s chief operating decision maker (CODM) monitors the revenue streams of the Company’s various products and services, operations are managed, and financial performance is evaluated on a Company-wide basis. The Company has determined that all of its financial service operations meet the aggregation criteria of ASC 280, Segment Reporting, as its current operating model is structured whereby financial service operations serve a similar base of retail and commercial customers utilizing a company-wide offering of similar products and services managed through similar processes that are collectively reviewed by the Company's Chief Executive Officer, who has been identified as the CODM. Therefore, all the Company’s financial service operations are considered by the CODM to be aggregated in one reportable operating segment.

Our CODM evaluates interest and noninterest income streams and credit losses from our various products and services, while expense activities, including interest expense and noninterest expense, are managed, and financial performance is evaluated, on a Company-wide basis. As a result, detailed profitability information for each interest and noninterest income stream is not used to allocate resources or in assessing performance. Rather, the CODM uses consolidated net income to assess performance by comparing it to and monitoring it against budgeted and prior year results. This information is used to manage resources to drive business and net income growth, including investment in key strategic priorities, as well as to determine our ability to return capital to shareholders. Segment assets represent total assets on our Consolidated Balance Sheets and segment net income represents net income on our Consolidated Statements of Income. All the Company's earnings relate to its operations within the United States.

Reclassifications: Certain items in prior financial statements have been reclassified to conform to the current presentation. Any reclassifications had no impact on prior year net income or shareholders’ equity.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 2 – Securities

Debt securities

The following tables summarize the amortized cost, fair value, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive loss on the Company’s debt securities available-for-sale and gross unrecognized losses on the Company’s debt securities held-to-maturity as of March 31, 2026, and June 30, 2025:

Available –for-Sale	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
March 31, 2026
Obligations of U.S. Treasury	$	998	$	—	$	(12	)	$	986
Obligations of U.S. government-sponsored entities and agencies		23,386		10		(2,055	)		21,341
Obligations of state and political subdivisions		84,793		110		(6,449	)		78,454
U.S. Government-sponsored mortgage-backed securities–residential		85,684		69		(9,738	)		76,015
U.S. Government-sponsored mortgage-backed securities– commercial		8,553		—		(1,291	)		7,262
U.S. Government-sponsored collateralized mortgage obligations– residential		66,466		295		(4,251	)		62,510
Other debt securities		11,922		96		(215	)		11,803
Total securities available-for-sale	$	281,802	$	580	$	(24,011	)	$	258,371

Held-to-Maturity

Amortized
Cost

Gross
Unrecognized
Gains

Gross
Unrecognized

Losses

Fair
Value

March 31, 2026

Obligations of state and political subdivisions

4,651

—

(95

)

4,556

Available-for-sale	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
June 30, 2025
Obligation of U.S Treasury	$	2,991	$	—	$	(54	)	$	2,937
Obligations of U.S. government-sponsored entities and agencies		26,117		47		(2,427	)		23,737
Obligations of state and political subdivisions		84,120		24		(8,685	)		75,459
U.S. Government-sponsored mortgage-backed securities - residential		91,676		96		(11,440	)		80,332
U.S. Government-sponsored mortgage-backed securities - commercial		8,567		—		(1,461	)		7,106
U.S. Government-sponsored collateralized mortgage obligations – residential		71,134		470		(4,543	)		67,061
Other debt securities		17,819		58		(634	)		17,243
Total securities available-for-sale	$	302,424	$	695	$	(29,244	)	$	273,875

Held-to-maturity

Amortized
Cost

Gross
Unrecognized
Gains

Gross
Unrecognized

Losses

Fair
Value

June 30, 2025

Obligations of state and political subdivisions

5,167

—

(141

)

5,026

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Proceeds from the sale of available-for-sale securities were as follows:

	Three Months Ended March 31,				Nine Months Ended March 31,
	2026		2025		2026			2025
Proceeds from sales	$	585	$	—	$	1,504		$	—
Gross realized losses		—		—		(26	)		—

The income tax benefit related to the realized losses was $5 for the nine-month period ended March 31, 2026.

The amortized cost and fair values of debt securities as of March 31, 2026, by expected maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date, primarily mortgage-backed securities, are shown separately.

Available-for-Sale	Amortized Cost		Estimated Fair Value
Due in one year or less	$	4,285	$	4,261
Due after one year through five years		37,250		35,753
Due after five years through ten years		23,867		22,834
Due after ten years		55,697		49,736
Total		121,099		112,584

U.S. Government-sponsored mortgage-backed and related securities		160,703		145,787
Total securities available-for-sale	$	281,802	$	258,371

Held-to-Maturity
Due after one year through five years	$	1,625	$	1,598
Due after five years through ten years		3,026		2,958
Total securities held-to-maturity	$	4,651	$	4,556

Securities with a carrying value of approximately $153,682 and $164,473 were pledged at March 31, 2026 and June 30, 2025, respectively, to secure public deposits and commitments as required or permitted by law.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following tables summarize the debt securities with unrealized and unrecognized losses as of March 31, 2026 and June 30, 2025, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:

	Less than 12 Months					12 Months or more					Total
Available-for-sale	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
March 31, 2026
Obligation of U.S. Treasury	$	—	$	—		$	986		(12	)	$	986	$	(12	)
Obligations of U.S. government-sponsored entities and agencies		834		(4	)		18,742		(2,051	)		19,576		(2,055	)
Obligations of state and political subdivisions		13,158		(272	)		51,186		(6,177	)		64,344		(6,449	)
U.S. Government-sponsored mortgage-backed securities – residential		5,003		(23	)		63,738		(9,715	)		68,741		(9,738	)
U.S. Government-sponsored mortgage-backed securities – commercial		—		—			7,262		(1,291	)		7,262		(1,291	)
U.S. Government-sponsored collateralized mortgage obligations - residential		12,366		(154	)		29,825		(4,097	)		42,191		(4,251	)
Other debt securities		1,486		(14	)		7,851		(201	)		9,337		(215	)
Total	$	32,847	$	(467	)	$	179,590	$	(23,544	)	$	212,437	$	(24,011	)

	Less than 12 Months					12 Months or more					Total
Held to Maturity	Fair Value		Unrecognized Loss			Fair Value		Unrecognized Loss			Fair Value		Unrecognized Loss
March 31, 2026
Obligations of state and political subdivisions	$	3,289	$	(70	)	$	1,267	$	(25	)	$	4,556	$	(95	)

	Less than 12 Months					12 Months or more					Total
Available-for-sale	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
June 30, 2025
Obligations of U.S. Treasury	$	—	$	—		$	2,937	$	(54	)	$	2,937	$	(54	)
Obligations of U.S. government-sponsored entities and agencies		—		—			20,898		(2,427	)		20,898		(2,427	)
Obligations of state and political subdivisions		6,867		(308	)		62,570		(8,377	)		69,437		(8,685	)
U.S. Government-sponsored mortgage-backed securities – residential		1,134		(5	)		70,955		(11,435	)		72,089		(11,440	)
U.S. Government-sponsored mortgage-backed securities – commercial		—		—			7,106		(1,461	)		7,106		(1,461	)
U.S. Government-sponsored collateralized mortgage obligations - residential		7,018		(76	)		32,632		(4,467	)		39,650		(4,543	)
Other debt securities		970		(12	)		13,327		(622	)		14,297		(634	)
Total	$	15,989	$	(401	)	$	210,425	$	(28,843	)	$	226,414	$	(29,244	)

	Less than 12 Months				12 Months or more					Total
Held to Maturity	Fair Value		Unrecognized Loss		Fair Value		Unrecognized Loss			Fair Value		Unrecognized Loss
June 30, 2025
Obligations of state and political subdivisions	$	—	$	—	$	5,026	$	(141	)	$	5,026	$	(141	)

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

At March 31, 2026, the Company’s portfolio consisted of 404 securities, of which 330 were available-for-sale and 3 were held-to-maturity securities in unrealized or unrecognized loss positions. As of March 31, 2026, no allowance for credit losses has been recognized on securities in an unrealized loss position as management does not believe any of the securities are impaired due to reasons of credit quality. This is based upon our analysis of the underlying risk characteristics, including credit ratings, and other qualitative factors related to our available-for-sale securities.

The Company’s mortgage-backed securities and collateralized mortgage obligations were issued by U.S. government-sponsored entities and agencies. The Company does not own any private label mortgage-backed securities. The Company’s municipal bond portfolio consists of tax-exempt and taxable general obligation and revenue bonds to a broad range of counties, towns, school districts, and other essential service providers. As of March 31, 2026, 97.5% of the municipal bonds held in the available-for-sale portfolio had an S&P or Moody’s investment grade rating, and 2.5% were non-rated issues. The municipal bonds in the held-to-maturity portfolio are all non-rated issues to local entities that also are deposit customers. The other debt securities consist of subordinated notes issued by other bank holding companies.

