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 dummy: Item

 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM

 ANNUAL REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended
 OR

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from _____to_____
 Commission File Number:
 001-41196
 (Exact name of registrant as specified in its
charter)

 87-4070846
 (State or other jurisdiction of
 incorporation or organization)
 (I.R.S. Employer
 Identification No.)
 2301 NW 87th Avenue
,
 Doral
,
 FL
 33172
 (Address of principal executive offices) (zip
code)
 Registrant's telephone number, including area code:

(
)
 715-5200
 Securities registered pursuant to Section 12(b)
of the Act:
 Title of each class
 Trading Symbol(s)
 Name of each exchange on which registered
 Class A Common Stock, $1.00 par value per
 share
 USCB
 The Nasdaq Stock Market LLC
 Securities registered pursuant to Section 12(g)
of the Act:

None
 Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

 No

 Indicate by check mark if the registrant is not required
to file reports pursuant to Section 13 or Section
15(d) of the Act.
Yes

 No

 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," "non-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 has
filed a report on
and attestation to its
management's assessment of the
effectiveness of its internal
 control over
financial reporting
under Section
404(b) of
the Sarbanes-Oxley
Act (15
U.S.C.7262(b)) by
the registered
public accounting
firm that
 prepared or issued its audit report.

 If securities are registered pursuant to Section 12(b) of the Act, indicate
by check mark whether the financial statements of the registrant included in
 the filing reflect the correction of an error to previously
issued financial statements.

 Indicate by check mark whether any of those
error corrections are restatements that required a recovery analysis of incentive-based compensation
 received by any of the registrant's executive officers during
the relevant recovery period pursuant to §240.10D-1(b).

 Indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the
Securities Exchange Act of 1934). Yes

 No

 The aggregate market value of the voting stock held
by non-affiliates of the registrant based on the
closing price of $12.83 per share on June 28,
 2024
, the last business day of the registrant's second quarter, was approximately $
 132.3

million (19,630,632 shares issued and outstanding
at
 such date less shares held by affiliates). Although directors
and executive officers and their affiliates of the Registrant were assumed
to be
 "affiliates" of the Registrant for purposes of the calculation,
the classification is not to be interpreted as an admission
of such status.
 As of February 28, 2025, the registrant had had
 20,053,025

shares of Class A Common Stock outstanding.
 DOCUMENTS INCORPORATED BY REFERENCE

 Certain portions of the registrant's Proxy Statement for the 2025 Annual Meeting of Shareholders (the "2025
Proxy Statement") are incorporated by
 reference into Part III of this report.

 FORM 10-K
 DECEMBER 31, 2024
 Cautionary Note Regarding Forward-Looking Statements
 Item 1.
 Business
 Item 1A.
 Risk Factors
 Item 1B.
 Unresolved Staff Comments
 Item 1C.
 Cybersecurity
 Item 2.
 Properties
 Item 3.
 Legal Proceedings
 Item 4.
 Mine Safety Disclosures
 Item 5.
 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
 Item 6.
 Reserved
 Item 7.
 Management's Discussion and Analysis of Financial Condition and Results of Operations
 Item 7A.
 Quantitative and Qualitative Disclosures About Market Risk
 Item 8.
 Financial Statements and Supplementary Data
 Consolidated Balance Sheets
 Consolidated Statements of Operations
 Consolidated Statements of Comprehensive Income

(Loss)
 Consolidated Statements of Changes in Stockholders' Equity
 Consolidated Statements of Cash Flows
 Item 9.
 Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
 Item 9A.
 Controls and Procedures
 Item 9B.
 Other Information
 Item 9C.

 Disclosure Regarding Foreign Jurisdictions That Prevent Inspections
 Item 10.
 Directors, Executive Officers and Corporate Governance
 Item 11.
 Executive Compensation
 Item 12.
 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
 Item 13.
 Certain Relationships and Related Transactions, and Director Independence
 Item 14.
 Principal Accountant Fees and Services
 Item 15.
 Exhibits and Financial Statement Schedules
 Item 16.
 Form 10-K Summary
 Exhibit Index
 Signatures

 CAUTIONARY NOTE REGARDING FORWARD
-LOOKING STATEMENTS

 This
Annual
Report
on
Form
that
are
not
in
are
to
be,
and
are
 hereby identified as, forward-looking
statements for purposes of
the safe harbor provided by
Section 21E of the Securities
 Exchange
Act
of
1934,
as
amended
("Exchange
Act").
The
words
"may,"
"will,"
"anticipate,"
"could,"
"should,"
"would,"
 "believe,"
"contemplate,"
"expect,"
"aim,"
"plan,"
"estimate,"
"continue,"
and
"intend,"
as
well
as
other
words
and
 expressions of
the future,
are intended
to identify
statements.
These forward-looking
to
our
projected
growth,
anticipated
performance,
and
 performance goals, as well as statements relating
to the anticipated effects on results
of operations and financial condition
 from expected
developments or events,
or business
and growth
strategies, including anticipated
internal growth and
 sheet restructuring.
 These forward-looking statements involve significant risks and uncertainties that could cause our actual results to differ
 materially from those anticipated in such statements.
Potential risks and uncertainties include, but are not
limited to:
 •

the strength of the United States economy
in general and the strength of the local
economies in which we conduct
 operations;
 •

our ability to successfully manage interest rate risk, credit
risk, liquidity risk, and other risks inherent to our industry;
 •

the accuracy of our financial statement estimates and assumptions, including the estimates used for our credit loss
 reserve and deferred tax asset valuation allowance;
 •

the efficiency and effectiveness of our
internal control environment;
 •

to comply
extensive laws
to which
subject, including
the laws
for each
 jurisdiction where we operate;
 •

or
in
the
and
markets,
or
stresses
in
the
 banking industry;
 •

deposit attrition and the level of our uninsured deposits;
 •

legislative or regulatory
changes and changes
in accounting
principles, policies,
practices or guidelines,
 the on-going effects of the implementation of the
Current Expected Credit Losses ("CECL");
 •

the lack of a significantly diversified loan portfolio and concentration in the South Florida market, including the risks
 of geographic, depositor,
and industry concentrations,
including our concentration
in loans secured by
real estate,
 in particular, commercial real estate;
 •

the effects of climate change;
 •

the concentration of ownership of our common stock;
 •

fluctuations in the price of our common stock;
 •

our ability to fund or access the capital markets at attractive
rates and terms and manage our growth, both organic
 growth as well as growth through other means, such as
future acquisitions;
 •

inflation, interest rate, unemployment rate, market, and monetary
fluctuations;
 •

impacts of international hostilities and geopolitical events;
 •

and
its
on
the
of
our
and
as
well
as
our
net
rate
 spread and net interest margin;
 •

the loss of key employees;

 •

the effectiveness of our risk management strategies, including operational risks, including, but not limited to, client,
 employee, or third-party fraud and cybersecurity breaches;
and

 •

other
risks
described
in
this
Annual
Report
on
Form
and
other
filings
we
make
with
the
Securities
and
 Exchange Commission ("SEC").
 All
are
necessarily
only
of
results,
and
there
can
be
no
assurance
that
 actual results will
not differ
materially from expectations.
Therefore, you are
cautioned not to
place undue reliance
on any
statements.
included in
this
Annual Report
on Form
10-K are
made
 only
as of
the
date
hereof,
and
we
undertake
no
obligation
to
update
or
revise
any forward
-looking
to reflect
 events or circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events,
 unless required to do so under
the federal securities laws. You
should also review the risk
factors described in this Annual
 Report on
Form 10-K
and in
the reports
Holdings, Inc.
has filed
or will
file with
the SEC
and, for
periods
 prior to
the completion of
the bank holding
company reorganization in
2021, U.S.
Century Bank filed
Federal Deposit
 Insurance Corporation ("FDIC").

 Item 1. Business
 Overview
 USCB Financial Holdings, Inc.,
a Florida corporation (the "Company"), was formed on December 17, 2021, to serve as
 the
for
U.S.
Century
Bank,
a
state-chartered
bank,
and
is
a
bank
(a
"BHC")
 registered with
the Board
of Governors
Reserve System
(the "Federal
Reserve")
Bank Holding
 Company Act
of 1956,
as amended
(the "BHC
Act"). The
Company is
headquartered
in Miami,
Florida, and,
through the
 Bank,
its
sole
direct
subsidiary,
operates
centers
in
South
a
wide
range
of
and
banking products
and services
.
As of
2024, the
had total
of $2.6
 billion.
 U.S. Century Bank (the "Bank")
commenced operations in October
2002 and is a Florida
state-chartered, non-Federal
System
member
bank.
Over
the
of
2021,
the
Bank
simplified
its
capitalization
structure
by
exchanging
 and/or repurchasing
all of its
issued and outstanding
preferred shares,
including Class C,
Class D, and
Class E preferred
In
2021,
the
Bank
reached
agreements
with
holders
of
its
Class
B
to
exchange
all
 outstanding Class B common stock for Class A common stock
in a 1-for-5 stock exchange.
 On July 27,
2021, the Bank
completed an initial
public offering of 4,600,000
shares of its
Class A common
stock. Shares
 of the Bank's Class
A common stock were
sold at a price
to the public
of $10.00 per share
and began trading on
the Nasdaq
 Stock Market under ticker symbol "USCB".

 On December
30, 2021
(the
"Effective
Date"),
acquired
all of
the
and
stock
 Bank in a
share exchange
(the "Reorganization")
effected under
the Florida
Business Corporation
Act and
in accordance
terms of
an Agreement and
Plan of
Share Exchange dated
December 27, 2021
between the Bank
 (the "Share Exchange Agreement"). The Reorganization and
the Share Exchange Agreement were approved
by the Bank's
 stockholders at a special meeting of the Bank's stockholders held on December 20,
2021. Pursuant to the Share Exchange
 Agreement, on the Effective
Date each issued and outstanding
share of the Bank's
Class A common stock was
converted
 into and exchanged
for one share
of the Company's Class
A common stock.
As a result,
the Bank became
the wholly owned
 subsidiary
of
the
Company,
the
became
the
for
the
Bank
and
the
stockholders
Bank
 became stockholders of the Company.
 Prior to the Effective Date, the Bank's Class A common stock was registered under Section 12(b) of the Exchange Act,
Bank was subject
to the information
requirements of the
Exchange Act and,
in accordance with
Section 12(i)
thereof,
 filed quarterly reports, proxy statements and other information with the FDIC. As a result of the Reorganization, pursuant to
 Rule 12g-3(a) under the
Exchange Act, the Company
became the successor
registrant to the Bank,
the Company's Class
 A common stock was deemed
to be registered under Section 12(b)
of the Exchange Act, and
the Company became subject
 to
the
of
the
Exchange
Act
and
is
now
to
file
reports,
proxy
and
other
 information with the SEC. The trading
symbol for the Company's
Class A Common Stock is "USCB",
which is the same as
 the Bank's former trading symbol.
 Prior to
the Reorganization,
had no
material assets
and had
not conducted
any business
or operations
 except for activities related to its incorporation and the
Reorganization.
 Our strategy
in becoming
a publicly
traded company
and forming
a BHC
was to
continue pursuing
organic growth
as
 well as strategic acquisitions if the opportunity arises,
which efforts will be further facilitated by access
to public capital and
 the added flexibility provided by a holding company structure.
 In this Annual Report on Form 10-K, unless the context indicated otherwise, references to "we," "us,", and "our" refer to
 the Company and the Bank,
as the context dictates. However, if the discussion
relates to a period before
the Effective Date,
 the terms refer only to the Bank.
 Products and Services
 Lending Services
 Our mission
is to
provide high
value, relationship
-based banking
products, services
and solutions
to a
diverse
set of
 clients in the
markets we serve. We focus
on serving small-to-medium sized businesses ("SMBs")
and catering to the
needs
 of
local
owners,
entrepreneurs
and
professionals
in
South
Florida.
We
have
further
leveraged
our
success
in

 providing comprehensive banking solutions
to SMBs to also secure the personal
retail deposit relationships of the owners,
 operators, and employees of our commercial lending clients, which has
been a cornerstone of our deposit growth strategy.
 In addition
traditional commercial
banking services,
among a
select number
of banks
size within
 our market
area that
can offer
certain specialty
banking products,
services and
solutions designed
for small
businesses,
 homeowner associations,
law firms, medical
practices and other
professional services
firms, and global
banking services.
 Our major specialty banking offerings include
the following:
 •
 Small
Business
Administration
("SBA")
lending:

Our
SBA
platform
originates
loans
under
Sections
7(a)
 and 504
SBA program.
The 7(a)
loan program,
SBA's most
common loan
program, includes
 help for small businesses
with special requirements
while the 504 loan program
provides long-term, fixed rate
 financing of
up to $5.0
million for
major fixed assets
that promote
business growth
and job creation.
Since its
 formation in
2018, the
platform serves
as an
opportunity to
generate commercial
and industrial
loans, or
C&I
 loans, and to diversify our revenue stream through originating and
selling SBA 7(a) loans. As of December 31,
 2024, the Bank continued to be
a Preferred Lending Partner with the
SBA which allows us to offer
the full range
 of SBA loan products and to exercise lending authority at the local bank level, allowing us
to make timely credit
 decisions for prospective clients.
 •
 Yacht lending:

Our yacht lending vertical
provides yacht financing for
larger vessels; transactions range
from
 $750 thousand to $7.5 million.
We target high net-worth
clients, in one of the
most active yacht markets
 country.

 •
 Homeowner Association ("HOA")
services:

We provide banking services
to HOAs and property
managers,
 including deposit collection,
lockbox services, payment
services, and lending
products. Launched in
2016, we
 offer our HOA customers a unique combination of market knowledge of
a local bank, and a highly personalized
 "white glove" approach to customer service.
 •
 Jurist Advantage and Private Client
Group services:

Our Jurist Advantage and Private
Client Group vertical
 provides customized
banking solutions
for law
firms as
their partners,
associates, staff,
and high
net
 worth clients.
We also leverage
our relationships with
our law
firm clients to
generate personal deposit
accounts.
 •
 Correspondent Banking services:

Our Global Banking
vertical provides correspondent
banking services for
 banks
headquartered
in
Latin
America
and
the
Caribbean
countries.
We
also
cross-sell
our
relationships
to
generate
for
our
Bank.
Our
 compliance team is experienced in issues related to correspondent banking, and we have frequent and regular
 open communication with our correspondent bank clients to ensure proper compliance controls are maintained
 at such institutions.
 •
 Medical
Advantage:
 MD
 Advantage
was
launched
in
2024;
this
vertical
concierge-level
 services to physicians,
dentists, and veterinarians.
 MD
 Advantage products and
services were designed
to cater
 to the complex banking requirements of medical professionals.
 Credit Practices
 Our underwriting process is informed by a conservative credit culture
that encourages prudent lending. We believe our
 strong asset quality
is due
to our understanding
of and experience
with businesses within
Florida,
in particular South
Florida,
 our
long-standing
relationships
with
and
our
disciplined
underwriting
processes.
Our
thorough
underwriting
 processes
collaboratively
our
seasoned
bankers,
underwriters
and
managers
in
the
 analysis of each loan request.

 We manage our credit risk by analyzing metrics related
to our different lines of business, which allows us to
maintain a
 conservative
and
well-diversified
loan portfolio
reflective
of various
industry
sectors.
Based
upon our
 aggregate exposure to any given borrower relationship, we undertake a scaled review
of loan originations that may involve
 senior credit officers, our Chief Credit Officer,
our Credit Committee or,
ultimately,
our Board of Directors ("Board").
 Deposit Products
 We offer
traditional deposit
products, including
commercial and
consumer checking
accounts, money
market deposit
 accounts, savings accounts, and
certificates of deposit
with a
variety of terms
and rates, as
well as a
robust suite of
treasury,
 commercial payments, and cash management services. Additionally,
we offer insured cash sweep ("ICS") and certificate of
 deposit account
registry service
("CDARS") deposit
products that
are FDIC-insured
for our
clients. Furthermore,
we offer
 deposit products
for municipalities
and
other public
entities. Our
deposit products
are mainly
offered
across
our primary
 geographic footprint.

 Title Services
Peninsula
Title
LLC
is
a
subsidiary
of
the
Bank
that
offers
our
title
for
real
closed
at
the
Bank.
Licensed
State
of Florida
and
Department
of Insurance
 Regulation, Florida Peninsula
Title LLC began operations
in 2021. Our
title service business not
only provides diversification
 for non-interest income but also provides our clients with access
to tile insurance services.