The issuers of all securities owned by the Company continue to make timely principal and interest payments under the securities’ contractual terms. The unrealized losses related to these securities have not been recognized into income because the decline in fair value is not attributed to credit quality, management does not intend to sell the securities, and it is not likely that management will be required to sell the securities prior to their anticipated recovery. The unrealized losses on these securities are primarily due to increases in market interest rates over the yields available at the time the underlying securities were purchased. The securities’ fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such investments decline.

Equity Securities

The Company owned equity securities with an amortized cost of $400 and a fair value of $392 as of June 30, 2025. The equity securities were redeemed on December 31, 2025 for their original cost of $400. Therefore, the Company recognized a net gain of $8 in other noninterest income during the nine-month period ended March 31, 2026. There was no gain or loss on equity securities recognized in earnings during the three- and nine-month periods ended March 31, 2025.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 3 – Loans and Allowance for Credit Losses

The following table presents loans by major category.

	March 31, 2026			June 30, 2025
Commercial & Industrial	$	153,408		$	113,513
Commercial real estate:
Owner occupied		166,698			162,674
Non-owner occupied		183,035			163,768
Farmland		47,848			42,050
Land Development		17,788			17,535
1 – 4 family residential real estate		207,548			201,602
Consumer		127,732			112,316
Total loans		904,057			813,458
Allowance for credit losses		(8,868	)		(8,470	)
Net Loans	$	895,189		$	804,988

Total loans include net unamortized deferred loan costs of $2,925 as of March 31, 2026 and $2,674 as of June 30, 2025. Commercial & Industrial loans include a third-party residential mortgage warehouse line-of-credit with an outstanding balance of $19,130 as of March 31, 2026 and a zero balance as of June 30, 2025.

The following table presents the activity in the allowance for credit losses by portfolio segment for the three months ended March 31, 2026.

	Commercial			Commercial									1-4 Family
	&			Real						Land			Residential
	Industrial			Estate			Farmland			Development			Real Estate			Consumer			Total

ACL beginning balance	$	1,299		$	3,650		$	129		$	242		$	2,013		$	1,444		$	8,777
Provision for expected credit losses		232			(87	)		(23	)		(29	)		(140	)		207			160
Charge-offs		(6	)		—			—			—			—			(115	)		(121	)
Recoveries		6			3			—			—			1			42			52
ACL ending balance	$	1,531		$	3,566		$	106		$	213		$	1,874		$	1,578		$	8,868

The following table presents the activity in the allowance for credit losses by portfolio segment for the nine months ended March 31, 2026.

	Commercial			Commercial								1-4 Family
	&			Real					Land			Residential
	Industrial			Estate		Farmland			Development			Real Estate			Consumer			Total

ACL beginning balance	$	1,249		$	3,446	$	118		$	266		$	2,010		$	1,381		$	8,470
Provision for expected credit losses		289			117		(12	)		(53	)		(137	)		451			655
Charge-offs		(13	)		—		—			—			—			(371	)		(384	)
Recoveries		6			3		—			—			1			117			127
ACL ending balance	$	1,531		$	3,566	$	106		$	213		$	1,874		$	1,578		$	8,868

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the activity in the allowance for credit losses by portfolio segment for the three months ended March 31, 2025.

											1-4 Family
	Commercial			Commercial							Residential
	&			Real					Land		Real
	Industrial			Estate			Farmland		Development		Estate			Consumer			Total

ACL beginning balance	$	1,076		$	3,478		$	93	$	178	$	2,086		$	933		$	7,844
Provision for expected credit losses		359			(170	)		12		20		(92	)		366			495
Charge-offs		(186	)		—			—		—		—			(167	)		(353	)
Recoveries		—			—			—		—		—			61			61
ACL ending balance	$	1,249		$	3,308		$	105	$	198	$	1,994		$	1,193		$	8,047

The following table presents the activity in the allowance for credit losses by portfolio segment for the nine months ended March 31, 2025.

											1-4 Family
	Commercial			Commercial							Residential
	&			Real					Land		Real
	Industrial			Estate			Farmland		Development		Estate			Consumer			Total

ACL beginning balance	$	1,144		$	3,650		$	89	$	174	$	2,018		$	855		$	7,930
Provision for expected credit losses		354			(342	)		16		24		(26	)		631			657
Charge-offs		(250	)		—			—		—		—			(449	)		(699	)
Recoveries		1			—			—		—		2			156			159
ACL ending balance	$	1,249		$	3,308		$	105	$	198	$	1,994		$	1,193		$	8,047

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the amortized cost of non-accrual loans by class as of March 31, 2026 and the interest income recognized on non-accrual loans for the three- and nine- month periods ended March 31, 2026:

	March 31, 2026
	Non-accrual		Total		Interest income recognized
	loans with		Non-accrual		During the periods presented
	no ACL		Loans		on non-accrual loans
					Three-month Period		Nine-month Period
Commercial & Industrial	$	140	$	140	$	—	$	—
1 – 4 family residential real estate		386		386		3		5
Total	$	526	$	526	$	3	$	5

The following table presents the amortized cost of non-accrual loans by class as of June 30, 2025 and the interest income recognized on non-accrual loans for the three- and nine -month periods ended March 31, 2025:

	June 30, 2025				March 31, 2025
	Non-accrual		Total		Interest Income Recognized
	loans with		Non-accrual		During the periods presented
	no ACL		loans		on non-accrual loans
					Three-month Period		Nine-month Period
Commercial & Industrial	$	332	$	332	$	—	$	—
Commercial real estate:
Owner occupied		—		—		—		16
1 – 4 family residential real estate		440		598		—		—
Total	$	772	$	930	$	—	$	16

The following table presents the aging of the amortized cost of past due loans as of March 31, 2026 by class of loans:

													Loans 90
	Days Past Due												Days Past
	30 – 59		60 - 89		90 Days or		Total		Loans Not				Due and
	Days		Days		Greater		Past Due		Past Due		Total		Accruing
Commercial & Industrial	$	—	$	—	$	140	$	140	$	153,268	$	153,408	$	—
Commercial real estate:
Owner occupied		—		—		—		—		166,698		166,698		—
Non-owner occupied		—		—		—		—		183,035		183,035		—
Farmland		—		—		—		—		47,848		47,848		—
Land development		—		—		—		—		17,788		17,788		—
1 – 4 family residential real estate		903		64		299		1,266		206,282		207,548		—
Consumer		186		27		21		234		127,498		127,732		21
Total	$	1,089	$	91	$	460	$	1,640	$	902,417	$	904,057	$	21

The above table of past due loans includes the recorded investment in non-accrual loans of $62 in the 60-89 days past due category, $439 in the 90 days or greater category, and $25 in the loans not past due category.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table presents the aging of the amortized cost of past due loans as of June 30, 2025 by class of loans:

													Loans 90
	Days Past Due												Days Past
	30 – 59		60 - 89		90 Days or		Total		Loans Not				Due and
	Days		Days		Greater		Past Due		Past Due		Total		Accruing
Commercial & Industrial	$	77	$	48	$	332	$	457	$	113,056	$	113,513	$	—
Commercial real estate:
Owner occupied		—		—		—		—		162,674		162,674		—
Non-owner occupied		—		—		—		—		163,768		163,768		—
Farmland		—		—		—		—		42,050		42,050		—
Land development		—		—		—		—		17,535		17,535		—
1 – 4 family residential real estate		57		161		374		592		201,010		201,602		—
Consumer		245		33		101		379		111,937		112,316		101
Total	$	379	$	242	$	807	$	1,428	$	812,030	$	813,458	$	101

The above table includes the recorded investment in non-accrual loans of $73 in the loans not past due category, $151 in the 60 – 89 days past due category, and $706 in the 90 days or greater category.

Modifications to Borrowers Experiencing Financial Difficulty

Occasionally, the Company modifies loans to borrowers experiencing financial difficulty to maximize collection of loan balances by providing principal forgiveness, term extension, an other than insignificant payment delay, or an interest rate reduction. In some cases, the Company may provide multiple types of concessions on one loan. If principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses. There were no modifications of loans to borrowers experiencing financial difficulty completed during the three- or nine- month periods ending March 31, 2026 and 2025.

Collateral Dependent Loans

A loan is considered collateral dependent when, based upon management's assessment, the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. In such cases, expected credit losses are based on the fair value of the collateral at the measurement date, adjusted for estimated selling costs if satisfaction of the loan depends on the sale of the collateral. As of March 31, 2026, there was one 1-4 family residential loan that was collateral dependent with an amortized cost of $120 with no allowance for credit losses allocated to it. As of June 30, 2025, there was one 1-4 family residential real estate loan that was collateral dependent with an amortized cost of $158 and $52 of the allowance for credit losses allocated to it.

Credit Quality Indicators:

The Company 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, current economic trends and other relevant information. At the time of origination, the Company analyzes all commercial loans individually and classifies the loans by credit risk. Management regularly monitors commercial loans for any changes in the borrowers’ ability to service their debt and completes an annual review to confirm the risk rating for those loans with total outstanding loan relationships greater than $500. The Company uses the following definitions for risk ratings:

Pass. Loans classified as pass exhibit a wide array of characteristics but at a minimum represent minimal level of risk and are considered collectable. Borrowers in this rating may have leveraged but acceptable balance sheet positions, satisfactory asset quality, stable to favorable sales and earnings trends, acceptable liquidity, and adequate cash flow. While generally adhering to credit policy, these loans may exhibit occasional exceptions that do not result in undue risk. Borrowers are generally capable of absorbing setbacks, financial and otherwise.

Special Mention. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Substandard. Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful. Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Not Rated. Loans listed as not rated are included in groups of homogeneous loans. Past due information is the primary credit indicator for groups of homogenous loans.

Based on the most recent analysis performed, the following tables present the amortized cost by internal risk category and class of loans as of March 31, 2026:

													Revolving		Revolving
													Loans		Loans
	Term Loans by Fiscal Year of Origination												Amortized		Converted
	2026		2025		2024		2023		2022		Prior		Cost Basis		To Term		Total
Commercial & Industrial
Pass	$	33,601	$	28,754	$	10,711	$	12,904	$	12,825	$	6,767	$	46,075	$	—	$	151,637
Special Mention		—		—		—		75		—		326		877		—		1,278
Substandard		—		—		21		—		116		117		239		—		493
Doubtful		—		—		—		—		—		—		—		—		—
Total Commercial & Industrial	$	33,601	$	28,754	$	10,732	$	12,979	$	12,941	$	7,210	$	47,191	$	—	$	153,408
Current year-to-date gross write-offs	$	—	$	7	$	—	$	—	$	—	$	6	$	—	$	—	$	13
Commercial real estate:
Owner occupied:
Pass	$	21,655	$	11,118	$	15,817	$	17,556	$	25,011	$	57,987	$	3,583	$	—	$	152,727
Special Mention		—		2,352		1,582		—		—		1,608		35		—		5,577
Substandard		—		—		5,865		—		—		2,207		187		135		8,394
Doubtful		—		—		—		—		—		—		—		—		—
Total owner occupied	$	21,655	$	13,470	$	23,264	$	17,556	$	25,011	$	61,802	$	3,805	$	135	$	166,698
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Non-owner occupied:
Pass	$	36,348	$	25,054	$	7,496	$	35,136	$	18,071	$	58,969	$	1,961	$	—	$	183,035
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total non-owner occupied	$	36,348	$	25,054	$	7,496	$	35,136	$	18,071	$	58,969	$	1,961	$	—	$	183,035
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Farmland:
Pass	$	5,508	$	9,520	$	1,736	$	5,565	$	5,055	$	19,323	$	1,027	$	114	$	47,848
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total Farmland	$	5,508	$	9,520	$	1,736	$	5,565	$	5,055	$	19,323	$	1,027	$	114	$	47,848
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

													Revolving			Revolving
													Loans			Loans
	Term Loans by Fiscal Year of Origination												Amortized			Converted
	2026		2025		2024		2023		2022		Prior		Cost Basis			To Term		Total
Land Development:
Pass	$	3,176	$	5,564	$	6,270	$	1,906	$	303	$	604	$	(35	)	$	—	$	17,788
Special Mention		—		—		—		—		—		—		—			—		—
Substandard		—		—		—		—		—		—		—			—		—
Doubtful		—		—		—		—		—		—		—			—		—
Total Land Development	$	3,176	$	5,564	$	6,270	$	1,906	$	303	$	604	$	(35	)	$	—	$	17,788
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—		$	—	$	—
Total:
Pass	$	100,288	$	80,010	$	42,030	$	73,067	$	61,265	$	143,650	$	52,611		$	114	$	553,035
Special Mention		—		2,352		1,582		75		—		1,934		912			—		6,855
Substandard		—		—		5,886		—		116		2,324		426			135		8,887
Doubtful		—		—		—		—		—		—		—			—		—
Total	$	100,288	$	82,362	$	49,498	$	73,142	$	61,381	$	147,908	$	53,949		$	249	$	568,777

Management monitors the credit risk profile by payment activity for residential and consumer loan classes. Loans past due 90 days or more and loans on nonaccrual are considered nonperforming. The following table presents the amortized cost of residential real estate and consumer loans based on payment status as of March 31, 2026:

													Revolving		Revolving
													Loans		Loans
	Term Loans by Fiscal Year of Origination												Amortized		Converted
	2026		2025		2024		2023		2022		Prior		Cost Basis		To Term		Total
1 – 4 family residential real estate:
Performing	$	17,043	$	23,044	$	15,256	$	17,491	$	26,123	$	77,576	$	30,629	$	—	$	207,162
Nonperforming		—		—		—		182		173		31		—		—		386
Total 1-4 family residential real estate	$	17,043	$	23,044	$	15,256	$	17,673	$	26,296	$	77,607	$	30,629	$	—	$	207,548
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Performing	$	46,829	$	51,250	$	14,483	$	10,410	$	3,875	$	864	$	—	$	—	$	127,711
Nonperforming		—		—		—		14		7		—		—		—		21
Total consumer	$	46,829	$	51,250	$	14,483	$	10,424	$	3,882	$	864	$	—	$	—	$	127,732
Current year-to-date gross write-offs	$	17	$	63	$	23	$	129	$	111	$	28	$	—	$	—	$	371
Total:
Performing	$	63,872	$	74,294	$	29,739	$	27,901	$	29,998	$	78,440	$	30,629	$	—	$	334,873
Nonperforming		—		—		—		196		180		31		—		—		407
Total	$	63,872	$	74,294	$	29,739	$	28,097	$	30,178	$	78,471	$	30,629	$	—	$	335,280

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Based on the most recent analysis performed, the following tables present the amortized cost by internal risk category and class of commercial loans as of June 30, 2025:

													Revolving		Revolving
													Loans		Loans
	Term Loans by Fiscal Year of Origination												Amortized		Converted
	2025		2024		2023		2022		2021		Prior		Cost Basis		To Term		Total
Commercial & Industrial
Pass	$	31,506	$	13,318	$	17,215	$	16,821	$	4,604	$	4,677	$	23,164	$	91	$	111,396
Special Mention		—		411		80		183		375		145		923		—		2,117
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total Commercial & Industrial	$	31,506	$	13,729	$	17,295	$	17,004	$	4,979	$	4,822	$	24,087	$	91	$	113,513
Current year-to-date gross write-offs	$	49	$	40	$	—	$	—	$	64	$	—	$	—	$	100	$	253
Commercial real estate:
Owner occupied:
Pass	$	12,350	$	16,042	$	21,391	$	26,435	$	19,268	$	48,946	$	4,452	$	—	$	148,884
Special Mention		2,320		7,582		—		—		619		2,701		411		—		13,633
Substandard		—		—		—		—		—		157		—		—		157
Doubtful		—		—		—		—		—		—		—		—		—
Total owner occupied	$	14,670	$	23,624	$	21,391	$	26,435	$	19,887	$	51,804	$	4,863	$	—	$	162,674
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Non-owner occupied:
Pass	$	28,937	$	13,970	$	35,895	$	18,667	$	21,883	$	42,916	$	1,500	$	—	$	163,768
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total non-owner occupied	$	28,937	$	13,970	$	35,895	$	18,667	$	21,883	$	42,916	$	1,500	$	—	$	163,768
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Farmland:
Pass	$	6,063	$	1,759	$	5,696	$	5,648	$	5,084	$	16,448	$	1,225	$	127	$	42,050
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total Farmland	$	6,063	$	1,759	$	5,696	$	5,648	$	5,084	$	16,448	$	1,225	$	127	$	42,050
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Land Development:
Pass	$	4,922	$	7,912	$	1,950	$	324	$	332	$	494	$	1,601	$	—	$	17,535
Special Mention		—		—		—		—		—		—		—		—		—
Substandard		—		—		—		—		—		—		—		—		—
Doubtful		—		—		—		—		—		—		—		—		—
Total Land Development	$	4,922	$	7,912	$	1,950	$	324	$	332	$	494	$	1,601	$	—	$	17,535
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Total:
Pass	$	83,778	$	53,001	$	82,147	$	67,895	$	51,171	$	113,481	$	31,942	$	218	$	483,633
Special Mention		2,320		7,993		80		183		994		2,846		1,334		—		15,750
Substandard		—		—		—		—		—		157		—		—		157
Doubtful		—		—		—		—		—		—		—		—		—
Total	$	86,098	$	60,994	$	82,227	$	68,078	$	52,165	$	116,484	$	33,276	$	218	$	499,540