 Seasonality
 We do not believe our business to be seasonal
in nature.
 Markets
 Our
is
South
Florida.
South
has
rapidly
emerged
as
a
top
destination
for
driven
by
a
combination
of
that
foster
and
stability.
The
region
offers
a
low-tax
 environment, a robust business infrastructure, and access to a
diverse talent pool. With a thriving
real estate market, strong
trade
connections,
and
an
increasing
concentration
of
tech
and
finance
sectors,
South
a
 dynamic ecosystem for financial services. Additionally,
the region's strategic location as a gateway to Latin America further
 enhances
its appeal
for corporations
looking
to strengthen
global
connectivity
and investment
opportunities.
We
believe
 Florida offers
long-term attractive
banking opportunities.
Our largest
concentration is
Miami metropolitan
statistical
 area; however, we are
also focused on
growth in
other urban Florida
markets in which
we have a
presence, such as
Broward
 and Palm Beach counties.

 According to the
United States
Census Bureau's
estimate, Florida
was the third
most populous state
in the country
in
 2024 and the three largest population
centers were in Miami-Dade, Broward, and Palm
Beach counties (all located in South
 Florida).
According
to
from
the
United
States
Census
Bureau,
Florida's
population
to
23.4
 residents, an increase of 1.8 million new residents
or 8.5% from April 2020 to July 2024.

 Competition
 Our markets are highly competitive, and we compete with a wide range of lenders and other financial institutions within
 our markets,
including local,
regional,
national,
and international
banks
and credit
unions.
We
also compete
 with mortgage companies, brokerage
firms, trust service providers, consumer
finance companies, mutual funds,
 firms,
processors,
or
Fintechs,
and
other
 financial intermediaries on various
of our products and
services. Some of our competitors
are not subject to the
and
the
level
of
supervision
to
us.
Many
of
our
competitors
are
much
larger
 institutions that have greater financial
resources than we do
and compete aggressively for market
share. These competitors
 attempt to gain market share through their financial product
mix, pricing strategies and larger banking center networks.
 Interest rates
on both
deposits and
prices of
fee-based services
are significant
competitive factors
among
generally.
Other
important
competitive
convenience,
quality
of
service,
 availability and quality of digital offerings, community
reputation, and continuity of personnel and services.

 Emerging Growth Company
 We are an "emerging growth
company,"
or "EGC", as defined in the Jumpstart
Our Business Startups Act of 2012 (the
 "JOBS Act"). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are
 applicable to other public companies
that are not EGCs, including,
but not limited to, not being
required to comply with
the
 auditor
attestation
of
of
the
Sarbanes-Oxley
Act,
reduced
 executive compensation in
our periodic
reports and proxy
statements, and exemptions
from the requirements
of holding a
 non-binding
advisory
vote
on executive
and shareholder
approval
of any
golden
parachute
payments
not
 previously approved.
of
the
JOBS
Act
also
that
an
EGC can
take
advantage
of
the
extended
 period provided
in Section
7(a)(2)(B) of
the Securities
Act of
1933, as
amended (the
"Securities Act"),
for complying
with
 new or revised accounting standards. In other
words, an EGC can delay the adoption
of certain accounting standards until
 those standards would otherwise apply to private
companies. We intend to take advantage
of the benefits of this extended
 transition period, for as long as it is available.

 We will
remain an
EGC until
the earliest
to occur
of (i)
the end
fiscal year
following the
fifth anniversary
 completion of the Bank's initial public offering in 2021,
(ii) the last day of the first fiscal year in
which the Company's annual

 gross revenues exceed $1.235 billion, (iii) the date that
the Company becomes a "large accelerated filer" as defined in
Rule
 12b-2 under the Exchange Act which would
occur if the market value of the
Company's common stock that is held
by non-
 affiliates exceeds $700 million as of the last business day
of the Company's most recently completed second
fiscal quarter
 (June 30th for the
Company), or (iv) the date on
which the Company has issued more
than $1 billion in non-convertible debt
 during the preceding three-year period.
 Human Capital Resources
 We respect
the values and
diversity exhibited
throughout our organization
and the community.
Diversity is an
integral
 part of
our organization's
culture. We
seek the
active engagement
and participation
of people
with diverse
backgrounds.
 We are taking
steps to create
programs to ensure
that we are
organized in a
way where the
unique contributions
of each
in
our Company
is recognized
and
supported.
Each team
member
is to
be
treated
fairly
with
equal
access
to
 opportunities and resources for success. Additionally, we run homebuyer educational and financial literacy
workshops in an
 effort to reach the financing needs of the sectors
of our communities in which these workshops are
most needed.
 Our human capital
objectives include attracting,
developing and retaining
the best available
talent from a
diverse pool
 of
candidates
for
the
Company.
To
do
so,
we
strive
to
competitive
pay
and
benefits,
updating
our
structure
and
periodically
reviewing
our
and
programs.
the
 identifies
opportunities
and
paths
for
the
of
our
staff,
and
we
seek
to,
whenever
possible,
fill
positions
by
 promotion within. The Company recognizes that the skills and knowledge of its employees
are critical to the success of the
 organization, and promotes training and continuing education
as an ongoing function for employees.
 We recognize
the importance
employee's
health and
well-being,
and offer
such
as a
401(k)
 retirement savings plan and make both matching and profit-sharing contributions to that plan. Benefit programs available to
employees
include,
in
addition
to
the
401(k)
retirement
savings
plan,
health
and
life
insurance,
paid
 holidays and other benefits.
 We value and promote diversity in
every aspect of our business
and at every level within
the Company. We recruit, hire,
 and
promote
employees
based
on
their
and
experience
and
in
with
Affirmative
Action
and
 Equal Employment Opportunity
laws and regulations.
Our policy is that
we do not
discriminate on the
basis of race, color,
 religion,
sex,
gender,
sexual
orientation,
ancestry,
pregnancy,
medical
age,
marital
status,
national
origin,
 citizenship status, disability veteran status, gender identity,
genetic information, or any other status protected
by law.
 At December 31, 2024,
we had 199
full-time equivalent employees.
None of our
employees are parties
to a collective
 bargaining agreement. We believe that our employees are our greatest asset and vital to our success. As such, we seek to
 hire and retain the best
candidate for each position, without regard to
age, gender, ethnicity,
or other protected class status,
 but
with
an
appreciation
for
a
diversity
of
perspectives
and
experiences.
We
have
a
structure
 including an array of benefit plans and programs that
we believe is attractive to our current and prospective
employees.
 Regulation and Supervision
 Bank holding
companies, banks, and
their affiliates are
extensively regulated under
federal and
state law
and regulation.
 These laws
have a
material effect
operations of
Holdings, Inc.
and its
direct and
 indirect subsidiaries, including U.S. Century Bank.
 Statutes, regulations and
regulatory policies limit
the activities in
which we may
engage and the
conduct of our
permitted
 activities and establish capital requirements with which we must comply. The regulatory framework is intended primarily for
 the
protection
of
depositors,
borrowers,
customers
and
clients,
the
FDIC
funds
and
the
as
a
 whole, and not for the protection of our shareholders or creditors. In many cases, the applicable regulatory authorities have
 broad
power
over
bank
banks
and
their
subsidiaries,
the
power
to
 substantial fines and other penalties for violations of laws
and regulations.

the
imposes
and
collection
obligations.
Banking
statutes
and
 regulations are subject
to change,
and additional statutes,
regulations, and corresponding
guidance may
be adopted. We
 are unable to predict these future changes or the effects, if any, that these changes could have on the business, prospects,
 revenues, and results of operations of the Bank and Company.
 The material
statutory and
regulatory requirements
that are
applicable to
us are
summarized below.
The description
 below is not intended to summarize all laws
and regulations applicable to us. These summary descriptions are not
 to be
a complete
explanation
of such
laws
and
their
effects
on
Inc. and
U.S.

 Century Bank and are qualified
in their entirety by reference
to the actual laws and
regulations. You
should refer to the full
 text of the statutes, regulations, and corresponding guidance
for more information.
 2018 Regulatory Reform
 In May 2018
the Economic
Growth, Regulatory
Relief and
Consumer Protection
Act (the "2018
Act"), was
enacted to
 modify or remove
certain financial reform
rules and regulations, including
some of those
implemented under the
Dodd-Frank
 Wall Street Reform
and Consumer Protection
Act ("Dodd-Frank Act") enacted
in 2010. While the 2018
Act maintains most
structure established
Dodd-Frank Act,
it amends
certain aspects
regulatory framework
for
 small depository institutions with assets of less than $10.0 billion and for large banks with assets of more than $50.0
billion.
 Many of these changes resulted in meaningful regulatory
relief for community banks such as U.S. Century Bank.

 The 2018 Act, among other matters, expanded
the definition of "qualified mortgages"
which may be held by a financial
and
simplified
the
rules
for
and
their
with
total
 consolidated assets of less than
$10.0 billion by instructing
(as described below) the federal
banking regulators to establish
 a single "Community Bank Leverage Ratio" of between 8 and 10 percent to
replace the leverage and risk-based regulatory
 capital ratios.
The 2018
Act also
expanded the
category of
holding companies
rely on
the "Small
Bank Holding
 Company and Savings and Loan Holding Company Policy Statement" (the "SBHC Policy") by raising the maximum amount
 of assets a
qualifying holding company may
have from $1.0 billion
to $3.0 billion.
This expansion also excluded
such holding
from
the minimum
of
the Dodd-Frank
Act. In
the
2018
Act included
 relief
for
banks
examination
cycles,
call
reports,
the
Volcker
Rule
(proprietary
trading
 prohibitions), mortgage disclosures and risk weights for certain
high-risk commercial real estate loans.

 Bank and Bank Holding Company Regulation
 As a Florida-chartered state bank, U.S. Century Bank
is subject to ongoing and comprehensive supervision, regulation,
 examination, and enforcement by the FDIC and the Florida Office
of Financial Regulation ("FOFR"). The FOFR supervises
 and regulates
all areas
operations including,
without limitation,
the making
of loans,
the issuance
of securities,
the
 conduct
of
our
affairs,
the
satisfaction
of
adequacy
the
of
dividends,
and
the
 establishment or closing
of banking centers.
In addition, our
deposit accounts
are insured
by the Deposit
Insurance Fund
 (the "DIF")
administered by
the FDIC to
the maximum
extent permitted
by law,
and the FDIC
has certain
supervisory and
 enforcement powers over us.
 Any entity that directly or
indirectly controls a bank
must be approved by the
Federal Reserve under the
Bank Holding
Act
of
1956
(the
"BHC
Act")
to
a
bank
company.
Bank
are
to
 regulation, inspection, examination, supervision and enforcement
by the Federal Reserve under the BHC Act. The Federal
 Reserve's jurisdiction also extends to any company that is directly
or indirectly controlled by a bank holding company.
 USCB Financial Holdings, Inc.,
which controls U.S. Century
Bank, is a bank holding
company and, as such,
is subject
 to ongoing and comprehensive supervision, regulation,
examination and enforcement by the Federal Reserve.
 Notice and Approval Requirements Related to Control
 Banking
laws
notice,
approval,
and
ongoing
on
any
person
or
entity
that
seeks
to
 acquire direct or
indirect "control" of
an FDIC-insured depository
institution. These laws
include the
BHC Act and
the Change
 in Bank Control Act. Among other things,
these laws require regulatory filings by
individuals or entities that seek to
acquire
 direct or indirect
"control" of
an FDIC-insured
depository institution.
The determination
of whether
an investor
"controls" a
 depository institution is based
on all of
the facts and
circumstances surrounding the investment. As
a general matter, a party
 is deemed to conclusively control a depository institution or
other company if the party owns or
controls 25% or more of any
 class of
voting stock.
Subject to
rebuttal, a
party may
be presumed
to control
a depository
institution or
other company
if
 the investor owns or controls
10% or more of any class
of voting stock (and the entity's
securities are registered under the
 Exchange Act or,
if not, the
investor would be
the largest
shareholder). Except under
limited circumstances,
bank holding
are
prohibited
from
acquiring,
without
prior
approval,
of
any
other
bank
or
bank
or
 substantially all
the assets
thereof or
more than
5% of
the voting shares
of a
bank or
bank holding company
which is not
 already a subsidiary.
 Source of Strength
 All companies, including bank holding companies, that directly or indirectly control an insured depository institution, are
 required to serve as a source
of strength for the institution. Furthermore,
the Federal Reserve policy
is that a bank holding
 company should stand ready
to use available resources
to provide adequate capital
to its subsidiary banks
during periods

stress or
adversity and
should maintain
the financial
flexibility and
capital-raising capacity
to obtain
 resources for
assisting its subsidiary
banks. Under
this requirement,
Holdings, Inc.
in the future
could be
 required to provide financial assistance
to U.S. Century Bank should
it experience financial distress.
Such support may be
 required at times when, absent this statutory and Federal Reserve policy requirement, a bank holding company may not be
 inclined or able to provide it. A bank holding company's
failure to meet its obligations to serve as a source of strength to
its
 subsidiary banks will
generally be considered
by the Federal
Reserve to be
an unsafe and
unsound banking practice
or a
 violation of the Federal Reserve's regulations,
or both.
 Safety and Soundness Regulation
 As an insured depository
institution, we are subject to
prudential regulation and supervision
and must undergo regular
 on-site examinations by our state and federal banking agencies. The cost of examinations of insured depository institutions
 and any affiliates are assessed
by the appropriate agency against
each institution or affiliate that
is subject to examination
 as it deems
necessary or
appropriate. We
file quarterly
consolidated reports
of condition
and income, or
call reports,
with
 the FDIC and the FOFR.
 The federal banking
agencies have also
adopted guidelines establishing safety
and soundness standards for
all insured
 depository institutions including U.S. Century Bank. The
safety and soundness guidelines relate to,
among other things, our
controls,
cybersecurity,
audit
loan
underwriting
and
documentation,
anti-
 money laundering policies and procedures, transactions
with insiders, risk management, compensation, asset
growth, and
rate
exposure.
These
assist
the
with
early
identification
and
resolution
of
 problems at insured depository
institutions. If we were
to fail to meet or
otherwise comply with any
of these standards, the
 FDIC could require us to submit a
plan for achieving and maintaining compliance.
If a financial institution fails to
submit an
 acceptable compliance plan, or fails in any material respect to implement a compliance plan that has been accepted by the
 FDIC, the FDIC is
required to issue an
order directing the
institution to cure the
deficiency.
Until the deficiency cited
 order is cured, the
FDIC may restrict
the financial institution's
rate of growth, require
the financial institution to
increase its
 capital, restrict
the rates
the institution
pays on
deposits or
require the
institution to
take any
action the
regulator deems
 appropriate
under
the
circumstances.
Noncompliance
with
the
by
the
safety
and
soundness
 guidelines may
also constitute
grounds for
other
action,
including cease
and desist
orders
and
civil
money
 penalty assessments. In addition,
the FDIC could terminate
our deposit insurance if
it determines that
our financial condition
 was unsafe or
unsound or that
we engaged in unsafe
or unsound practices that
violated applicable rules, regulations,
orders
 or conditions enacted or imposed on us by our regulators.
 During
the
past
decade,
the
bank
have
increasingly
emphasized
the
importance
of
sound
risk
 management processes
and strong
internal controls
when evaluating
the activities
financial institutions they
supervise.
 Properly managing risks has been identified as critical to the conduct of safe and sound banking activities and has become
 even more
important as
new technologies, product
innovation and
the size
and speed
transactions have
changed
 the nature of
banking markets. The
agencies have identified
a spectrum of
risks facing a
banking institution including,
but
 not limited
to, credit,
market, liquidity, interest rate,
cybersecurity, operational, legal and
reputational risk. In
particular, recent
 regulatory pronouncements
have focused
on operational
risk, which
arises from
the potential
that inadequate
operational problems,
breaches
in
controls, fraud
or unforeseen
catastrophes
will result
in unexpected
 losses. New
products and
services, use
of outside
vendors and
cybersecurity are
critical sources
of operational
risk that
 financial institutions
are expected
to address
current environment.
We have
active Board
and senior
 oversight
policies,
and
risk
limits;
risk
and
monitoring
and
 information systems; and comprehensive internal controls
to address these various risks.
 Permissible Activities and Investments
 Banking
laws
restrict
the
of
USCB
Inc.
to
in
other
than
those
to
be
so
closely
to
as
to
be
a
proper
incident
thereto.
The
 Reserve has determined
by regulation that
certain activities are
closely related to
banking including operating
a mortgage
 company,
finance company,
credit card
company,
factoring
company,
trust
or savings
association;
performing
data
processing
operations;
limited
brokerage
services;
acting
as
an
or
 advisor; acting as
an insurance agent
for certain types
of credit-related insurance;
leasing personal property
on a
full-payout,
 non-operating basis; providing
tax planning and
preparation services; operating
a collection agency;
and providing certain
 courier services. In
addition, the Gramm
-Leach-Bliley Act (the
"GLB Act") expanded
the scope of
permissible activities for
 a bank holding company that
qualifies as a financial holding company.
Under the regulations implementing
the GLB Act, a
 financial holding company may engage
in additional activities that are financial
in nature or incidental or complementary
to
 a financial activity
such as securities
underwriting, insurance underwriting and
merchant banking. USCB Financial
 Inc. is not a financial holding company.