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

													Revolving		Revolving
													Loans		Loans
	Term Loans by Fiscal Year of Origination												Amortized		Converted
	2025		2024		2023		2022		2021		Prior		Cost Basis		To Term		Total
1 – 4 family residential real estate:
Performing	$	20,297	$	18,547	$	19,403	$	27,391	$	45,186	$	41,453	$	28,663	$	63	$	201,003
Nonperforming		—		—		185		199		—		215		—		—		599
Total 1-4 family residential real estate	$	20,297	$	18,547	$	19,588	$	27,590	$	45,186	$	41,668	$	28,663	$	63	$	201,602
Current year-to-date gross write-offs	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Consumer:
Performing	$	66,567	$	20,500	$	16,079	$	6,950	$	1,838	$	186	$	95	$	—	$	112,215
Nonperforming		—		—		72		29		—		—		—		—		101
Total consumer	$	66,567	$	20,500	$	16,151	$	6,979	$	1,838	$	186	$	95	$	—	$	112,316
Current year-to-date gross write-offs	$	49	$	26	$	199	$	251	$	19	$	2	$	—	$	—	$	546
Total:
Performing	$	86,864	$	39,047	$	35,482	$	34,341	$	47,024	$	41,639	$	28,758	$	63	$	313,218
Nonperforming		—		—		257		228		—		215		—		—		700
Total	$	86,864	$	39,047	$	35,739	$	34,569	$	47,024	$	41,854	$	28,758	$	63	$	313,918

Note 4 - Fair Value

Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. There are three levels of inputs that may be used to measure fair values:

Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3: Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Financial assets and financial liabilities measured at fair value on a recurring basis include the following:

Securities available-for-sale: When available, the fair values of available-for-sale securities are determined by obtaining quoted prices on nationally recognized securities exchanges (Level 1 inputs). For securities where quoted market prices are not available, fair values are calculated based on market prices of similar securities (Level 2 inputs). For securities where quoted prices or market prices of similar securities are not available, fair values are calculated using discounted cash flows or other unobservable inputs (Level 3 inputs).

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Assets and liabilities measured at fair value on a recurring basis are summarized below, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

	Balance at March 31,		Fair Value Measurements at March 31, 2026
	2026		Level 1		Level 2		Level 3
Assets:
Obligations of U.S. Treasury	$	986	$	986	$	—	$	—
Obligations of U.S. government-sponsored entities and agencies		21,341		—		21,341		—
Obligations of state and political subdivisions		78,454		—		78,454		—
U.S. Government-sponsored mortgage-backed securities – residential		76,015		—		76,015		—
U.S. Government-sponsored mortgage-backed securities – commercial		7,262		—		7,262		—
U.S. Government-sponsored collateralized mortgage obligations - residential		62,510		—		62,510		—
Other debt securities		11,803		—		11,803		—

	Balance at June 30,		Fair Value Measurements at June 30, 2025
	2025		Level 1		Level 2		Level 3
Assets:
Obligations of U.S. treasury	$	2,937	$	2,937	$	—	$	—
Obligations of U.S. government-sponsored entities and agencies		23,737		—		23,737		—
Obligations of state and political subdivisions		75,459		—		75,459		—
U.S. government-sponsored mortgage-backed securities - residential		80,332		—		80,332		—
U.S. government-sponsored mortgage-backed securities - commercial		7,106		—		7,106		—
U.S. government-sponsored collateralized mortgage obligations - residential		67,061		—		67,061		—
Other debt securities		17,243		—		17,243		—
Equity securities		392		—		392		—

Certain assets and liabilities are measured at fair value on a non-recurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances. Assets that may be recorded at fair value on a nonrecurring basis include individually evaluated collateral dependent loans, other real estate owned, and other repossessed assets.

Collateral Dependent Loans: The fair value of collateral dependent loans with specific allocations of the allowance for credit losses is generally based on recent real estate appraisals. Collateral dependent individually evaluated loans carried at fair value generally receive specific allocations of the allowance for credit losses or are charged down to their fair value. These appraisals may utilize a single valuation approach or a combination of approaches including comparable sales and the income approach. Adjustments are routinely made in the appraisal process by the appraisers to adjust for differences between the comparable sales and income data available. Such adjustments are usually significant and typically result in a Level 3 classification of the inputs for determining fair value. There were no collateral dependent individually evaluated loans measured at fair value on a non-recurring basis at March 31, 2026 or June 30, 2025.

Other Real Estate and Repossessed Assets Owned: Assets acquired through or instead of loan foreclosure are initially recorded at fair value less costs to sell when acquired, establishing a new cost basis. Subsequent to their initial recognition, these assets are remeasured at fair value, which is the lower of cost or fair value less estimated costs to sell, through a write-down included in other non-interest expense. Real estate owned properties and other repossessed assets, which are primarily vehicles, are evaluated on a quarterly basis for additional impairment and adjusted accordingly. There were no such fair value measurement adjustments recorded during the three- and nine-month periods ended March 31, 2026 or 2025. There were no other real estate owned and other repossessed assets as of March 31, 2026 or June 30, 2025.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

The following table shows the estimated fair values of financial instruments that are reported at amortized cost in the Company’s consolidated balance sheets, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:

	March 31, 2026				June 30, 2025
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Financial Assets:
Level 1 inputs:
Cash and cash equivalents	$	17,321	$	17,321	$	19,908	$	19,908
Level 2 inputs:
Loans held for sale		1,246		1,260		814		833
Accrued interest receivable		3,875		3,875		3,704		3,704
Level 3 inputs:
Securities held-to-maturity		4,651		4,556		5,167		5,026
Loans, net		895,189		879,133		804,988		779,964
Financial Liabilities:
Level 2 inputs:
Demand and savings deposits		839,287		839,287		772,354		772,354
Time deposits		270,597		270,125		264,464		263,250
Short-term borrowings		21,696		21,696		15,511		15,511
Federal Home Loan Bank advances		7,017		6,621		22,551		20,677
Accrued interest payable		471		471		676		676

The assumptions used to estimate fair value are described as follows:

Cash and cash equivalents: The carrying value of cash and deposits in other financial institutions were considered to approximate fair value resulting in a Level 1 classification.

Accrued interest receivable and payable, demand and savings deposits and short-term borrowings: The carrying value of accrued interest receivable and payable, demand and savings deposits and short-term borrowings were considered to approximate fair value due to their short-term duration resulting in a Level 2 classification.

Loans held for sale: The fair value of loans held for sale is estimated based upon binding contracts and quotes from third party investors resulting in a Level 2 classification.

Loans: Fair value for loans was estimated for portfolios of loans with similar financial characteristics. The estimated fair value approximates carrying value for variable-rate loans that reprice frequently and with no significant change in credit risk. The fair value of fixed-rate loans and variable-rate loans which reprice on an infrequent basis is estimated by discounting future cash flows using the current interest rates at which similar loans with similar terms would be made to borrowers of similar credit quality resulting in a Level 3 classification. An overall valuation adjustment is made for specific credit risks as well as general portfolio credit risk.

Securities held-to-maturity: The held-to-maturity securities are general obligation and revenue bonds issued by local municipalities. The fair value of these securities are calculated using a spread to the applicable municipal fair market curve resulting in a Level 3 classification.

Time deposits: Fair value of fixed-maturity certificates of deposit was estimated using the rates offered at March 31, 2026 and June 30, 2025 for deposits of similar remaining maturities, resulting in Level 2 classification. Estimated fair value does not include the benefit that results from low-cost funding provided by the deposit liabilities compared to the cost of borrowing funds in the market.

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Federal Home Loan Bank advances: Fair value of Federal Home Loan Bank advances was estimated using current rates at March 31, 2026 and June 30, 2025 for similar financing resulting in a Level 2 classification.

Other equity securities, at cost: Other equity securities, primarily consist of Federal Home Loan Bank stock, Federal Reserve Bank stock, and other equity investments in financial institutions. These equity securities are accounted for at cost due to restrictions placed on their transferability, and, therefore, are not subject to the fair value disclosure requirements.

Off-balance sheet commitments: The Company’s lending commitments have variable interest rates and “escape” clauses if the customer’s credit quality deteriorates. Therefore, the fair values of these items are not significant and are not included in the above table.

Note 5—Affordable Housing Tax Credit Partnership

In April 2023, the Company invested in a limited partnership that in turn invested in qualified affordable housing projects that will generate tax benefits for the limited partner investors, including federal low-income housing tax credits pursuant to Section 42 of the Internal Revenue Code. This partnership investment is an unconsolidated Variable Interest Entity (VIE) for which the Company holds an interest in but is not the primary beneficiary of the VIE. The purpose of this investment is to achieve a satisfactory return on capital, to facilitate the sale of additional affordable housing product offerings, and to assist in achieving goals associated with the Community Reinvestment Act. The primary activities of the limited partnership include the identification, development, and operation of multi-family housing that is leased to qualifying residential tenants. Generally, these types of investments are funded through a combination of debt and equity.

The Company uses the proportional amortization method to account for its investment. The investment is included in other assets and the unfunded commitment is included in other liabilities. As a limited partner, there is no recourse to the Company by the creditors of the limited partnership, however, the tax credits are generally subject to recapture should the partnership fail to comply with the applicable government regulations.

The following table summarizes the balances of the affordable housing tax credit investment and related unfunded commitment at March 31, 2026 and June 30, 2025.

	March 31, 2026			June 30, 2025
Affordable housing tax credit investment	$	9,335		$	9,853
Less: amortization		(647	)		(518	)
Net affordable housing tax credit investment	$	8,688		$	9,335
Unfunded commitments	$	3,710		$	5,035

The following summarizes other information relating to the affordable housing tax credit investment for the three-and nine month periods ended March 31, 2026, and 2025.

	Three Months Ended March 31,				Nine Months Ended March 31,
	2026		2025		2026		2025
Tax credits and other tax benefits recognized	$	239	$	193	$	777	$	465
Proportional amortization expense included in provision for income taxes		203		142		647		376

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 6 – Earnings Per Share

Basic earnings per share is the amount of earnings available to each share of common stock outstanding during the reporting period and is equal to net income divided by the weighted average number of shares outstanding during the period. Diluted earnings per share is the amount of earnings available to each share of common stock outstanding during the reporting period adjusted to include the effect of potentially dilutive common shares that may be issued upon the vesting of restricted stock awards. There were no shares that were anti-dilutive for the three- and nine-month periods ending March 31, 2026. There were no shares that were anti-dilutive for the three-month period ended March 31, 2025, and 6,083 shares of restricted stock were anti- dilutive for the nine-month period ended March 31, 2025. The following table details the calculation of basic and diluted earnings per share:

	For the Three Months Ended March 31,				For the Nine Months Ended March 31,
	2026		2025		2026		2025
Basic:
Net income available to common shareholders	$	2,817	$	1,851	$	8,206	$	6,374
Weighted average common shares outstanding		3,146,665		3,139,105		3,148,512		3,130,077
Basic income per share	$	0.90	$	0.59	$	2.61	$	2.04

Diluted:
Net income available to common shareholders	$	2,817	$	1,851	$	8,206	$	6,374
Weighted average common shares outstanding		3,146,665		3,139,105		3,148,512		3,130,077
Dilutive effect of restricted stock		92		44		119		—
Total common shares and dilutive potential common shares		3,146,758		3,139,149		3,148,631		3,130,077
Dilutive income per share	$	0.90	$	0.59	$	2.61	$	2.04

CONSUMERS BANCORP, INC.

Notes to the Consolidated Financial Statements

(Unaudited) (continued)

(Dollars in thousands, except per share amounts)

Note 7 –Accumulated Other Comprehensive Income (Loss)

The components of other comprehensive income related to unrealized gains and losses on available-for-sale securities for the three and nine-month periods ended March 31, 2026 and 2025, were as follows:

	Pretax			Tax Effect		After-tax			Affected Line Item in Consolidated Statements of Income
Balance as of December 31, 2025	$	(21,525	)	$	4,520	$	(17,005	)
Unrealized holding losses on available-for-sale securities arising during the period		(1,906	)		401		(1,505	)
Balance as of March 31, 2026	$	(23,431	)	$	4,921	$	(18,510	)

	Pretax			Tax Effect			After-tax
Balance as of December 31, 2024	$	(33,246	)	$	6,981		$	(26,265	)
Unrealized holding gains on available-for-sale securities arising during the period		3,278			(687	)		2,591
Balance as of March 31, 2025	$	(29,968	)	$	6,294		$	(23,674	)

	Pretax			Tax Effect			After-tax			Affected Line Item in Consolidated Statements of Income
Balance as of June 30, 2025	$	(28,549	)	$	5,995		$	(22,554	)
Unrealized holding gains on available-for-sale securities arising during the period		5,111			(1,073	)		4,038
Amounts reclassified from accumulated other comprehensive gains		7			(1	)		6		(a)(b)
Net current period other comprehensive income		5,118			(1,074	)		4,044
Balance as of March 31, 2026	$	(23,431	)	$	4,921		$	(18,510	)

	Pretax			Tax Effect			After-tax
Balance as of June 30, 2024	$	(35,864	)	$	7,532		$	(28,332	)
Unrealized holding gains on available-for-sale securities arising during the period		5,896			(1,238	)		4,658
Balance as of March 31, 2025	$	(29,968	)	$	6,294		$	(23,674	)

(a) Securities losses, net

(b) Income tax expense

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations

(Dollars in thousands, except per share data)

Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations

General

The following is management’s analysis of the Company’s results of operations for the three- and nine-month periods ended March 31, 2026, compared to the same periods in fiscal year 2025, and the consolidated balance sheet at March 31, 2026, compared to June 30, 2025. This discussion is designed to provide a more comprehensive review of the operating results and financial condition than could be obtained from an examination of the financial statements alone. This analysis should be read in conjunction with the consolidated financial statements and related footnotes and the selected financial data included elsewhere in this report.

Overview

Consumers Bancorp, Inc., a bank holding company incorporated under the laws of the State of Ohio (the Company), owns all the issued and outstanding common shares of Consumers National Bank, a bank chartered under the laws of the United States of America (the Bank). The Company’s activities have been limited primarily to holding the common shares of the Bank. The Bank’s business involves attracting deposits from businesses and individual customers and using such deposits to originate commercial, mortgage and consumer loans in its market area, consisting primarily of Carroll, Columbiana, Jefferson, Mahoning, Stark, Summit, and contiguous counties in Ohio, Pennsylvania, and West Virginia. The Bank also invests in securities consisting primarily of U.S. government sponsored entities, municipal obligations, mortgage-backed and collateralized mortgage obligations issued by Fannie Mae, Freddie Mac and Ginnie Mae.

Results of Operations

Three- and Nine-Month Periods Ended March 31, 2026 and 2025

Net income for the third quarter of fiscal year 2026 was $2,817, or $0.90 per common share, compared with $1,851, or $0.59 per common share for the three months ended March 31, 2025. The following are key highlights of our results of operations for the three months ended March 31, 2026, compared with the prior fiscal year comparable period:

	●	tax-equivalent net interest income increased by $1,556, or 18.0%, to $10,212 in the third quarter of fiscal year 2026 from the same prior year period primarily because of a $109,485, or 10.5%, increase in average interest- earning assets combined with a 28-basis point increase in the yield on interest-earning assets;
	●	a $160 provision for credit losses on loans and $50 provision for credit losses on unfunded commitments was recorded for the three-month period ended March 31, 2026, compared with a $495 provision for credit losses on loans and a $15 provision for credit losses on unfunded commitments for the same prior year period;
	●	noninterest income increased by $154, or 12.1%, in the third quarter of fiscal year 2026 compared with the same prior year period primarily because of $61, or 10.4%, increase in debit card interchange income and a $23, or 31.9%, increase in mortgage banking revenue; and
	●	noninterest expenses increased by $785, or 11.0%, in the third quarter of fiscal year 2026 from the same prior year period primarily because of increases in salaries and benefits and occupancy and equipment expenses because of additions to staff in the lending area, additional expenses associated with the new branch locations, and additional investments in software and security monitoring.

Net income for the first nine months of fiscal year 2026 was $8,206, or $2.61 per common share, compared with $6,374, or $2.04 per common share for the nine months ended March 31, 2025. The following are key highlights of our results of operations for the nine months ended March 31, 2026, compared with the prior fiscal year comparable period:

	●	tax-equivalent net interest income increased by $5,104, or 20.6%, to $29,938 in the first nine months of fiscal year 2026 from the same prior year period primarily because of a $86.0 million, or 8.2%, increase in average interest earning assets combined with a 28-basis point increase in the yield on interest-earning assets and a 15-basis point reduction in the cost of funds;
	●	a $655 provision for credit losses on loans and a $160 provision for credit losses on unfunded commitments was recorded for the nine-month period ended March 31, 2026, compared with a $657 provision for credit losses on loans and a $10 provision for credit losses on unfunded commitments for the same prior year period;

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

	●	noninterest income increased by $451, or 11.2%, in the first nine months of fiscal year 2026 compared with the same prior year period because of $98 of revenue recognized on interest rate swaps, an increase in mortgage banking revenue of $102, or 38.9%, an increase in debit card interchange income of $123, or 6.6%, and an increase in bank owned life insurance income of $64, or 22.1%, because of the purchase of an additional policy; and
	●	noninterest expenses increased by $2,852, or 13.8%, in the first nine months of fiscal year 2026 from the same prior year period primarily due to increases in salaries and benefits and occupancy and equipment expenses from additions to staff in the lending area and additional expenses associated with the new branch locations.

The annualized return on average equity and return on average assets were 12.82% and 0.94%, respectively, for the three months ended March 31, 2026, compared to 10.35% and 0.68%, respectively, for the same prior year period. The annualized return on average equity and return on average assets were 13.04% and 0.91%, respectively, for the nine months ended March 31, 2026, compared to 11.98% and 0.77%, respectively, for the same prior year period.