 In addition, as a general matter, the establishment or acquisition
by USCB Financial Holdings, Inc. of
a non-bank entity,
 or
the
initiation
of
a
non-banking
activity,
prior
approval.
In
approving
or
the
addition
of
 activities,
the
considers,
among
other
the
acquisition
or
the
can
 reasonably be expected
to produce benefits
to the public, such
as greater convenience,
increased competition or
gains in
 efficiency,
that
outweigh
such
effects
as
undue
concentration
of
resources,
decreased
or
unfair
 competition, conflicts of interest or unsound banking practices.
 Regulatory Capital Requirements
 The federal banking
regulators have adopted
risk-based capital
adequacy guidelines for
bank holding companies
and
 their subsidiary banks
and banks without bank
holding companies based on
the Basel III
standards. Under these guidelines,
 assets and off-balance sheet items are assigned to specific risk categories, each with designated risk weightings. The risk-
 based capital guidelines are designed to make regulatory
capital requirements more sensitive to differences
in risk profiles
 among banks and bank holding
companies, to account for off-balance sheet
exposure, to minimize disincentives for
 liquid assets, and
to achieve greater
consistency in
evaluating the capital
adequacy of
major banks throughout
the world.
 The resulting
capital ratio requirements
represent capital as
a percentage of
total risk-weighted assets
and off-balance sheet
 items. Final
rules implementing the
capital adequacy guidelines
became effective, with
various phase-in periods,
on January
 1, 2015
for
banks
such
as us.
All
of
the
rules
were
fully
phased
in
as of
1,
2019.
These
final
rules
 represent a significant change to the prior general risk-based capital rules and are
designed to substantially conform to the
 Basel III international standards.
 In computing
total risk-weighted
assets, bank
and bank
holding company
assets are
given risk-weights
of 0%,
20%,
 50%, 100%
and 150%.
off-balance
sheet items
are given
similar credit
conversion
to convert
 them to asset
equivalent
amounts to which
an appropriate risk-weight
will apply.
Most loans will
be assigned to
the 100%
 risk
category,
except
for
performing
first
mortgage
loans
fully
by
1-to-4
family
or
multi-family
 properties, which carry
a 50% risk
rating, and certain
past due loans
which are assigned
a 150% risk
rating. Most investment
 securities (including,
primarily,
general obligation
claims on
states or
other political
subdivisions of
the United
States) will
 be assigned to
the 20%
category,
except for
municipal or
state revenue bonds,
which have
a 50%
risk-weight, and
direct
 obligations of the U.S. Treasury
or obligations backed by the full faith
and credit of the U.S. government,
which have a 0%
 risk-weight. In covering off
-balance sheet items, direct
credit substitutes, including
general guarantees and standby
letters
 of credit backing
financial obligations,
are given a
100% conversion
factor.
Transaction-related
contingencies such
as bid
 bonds, standby
letters of
credit backing
nonfinancial obligations,
and undrawn
commitments (including
commercial credit
 lines with an
initial maturity
of more than
one year) have
a 50% conversion
factor.
Short-term commercial
letters of credit
 are converted at 20% and certain short-term unconditionally
cancelable commitments have a 0% factor.
 Under
the
final
rules,
minimum
for
both
the
quality
and
quantity
of
held
by
 organizations. In this respect, the final rules
implement strict eligibility criteria for regulatory capital instruments and improve
 the methodology for
calculating risk-weighted
assets to enhance
risk sensitivity.
Consistent with the
international Basel III
 framework, the rules include a new
minimum ratio of Common Equity
Tier 1 Capital to Risk-Weighted
Assets of 4.5%. The
 rules also create a Common Equity Tier 1 Capital conservation
buffer of 2.5% of risk-weighted assets. This buffer
is added
 to each of the three risk-based capital
ratios to determine whether an institution
has established the buffer.
The rules raise
 the minimum ratio of Tier 1 Capital to Risk-Weighted Assets from 4% to 6% and
include a minimum leverage ratio of 4% for
 all banking
organizations. If
a financial
capital conservation
buffer
falls below
2.5% —
e.g., if
the institution's
 Common Equity
Tier
1 Capital
to Risk
-Weighted
Assets is
less than
7.0% —
then capital
distributions
and
discretionary
 bonus payments will
be limited or
prohibited based on
the size of
the institution's conservation buffer. The types
of payments
 subject to this limitation include
dividends, share buybacks, discretionary payments on
Tier 1 instruments, and discretionary
 bonus payments.
 The
may
also
the
treatment
of
accumulated
other
("AOCI")
for
 regulatory capital purposes. Under
the rules, AOCI generally
flows through to regulatory
capital;
however, community banks
 and their holding companies (if any) were allowed to make a
one-time irrevocable opt-out election to continue to treat AOCI
as under
the old
regulations for
regulatory capital
purposes. This
election was
required to
be made
first
 call report
filed after
January 1,
2015. We
made the
opt-out election.
the rules
also permit
community banks
 with less than $15.0 billion in total assets to continue to count certain non-qualifying capital instruments issued prior to May
 19, 2010 as Tier 1 capital, including trust preferred securities
and cumulative perpetual preferred stock (subject to a limit of
 25% of Tier 1 capital). However, non-qualifying
capital instruments issued on or after May 19, 2010 do not qualify for Tier 1
 capital treatment. At December 31, 2024, we had no
such investments.
 In May 2016,
amendments to the
Federal Reserve's SBHC Policy
became effective which increased
the asset threshold
 to qualify to utilize the
provisions of the SBHC
Policy from $500.0
million to $1.0 billion.
Subsequently,
as part of the
2018
 Act, the
threshold
was
to
$3.0
billion.
Bank
holding companies
which
are subject
SBHC
Policy

 subject to compliance with
the regulatory capital requirements
described above until they
exceed $3.0 billion in
assets. As
 a consequence, as of December
31, 2024, USCB Financial Holdings, Inc.
was not required to
comply with the requirements
 set forth above
and will not
be subject to
such requirements
until such time
that its
consolidated total
assets exceed
$3.0
 billion or
the Federal Reserve
determines that USCB
Financial Holdings, Inc.
is no
longer deemed to
be a
small bank
 company.
if
USCB
Inc.
had
been
to
the
it
would
have
been
in
 compliance with such requirements.
 In
September
2019,
the
jointly
finalized
a
rule
to
simplify
the
 requirements described above for qualifying community banking organizations
that opt into the Community Bank Leverage
 Ratio, or
CBLR,
framework,
as required
by Section
201 of
the Regulatory
Relief
Act. The
final rule
became
on
 January 1,
2020,
CBLR framework
became
available for
banks to
use beginning
with
their
March
31, 2020
call
 reports. Under
the final
rule, if
a qualifying
banking organization
opts into
the CBLR
framework and
meets all
 requirements under the
framework, it will
be considered to
have met
the well-capitalized ratio
requirements under the
prompt
 corrective action
described below
in this
Form 10-K
and will
required to
report or
calculate
risk-based
 capital. In order to
qualify for the CBLR
framework, a community
banking organization must
have a tier 1
leverage ratio of
 greater than
9%, less
than $10.0
billion in
total consolidated
assets, off
-balance
sheet exposures
of 25%
or less
and
trading
and
of 5%
or less
assets.
Although
U.S. Century
 Bank is a qualifying
community banking organization,
U.S. Century Bank has
elected not to opt in
to the CBLR framework
 at this time and will continue to follow the Basel III capital
requirements as described above.
 As of
U.S. Century
Bank qualified
as a
"well capitalized"
institution. See
Note 15
 "Regulatory Matters"
of the Consolidated
Financial Statements
included in
Item 8
of this
Annual Report
on Form
10-K for
 further details.
 Prompt Corrective Action
 Under the Federal
Deposit Insurance Act
("FDIA"), the
federal bank regulatory
agencies must take
"prompt corrective
 action"
undercapitalized
U.S.
institutions.
The
capital-based
five
 categories
of
with
"well
capitalized,"
"adequately
capitalized,"
 "undercapitalized,"
"significantly
undercapitalized,"
and
"critically
undercapitalized,"
and
are
subjected
to
differential
 regulation corresponding to the capital category within
which the institution falls.

 An insured depository
institution is deemed
to be "well
capitalized" if
it has a
total risk-based
capital ratio
of 10.0% or
 greater, a
tier 1 risk-based
capital ratio of 8.0%
or greater,
a Common Equity
Tier 1
risk-based capital ratio
of 6.5% and a
 leverage ratio of 5.0%
or greater, and the institution is
not subject to
an order, written agreement, capital directive, or
prompt
 corrective action
directive to
meet and
maintain a
specific level
for any
capital measure.
Under certain
circumstances,
a
 well-capitalized, adequately
capitalized or
undercapitalized institution
treated as
if the
institution were
next
 lower capital category if it is determined that the institution is in an unsafe or unsound condition or is engaging in an unsafe
 or unsound practice.
The degree of
regulatory scrutiny
of a financial
institution will increase,
and the permissible
 of
the
will
decrease,
as
it
moves
downward
the
categories.
Under
specified
circumstances,
a
agency
may
reclassify
a
"well-capitalized"
as
adequately
capitalized
and
may
an
 adequately capitalized institution or an
undercapitalized institution to comply with
supervisory actions as if
it were in
the next
 lower
(except
that
the
FDIC
may
not
reclassify
a
significantly
undercapitalized
as
critically
 undercapitalized).
A banking
institution that
is undercapitalized
is required
to submit
a capital
restoration
plan. Failure
to
 meet
could
the
to
a
of
remedies
by
bank
 agencies,
including:
termination
of
by
the
FDIC,
on
activities,
and
 appointment of the FDIC as conservator or receiver.
 At December 31, 2024, U.S. Century Bank was deemed to be a "well-capitalized" institution for purposes of the prompt
 corrective action regulations and as such is not subject
to the above mentioned restrictions.
 Commercial Real Estate Concentration Guidelines
 The federal
banking regulators
have implemented
guidelines to
address increased
concentrations in
loans.
These
describe
the
criteria
will
use
as
indicators
to
identify
 potentially
exposed
to
real
concentration
risk.
An
that
has
(i)
experienced
rapid
in
estate lending,
(ii) notable
exposure to
a specific
type of
estate, (iii)
total reported
loans
 for construction, land development,
and other land representing
100% or more of
total capital, or (iv) total
construction)
as
in
the
guidance,
representing
300%
or
more
of
total
 capital and the outstanding balance of the
institution's commercial real estate portfolio has increased by 50% or
more in the
 prior 36 months, may be identified for further supervisory
analysis of a potential concentration
risk.

31, 2024, our
ratio of construction
loans to total
risk-based capital
was 23%,
and therefore,
we were
 under
the
100%
threshold
set
forth
in
clause
(iii)
in
the
paragraph
above.
with
respect
to
clause
(iv)
in
the
 paragraph above, as
of December
31, 2024, our
ratio of total
estate loans
to total risk-based
capital was
 366% and the outstanding balance of
the institution's commercial real estate portfolio increased by 50% or
more in the prior
 36 months.
As a
result, we
are deemed
to have
a concentration
in commercial
lending under
applicable regulatory
 guidelines.
 If a
concentration is
present, under
the federal
banking regulator'
guidance, management
should employ
heightened
 risk management practices that address key elements,
including board and management oversight and
strategic planning,
 portfolio management,
of underwriting
standards,
risk assessment
and monitoring
market analysis
 and stress
testing, and
maintenance of
increased capital
levels as
needed to
support the
level of
 lending.
To
address the commercial
real estate lending
concentration, the Bank
has previously established
a commercial
 real estate lending framework to
monitor specific exposures and
limits by types within the commercial
real estate portfolio,
 including, among other
things, annual stress testing
of the commercial real
estate portfolio, and takes
appropriate actions,
 as necessary.
 Payment of Dividends and Share Repurchases
 The ability of
the board of
directors of an
insured depository
institution to declare
a cash dividend
or other distribution
 with respect to capital is subject
to federal and state statutory
and regulatory restrictions that
limit the amount available for
 such
distribution
depending
upon
earnings,
the
has
retained
 earnings, and cash needs of the institution,
as well as general business conditions.
Insured depository institutions are also
 prohibited
from
paying
fees
to
any
controlling
persons
or,
with
limited
exceptions,
making
 distributions, including dividends, if after such transaction the institution would be
less than adequately capitalized. We may
 generally declare a dividend
from retained net profits
which accrued prior to
the preceding two
years, but we must,
before
 the
declaration
of
a
dividend
on
our
under
law,
carry
20%
of
our
net
profits
for
such
 preceding period
as is
covered by
the dividend
surplus fund,
until the
same shall
at least
equal the
our
 common stock and preferred stock,
if any, then issued and outstanding. Under Florida law, we are
prohibited from declaring
 a
dividend
at
any
time
at
which
our
net
from
the
year
combined
with
the
retained
net
from
the
 preceding two years is a loss or which would cause our capital accounts to
fall below the minimum amount required by law,
 regulation, order,
or any written agreement
with a state or
federal regulatory agency.
 Furthermore, under applicable
FDIC
 regulations and policy,
because U.S. Century Bank has
negative retained earnings, it must obtain the
prior approval of the
 FDIC before effecting a cash dividend or other capital
distribution.
 A Federal Reserve policy statement on the payment
of cash dividends states that a bank holding
company should pay
 cash dividends only to the
extent that the holding company's net
income for the past year
is sufficient to cover both the
cash
 dividends and
a rate
of earnings
retention that
is consistent
holding company's
capital needs,
asset quality
and
 overall
condition.
The
Reserve's
policy
also
that
it
would
be
inappropriate
for
a
 company experiencing serious financial problems to borrow funds to pay dividends.
Furthermore, under the federal prompt
 corrective action
regulations, the
Federal Reserve
may prohibit
a bank
holding company
from paying
any dividends
if the
 holding company's bank subsidiary is classified
as "undercapitalized." See "- Prompt Corrective Action"
above.
 Section 225.4(b)(1) of Regulation Y promulgated
by the Federal Reserve requires that
a bank holding company that is
 not "well-capitalized" or "well-managed",
or that is subject to any
unresolved supervisory issues, provide
prior notice to the
 Federal Reserve for
any repurchase or
redemption of
its equity securities
for cash or
other value that
would reduce by
 percent or more the bank
holding company's consolidated
net worth aggregated over
the preceding 12-month period.
The
may
disapprove
such
a
purchase
or
redemption
if
it
determines
that
the
proposal
would
constitute
an
 unsafe or
unsound practice
or would
violate any
law,
regulation, Federal
Reserve order
or any
condition imposed
by,
or
 written
agreement
 with,
the
Reserve.
As
of
31,
2024,
the
was
not
to
any
formal
 supervisory restrictions on
its ability
to pay dividends
but will
notify the
Federal Reserve in
advance of any
proposed dividend
 to the Company's shareholders in
light of the Bank's
negative retained earnings. In addition,
we will provide prior
notification
 to the Federal Reserve prior to effecting proposed share
repurchases.
 Incentive Compensation
 Guidelines adopted by
the federal
banking agencies pursuant
FDIA prohibit
excessive compensation as
an unsafe
 and
unsound
practice
and
describe
as
excessive
when
the
paid
are
unreasonable
or
 disproportionate to the services performed by an executive
officer, employee, director
or principal shareholder.