Net Interest Income

Net interest income, the difference between interest income earned on interest-earning assets and interest expense incurred on interest-bearing liabilities, is the largest component of the Company’s earnings. Net interest income is affected by changes in the volumes, rates and composition of interest-earning assets and interest-bearing liabilities. In addition, prevailing economic conditions, fiscal and monetary policies and the policies of various regulatory agencies all affect market rates of interest and the availability and cost of credit, which, in turn, can significantly affect net interest income. Net interest margin is calculated by dividing net interest income on a fully tax equivalent basis (FTE) by total average interest-earning assets. FTE income includes tax-exempt income, restated to a pre-tax equivalent, based on the statutory federal income tax rate. The federal income tax rate in effect for the 2026 and 2025 fiscal years was 21.0%. All average balances are daily average balances. Non-accruing loans are included in average loan balances and average securities include unrealized gains and losses on securities available-for-sale, while yields are based on average amortized cost.

The Company’s net interest margin was 3.53% for the three months ending March 31, 2026, compared with 3.27% for the same prior year period. FTE net interest income for the three months ended March 31, 2026, increased by $1,556, or 18.0%, to $10,212 from $8,656 for the same prior year period.

The yield on average interest-earning assets increased to 5.21% for the three months ended March 31, 2026, compared with 4.93% for the same period last year. Tax-equivalent interest income increased by $2,007, or 15.4%, for the three months ended March 31, 2026, from the same prior year period primarily because of a $109,485, or 10.5%, increase in average interest-earning assets and a 28-basis point increase in the yield on average interest-earning assets. The yield on securities and loans was positively impacted by new and repricing assets being invested at higher current market rates. Interest expense for the three months ended March 31, 2026 increased by $451, or 10.3%, from the same prior year period primarily as a result of a $82,864, or 10.5%, increase in interest bearing liabilities that was partially offset by lower time deposit costs because of declines in shorter-term market interest rates. The Company’s cost of funds was 2.25% for both of the three-month periods ending March 31, 2026 and March 31, 2025.

The Company’s net interest margin was 3.45% for the nine months ending March 31, 2026, compared with 3.07% for the same prior year period. FTE net interest income for the nine months ended March 31, 2026, increased by $5,104, or 20.6%, to $29,938 from $24,834 for the same prior year period.

The yield on average interest-earning assets increased to 5.13% for the nine months ended March 31, 2026, compared with 4.85% for the same period last year. Tax-equivalent interest income increased by $5,298, or 13.5%, for the nine months ended March 31, 2026, from the same prior year period primarily because of 28-basis point increase in the yield on average interest-earning assets and an $85,954, or 8.2%, increase in average interest-earning assets. The tax-equivalent yield on tax-exempt securities was positively impacted in the first nine months of fiscal year 2026 by the Company’s transfer of municipal bonds to CNB Investment Co. Also, the yield on taxable securities and loans was positively impacted by new and repricing assets being invested at higher current market rates. Interest expense for the nine months ended March 31, 2026 increased by $194, or 1.3%, from the same prior year period because of a $64,175, or 8.1%, increase in average interest-bearing liabilities. The Company’s cost of funds decreased to 2.27% for the nine months ended March 31, 2026 compared with 2.42% for the same prior year period from lower time deposit and short-term borrowing costs because of declines in shorter-term market interest rates.

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Average Balance Sheets and Analysis of Net Interest Income for the Three Months Ended March 31,

(In thousands, except percentages)

	2026								2025
	Average Balance			Interest		Yield/ Rate			Average Balance			Interest		Yield/ Rate
Interest-earning assets:
Taxable securities	$	193,177		$	1,577		3.05	%	$	212,152		$	1,740		2.98	%
Tax-exempt securities (1)		74,195			664		3.46			67,186			577		3.19
Loans (1)		874,259			12,696		5.89			749,672			10,552		5.71
Other equity securities, at cost		2,271			35		6.25			2,072			40		7.83
Equity securities		—			—		—			381			8		8.52
Interest bearing deposits and federal funds sold		8,278			80		3.92			11,232			128		4.62
Total interest-earning assets		1,152,180			15,052		5.21	%		1,042,695			13,045		4.93	%

Noninterest-earning assets		64,419								63,007

Total Assets	$	1,216,599							$	1,105,702

Interest-bearing liabilities:
NOW	$	154,182		$	240		0.63	%	$	152,868		$	253		0.67	%
Savings		414,617			2,026		1.98			355,121			1,542		1.76
Time deposits		280,863			2,469		3.57			259,689			2,510		3.92
Short-term borrowings		18,703			88		1.91			15,537			65		1.70
FHLB advances		4,671			17		1.48			6,957			19		1.11
Total interest-bearing liabilities		873,036			4,840		2.25	%		790,172			4,389		2.25	%

Noninterest-bearing liabilities:
Noninterest-bearing checking accounts		241,404								228,839
Other liabilities		13,039								14,188
Total liabilities		1,127,479								1,033,199
Shareholders’ equity		89,120								72,503

Total liabilities and shareholders’ equity	$	1,216,599							$	1,105,702

Net interest income, interest rate spread (1)				$	10,212		2.96	%				$	8,656		2.68	%

Net interest margin (net interest as a percent of average interest-earning assets) (1)							3.53	%							3.27	%

Federal tax exemption on non-taxable securities and loans included in interest income				$	146							$	137

Average interest-earning assets to interest-bearing liabilities		131.97	%							131.96	%

(1) calculated on a fully taxable equivalent basis utilizing a statutory federal income tax rate of 21.0%

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Average Balance Sheets and Analysis of Net Interest Income for the Nine Months Ended March 31,

(In thousands, except percentages)

	2026								2025
	Average Balance			Interest		Yield/ Rate			Average Balance			Interest			Yield/ Rate
Interest-earning assets:
Taxable securities	$	200,209		$	4,957		3.02	%	$	208,627		$	4,939			2.82	%
Tax-exempt securities (1)		71,348			1,909		3.31			67,888			1,276			2.30
Loans (1)		853,369			37,345		5.83			755,814			32,406			5.71
Other equity securities, at cost		2,206			119		7.19			2,089			123			7.84
Equity securities		261			17		8.68			381			25			8.74
Interest bearing deposits and federal funds sold		6,082			181		3.96			12,722			461			4.83
Total interest-earning assets		1,133,475			44,528		5.13	%		1,047,521			39,230			4.85	%

Noninterest-earning assets		64,024								61,748

Total Assets	$	1,197,499							$	1,109,269

Interest-bearing liabilities:
NOW	$	156,060		$	844		0.72	%	$	146,162		$	764			0.70	%
Savings		402,789			6,007		1.99			353,950			4,942			1.86
Time deposits		271,563			7,366		3.61			261,778			8,234			4.19
Short-term borrowings		18,903			265		1.87			21,429			383			2.38
FHLB advances		6,162			108		2.33			7,983			73			1.22
Total interest-bearing liabilities		855,477			14,590		2.27	%		791,302			14,396			2.42	%

Noninterest-bearing liabilities:
Noninterest-bearing checking accounts		244,662								231,340
Other liabilities		13,499								15,775
Total liabilities		1,113,638								1,038,417
Shareholders’ equity		83,861								70,852

Total liabilities and shareholders’ equity	$	1,197,499							$	1,109,269

Net interest income, interest rate spread (1)				$	29,938		2.86	%				$	24,834			2.43	%

Net interest margin (net interest as a percent of average interest-earning assets) (1)							3.45	%								3.07	%

Federal tax exemption on non-taxable securities and loans included in interest income				$	422							$	(47	)

Average interest-earning assets to interest-bearing liabilities		132.50	%							132.38	%

(1) calculated on a fully taxable equivalent basis utilizing a statutory federal income tax rate of 21.0%

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Provision for Credit Losses

The allowance for credit losses on loans consists of general and specific components. The general component covers loans collectively evaluated for credit loss and is based on peer historical loss experience adjusted for current and forecasted factors. For each portfolio segment, a loss driver analysis (LDA) is performed to identify appropriate loss indicators and create a regression model for use in forecasting cash flows. The LDA analysis utilizes peer data from the Federal Financial Institutions Examination Council’s (FFIEC) Call Report data for all segments. Since the Company has had very limited loss experience, management elected to utilize benchmark peer loss history data to estimate historical loss rates. The Company has established a one-year reasonable and supportable forecast period with a one-year straight-line reversion to the long-term historical average. The Company uses the central tendency seasonally adjusted civilian unemployment rate forecast from the Federal Open Market Committee for all portfolio segments. Other key assumptions include a maturity assumption for loans without maturity dates and prepayment / curtailment rates specific to each loan segment. Prepayment and curtailment rates are calculated based on the Company’s own data.

Management's adjustments to the quantitative evaluation may be for trends in delinquencies, trends in the volume of loans, changes in underwriting standards, changes in the value of underlying collateral, the existence and effect of portfolio concentration, regulatory environment, economic conditions, Company management and the status of portfolio administration including the Company’s loan review function.