 In June 2010,
the federal banking
agencies jointly
adopted the
Guidance on Sound
Incentive Compensation
Policies,
 or GSICP.
The GSICP was
intended to ensure
that banking organizations
do not undermine
the safety and
soundness of
 such organizations
by encouraging
excessive risk-taking.
This guidance,
which covers
all employees
that have
the ability
 to expose the organization
to material amounts
of risk, either
individually or as
part of a group,
is based upon a
set of key
 principles relating to
a banking organization's
incentive compensation arrangements.
Specifically,
incentive compensation
 arrangements should (i)
provide employee incentives
that appropriately balance risk
in a manner that does
not encourage
 employees to expose their
organizations to imprudent risk,
(ii) be compatible with
effective controls and risk
 and (iii) be supported by
strong corporate governance,
including active and effective
oversight by the organization's
board
 of directors. Any deficiencies in our compensation
practices could lead to supervisory or enforcement
actions by the FDIC.
 The
GSICP
Guidance
that
may
be
taken
a
organization
if
its
incentive
 compensation arrangements or related risk-management control or governance processes pose a risk to the
organization's
 safety and soundness and the organization is not taking prompt and
effective measures to correct the deficiencies.
 The
Dodd-Frank
Act
the
and
the
SEC
to
establish
joint
or
 prohibiting incentive-based
payment arrangements
at specified
regulated entities,
us, having at
least $1
billion in
 total
that
encourage
inappropriate
risk-taking
by
an
officer,
employee,
director
or
 shareholder
with
excessive
compensation,
fees,
or
or
that
could
lead
to
loss
to
the
entity.
In
 addition, these regulators must establish regulations or guidelines requiring enhanced disclosure to regulators of incentive-
 based compensation
arrangements. The
federal banking
agencies proposed
such regulations
in April
2011
and issued
a
 second proposed
rule in
April 2016.
The second
proposed rule
would apply
to all
banks, among
other institutions,
with at
 least $1.0 billion in average
total consolidated assets.
Final regulations have not
been adopted as of the
date of this Form
 10-K.
If
adopted,
these
or
other
would
on
the
manner
in
which
we
may
structure
 compensation for our executives and other employees
that go beyond the requirements of GSICP.
The scope and content
federal banking
agencies' policies
on incentive
compensation are
continuing
to develop
and are
likely
to continue
 evolving, but the timeframe for finalization of such policies
is not known at this time.
 Limits on Transactions with Affiliates and
Insiders
 Transactions
and
any
affiliate
are
governed
by
Sections
23A
and
23B
of
the
 Federal Reserve Act. An affiliate
of an insured financial institution
is any company or entity which
controls, is controlled by
 or
is
under
with
the
institution.
In
a
bank
context,
the
bank
 company of an insured financial institution
(such as the Company) and any
companies which are controlled by such holding
are
affiliates
of
the
institution.
Generally,
23A
limits
the
to
which
the
 financial institution or its
subsidiaries may engage in
"covered transactions" with any one
affiliate to an amount equal
to 10%
 of such institution's
capital stock
and surplus, and
contains an
aggregate limit
on all such
transactions with
all affiliates
to
 an amount equal to 20% of such capital stock and surplus. Section 23B applies to "covered transactions" as well as certain
 other
and
that
all
be
on
terms
substantially
the
same,
or
at
least
as
favorable
to
the
 insured financial institution, as
those provided to
a non-affiliate. The term "covered
transaction" includes the making
of loans
 to, purchase of
assets from
and issuance of
a guarantee to
an affiliate
and similar
transactions. Section
23B transactions
 also include
the provision
of services
sale of
assets by
an insured
institution to
an affiliate.
 loans or other
extensions of
credit by the
financial institution
to the affiliate
are to be
collateralized in
accordance with
the
 requirements set for in Section 23 of the Federal Reserve
Act.
 Sections 22(g)
and (h)
Federal Reserve
Act place
restrictions on
loans to
executive officers, directors
and principal
 stockholders. Under
Section 22(h),
loans to
a director,
an executive
officer
a greater
than 10%
stockholder
of an
institution,
and
affiliated
interests
of
either,
may
not
exceed,
together
with
all
other
 loans to such
person and
affiliated interests,
the insured financial
institution's loans
to one borrower
limit (generally
equal
 to 15%
of
the
unimpaired capital
and
surplus).
22(h) also
that
loans
to directors,
 officers and principal stockholders be made on terms substantially the same as offered in comparable transactions to other
 persons unless the loans are made pursuant to a benefit or compensation program that (i) is widely available to employees
institution and
(ii) does
not give
preference to
any director, executive
officer or
principal stockholder, or
certain affiliated
 interests thereof, over other employees
of the insured financial institution.
Section 22(h) also requires prior board
approval
 for the issuance of certain loans. In addition, the aggregate amount of
extensions of credit by an insured financial institution
 to all insiders cannot
exceed the institution's
unimpaired capital and
surplus. Furthermore, Section
22(g) places additional
 restrictions on loans to executive officers. At December
31, 2024, the Bank was in compliance with the above
restrictions.
 FDIC Deposit Insurance
 The FDIC is
an independent
federal agency
that insures the
deposits of federally
insured depository
institutions up
to
 applicable limits. The FDIC also has certain regulatory,
examination and enforcement powers with respect to FDIC-insured

 institutions.
The
are
by
the
FDIC
up
to
limits.
As
a
general
matter,
the
maximum
 insurance amount is $250 thousand per depositor.
FDIC-insured depository institutions are
required to pay deposit insurance
assessments to the FDIC. The
a particular
institution's deposit
insurance assessment
is based
on that
institution's risk
classification under
an
 FDIC risk-based assessment system. An institution's
risk classification is assigned based on
its capital levels and the level
 of supervisory concern the institution poses to the regulators.
 Under the current
system, deposit
insurance assessments
are based
on a bank's
assessment base,
which is
 as average total assets minus
average tangible equity.
For established small institutions,
such as the Bank, the
FDIC sets
rates
based
on
the
Ratios
Method,
which
takes
into
account
several
ratios
that
reflect
 leverage, asset quality,
and earnings at
each individual institution
and then applies
a pricing multiplier that
is the same for
 all institutions. An
institution's rate
must be within
a certain minimum
and a certain
maximum, and the
range varies based
composite CAMELS
rating. The
deposit insurance
is calculated
by multiplying
the bank's
 assessment base
total base
assessment rate.
Assessment rates
for most
insured depository
institutions with
less
 than $10.0 billion of assets range from 2.5 to 32 basis points
of each institution's total assets less tangible
capital.
 In October 2022, the FDIC finalized a
rule that increased the initial base deposit insurance
assessment rates by 2 basis
 points, beginning with the first
quarterly assessment period of 2023
(January 1, 2023 through
March 31, 2023). The FDIC,
 as required under the FDIA, established a plan in
September 2020 (the "Restoration Plan") to restore the DIF
reserve ratio
 to meet or exceed
the statutory minimum
of 1.35% within eight
years. The Restoration
Plan did not
include an increase
in
 the deposit
insurance assessment
rate. Based
FDIC's recent
projections,
however,
the FDIC
determined that
the
 DIF reserve ratio
is at risk
of not reaching the
statutory minimum by
the statutory deadline
of September 30,
2028 without
 increasing the
deposit insurance
assessment rates.
The increased
assessment would
improve the
likelihood that
the DIF
 reserve ratio would reach the required minimum by the statutory deadline, consistent with the
FDIC's amended Restoration
 Plan. The FDIC
also concurrently maintained
the Designated Reserve
Ratio ("DDR") for
the DIF at
2% for 2023. The
new
 assessment rate schedules will remain
in effect unless and until the reserve
ratio meets or exceeds 2% in order to support
in
the
DIF
in
progressing
toward
the
FDIC's
goal
of
a
2%
DRR.
Progressively
lower
rate
 schedules will
take effect
when the
reserve ratio
reaches 2%,
and again
when it
reaches 2.5%.
The revised
 rate schedule will
remain in effect unless
and until the
reserve ratio meets
or exceeds 2%,
absent further action by
the FDIC.
 Under the
FDIA, the
FDIC may
terminate deposit
insurance upon
a finding
that the
institution has
engaged in
unsafe
 and unsound
practices,
is in
an unsafe
or unsound
to continue
or has
violated any
law,
 regulation, rule, order, or condition
imposed by the FDIC.
 Depositor Preference
 The FDIA provides
that, in the
event of the
"liquidation or other
resolution" of an
insured depository institution, the
claims
 of depositors
of the institution
(including the
claims of
the FDIC as
subrogee of
insured depositors)
and certain claims
for
 administrative
of
the
FDIC
as
a
receiver
will
have
priority
over
other
general
unsecured
claims
the
 institution. Insured and
uninsured depositors,
along with the
FDIC, will have
priority in payment
ahead of unsecured,
non-
 deposit creditors,
including U.S.
Century Bank,
with respect
to any
extensions of
credit they
have made
to such
 depository institution.
 Overdraft Fee Regulation
 The Electronic Fund Transfer Act prohibits
financial institutions from charging consumers fees
for paying overdrafts on
 automated teller machines, or
ATMs,
and one-time debit card transactions,
unless a consumer consents,
or opts in, to the
 overdraft service for those types
of transactions. If a consumer
does not opt in,
any ATM transaction or debit that overdraws
 the consumer's account
will be denied.
Overdrafts on
the payment
of checks
and regular
electronic bill
payments are
not
 covered
by
this
new
rule.
Before
opting
in,
the
must
be
provided
with
a
notice
that
explains
the
overdraft
services,
the
fees
with
the
service,
and
the
consumer's
choices.
must
consumers
who
do
not
opt
in
with
the
same
account
terms,
and
features
 pricing) that they provide to consumers who do opt in.
 Federal Reserve System and Federal Home Loan
Bank System
 We are a member of the Federal Home Loan Bank ("FHLB") of Atlanta, which is one of 11 regional FHLBs. Each FHLB
 serves as
a quasi-reserve
bank for
its members
within its
assigned region.
It is
funded primarily
from funds
deposited by
 member institutions
and proceeds
from the sale
of consolidated
obligations of
the FHLB
system. A
FHLB makes
loans to
 members (i.e., advances) in accordance with policies
and procedures established by the Board of Trustees
of the FHLB.

 As a member
of the FHLB
of Atlanta, we are
required to own
capital stock in
the FHLB in
an amount at
least equal to
 0.07% (or
7 basis
points), which
is subject
to annual
adjustments, of
the Bank's
total assets
end of
each calendar
 year (up
to a
maximum of
$18.0 million),
plus 4.75%
outstanding advances
(borrowings) from
the FHLB
of Atlanta
 under the activity-based stock ownership requirement.
 Anti-Money Laundering Regulation
 As a financial
institution, we
must maintain
anti-money laundering
programs that
include established
internal policies,
and
controls,
a
designated
officer,
an
ongoing
training
program,
and
testing
of
the
 program by an independent audit function in accordance with the
Bank Secrecy Act of 1970, as amended ("BSA"), and the
 regulations issued by the Department of the Treasury
in 31 CFR Chapter X, FDIC
Section 326.8 of the FDIC's regulations
 and the Florida Control of
Money Laundering and Terrorist
Financing in Financial Institutions
Act. Financial institutions are
 prohibited from entering into specified financial transactions and account relationships and must meet enhanced standards
 for due
diligence and
"knowing
your
customer"
in their
dealings
with
foreign financial
foreign customers
and
 other high risk
customers. Financial
institutions must also
take reasonable steps
to conduct enhanced
scrutiny of account
 relationships to
guard against
money laundering
report transactions
that meet
certain dollar
amount thresholds
as
 well as any
suspicious transactions.
Laws, such
Act enacted
in 2001,
as described
below,
 law enforcement authorities with increased access to financial
information maintained by banks.

 Anti-money laundering
obligations have
been substantially
strengthened
as a
the USA
PATRIOT
Act. Bank
 regulators routinely examine institutions for compliance with these obligations, and this area has become a particular focus
 of
the
in
years.
In
the
are
to
consider
in
connection
with
the
of
applications.
In
have
expressed
concern
over
institutions'
with
and,
in
some
cases,
have
delayed
approval
of
their
expansionary
 proposals. The regulators and other
governmental authorities have been
active in imposing "cease
and desist" orders and
 significant money penalty sanctions against institutions
found to be in violation of the anti-money laundering regulations.
Act
 The USA
PATRIOT
Act became
in October
2001 and
amended the
BSA. The
Act requires
 banks to establish anti-money laundering programs that
include, at a minimum:
 •

a bank
that
policies,
and
to
implement
and
 maintain the
bank's compliance
with all
requirements of
the USA
PATRIOT
Act, the
BSA and
related laws
 and regulations;
bank wide
and procedures
for monitoring
and reporting
of suspicious
and
 activities;
 •

a designated compliance officer;
 •

employee training for bank employees;
 •

an independent audit function to test the efficacy
of the bank's anti-money laundering program;
 •

procedures to verify the identity of each bank customer upon
the opening of accounts;
 •

heightened due diligence policies,
procedures and controls applicable to
certain foreign accounts and
relationships;
 and
 •

required reports to law enforcement and/or financial regulators to assist in the deterrence and prevention of money
 laundering activities.
the USA PATRIOT
Act requires each financial
institution to develop a
customer identification program,
or
 CIP, as part of its anti-money
laundering program. The
key components of
the CIP are
identification verification, government
 list comparison,
notice and
record retention.
The purpose
CIP is
to enable
the financial
institution to
determine the
 true identity
and anticipated
account activity
of each
customer.
To
make this
determination, the
financial institution
must,
 among other things, collect certain information from customers at the time they enter
into the customer relationship with the
 financial institution.
This information must
be verified within
a reasonable time.
Furthermore, all customers
must be
screened
 against any CIP-related government
lists of known or suspected
terrorists or other "sanctioned"
persons. In May 2018, the
 U.S. Treasury's
Financial Crimes
Enforcement Network,
or FinCEN,
issued a
final rule
BSA requiring
banks to
 identify and verify
the identity of
the natural persons
behind their customers
that are legal
entities—the beneficial
owners.
 The
Anti-Money
Laundering
Act
of
2020
(the
"AML
Act")
and
the
AML
Act,
the
Corporate
Transparency
Act
(the
 "CTA"),
was enacted in
January 2021. The
AML Act is
intended to be
a comprehensive
reform and modernization
to U.S.
 bank
secrecy
and
laws.
Among
other
it
codifies
a
risk-based
approach
to
 laundering compliance
for financial
institutions; requires the
development of
standards for evaluating
technology and
 processes
for BSA
compliance;
expands
enforcement-
and investigation
-related
authority,
increasing
 sanctions
for
BSA
violations
and
instituting
BSA
whistleblower
incentives
and
protections.
The
CTA
establishes

 uniform beneficial
ownership reporting
requirements for
corporations, limited
liability companies,
and other similar
entities
 formed or registered to do business in the United States. The CTA
authorizes FinCEN to collect that information and share
 it with
authorized government authorities
and financial institutions,
effective safeguards and
controls. In December
 2024,
a
nationwide
injunction
was
granted,
blocking
the
of
the
CTA
pending
the
adjudication
of
the
 constitutionality
of
the
CTA.
In
late
2025,
the
United
States
Supreme
Court
reversed
the
U.S.
district
court's
 preliminary injunction staying the CTA.
However, a separate nationwide
stay of the CTA
issued earlier in January 2025 by
 another U.S.
district court
was not
affected
Supreme Court's
action. In
mid-February
U.S.
district court
 stayed the preliminary relief granted
in its early January
2025, order, including the nationwide stay
of the CTA.
On February
 19, 2025, FinCEN published an
updated alert stating that,
in view of the U.S. district
court's decision, beneficial
ownership
under
the
CTA
will
be
in
effect.
FinCEN
extended
the
deadline
for
most
 reporting companies filing initial, updated
and corrected beneficial ownership
reports to March 21, 2025
(30 calendar days
 from
February
19,
2025).
Subsequently,
on
March
2,
2025,
the
U.S.
Treasury
announced
that
it
was
suspending
of
the
CTA
domestic
and
their
beneficial
owners.
The
U.S.
Treasury
also
 announced
that
it
would
be
proposing
revised
rules
to
foreign
only.
In
2023,
 FinCEN issued regulations regarding
access to the beneficial ownership
information collected under the CTA.
We and our
 affiliates have adopted
policies, procedures and
controls designed to comply
with the BSA, the AML
Act, the CTA
Act.
 The Office of Foreign Assets Control
 The Office of Foreign Assets Control (the "OFAC")
is responsible for helping to ensure that U.S. entities do not engage
 in transactions with
"enemies" of
the United States,
as defined by
various Executive
Orders and Acts
of Congress.
OFAC
 publishes lists of
names of
persons and organizations
suspected of aiding,
harboring or
engaging in terrorist
acts; owned
 or
controlled
by,
or
acting
on
behalf
of
target
countries;
and
narcotics
traffickers.
Such
persons
are
referred
to
as
 "sanctioned" persons.

 If a bank finds
a name on
any transaction, account
or wire transfer
that is on
an OFAC
list, it must
freeze the account
 and/or block the transaction or wire transfer. We utilize an outside vendor to oversee
the inspection of our accounts and the
 filing of any notifications.
We also monitor
high-risk OFAC
areas such as new
accounts, wire transfers
and customer files.
 These checks are performed using software that is updated each time
a modification is made to the lists provided by
OFAC
 and other agencies of Specially Designated Nationals
and Blocked Persons.
 Consumer Laws and Regulations
 Our activities
are subject
to a
of federal
and state
statutes and
designed to
protect consumers
in
 transactions with
banks. Interest
charges collected
or contracted
for by
us are
state usury
laws and
 federal laws concerning interest rates. Our loan
operations are also subject to federal laws
applicable to credit transactions,
 such as:
 •

the
Truth-In-Lending
Act
("TILA"),
and
Regulation
Z,
governing
disclosures
of
and
servicing
terms
to
 consumer borrowers and including substantial new requirements for mortgage lending and servicing, as mandated
 by the Dodd-Frank Act
 •

the Home Mortgage Disclosure Act of 1975 and Regulation C, requiring
financial institutions to provide information
 to enable the
public and public
officials to
determine whether
a financial institution
is fulfilling its
obligation to help
 meet the housing needs of the communities they serve;
 •

the Equal Credit
Opportunity Act
and Regulation
B, prohibiting
discrimination on
the basis
of race,
color,
religion,
 or other prohibited factors in extending credit;
 •

the Fair
Credit Reporting Act
of 1978,
as amended by
the Fair
and Accurate Credit
Transactions Act, and Regulation
 V, as well as the rules and
regulations of the FDIC governing the
use and provision of information
to credit reporting
 agencies, certain identity theft protections and certain
credit and other disclosures;
 •

the Fair
Debt Collection
Practices Act
and Regulation
F,
governing the
manner in
which consumer
debts may
be
 collected by collection agencies; and
 •

the Real Estate Settlement Procedures Act,
("RESPA"), and Regulation X, which governs aspects of the settlement
 process for residential mortgage loans.
 Our deposit operations are also subject to federal laws,
such as:
 •

the FDIA, which, among other things, limits the amount of
deposit insurance available per account to $250,000 and
 imposes other limits on deposit-taking;
 •

the Right to
Financial Privacy Act,
which imposes a
duty to maintain
the confidentiality of
consumer financial records
 and prescribes procedures for complying with administrative subpoenas
of financial records;

 •

Check Clearing for
the 21st Century
Act (also known
as "Check 21"),
which gives "substitute
checks," such as
digital
 check images and copies made from that image, the
same legal standing as the original paper check;
 •

the Electronic
Funds Transfer
Act and
Regulation E,
which governs
automatic deposits
to and
withdrawals
from
 deposit accounts
and customers'
rights and
liabilities arising
ATMs
electronic banking
 services; and
 •

the Truth
in Savings
Act and
Regulation DD,
which requires
depository institutions
to provide
disclosures so
that
 consumers can make meaningful comparisons about depository
institutions and accounts.
 These
laws
and
mandate
and
regulate
the
manner
in
which
 institutions must deal with clients when
taking deposits or making loans to
such clients. We must comply with the applicable
 provisions of these consumer protection laws and regulations as part of both
our ongoing client relations and our regulatory
 compliance obligations.
 Financial Privacy and Cybersecurity
 Banking organizations
are
many federal
and state
laws and
governing the
collection,
use and
 protection of customer information.
Under the privacy protection
provisions of the GLB
Act and related laws
and regulations,
 including Florida laws, we are limited in our ability
to disclose non-public information about consumers
to nonaffiliated third
 parties. These
of
privacy
policies to
consumers
and,
in
some
circumstances,
us to
 allow
consumers
to
prevent
of
to
a
nonaffiliated
third
party
and
to
not
disclose
 account numbers or
access codes to
non-affiliated third parties for
marketing purposes. Federal
banking agencies, including
 the
FDIC,
have
for
establishing
and
programs
for
 implementing safeguards. These guidelines,
along with related
regulatory materials, increasingly focus
on risk management
 and processes related to information technology and the
use of third parties in the provision of financial services.
 In
the
have
a
rule
to
establish
computer-security
incident
notification
for
bank
banks
and
their
service
providers.
Under
the
rule,
organizations
are
 required to notify their primary
federal regulators within 36 hours
of any incident that has materially
disrupted or degraded,
 or is
reasonably
likely to
materially disrupt
or degrade,
the banking
organization's
deliver banking
services to
a
 material portion of
its client base,
jeopardize the
viability of key
operations, or
impact the financial
stability of
the financial
 sector. The rule also imposes
certain notification requirements on third-party bank
service providers when they experience
 a computer-security
incident that
has caused,
or is
likely to
cause a
material service
disruption or
degradation for
four or
 more hours. In such case, the service provider is required to notify its bank-designated point of contact as soon as possible
 upon discovery of the incident.
 In addition to federal laws and regulations, we are subject
to state laws governing customer privacy and cybersecurity.
 The Florida Information Protection Act of 2014 ("Florida Act") requires notification of
the Florida Department of Legal Affairs
 of any breach involving
personal information that
affects more than
500 people as
well as requiring notification
of affected
 individuals of
a breach.
The Florida
Act also
requires us to
take reasonable
measures to protect
and secure
data in
electronic
 form containing personal information and take all reasonable measures to dispose, or arrange for the disposal, of
 records containing
personal information
within our
custody or
control when
the records
are no
longer to
be retained.
We
 incur
costs
and
in
order
to
address
with
the
and
state
privacy
and
 cybersecurity laws and regulations, and we expect such
costs and expenses will continue into the future.
 Consumer Financial Protection Bureau
 The Consumer Financial Protection Bureau ("CFPB") is
an independent regulatory authority housed within the
 Reserve Board. The CFPB has broad authority to regulate the offering and provision of consumer financial products and to
 prevent institutions subject to its authority from engaging in "unfair
and deceptive or abusive acts or practices" with respect
 to their
offering of consumer
financial products or
services. The CFPB
has the
authority to
supervise and examine
 institutions with more than $10.0 billion
in assets for compliance with federal
consumer laws. The authority to supervise
and
 examine depository institutions with
$10.0 billion or less in assets,
such as U.S. Century Bank,
for compliance with federal
 consumer laws
remains largely
with those
institutions'
primary federal
regulators.
the CFPB
may participate
in
 examinations of these smaller
institutions on a "sampling
basis" and may refer
potential enforcement actions
against such
 institutions to their
primary regulators. As such,
the CFPB may
participate in examinations of
U.S. Century Bank.
 states are
permitted to
adopt consumer
protection laws
that are
stricter than
the regulations
promulgated
 by the CFPB, and state attorneys general are permitted to
enforce consumer protection rules adopted by the CFPB against
 certain institutions.

 The Volcker Rule
 The Dodd-Frank Act
prohibits (subject to
certain exceptions) us
and our
affiliates from engaging
in short term
proprietary
 trading in securities and derivatives and from investing
in and sponsoring certain investment companies defined
in the rule
 as "covered
funds" (including
not only
hedge funds,
commodity pools
and private
equity funds,
but also
a range
of asset
 securitization structures
that do not
meet exemptive
criteria in the
final rules). This
statutory provision
is commonly
called
 the "Volcker Rule." At December 31, 2024, we are not
subject to the Volcker Rule because of our asset
size, which is below
 the $10.0 billion Volcker Rule
threshold.
 Community Reinvestment Act and Fair Lending Requirements
 As
previously
noted,
we
are
to
fair
and
involving
home
 mortgage
We
are
also
to
and
under
the
 Community Reinvestment Act ("CRA").
The CRA and
its corresponding regulations are
intended to encourage banks
to help
 meet the credit needs of
the communities they serve,
including low- and moderate
-income neighborhoods, consistent with
 safe and sound banking practices.

the
CRA
to
evaluate
the
record
of
a
in
 meeting applicable
CRA requirements.
The CRA
further requires
the agencies
to take
into account
our record
of meeting
needs
when
evaluating
applications
for,
among
other
new
branches
or
mergers.
We
are
also
 subject to analogous state CRA requirements
in Florida and certain other states
in which we may establish branch
offices.
 In
connection
with
their
of
CRA
performance,
the
FDIC
and
FOFR
assign
a
rating
of
"outstanding,"
 "satisfactory,"
"needs to
improve," or
"substantial
noncompliance."
We received
a "satisfactory"
CRA Assessment
Rating
 from
both
in
our
most
CRA
examinations
in
2023.
In
addition
to
substantive
and
 corrective measures that may be required for a violation of certain fair lending laws, the federal banking agencies may take
 compliance with such laws and CRA
into account when regulating and supervising
other activities of the bank, including
in
 acting
on
expansionary
proposals
such
as when
a bank
submits
an
application
to establish
bank
branches,
merge
with
 another bank,
or acquire
the assets
and assume
the liabilities
of another bank.
An unsatisfactory
CRA and/or
fair lending
 record could
substantially delay or
block any
such transaction.
The regulatory agency's
assessment of
the institution's
record
 is made available to
the public at
www.ffiec.gov/craratings.
Following its most
recent CRA performance
evaluation in April
 2023, the Bank received an overall rating of "Satisfactory."
 In October 2023, the
federal banking agencies jointly issued
a final rule to
revise the regulations implementing the
CRA.
 The final rule took effect on April 1, 2024, with staggered compliance dates; the applicability date for most of the provisions
 is January
1, 2026.
The changes
are designed
to encourage
banks to
expand access
to credit,
and banking
 services in low and moderate income
communities, adapt to changes in
the banking industry including mobile
and internet
 banking, provide
greater clarity and
consistency in
the application
of the CRA
regulations and
tailor CRA evaluations
and
 data
collection
to
bank
size
and
type.
The
final
rule
implements
a
revised
that,
like
the
 framework, is based on
bank asset size and
business model. Under the
final rule, a new
"Retail Lending Test" is established
 except with banks with
total assets of less
than $600.0 million as
of December 31
in either of the
prior two calendar years
 have the option to maintain
the current CRA evaluation
framework, referred to in
the final rule as the
"Small Bank Lending
 Test,"
or opt into
the Retail Lending
Test.
The Retail Lending
Test
evaluates a bank's
record of helping
to meet the
 needs of
its community
through the
origination and
purchase of
mortgage, multi
-family,
small business,
small
 farm and,
in certain
cases, automobile
loans. Banks
of all
sizes will
maintain the
option to
elect to
be evaluated
under a
 strategic plan
final rule
updating the
for obtaining
approval for
such plan.
The final
rule continues
the
approach
of
requiring
banks
to
delineate
"facility-based
areas,"
which
comprise
the
areas
 around a bank's main office, branches, and deposit-taking remote service facilities (e.g., ATMs). The final rule allows banks
 to receive CRA credit for any qualified community development
activity, regardless
of location.
 Call Reports and Examination Cycle
 All institutions, regardless of size, submit
a quarterly call report that includes
data used by federal banking agencies
to
 monitor the condition, performance, and
risk profile of individual institutions
and the industry as a whole.
In June 2019, the
 federal banking agencies issued a
final rule to permit insured depository
institutions with total assets of
less than $5 billion
 that
do
not
in
complex
or international
to
file
the
most
streamlined
version
quarterly
call
 report, and to reduce data reportable on certain streamlined
call report submissions.
 Effect of Governmental Monetary Policies
 The commercial banking
business is affected
not only by
general economic conditions,
but also by
the monetary policies
 of the Federal Reserve. Changes in the discount rate
on member bank borrowing, availability of borrowing
at the "discount

 window,"
open
in
the
Fed
Funds
target
rate,
the
imposition
of
in
reserve
 requirements against member banks' deposits
and assets of foreign banking centers
and the imposition of and changes in
 reserve requirements against certain
borrowings by banks and
their affiliates are
some of the
instruments of monetary
policy
 available to the Federal Reserve. These
monetary policies are used in
varying combinations to influence overall growth and
 distributions of bank loans, investments and deposits, which may affect interest rates charged
on loans or paid on deposits.
 The monetary
policies of
the Federal
Reserve have
had a significant
the operating
results of
commercial banks
 and are
expected to
to do
so in
the future.
The Federal
Reserve's
policies are
influenced
dual
 mandate
of
price
stability
and
full
employment,
and
to
a
lesser
degree
by
short-term
and
in
the
 international trade
balance and
fiscal policies
U.S. government.
Future changes
in monetary
policy and
the
 effect of such changes on our business and earnings
in the future cannot be predicted.
 Future Legislation and Regulation
 Congress may enact legislation from time to time that affects
the regulation of the financial services industry,
and state
 legislatures may enact legislation from time to time affecting the regulation of financial institutions chartered by or operating
 in those states.
Federal and state
regulatory agencies
also periodically propose
and adopt changes
to their regulations
or
 change the manner
in which existing
regulations are
applied or
interpreted. The
substance or
impact of pending
or future
 legislation or regulation, or
the application thereof, cannot
be predicted, although enactment
of proposed legislation has
in
 the past
and may
future affect
the regulatory
structure under
which we
operate and
may significantly
increase our
 costs, impede the efficiency
of our internal business
processes, require us to
increase our regulatory
capital or modify our
strategy,
or
limit
our
to
pursue
opportunities
in
an
efficient
manner.
Our
 condition, results
or prospects
adversely affected,
perhaps materially,
as a
any such
new
 legislation or regulations.
 Federal Securities Laws and the Sarbanes-Oxley Act
 USCB Financial Holdings, Inc.'s Class A
common stock is registered with
the SEC under Section
12(b) of the Securities
 Exchange Act of 1934. USCB Financial
Holdings, Inc. is subject to the
proxy and tender offer rules, insider trading reporting
 requirements and restrictions, and certain other requirements
under the Exchange Act.
 As a public company,
USCB Financial Holdings, Inc. is also subject to
the Sarbanes-Oxley Act of 2002 ("SOA"), which
 is applicable to all companies,
both U.S. and non-U.S., that
file periodic reports under
the Exchange Act. The stated
goals
 of
the
SOA
were
to
responsibility,
to
for
enhanced
for
and
auditing
 improprieties at
publicly traded
companies and
to protect
investors by
improving the
accuracy and
reliability of
 disclosures pursuant to
the securities laws.
The SEC is
responsible for establishing
rules to implement
various provisions
SOA. The
SOA
disclosure requirements
and corporate
rules, requires
the SEC
and
 securities exchanges to adopt extensive additional disclosure, corporate governance and other related rules and mandates
 further studies
of certain
issues by
the SEC.
The SOA
represents significant
regulation of
the accounting
profession and
 corporate governance
practices, such
relationship between
a board
of directors
and management
and between
a
 board of directors and its committees.
 As directed
SOA, USCB
Financial Holdings,
Inc.'s principal
executive officer
and principal
financial officer
are
 required to certify that
the Company's quarterly
and annual reports
do not contain any
untrue statement of
a material fact.
 The rules adopted by
the SEC under the
SOA have several requirements,
including having these
officers certify that:
they
 are responsible for establishing, maintaining and regularly evaluating the
effectiveness of our internal control over financial
 reporting; they
have made
certain disclosures
to USCB
Financial Holdings,
Inc.'s auditors
and the audit
committee of
the
 Board of Directors
about USCB
Financial Holdings,
Inc.'s internal
control over
financial reporting;
and they
have included
 information in USCB Financial Holdings,
Inc.'s quarterly and annual
reports about their evaluation
and whether there have
 been
in
USCB
Inc.'s
over
or
in
other
that
could
 materially affect USCB Financial Holdings, Inc.'s
internal control over financial reporting.
 In March 2020, the SEC issued
a final rule, effective
April 27, 2020, under the
SOA – Amendments to the Accelerated
 Filer and
Large Accelerated
Filer Definitions.
As a
the amendments,
certain low
revenue and/or
low public
float
 filers, while they remained obligated to provide a
report by management assessing the effectiveness of their internal control
 over financial reporting ("ICFR"), were
not required to provide
an attestation report from
their independent auditor assessing
 the effectiveness
of their ICFR.
The Company meets
the amended definition
of an accelerated
filer as of
January 1, 2025
 and would normally be required to provide an attestation report from its independent auditor assessing
the effectiveness of
 its ICFR. However, as long it is an eligible emerging growth company,
such auditor attestation requirement will not apply to
 the Company.
However, the
Bank remains subject
to independent auditor
attestation required
under FDIC regulations
set
 forth at 12 C.F.R.
§363.3(b).

 Available Information
 Our website
address is
www.uscentury.com.
Our electronic
filings with
the FDIC
(prior to
the bank
holding company
 reorganization) and the SEC (including
all Annual Reports on
Form 10-K, Quarterly Reports on
Form 10-Q, Current Reports
 on
Form
8-K,
and
if
applicable,
amendments
to
those
reports)
are
free
of
charge
on
the
website
as
soon
as
 reasonably practicable after
they are electronically
filed with, or furnished
to, the FDIC
or SEC. The information
posted on
 our website is not incorporated into this Annual
Report on Form 10-K. In addition, the FDIC
and the SEC each maintains a
 website that contains reports and other information that
is filed.