The specific component includes loans that do not share similar risk characteristics that are evaluated on an individual basis and are excluded from the pooling approach. As of March 31, 2026, individually evaluated loans totaled $19,674 and included a $19,130 third-party residential mortgage warehouse line-of-credit and $526 of nonaccrual loans. The warehouse line-of-credit is included in individually evaluated loans because of the unique structure of the loan given the short-term nature of the advances, curtailment features provided by the financial institution that the line-of-credit is issued to, as well as being secured by individual residential properties. As of June 30, 2025, individually evaluated loans totaled $930 of nonaccrual loans. There was no specific allocation of the allowance for credit losses to individually evaluated loans as of March 31, 2026, and there was a $52 specific allocation of the allowance for credit losses to individually evaluated loans as of June 30, 2025.

The allowance for credit losses as a percentage of loans was 0.98% as of March 31, 2026 and 1.04% as of June 30, 2025. Net charge-offs of $257, or an annualized 0.04% of total loans, were recorded during the nine-month period ended March 31, 2026, compared with net charge offs of $540, or an annualized 0.09% of total loans, for the same period last year.

Non-performing loans were $547 as of March 31, 2026, compared with $1,031 as of June 30, 2025. As of March 31, 2026, non-performing loans included $140 that was guaranteed by the Small Business Administration as compared to $332 that was guaranteed as of June 30, 2025. Excluding the guaranteed portion, non-performing loans to total loans were 0.04% as of March 31, 2026, and 0.09% as of June 30, 2025. As of March 31, 2026, loans classified as special mention were $6,855 and substandard were $8,887. The balances of loans classified as special mention and substandard are primarily related to one commercial customer because of a combination of a delay in a construction project and reduced revenue in the industry. The construction project for this commercial relationship is now complete, and operations have commenced in the new building, a portion of the property is being leased, and the customer implemented operational changes which have improved their financial performance. The commercial real estate securing these loans has recently been appraised for an amount that exceeds the outstanding loan balance, and the customer has a signed letter of intent for the purchase of the real estate that, if consummated, will pay off a substantial portion of this loan relationship. Uncertainty remains regarding future levels of criticized and classified loans, non-performing loans and charge-offs. Management will continue to closely monitor changes in the loan portfolio and will work with borrowers as needed to mitigate losses to the Company.

The allowance for credit losses on off-balance sheet credit exposures is a liability account representing expected credit losses over the contractual period for which the Company is exposed to credit risk resulting from a contractual obligation to extend credit. The reserve for unfunded commitments is primarily related to 1 - 4 family home equity lines of credit and commercial construction loans. For the nine-month period ended March 31, 2026, an increase of $160 was recorded to the reserve for unfunded commitments compared with $10 for the same period last year. The balance of the reserve for unfunded commitments was $540 and $380 as of March 31, 2026 and June 30, 2025, respectively.

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Noninterest Income

Noninterest income increased by $154, or 12.1%, for the third quarter of fiscal year 2026 from the same period last year primarily because of an increase of $61, or 10.4%, in debit card interchange income due to increased customer usage, an increase of $23, or 31.9%, in mortgage banking activity, and an increase of $24, or 24.7%, in bank owned life insurance income because of the purchase of additional life insurance policies. For the nine-month period ended March 31, 2026, noninterest income increased $451, or 11.2%, from the same period last year. The increase in noninterest income was primarily due to $98 of revenue recognized on interest rate swaps, an increase of $123, or 6.6%, in debit card interchange income due to increased customer usage, and an increase of $102 or 38.9% in mortgage banking activity, and an increase of $64, or 22.1%, in bank owned life insurance income because of the purchase of additional life insurance policies.

Noninterest Expenses

Total noninterest expenses increased by $785, or 11.0%, for the third quarter of fiscal year 2026 and $2,852 or 13.8% for the nine-month period ended March 31, 2026 compared with the same periods last year. Salaries and employee benefits increased by $1,752, or 15.2%, for the nine-month period ended March 31, 2026, compared with the same prior year period primarily because of the addition of lending sales and support staff, hiring of staff for the new branch locations, and annual merit and cost of living adjustments. Occupancy and equipment expenses increased by $464, or 16.9%, for the first nine months of the fiscal year 2026 compared with the same period last year primarily because of increases in software license expenses, additional investments in security monitoring software, and increases in occupancy and premise expenses as a result of the new branch locations. Other non-interest expenses increased by $200, or 10.4%, primarily because of higher loan expenses related to the increased volume in loan originations and expenses associated with the 60^th anniversary celebration.

Income Taxes

Income tax expenses were $524 and $1,496 for the three- and nine-month periods ended March 31, 2026, compared to $274 and $1,242 for the three- and nine-month periods ended March 31, 2025. The effective tax rates were 15.7% and 15.4% for the three- and nine-month periods ended March 31, 2026, respectively, and 12.9% and 16.3% for the three- and nine-month periods ended March 31, 2025. The effective tax rates differed from the federal statutory rate because of tax-exempt income from obligations of state and political subdivisions, loans, bank owned life insurance income, and the low-income housing tax credits.

Financial Condition

Total assets as of March 31, 2026 were $1,238,168 compared to $1,165,008 at June 30, 2025, an increase of $73,160, or an annualized 8.4%. From June 30, 2025 to March 31, 2026, total loans increased by $90,599, or an annualized 14.9%, and total deposits increased by $73,066 or an annualized 9.4%.

Available-for-sale securities decreased by $15,504 from $273,875 as of June 30, 2025, to $258,371 as of March 31, 2026 primarily because of $20,871 of cash received from maturities, sales, calls, and principal pay downs that was not reinvested into securities but was rather invested in loans. The unrealized loss on the portfolio was $23,431 as of March 31, 2026, an improvement of $5,118 from June 30, 2025. The unrealized loss is a result of the increase in market interest rates compared with the yields within the portfolio that were available at the time the underlying securities were purchased. The fair value is expected to recover as the securities approach their maturity or repricing dates or if market yields for such securities decline. The portfolio is comprised of agency mortgage-backed securities, obligations of state and political subdivisions, other government agencies’ debt, corporate debt, and U.S. Treasury notes. The municipal bond portfolio consists of tax-exempt and taxable general obligations and revenue bonds to a broad range of counties, towns, school districts, and other essential service providers. As of March 31, 2026, 97.5% of the municipal bonds held in the available-for-sale portfolio had an S&P or Moody’s investment grade rating, and 2.5% were non-rated issues. The other debt securities consist of subordinated notes issued by other bank holding companies. As of March 31, 2026, the projected cash flow from the portfolio over the next 12 months was approximately $44,462, which may be available to reinvest into loans or securities at the then current market rates.

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Asset Quality

The following table presents the aggregate amounts of non-performing assets and select ratios as of the dates indicated.

	March 31, 2026			June 30, 2025			March 31, 2025
Non-accrual loans	$	526		$	930		$	935
Loans past due over 90 days and still accruing		21			101			17
Total non-performing loans		547			1,031			952
Other real estate and repossessed assets		—			—			76
Total non-performing assets	$	547		$	1,031		$	1,028

Non-performing loans to total loans		0.06	%		0.11	%		0.12	%

As of March 31, 2026, non-accrual loans include loans that are guaranteed by the Small Business Administration. Excluding the guaranteed portion, non-performing loans were $407, or 0.04% of total loans as of March 31, 2026.

Contractual Obligations, Commitments, Contingent Liabilities and Off-Balance Sheet Arrangements

Liquidity

The objective of liquidity management is to ensure adequate cash flows to accommodate the demands of our customers and provide adequate flexibility for the Company to take advantage of market opportunities under both normal operating conditions and under unpredictable circumstances of industry or market stress. Cash is used to fund loans, purchase investments, fund the maturity of liabilities, and, at times, to fund deposit outflows and operating activities. The Company’s principal sources of funds are deposits; amortization and prepayments of loans; maturities, calls and principal receipts from securities; borrowings; and operations. Management considers the asset position of the Company to be sufficiently liquid to meet normal operating needs and conditions. The Company’s interest-earning assets are mainly comprised of loans and investment securities. Management continually strives to obtain the best mix of loans and investments to both maximize yield and ensure the soundness of the portfolio, as well as to provide funding for loan demand as needed.

For the nine months ended March 31, 2026, net cash inflows from operating activities were $7,611, net cash outflows for investing activities was $71,932 and net cash inflows from financing activities was $61,734. A major source of cash was $73,066 from the increase in deposits and $33,616 from maturity, calls, and principal pay downs of available-for-sale securities. A major use of cash was $90,856 for loan originations. Total cash and cash equivalents were $17,321 as of March 31, 2026, compared to $19,908 at June 30, 2025, and $34,435 at March 31, 2025.

The Bank offers several types of deposit products to a diverse base of business, public fund, and personal customers. We believe the rates offered by the Bank and the fees charged for them are competitive with the rates and fees charged by other banks for similar deposit products currently available in the market area. Deposits totaled $1,109,884 at March 31, 2026, an increase of $73,066, or an annualized 9.4%, compared with $1,036,818 at June 30, 2025. As of March 31, 2026, the estimated percentage of uninsured deposits, excluding collateralized public fund deposits, was 23.8%.