 Item 1A. Risk Factors

 This
section
a
description
of
the
risk
and
uncertainties
identified
by
that
could,
 individually or in combination, harm our business, results of
operations, liquidity and financial condition. The risks described
 below are
not all
inclusive. We
may face
other risks
that are
not presently
known, or
that we
presently deem
immaterial,
 which may also adversely
affect our business, results
of operations, liquidity and
financial condition. If any
of these known
 or unknown risks
or uncertainties actually
occur,
our business, results
of operations, liquidity
and financial condition
could
 be materially and adversely affected.

 Summary of Risk Factors
 Our business is subject to
a number of risks that could
cause actual results to differ
materially from those indicated
by
 forward-looking statements
made in this
Form 10-K
or presented
elsewhere from
time to time.
These risks
are discussed
 more fully in this Item 1A and include, without limitation,
the following:
 Risks Related to our Business and Operations
 •

Our
and
are concentrated
in
South
Florida,
and
we
are
more
sensitive
to
 adverse changes in the local economy than our more geographically
diversified competitors.
 •

Our concentration of real estate loans in a limited market
area exposes us to lending risks.
 •

The small- to medium-sized businesses
to which we lend may have
fewer resources to weather adverse
 developments, which may impair a borrower's ability to
repay a loan.
 •

Inflationary pressures and rising prices may affect
our results of operations and financial condition.
 •

The soundness of other financial institutions could adversely
affect us.
 •

Insufficient
could
impair
our
to
fund
and
jeopardize
our
of
 operations, growth and prospects.
 •

Changes in
U.S. trade policies
global political factors
beyond our
control, including the
imposition of tariffs,
 retaliatory
tariffs,
or
other
sanctions,
may
our
and
of

 •

Our lending business is subject to credit risk, which could
lead to unexpected losses.

 •

The transition from the use of LIBOR may adversely impact the interest rates paid
on certain financial instruments.
 •

Natural
disasters
and
severe
events
in
could
have
a
on
our
 financial condition and operations.
 •

Our business is subject to
interest rate risk and variations
in interest rates may
materially and adversely affect
our
 financial performance.
 •

A
failure
or
the
perceived
risk
of
a
failure
to
raise
the
statutory
debt
limit
of
the
U.S.
in
the
could
have
a
 material adverse effect on our business, financial
 •

Our allowance for credit losses may not be sufficient
to absorb potential losses in our loan portfolio.

 •

Our commercial loan portfolio may expose us to increased
credit risk.

 •

The imposition of further limits
by the bank regulators
on commercial real estate
lending activities could curtail our
 growth and adversely affect our earnings.
 •

Our SBA lending program depends on our status as a participant in the SBA's Preferred Lenders Program, and we
 face specific risks associated with originating SBA loans
and selling the guaranteed portion thereof.

 •

The SBA may not honor its guarantees if we do not originate
loans in compliance with SBA guidelines.

 •

Correspondent banking is an important part of our business,
which creates increased BSA/AML risk.

 •

We may not recover all amounts that are contractually
owed to us by our borrowers.

 •

Non-performing assets
take significant time
to resolve and
our results of
operations and financial
 condition, and could result in further losses in the future.
 •

We engage in
lending secured by
real estate and
may foreclose on
the collateral and
own the underlying
real estate,
 subjecting us
costs and potential
risks associated with
the ownership
of real
property and
other risks, including
to
environmental
or
protection
initiatives
or
in
state
or
law
may
 substantially raise the cost of foreclosure or prevent us
from foreclosing at all.
 •

We are exposed to risk of environmental liability when
we take title to property.
 •

We are subject to
certain operational risks, including, but
not limited to, customer, employee or
third-party fraud and
 data processing system failures and errors.
 •

We face significant
operational risks because
the nature of the
financial services business
involves a high volume
 of transactions.
 •

We have several large depositor
relationships, the loss of
which could force us to
fund our business through more
 expensive and less stable sources.
 •

Our
in
difficult
could
have
effects
on
our
of
 •

We may
not effectively
execute on
our expansion
strategy,
which may
to maintain
our
 historical growth and earnings trends.
 •

New lines of business, products, product enhancements
or services may subject us to additional risk.

 •

Our business
needs and
future growth
may require us
to raise
additional capital
and that
capital may
 on terms acceptable to us or may be dilutive to existing shareholders.

 •

We may grow through mergers or
acquisitions, a strategy that may
not be successful or, if successful, may produce
 risks
in
successfully
integrating
and
managing
the
merged
or
and
may
dilute
our
 shareholders.

 •

The loss of one or more
of our key personnel, or
our failure to attract and
retain other highly qualified
personnel in
 the future, could harm our business.
 •

Damage to our reputation could significantly harm our
businesses.

 •

We face
strong competition
from financial
that offer
banking services,
 which could materially and adversely affect our
business.
 •

We must respond to rapid technological changes
to remain competitive.
 •

We continually
encounter technological change,
and we may
have fewer resources
than many of
our competitors
 to invest in technological improvements.
 •

Our current and future uses of Artificial Intelligence (AI)
and other emerging technologies may create additional
 risks.
 •
 A
 failure, interruption, or breach in the
security of our systems, or those
of our contracted vendors, could disrupt
our
 business, result in the disclosure of confidential information, damage our reputation, and
create significant financial
 and legal exposure.
 •

We rely on other companies to provide key components of our business infrastructure and our operations could be
 interrupted if
our third-party
service providers
experience difficulty,
terminate their
or fail
to comply
with
 banking regulations.

 •

Litigation
and
actions,
actions,
could
us
to
fines,
 penalties, judgments
or other requirements
resulting in
increased expenses or
restrictions on
activities.
 •

Certain of our
directors may
have conflicts of
interest in determining
whether to present
business opportunities
to
 us or another entity with which they are, or may become, affiliated.
 Risks Related to Our Tax, Accounting
and Regulatory Compliance

 •

Our ability to
recognize the benefits
of our deferred
tax assets is
dependent on future
cash flows and
taxable income
 and may be materially impaired upon significant changes
in ownership of our common stock.
 •

The accuracy of
our financial statements
and related disclosures
could be affected
if the judgments,
 or estimates used in our critical accounting policies are inaccurate.
 •

As a public company,
we may not efficiently or effectively
create an effective internal control environment,
and any
 future failure to maintain effective
internal control over financial reporting
could impair the reliability of
our financial
 statements, which
in turn could
harm our
business, impair
investor confidence
in the accuracy
and completeness
reports
and
our access
markets,
cause
the
price
of
our Class
stock
to
 decline and subject us to regulatory penalties.
 •

We operate in a highly
regulated environment, and the
laws and regulations that
govern our operations, corporate
 governance, executive
compensation and
accounting principles, or
changes in them,
or our failure
to comply with
 them, could adversely affect us.
 •

We
face
a
risk
of
noncompliance
with
the
Bank
Secrecy
Act
and
other
statutes
and
 regulations and corresponding enforcement proceedings.
 •

Significantly heightened regulatory and
supervisory expectations and scrutiny
in the United States have
 our
regulatory,
and
other
risks
and
costs
and
us
to
legal
and
examinations,
 investigations, and enforcement actions.

 •

We are subject to capital adequacy requirements
and may become subject to more stringent capital requirements,
 which could adversely affect our financial condition
and operations.
 •

We are periodically subject to examination and scrutiny by a number of
banking agencies and, depending upon the
 findings and determinations of these agencies, we may
be required to make adjustments to our
business that could
 adversely affect us.
 •

We are
numerous laws
of certain
regulatory agencies
designed to
protect consumers,
 including the
Community Reinvestment
Act, or
CRA, and
fair lending
laws, and
failure to
comply with
these laws
 could lead to a wide variety of sanctions.
 •

Climate change
and related
legislative and
regulatory initiatives
may materially
affect our
business and
results of
 •

Increasing scrutiny
and evolving
expectations from
customers, regulators,
investors, and
other stakeholders
with
 respect to our environmental, social
and governance practices may
impose additional costs on
us or expose us to
 new or additional risks.
 Risks Related to Our Class A Common Stock
 •

Our ability to pay dividends is subject to restrictions.
 •

The market price and trading volume of our Class A common stock may be volatile, which could result in rapid and
 substantial losses for our shareholders.
 •

There are
significant restrictions
Articles of
Incorporation
that restrict
the ability
to sell
our capital
stock
to
 shareholders that would own 4.95% or more of our stock,
excluding our Significant Investors.

 •

we
are
an
emerging
and
we
have
decided
to
take
advantage
of
 exemptions from various reporting
and other requirements applicable
to emerging growth companies,
our Class A
 common stock could be less attractive to investors.
 •

we
have
elected
to
use
the
extended
for
complying
with
new
or
revised
 standards for an
"emerging growth company,"
our financial statements
may not be comparable
to companies that
 comply with these accounting standards as of the public
company effective dates.
 •

We have existing investors that
own a significant amount of
our common stock whose individual
interests may differ
 from yours.

 •

Provisions in our governing documents and Florida
law may have an anti-takeover effect
and there are substantial
 regulatory limitations on changes of control of the Company.
 Risks Related to our Business and Operations
 Our business
operations and
lending activities
are concentrated
in South
Florida, and
more sensitive
 to adverse changes in the local economy than our
more geographically diversified competitors.

 Unlike many of
our larger competitors
that maintain significant
operations located
outside of our
market area, most
of
 our customers are concentrated in South Florida. In addition, we have
a high concentration of loans secured by real estate
 located in
South Florida.
Therefore, our
success depends
upon the
general economic
conditions in
South Florida,
which
 may differ from the economic conditions in other areas
of the U.S. or the U.S. generally.
 Our real estate
collateral provides
an alternate source
of repayment in
the event
of default by
the borrower;
however,
 the value of the collateral may decline during the time the credit is outstanding. The concentration of our loans in the South
 Florida area subjects us to
risk that a downturn in the
local economy or recession in
this area could result in
a decrease in
 loan originations and increases in delinquencies and foreclosures, which would have a greater negative effect on us than if
 our lending were more geographically diversified. Additionally, the COVID-19 pandemic accelerated the adoption of remote
 work
options,
potentially
influencing
the
of
office
properties
our
real
 portfolio. If we
are required to
liquidate our real
estate collateral securing
a loan during
a period of
reduced real estate
values
 to satisfy the debt,
our earnings and capital could
be adversely affected. Moreover, since a large portion
of our loan portfolio
 is secured by properties located in South Florida, the occurrence of a natural disaster, such as a hurricane, or a man-made
 disaster could result in
a decline in loan originations,
a decline in the
value or the destruction
of mortgaged properties and
 an increase in the risk of delinquencies, foreclosures or loss on loans originated by us. We may suffer further losses due to
 the decline in the
value of the properties
underlying our mortgage loans, which
would have an adverse
impact on our results
 of operations and financial condition.
 A downturn in the local economy generally may lead to loan losses that are not offset by operations in other markets; it
 may also reduce the ability
of our customers to grow
or maintain their deposits with
us. For these reasons, any
regional or
 local economic
downturn
that
affects
South Florida,
or existing
or
prospective
borrowers
or
depositors
in
South Florida,
 could have a material adverse effect on our business,
 In addition, there are continuing concerns related
to, among other things, the increasing
level of U.S. government debt
 and fiscal actions that may be taken to address that debt, price fluctuations
of key natural resources, inflation, the potential
 resurgence of economic
and political tensions with
China, the continuing war
in Ukraine, the conflict
in Gaza and the
level
 of oil and
natural gas
prices due
to, among
other things,
Russian supply
disruptions resulting
ongoing Ukrainian
 conflict, each
of which
may have
a destabilizing
financial markets
and economic
activity.
Economic pressure
on
 consumers and
overall economic
uncertainty may
result in
changes in
consumer and
business spending,
borrowing and
 saving
habits.
These
other
developments
in
the
domestic
or
 markets or economies may
significantly affect the markets in
which we do business, the
value of our loans
and investments,
 and our ongoing operations, costs and profitability.

 Our concentration of real estate loans in a limited
market area exposes us to lending risks.
 At December 31, 2024,
approximately $1,426 million,
or 72.6%, of our
total loan portfolio, was
secured by real
estate,
 in particular commercial real
estate, most of which is
located in our primary
lending market area of
the Miami metropolitan
 statistical
area.
Future
declines
in
the
real
values
in
our
and
surrounding
markets
could
 significantly impair
particular real
estate collateral
securing our
to sell
the collateral
 upon
foreclosure
for
an
to
satisfy
the
borrower's
to
us.
This
could
increasing
our
 allowance for credit
losses to address
the decrease in
the value of
the real estate
securing our loans,
which could have
a
 material adverse effect on our business, financial
condition, results of operations, and growth prospects.
 The
small-
to
medium-sized
businesses
to
which
we
lend
may
have
fewer
to
 business developments, which may impair a borrower's
ability to repay a loan.
 We
target
our
and
marketing
strategies
to
serve
the
and
 needs of SMBs and
the owners and operators of
those businesses. SMBs generally have
fewer financial resources in terms
 of capital or
borrowing capacity
than larger entities,
frequently have
smaller market shares
than their competition,
 more
vulnerable
to
downturns,
often
need
substantial
to
expand
or
compete,
and
may
 experience substantial
volatility in
operating results,
which, individually
or in
the aggregate,
may impair
their ability
 as a borrower
to repay a loan.
In addition, the success
of SMBs often
depends on the management
skills, talents and efforts
 of a
small group
of key
people, and
the death,
disability or
resignation of
one or
more of
these individuals
an
 adverse impact on
the business and
its ability to
repay its loan.
If general economic
conditions negatively impact
the markets
 in which we operate
or any of our
borrowers otherwise are affected by adverse
business developments, our SMB borrowers
 may be disproportionately affected and their ability to
repay outstanding loans may be adversely affected, which could
have
 a material adverse effect on our business, financial
 Inflationary pressures and rising prices may affect
our results of operations and financial condition.
 The inflationary
outlook in
the United
States remains
uncertain. As
of December
the consumer
price index
 was 2.9% year-over-year. While this
is a significant reduction to the rate of inflation experienced in 2022 and 2023, it is still
 above the FRB's targeted rate. The risks to
our business from inflation depend on the
durability of the inflationary pressures
 in our markets. Although
the FRB has reduced
the federal funds rate
three times in 2024,
no assurance can
be given that
 it will
continue to
do so.
At the
end of
January 2025,
the FRB
determined not
to reduce
the federal
funds rate.
The resurgence
 of elevated levels
of inflation could
lead the FRB
to cease reducing
its benchmark rate
or potentially starting
to increase it
 again which could,
in turn, increase
the borrowings costs
of our customers,
making it more
difficult for them
to repay their
 loans or
other obligations.
Elevated interest
rates
needed to
tame inflationary
price pressures,
which
could also
 push down asset prices, including collateral values, and weaken
economic activity.

 As inflation increases and market interest
rates rise the value of
our investment securities, particularly those with longer
 maturities,
decreases,
although
this
can
be
less
pronounced
for
floating-rate
instruments.
In
inflation
 generally increases the cost of goods and services we use in
our business operations, such as electricity and other utilities,
 which increases our
noninterest expenses. Also,
a prolonged period
of inflation could
cause wages and
other of our costs
 to increase, which could adversely
affect our results of
operations and financial condition.
Furthermore, our customers are
 also affected by inflation
and the rising costs of
goods and services used
in their households and businesses,
which could
 have a negative impact on their ability to repay their loans with us.
In addition, SMBs may be impacted more during periods
 of
high
inflation,
as
they
are
not
able
to
leverage
economics
of
scale
to
mitigate
cost
pressures
compared
to
larger
 businesses. Consequently,
the ability of
customers to repay
their loans
may deteriorate,
and in some
cases
 this deterioration may occur quickly,
which would adversely impact our results of operations
and financial condition.

 The soundness of other financial institutions could
adversely affect us.
 Our
to
in
routine
and
other
could
be
affected
by
the
and
 commercial soundness
of other
financial institutions.
Financial services
companies are
interrelated as
a result
of trading,
 clearing,
counterparty
or
other
relationships.
We
have
to
industries
and
counterparties,
and
with
counterparties
in
the
industry,
brokers
and
dealers,
and
other
institutional
clients.
Defaults
by,
or
even
rumors
or
questions
about,
one
or
more
 institutions or market utilities, or
the financial services industry generally, may lead to market-wide liquidity
problems, losses
 of depositor,
creditor
and
counterparty
confidence
and
or defaults
by us
or by
other institutions.
These
or
 defaults
could
have
a
on
our
of
and
 prospects. Additionally,
if our
competitors were
extending credit
on terms
we found
to pose
excessive risks,
or at interest
 rates which we believed
did not warrant the
credit exposure, we may not
be able to maintain
our business volume and
could
 experience deteriorating financial performance.

 Insufficient liquidity could
impair our ability to
fund operations and jeopardize
our financial condition,
 of operations, growth and prospects.
 Effective liquidity management is essential for the operation of our business. Although we
have implemented strategies
 to maintain
sufficient
and
diverse
sources of
to accommodate
planned,
as unanticipated,
needs
 (including changes
in assets, liabilities, and
off-balance sheet commitments under various
economic conditions), an inability
 to
raise
funds
deposits,
borrowings,
the
sale
of
and
other
sources
could
have
a
 adverse effect
liquidity. Our access
to funding
sources in
amounts adequate to
finance our
activities could
be impaired
 by factors that affect us specifically or the financial services
industry in general. Factors that could detrimentally impact
our
 access to liquidity sources include a decrease in the level of our business activity due to a market disruption, a decrease in
 the borrowing capacity assigned to
our pledged assets by our
secured creditors, competition from other
financial institutions
 which could drive up the
costs of deposits or adverse
regulatory action against us. Deterioration in
economic conditions and
 the loss of
confidence in financial
institutions may increase
our cost of
funding and limit
our access to
some of our
customary
 sources of liquidity,
including, but not
limited to, inter-bank
borrowings and borrowings
from the Federal
Home Loan Bank
 of Atlanta, or
the FHLB, and
the Federal Reserve
Bank of Atlanta.
Our ability to
acquire deposits
or borrow
could also be
 impaired by
factors that
specific to
us, such
as a
severe disruption
financial markets
or negative
views and
about the
prospects
industry generally
as
a result
of conditions
faced
by banking
 organizations
in
the
domestic
and
markets.
Any decline
in
or cost
of liquidity
could
 adversely impact our ability to originate loans, invest in securities, meet our expenses
or fulfill obligations such as repaying
 our borrowings or
meeting deposit withdrawal demands,
any of which
could, in turn,
have an adverse
effect on our
 financial condition, and results of operations.
 Changes in
U.S. trade
policies and
other global
political factors
beyond our
control, including
the imposition
 of tariffs, retaliatory tariffs, or other sanctions, may adversely impact our business, financial condition and results

 There have
been, and
future, changes
with respect
to U.S.
and international
trade policies,
legislation,
 treaties
and
tariffs,
embargoes,
sanctions
and
other
trade
restrictions.
In
early
February,
the
new
U.S.
administration
 imposed
orders
a
new
tariff
policy,
imposing
a
25%
duty
on
merchandise
imports
from
Mexico
and
 Canada
alongside
a
10%
tariff
on
Chinese
imports.
The
orders
included
an
exemption
for
Canadian
energy
 resources, subject to a reduced 10% tariff. The tariffs were set to take effect on February 4,
2025, but following discussions
 between the United States and each
of Canada and Mexico, the U.S.
administration agreed to a pause of
at least 30 days
 in the implementation of the duties. The tariffs on China went into
effect as scheduled on February 4, 2025. This led to 10%
 to
15%
retaliatory
tariffs
on
U.S.
energy
and
farm
machinery
imports
being
imposed
by
China
on
February
9,
2025.
 Subsequently,
the U.S. administration
announced the
United States would
impose a
25% tariff
on all imports
of steel and
 aluminum,
coming
into force
in
mid-March
2025.
In
an
10%
tariff
was
announced
to
be
imposed
on
 China in
early March
2025.
Tariffs,
retaliatory tariffs
or other
trade restrictions
on products
and materials
that customers
 import or
export, or
a trade
war or
other related
governmental actions
related to
tariffs, international
trade agreements
or
 policies or other trade restrictions have the potential to negatively impact our customers' costs, demand for our
products, or
 the U.S. economy or certain sectors thereof and, thus, could adversely impact
our business, financial condition and results
 of operations. As
a result of
Russia's invasion of
Ukraine, the U.S.
imposed, and may
continue to impose
material additional,
 financial and economic sanctions and export
controls against certain Russian organizations
and/or individuals, with similar
 actions either implemented or
planned by the
European Union ("EU")
and the United
Kingdom ("UK") and other
jurisdictions.
 The U.S.,
the
UK, and
the
EU have
each imposed
packages
and
sanctions
that,
in various
ways,
 constrain
with
numerous
Russian
entities
and
individuals;
in
Russian
sovereign
debt;
and
 investment,
trade, and
financing
to, from,
or in
regions of
Ukraine.
Moreover,
actions by
Russia, and
any further
 measures taken by
the U.S. or
its allies, could
have negative impacts
on regional and
global financial markets
and economic
 conditions.
To
the
in
the
global
political
environment,
the
continuing
war
in
Ukraine
and
the
 continued heightened
tensions between
Russia and
the U.S.,
NATO,
the EU
UK, as
the conflict
in Gaza,
 have
a
on
us
or
on
the
markets
in
which
we
operate,
our
of
and
 condition could be materially and adversely impacted.
 Our lending business is subject to credit risk, which
could lead to unexpected losses.

 Our
involves
making
loans
to
customers.
The
of
is
inherently
risky
the
 principal or
interest on
be repaid
timely or
at all
or the
any collateral
securing the
loan may
be
 insufficient to
cover our
outstanding exposure.
These risks
may be affected
strength or
weakness of
the particular
 borrower's business sector
and local, regional and
national market and
economic conditions. Many
of our loans are
made
 to SMBs that may be
less able to withstand
competitive, economic and financial
pressures than larger borrowers.
Our risk
 management practices,
monitoring the
concentration of
our loans
within specific
industries in
which we
lend and

 concentrations with individual borrowers
or related borrowers, and
our credit approval
practices, may not adequately
reduce
 credit risk. In addition, there are risks inherent in making any loan, including
risks relating to proper loan underwriting, risks
 resulting from
changes in
economic and
industry conditions,
risks inherent
in dealing
with individual
borrowers, including
 the risk that a borrower may not provide
information to us about their business
in a timely manner,
may present inaccurate
 or incomplete information to us, may lack a U.S. credit history,
or may leave the U.S. without fulfilling their loan obligations,
 leaving us with
little recourse
to them personally,
and/or risks
relating to the
collateral. In
order to
manage credit
 risk successfully,
we must,
among other
things, maintain
disciplined and
prudent underwriting
standards and
ensure that
 our lenders follow those standards. The weakening of
these standards for any reason, such as an
attempt to attract higher
 yielding loans,
a lack
of discipline
or diligence
by our
employees in
underwriting and
monitoring loans,
the inability
 employees to adequately adapt
policies and procedures to
changes in economic or
any other conditions affecting borrowers
 and the quality
of our loan portfolio,
may result in loan
defaults, foreclosures and additional
charge-offs and may necessitate
 that we significantly increase our allowance for credit losses, each of which could adversely affect our net income. A failure
 to effectively
manage
credit risk
with
our loan
portfolio could
lead to
unexpected
losses and
have a
 adverse effect on our business, financial condition
 The
from
the
use
of
LIBOR
may
the
rates
paid
on
 instruments.
 LIBOR (the London
InterBank Offered
Rate) was
used as a
reference rate for
certain of the
Corporation's adjustable-
 rate loans and
bonds. In 2017,
the U.K. Financial
Conduct Authority, which regulates LIBOR,
announced that the
publication
 of LIBOR would not be guaranteed beyond 2021. In December 2020, the administrator of LIBOR announced its intention to
 (i) cease
the publication
one-week
and two-month
U.S. dollar
LIBOR after
2021, and
(ii) cease
the
 publication of all other
tenors of U.S.
dollar LIBOR (one, three,
six and 12
month LIBOR)
after June 30,
2023. The remaining
 synthetic LIBOR was published for the last time
as of September 30, 2024.
Synthetic LIBOR was a temporary measure
to
 allow entities to transition to alternative risk-free reference
rates.
 There are ongoing efforts to establish an alternative
reference rate. The Federal Reserve Board, in conjunction with
the
 Alternative
Reference
Rates
Committee,
a
steering
committee
comprised
of
large
U.S.
supports
 replacing
LIBOR
with
SOFR
(Secured
Overnight
Financing
Rate),
a
new
calculated
by
short-term
 agreements backed by
Treasury securities. The Bank adopted
SOFR as its
preferred benchmark as an
alternative to LIBOR
 for use in new contracts in 2023.
 While
the
Adjustable
Rate
(LIBOR)
Act
and
implementing
will
help
to
legacy
LIBOR
 contracts to a new benchmark rate, the
substitution of SOFR for LIBOR may
have potentially significant economic impacts
 on parties to affected
contracts. SOFR is
different from LIBOR
in that it is
a retrospective-looking secured
rate rather than
 a forward-looking
unsecured rate.
while SOFR
appears to
be the
preferred replacement
rate for
LIBOR, it
is
 not
to
predict
SOFR
will
ultimately
prevail
in
the
as
the
definitive
replacement
for
LIBOR.
 Uncertainty
as
to
the
of
alternative
reference
rates,
and
as
to
or
other
reforms
to
the
 transition from LIBOR, may adversely affect the val
ue of LIBOR-based financial arrangements of the Company.
 Natural disasters and severe weather events in Florida
could have a material adverse impact on our
 financial condition and operations.

 Our
and
our
base
are
located
in
South
Florida.
This
region
is
vulnerable
to
natural
 disasters
and
severe
events
or
acts
of
God,
such
as
hurricanes
or
tropical
storms,
which
can
have
a
 adverse impact
loan portfolio,
our overall
business, financial
condition and
operations, cause
widespread property
 damage and have
the potential to
significantly depress
the local economies
in which we
operate. Future adverse
 events in
Florida could
potentially result
in extensive
and costly
property damage
to businesses
and residences,
depress
 the value of property serving as collateral for our loans, force the relocation of residents, and
significantly disrupt economic
 activity in the region.

 We cannot
predict the
extent of
damage that
may result
from such
adverse weather
events, which
will depend
on a
 variety of factors that are beyond our control,
including, but not limited to, the
severity and duration of the event,
the timing
 and level
of government
responsiveness, the
pace of
economic recovery
and availability
of insurance
to cover
losses. In
the
nature,
frequency
and
severity
of
these
events
and
other
natural
disasters
may
be
 exacerbated by climate change. If a significant adverse weather event or other natural disaster were to occur, it could have
 a materially adverse impact
on our financial
condition, results of operations
and our business, as
well as potentially
 our exposure to credit and liquidity risks.

 Our business is subject to
interest rate risk, and variations in
interest rates may materially and adversely
 our financial performance.

 Changes in the
interest rate environment
may reduce our
profits. It is
expected that our
primary source of
income will
 continue to be from
the differential or
"spread" between the
interest earned on
loans, securities and
other interest-earning
 assets, and the interest paid on
deposits, borrowings and other interest-bearing liabilities. Net
interest spreads are affected,
 in part, by the
difference between the maturities and repricing characteristics of
interest-earning assets and interest-bearing
 liabilities. Changes
in market
interest rates
generally affect
loan volume,
loan yields,
funding sources
and funding
costs.
 Our
net interest
spread
depends
on
many
that
are partly
or completely
out
control,
competition,
 general economic
conditions, and
federal economic
monetary and
fiscal policies,
and in particular,
the Federal
Reserve's
 policy determinations with respect to interest rates.
 During 2022 and 2023, the Federal
Open Market Committee (the "FOMC")
increased certain benchmark interest
rates
 to reduce the rate of
inflation to the extent necessary
to reduce inflation to
the rate that the
FOMC believes is appropriate.
 All
of
these
increases
were
expressly
made
in
response
to
inflationary
pressures.
In
2024,
the
FOMC
decreased
such
 benchmark
rates three
times.
there can
be no
assurances
as to
any future
FOMC
action, including
it
 continues to decrease
the federal funds
rate or implements
increases. In late
January 2025, the
FOMC determined to
not
 change the federal funds rate at 4.25% to 4.5%.

 While an increase in
interest rates may increase
our weighted average
loan yield, it may
adversely affect the
ability of
 certain borrowers
with variable rate
loans to pay
the contractual
interest and principal
due to us.
Following an
increase in
 interest rates, our
ability to maintain
a positive net
interest spread is
dependent on our ability
to increase our
loan offering
 rates, replace
loans that
mature and
repay or
that prepay
before maturity
with new
originations at
higher rates,
minimize
 increases on
our deposit
rates, and maintain
an acceptable level
and composition of
funding. We cannot
provide assurances
 that we will be
able to increase
our loan offering
rates and continue
to originate loans
due to the competitive
landscape in
 which we operate. Additionally, we cannot provide
assurances that we can minimize
the increases in our
deposit rates while
 maintaining
an
acceptable
level
of
deposits.
Due
to
competitive
pressures
in
2023,
we
the
rates
paid
on
our
 interest-bearing deposits such that
our weighted average cost
of deposits increased from
0.62% for 2022
to 3.04% for
2023.
in 2024,
in light
FOMC's actions
to decrease
the federal
funds rate
three times,
we decreased
the rates
 paid on our interest-bearing deposits. As a result,
while the overall funds increased, the cost of it
increased at a lesser pace
 when compared to the
increase in cost of
deposits from 2022 to
2023. Finally,
we cannot provide
any assurances that
we
 can maintain our current levels of noninterest-bearing deposits as
customers may seek higher-yielding products due to the
 increased interest rates being paid on deposits currently,
as compared to 2023 and 2022.
in
levels
of
rates
could
materially
and
our
net
margin,
asset
 quality, loan origination
volume, average loan portfolio balance, liquidity,
and overall profitability.
 A failure or the perceived
risk of a failure to raise
the statutory debt limit
of the U.S. in the future
could have a
 material adverse effect on our business, financial
condition and results of operations
.
 Ongoing
U.S.
debt
ceiling
and
budget
deficit
concerns
have
the
possibility
of
credit-rating
 downgrades
and
slowdowns,
or
a
recession
in
the
United
States.
Although
U.S.
lawmakers
have
passed
 legislation
past to
raise the
federal debt
ceiling
on multiple
occasions,
the most
in June
 2023, ratings agencies have lowered
or threatened to lower the long-term
sovereign credit rating on the
United States. On
 January 1,
extension of
the debt
ceiling limit
effected in
June 2023
expired. The
debt ceiling
was reinstated
on
 January 2, 2025,
at $36.1 trillion,
a figure reflecting
the total federal
debt accumulated
by that date.
In late January
2025,
 the U.S.
Treasury
began employing
various
measures,
suspending
in federal
retirement funds
and
 halting the issuance of certain securities, to continue financing government operations. There are proposals to
increase the
 debt ceiling limit by $4.0 trillion, subject to agreements on other matters including extending $4.5 trillion in tax cuts from the
 2017 Tax
Cuts and Jobs
Act (set to
expire in 2025)
and implementing
$2 trillion in
mandatory spending
reductions over a
 decade.
The
of
this
or
any
further
downgrades
to
the
U.S.
government's
sovereign
rating
or
its
perceived
 creditworthiness could adversely
affect the U.S.
and global
financial markets and
economic conditions. These
developments
 could cause interest
rates and borrowing
costs to rise
(unless the Federal
Reserve re-initiates
quantitative easing),
which
 may negatively impact our ability to access the debt markets on favorable terms. In addition, disagreement over the federal
 budget has caused the U.S. federal
government to shut down for periods
of time. Continued adverse political and
 conditions could have a material adverse effect
on our business, financial condition and results of operations.
 Our allowance for credit losses may not be sufficient
to absorb potential losses in our loan portfolio.