Jumbo time deposits (those with balances of $250 and over) totaled $89,821 as of March 31, 2026 and $74,683 as of June 30, 2025 and are from local customers, businesses, and public entities. These deposits are monitored closely by the Company and are mainly priced on an individual basis. The Company has the option to use a fee-paid broker or CD listing service to obtain deposits from outside its normal service area as an additional source of funding. The Company, however, does not rely upon these types of deposits as a primary source of funding. There were $2,030 and $1,420 deposits classified as brokered deposits as of March 31, 2026 and June 30, 2025, respectively. Although management monitors interest rates on an ongoing basis, a quarterly rate sensitivity report is used to determine the effect of interest rate changes on the financial statements. In the opinion of management, enough assets or liabilities could be repriced over the near term (up to three years) to compensate for such changes. The spread on interest rates, or the difference between the average earning assets and the average interest-bearing liabilities, is monitored monthly.

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

To provide additional sources of liquidity, the Company has lines of credit with other financial institutions and entered into agreements with the FHLB of Cincinnati and the Federal Reserve discount window. At March 31, 2026, advances from the FHLB of Cincinnati totaled $7,017 compared with $22,551 as of June 30, 2025. As of March 31, 2026, the Bank had the ability to borrow an additional $110,555 from the FHLB of Cincinnati based on a blanket pledge of qualifying first mortgage and multi-family loans. The Company considers the FHLB of Cincinnati to be a reliable source of liquidity funding, secondary to its deposit base. In addition, as of March 31, 2026, the Company had approximately $98,894 in securities unencumbered by a pledge that could be used to support additional borrowings, as needed, through the Federal Reserve discount window.

Short-term borrowings consisted of repurchase agreements, federal funds purchased, and a line of credit from another financial institution and totaled $21,696 as of March 31, 2026 and $15,511 as of June 30, 2025. Repurchase agreements are classified as borrowings and were the most significant component of short-term borrowings with a balance of $17,801 as of March 31, 2026 and $15,511 as of June 30, 2025. Repurchase agreements are financing arrangements with local customers that mature daily and the Bank pledges securities as collateral for these borrowings. Federal funds purchased totaled $3,670 as of March 31, 2026 and are used as a short-term source of funding. The company has access to a line of credit from another financial institution since the holding company does not conduct operations and its primary sources of liquidity are dividends upstreamed from the Bank and borrowings from outside sources. As of March 31, 2026, the outstanding balance on the holding company’s line of credit was $225 and the availability on the line of credit was $4,775.

To meet the financial needs of our customers, we have issued commitments to originate mortgage, commercial, construction, and consumer loans and commitments for commercial, home equity, and consumer lines of credit. Since commitments to extend credit have a fixed expiration date or other termination clause, some commitments will expire without being drawn upon and the total commitment amounts do not necessarily represent future cash requirements. Financial standby letters of credit are conditional commitments issued to guarantee the performance of a customer to a third party. The same credit policies are used in making commitments and financial standby letters of credit as are used for on-balance sheet instruments. Total unused commitments were $214,082 as of March 31, 2026, and $212,550 as of June 30, 2025.

Capital Resources

Total shareholders’ equity increased by $10,583 to $86,854 as of March 31, 2026, from $76,271 as of June 30, 2025 because of net income of $8,206 for the first nine months of fiscal year 2026 and an improvement of $4,044 in the accumulated other comprehensive loss from the mark-to-market of available-for-sale securities, which was partially offset by cash dividends paid of $1,983. As market interest rates rise, the fair value of fixed-rate available-for-sale securities decline with a corresponding net of tax decline recorded in the accumulated other comprehensive loss portion of equity. The fair value is expected to recover as the securities approach their maturity date or repricing date or if market yields for such securities decline.

The Bank is subject to various regulatory capital requirements administered by federal regulatory agencies. Capital adequacy guidelines and prompt corrective-action regulations involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Failure to meet various capital requirements can initiate regulatory action that could have a direct material effect on the Company’s financial statements.

As of March 31, 2026, the Bank’s common equity tier 1 capital and tier 1 capital ratios were 11.06% and the leverage and total risk-based capital ratios were 8.37% and 12.07%, respectively. This compares with common equity tier 1 capital and tier 1 capital ratios of 10.99% and leverage and total risk-based capital ratios of 8.23% and 12.00%, respectively, as of June 30, 2025. The Bank exceeded minimum regulatory capital requirements to be considered well-capitalized for both periods. Management is not aware of any matters occurring after March 31, 2026 that would cause the Bank’s capital category to change.

Critical Accounting Policies

The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America and follow general practices within the industry in which it operates. Application of these principles requires management to make estimates or judgments that affect the amounts reported in the financial statements and accompanying notes. These estimates are based on information available as of the date of the financial statements; accordingly, as this information changes, the financial statements could reflect different estimates or judgments. Certain policies inherently have a greater reliance on the use of estimates, and as such have a greater possibility of producing results that could be materially different than originally reported.

CONSUMERS BANCORP, INC.

Management's Discussion and Analysis of Financial Condition

and Results of Operations (continued)

(Dollars in thousands, except per share amounts)

Critical accounting policies are those policies that are highly dependent on subjective or complex judgments, estimates and assumptions and where changes in those estimates and assumptions could have a significant impact on the financial statements. The Company has identified the appropriateness of the allowance for credit losses and the evaluation of goodwill for impairment as critical accounting policies and an understanding of these policies is necessary to understand the financial statements. Note 1 (Summary of Significant Accounting Policies – Allowance for Credit Losses), Note 3 (Loans and Allowance for Credit Losses), Note 5 (Goodwill and Acquired Intangible Assets), and Management’s Discussion and Analysis of Financial Condition and Results of Operation (Critical Accounting Policies and Use of Significant Estimates) of the 2025 Form 10-K provide detail regarding the Company’s accounting for the allowance for credit losses and Goodwill.

Forward-Looking Statements

Certain statements contained in this Quarterly Report on Form 10-Q, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “may,” “continue,” “estimate,” “intend,” “plan,” “seek,” “will,” “believe,” “project,” “expect,” “anticipate” and similar expressions are intended to identify forward-looking statements. These forward-looking statements may involve risks and uncertainties that are difficult to predict, may be beyond our control, and could cause actual results to differ materially from those described in such statements. Any such forward-looking statements are made only as of the date of this report or the respective dates of the relevant incorporated documents, as the case may be, and, except as required by law, we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. Risks and uncertainties that could cause actual results for future periods to differ materially from those anticipated or projected include, but are not limited to:

	●	changes in local, regional and national economic conditions becoming less favorable than we expect, resulting in a deterioration in asset credit quality or debtors being unable to meet their obligations because of high unemployment rates and inflationary pressures;
	●	rapid fluctuations in market interest rates could result in changes in fair market valuations and a decline in net interest income;
	●	the effects of, and changes in, trade, tariff policies, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board;
	●	changes in the level of non-performing assets and charge-offs;
	●	unanticipated changes in our liquidity position, including, but not limited to, changes in the cost of liquidity, our ability to find alternative funding sources, and potential market reactions to the default or risk of default by other financial institutions;
	●	the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, securities, and insurance) with which we must comply;
	●	competitive pressures on product pricing and services;
	●	breaches of security or failures of our or our vendor’s technology systems due to technological or other factors and cybersecurity threats;
	●	changes in consumer spending, borrowing and savings habits;
	●	declining asset values impacting the underlying value of collateral;
	●	changes in accounting policies, rules and interpretations;
	●	our ability to attract and retain qualified employees; and
	●	changes in the reliability of our vendors, internal control systems or information systems.

CONSUMERS BANCORP, INC.

Item 4 – Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by the report, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-15e. Based on the evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2026.

Changes in Internal Controls Over Financial Reporting

There have not been any changes in the Company’s internal control over financial reporting that occurred during the Company’s last quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

CONSUMERS BANCORP, INC.

PART II – OTHER INFORMATION

Item 1 – Legal Proceedings

None

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3 – Defaults Upon Senior Securities

None

Item 4 – Mine Safety Disclosures

Not Applicable

Item 5 – Other Information

None

Item 6 – Exhibits

Exhibit

Number

Description

Exhibit 31.1

Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

Exhibit 31.2

Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

Exhibit 32.1

Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes Oxley Act of 2002.

101.INS	Inline XBRL Instance Document (The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document) (1)
101.SCH	Inline XBRL Taxonomy Extension Schema Document (1)
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document (1)
101.DEF	Inline XBRL Taxonomy Extension Definitions Linkbase Document (1)
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document (1)
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104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101.1)

(1)	These interactive date files shall not be deemed filed for purposes of Section 11 or 12 of the Securities Act of 1933, as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability under those sections.

SIGNATURES

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.

	CONSUMERS BANCORP, INC. (Registrant)

Date: May 8, 2026	/s/ Ralph J. Lober II Ralph J. Lober II President & Chief Executive Officer (principal executive officer)

Date: May 8, 2026	/s/ Renee K. Wood Renee K. Wood Chief Financial Officer & Treasurer (principal financial officer)