 We
an
allowance
for
that
represents
judgment
of
probable
and
risks
 inherent in our loan portfolio.
The level of the allowance
reflects management's continuing
evaluation of general economic

present
political
and
diversification
and
seasoning
of
the
loan
portfolio,
historic
loss
 experience, identified credit
problems, delinquency levels
and adequacy of
collateral. Determining the
appropriate level of
 our
allowance
for
involves
a
degree
of
subjective
judgment
and
to
make
 estimates of and assumptions regarding current credit risks
and future trends, all of which may undergo material changes.
 Inaccurate
assumptions,
deterioration
of
affecting
borrowers,
new
identification
of
problem
loans
or deterioration
of existing
problem
 and
other
and
analysis),
both
and
outside
of
our
control,
may
us
to
 increase our allowance for
credit losses. In addition,
our regulators, as an
integral part of their
periodic examinations, review
 our methodology for calculating, and
the adequacy of, our allowance
for credit losses and may
direct us to make additions
 to the allowance
based on their
judgments about
information available to
them at the
time of their
examination. Further,
if
 actual charge-offs in future
periods exceed the
amounts allocated to
our allowance for
credit losses, we
may need additional
 provisions for credit losses to restore
the adequacy of our allowance for
credit losses. Finally, the measure of our allowance
 for credit losses depends on the
adoption and interpretation of accounting
standards. The Financial Accounting
Standards
 Board, or FASB, issued a new credit
impairment model, the Current Expected Credit Loss,
or CECL model, which became
to
us
on
1,
2023.
CECL
to
estimate
and
develop
a
for
 losses over the lifetime of the loan at origination, as opposed to reserving for incurred or probable
losses up to the balance
 sheet date. Under the CECL
model, expected credit deterioration
will be reflected in the
income statement in the
period of
 origination or acquisition of a loan,
with changes in expected credit losses
due to further credit deterioration or
improvement
 reflected in the periods in which the expectation
changes. As a result of the initial
implementation of CECL, we incurred as
 of January 1, 2023
a $1.1 million cumulative
effect of the
adoption of CECL. Moreover,
the CECL model may
create more
 volatility in our level of allowance for credit
losses. If we are required to materially
increase our level of allowance for credit
 losses for any reason, such increase could adversely affect our business, prospects, cash flow,
liquidity, financial condition

 Our commercial loan portfolio may expose us to increased
credit risk.
 Commercial business
and real
estate loans
generally have
a higher
risk of
loss because
loan balances
are typically
 larger
than
real
and
loans
and
repayment
is
usually
dependent
on
cash
flows
from
the
 borrower's business or the
property securing the loan. Our
commercial business loans are primarily made
to small business
 and middle market customers. These loans typically
involve repayment that depends upon income
generated, or expected
 to be generated, by the property securing the loan and/or
by the cash flow generated by the business borrower and
 adversely affected by changes in the economy or
local market conditions. These loans expose a
lender to the risk of having
 to liquidate the collateral securing
these loans at times when
there may be significant fluctuation
of commercial real estate
 values or to the
risk of inadequate cash flows to
service the commercial loans. Unexpected deterioration in
the credit quality
commercial business
and/or real
estate loan
portfolio could
require us
to increase
our allowance
for credit
losses,
 which would
reduce our
profitability and
an adverse
financial condition,
and results
of
 Commercial construction loans generally
have a higher risk of
loss due to the assumptions
used to estimate the value
 of property
at completion
cost of
the project,
including interest.
It can
be difficult
to accurately
evaluate the
total
 funds required
to complete
a project,
and construction
lending often
involves the
disbursement
of substantial
funds with
 repayment dependent, in large part, on the success of the ultimate project rather than the ability of a borrower or guarantor
 to repay the loan from sources other than the subject project. If the assumptions and estimates are inaccurate, the value of
 completed property
may fall
below the
related loan
amount. If we
are forced to
foreclose on
a project
prior to
completion,
be
unable
to
recover
the
entire
unpaid
portion
loan,
which
would
lead
to
losses.
In
we
may
be
 required to fund additional amounts to complete a project,
incur taxes, maintenance and compliance costs for
a foreclosed
 property and
may have
to hold
the property
for an
indeterminate
period of
time, any
of which
could adversely
our
 business, prospects, cash flow,
liquidity, financial
 The imposition of
further limits by the
bank regulators on commercial
real estate lending activities
could curtail
 our growth and adversely affect our earnings.

 The FDIC, the Federal Reserve
and the Office of
the Comptroller of the
Currency have promulgated joint
guidance on
 sound risk management practices for financial institutions with concentrations in commercial real estate lending. Under this
 guidance,
a financial
that,
like
us,
is actively
involved
in
real
lending should
perform
a risk
 assessment to identify
concentrations. Regulatory
guidance on concentrations
in commercial real
estate lending provides
 that a bank's commercial real estate lending exposure could
receive increased supervisory scrutiny where total commercial
loans, including
loans secured
by multi-family
properties, owner-occupied
and nonowner-occupied
 investor real estate, and
construction and land loans, represent 300%
or more of an
institution's total risk-based capital, and
 the outstanding balance of the commercial real estate loan portfolio has increased by
50% or more during the preceding 36

 months.
At
31,
2024,
our
total
investor
real
loans
by
apartment
 buildings, commercial real estate, and construction and
land loans represented 366% of the Bank's
total risk-based capital
 and the growth in the commercial real estate portfolio exceeded 50% over
the preceding 36 months. The particular focus of
 the guidance is on exposure to commercial
real estate loans that are dependent
on the cash flow from the real estate
held
 as collateral and that
are likely to be
at greater risk
to conditions in the
commercial real estate
market (as opposed
to real
 estate collateral held as a secondary source of repayment
or as an abundance of caution). The purpose
of the guidance is
 to guide institutions in developing risk management practices and capital
levels commensurate with the level and nature of
concentrations.
Management has
established a
estate lending
to monitor
 exposures and limits by
types within the commercial
real estate portfolio and
takes appropriate actions, as necessary. While
 we believe
we have
implemented policies and
procedures with
respect to
our commercial
loan portfolio
consistent
 with this
guidance, the
FDIC, the
Bank's primary
federal regulator,
could require
us to
implement additional
policies and
 procedures pursuant to their interpretation
of the guidance that may result
in additional costs to us. In addition,
If the FDIC
 were to impose restrictions on the amount
of commercial real estate loans we can
hold in our portfolio, our earnings would
 be adversely affected.
 Our
SBA
is dependent
upon
the
government
and
our status
as
a participant
 SBA's Preferred
Lenders Program,
and we
face specific
risks associated
with originating
SBA loans
and selling
 the guaranteed portion thereof.
 We
have
been
by
the
SBA
to
participate
in
the
SBA's
Preferred
Lenders
Program.
As
an
SBA
Preferred
 Lender,
we enable
our clients
to obtain
SBA loans
without being
the potentially
lengthy SBA
approval process
for
lenders
that
are
not
SBA
Preferred
Lenders.
The
SBA
periodically
reviews
the
of
 participating
lenders
to
assess,
among
other
the
lender
exhibits
prudent
risk
management.
When
 weaknesses are identified, the SBA may request corrective actions
or impose enforcement actions, including revocation of
 the lender's
Preferred Lender
status. If
we lose
our status
as an
SBA Preferred
Lender,
lose some
or all
 customers to
lenders who
are SBA
Preferred Lenders,
which could
financial condition
and
 results of operations.
 We generally sell the guaranteed
portion of our SBA 7(a) loans
in the secondary market. These sales
have resulted in
 both premium income for us
at the time of
sale and created a stream
of future servicing income. There
can be no assurance
 that we will be able to continue originating these loans, that a secondary market for these loans will continue to exist or that
 we will continue to realize
premiums upon the sale of
the guaranteed portion of
these loans. When we sell
the guaranteed
 portion of our SBA 7(a) loans, we incur credit risk on the non-guaranteed portion of the loans, and if a customer defaults on
 the non-guaranteed portion of a loan, we share any loss
and recovery related to the loan pro-rata with the SBA.
 The laws, regulations and
standard operating procedures
that are applicable to
SBA loan products may
change in the
 future. We
cannot predict
the effects
changes on
and profitability.
Because government
regulation
 greatly
affects
the
and
of
all
banks
and
bank
especially
our
 organization, changes in the laws, regulations
and procedures applicable to SBA loans
could adversely affect our ability
to
 operate profitably.
In addition, the
aggregate amount of
SBA 7(a) and 504
loan guarantees by the
SBA must be approved
 each fiscal year by the federal
government. We cannot predict
the amount of SBA 7(a)
loan guarantees in any given fiscal
 year. If the federal government were to reduce the amount of SBA loan guarantees, such reduction
could adversely impact
 our SBA lending
program, including making and
selling the guaranteed portion
of fewer SBA
7(a) and 504
loans. In addition,
 any default by
the U.S. government
on its obligations
or any prolonged
government shutdown
could, among
other things,
 impede our ability to originate
SBA loans or sell such loans
in the secondary market, which
could materially and adversely
 affect our business, financial condition and results
 The SBA may not honor its guarantees if we do not originate
loans in compliance with SBA guidelines
.

 SBA lending programs
typically guarantee
75.0% of the
principal on
an underlying
loan. If the
SBA establishes
that a
 loss on
an
SBA guaranteed
loan
is attributable
to significant
technical
deficiencies
manner
in which
was
 originated,
funded
or serviced
by us,
the
SBA may
seek
recovery
of
the
loss
to
the
deficiency
from
us
 notwithstanding that a portion of the loan was
guaranteed by the SBA, which could adversely
affect our business, financial
 condition and results of
operations. While we
follow the SBA's underwriting
guidelines, our ability to
do so depends on the
 knowledge and diligence of our employees
and the effectiveness of controls
we have established. If our employees
do not
 follow
the
SBA
in
originating
loans
and
if
our
loan
and
audit
programs
fail
to
identify
and
rectify
such
 failures, the
SBA may
reduce or,
in some
cases, refuse
to honor
its guarantee
obligations and
incur losses
as a
 result.

 Correspondent banking is an important part of our
business, which creates increased BSA/AML risk.
 As our
model
to banks
in Latin
America
Caribbean,
these
cross-
 border
relationships
pose
unique
risks
they
create
situations
in
which
a
U.S.
 institution will be
handling funds from
a financial institution
in Latin America
and the Caribbean
whose customers may
not
 be transparent to us. Moreover, many foreign financial institutions, including
in Latin America and the Caribbean where our
 correspondent banking
are located,
or similar
as U.S.
banks.
these
foreign
may
pose
money
risk
to
their
respective
U.S.
bank
 correspondent(s). Because
large amount
of funds,
multiple transactions,
and our
potential lack
of familiarity
with a
 foreign correspondent financial institution's customers, these customers may
be able to more easily
conceal the source and
illicit
funds.
Consequently,
we
may
have
a
higher
risk
of
non-compliance
with
the
Bank
Secrecy
Act of
1970,
as
 amended
("BSA")
and
other
("AML")
rules
and
due
to
our
 relationships with foreign
financial institutions. Additionally,
international private banking
places additional pressure
 policies, procedures
and systems
for complying
BSA, and
AML statutes
recently
 enacted CTA.
Our failure to strictly adhere
to the terms and requirements
of our OFAC
license or our failure to
adequately
 manage our
BSA/AML compliance
risk in
light of
our correspondent
banking relationship
with foreign
financial institutions
 and international private banking could result in regulatory
or other actions being taken against us, including the imposition
 of
civil
money
formal
agreements
and
cease
and
desist
orders.
Furthermore,
failure
to
meet
 requirements could require us to incur additional significant costs in order
to bring our BSA/AML processes and procedures
 into compliance, negatively
impact our reputation,
and have a
material adverse
our business, financial

 In recent
years, sanctions
that the
regulators have
imposed on
banks that
have not
complied with
all BSA
and AML
 requirements have been
especially severe. In
order to comply
with regulations, guidelines
and examination procedures
in
 this area, we have
dedicated significant resources to our BSA/AML process
and procedures. If our policies, procedures and
are deemed
deficient,
we could
be
to
fines
and
such
as additional
 restrictions on our ability to pay
dividends and the necessity to obtain
regulatory approvals to proceed with
certain aspects
 of our business plan, such as acquisitions.
 We may not recover all amounts that are contractually
owed to us by our borrowers.

 We are
dependent on
the collection
of loan
principal, interest,
and fees
to partially
fund our
operations. A
shortfall in
 collections and proceeds may impair our ability to fund
our operations or to repay our existing debt.
 When
we
lend
funds,
commit
to
fund
a
loan
or
enter
into
a
letter
of
or
other
credit-related
contract
with
a
 counterparty, we incur credit risk. The
credit quality of our
portfolio can have a
significant impact on our
earnings. We expect
 to experience
charge-offs
and delinquencies
loans
future.
Our
customers'
 worse
than
our
underwriting
contemplated
when
we
originated
the
and
in
these
circumstances,
we
could
incur
 substantial impairment or loss
of the value on these
loans. We may
fail to identify problems
because our customer
did not
 report them in a timely manner
or, even if
the customer did report the problem,
we may fail to address it
quickly enough or
 at all, or some loans,
due to market circumstances,
may not be able
to be fully rehabilitated.
Even if customers provide
us
 with full and accurate disclosure
of all material information concerning
their businesses, we may misinterpret
or incorrectly
 analyze this information. Mistakes
may cause us
to make loans that
we otherwise would not
have made or
to fund advances
 that we otherwise would not have funded, either
of which could result in losses on
loans, or necessitate that we significantly
 increase our allowance for loan and
lease losses. As a result, we could
suffer loan losses and
have non-performing loans,
 which could
have
a material
net
and
of
and financial
 extent the losses exceed our allowance for loan and lease
losses.
 Some
of
our
loans
are
by
liens
on
specified
of
the
borrowers
and
we
may
not
or
properly
 perfect our liens or the value
of the collateral securing any
particular loan may not be sufficient
to protect us from suffering
 a partial or complete
loss if the loan
becomes non-performing and
we proceed to foreclose
on or repossess
the collateral.

 With
respect
to
loans
that
we
originate
for
condominium
or
homeowners'
associations
("Associations"),
these
loans
are
 primarily secured by and rely
upon the cash flow received
by the Associations from
payments received from their
property
 owners, as well
as cash on
hand. These Associations
rely upon payments
received from their
property owners in
order to
 perform
on
these
loans
and
for
the
loan
collateral.
our
to
recover
on
non-performing
loans
 made to Associations
is dependent
upon the Association
having sufficient
cash on hand
for repayment of
the loan and/or
 having
the
to
on
its
property
owners,
some
of
whom
may
not
have
the
to
pay
such
 assessments. In such events, we could suffer loan losses,
which could have a material adverse effect on our
net earnings,
 allowance for loan and lease losses, financial condition,

 Non-performing
take
time
to
resolve
and
our
of
and
 financial condition, and could result in further losses in
the future.
 Non-performing assets adversely
affect our net
income in
various ways. We
do not
record interest income
on nonaccrual
 loans or other
owned ("OREO"),
thereby adversely
affecting our
and returns on
assets and
equity,
 increasing our loan administration costs and adversely
affecting our efficiency ratio. When
we take collateral in foreclosure
 and similar proceedings, we are
required to mark the collateral to
its then-fair market value, which may
result in a loss. Non-
 performing loans
and OREO
also increase our
risk profile
and the level
of capital
our regulators
believe is appropriate
for
 us to
maintain in
light of
such risks.
The resolution
of non-performing
assets requires
significant time
commitments from
and
can
be
detrimental
to
the
of
their
other
responsibilities.
In
there
are
legal
fees
with
the
resolution
of
problem
as
well
as
carrying
costs
such
as
taxes,
insurance,
and
maintenance
 related to OREO.
If we experience
increases in non-performing
loans and non-performing
assets, our net
interest income
 may be negatively impacted and
our loan administration costs
could increase, each of which could
have an adverse effect
 on our net income and related ratios, such as return
on assets and equity.
 We engage in
lending secured by
real estate and
may foreclose on
the collateral and
own the underlying
real
 estate,
subjecting
us
to
the
costs
and
risks
with
the
ownership
of
real
property,
to
environmental
or
protection
initiatives
or
in
state
or
law
may
 substantially raise the cost of foreclosure or prevent
us from foreclosing at all.

 Since we
originate
loans secured
by real
estate, we
may have
to foreclose
property
to recover
our
 investment and may thereafter own and operate such property,
in which case we would be exposed to the risks inherent in
 the
ownership
of
real
estate.
The
that
we,
as
a
mortgagee,
may
realize
after
a
foreclosure
depends
on
 outside of our
control, including,
but not limited
to, general or
local economic conditions,
environmental cleanup
liabilities,
 various assessments
relating to
the ownership
of the property,
interest rates, real
estate tax rates,
operating expenses
of
 the
mortgaged
properties,
our
to
and
occupancy
of
the
properties,
zoning
laws,
 governmental and
regulatory rules,
and natural disasters.
Our inability
to manage
the amount
of costs
or size
of the risks
 associated with
the ownership
of real
estate, or
write-downs in
of OREO,
an adverse
our
 business, financial condition, and results of operations.
consumer protection initiatives
or changes in state
or federal law may
substantially increase the time
and
 expenses associated
residential foreclosure
process or
prevent us
from foreclosing
at all.
A number
of states
in
years
have
either
considered
or
foreclosure
reform
laws
that
make
it
substantially
more
difficult
and
 expensive for
lenders to
foreclose on
residential properties
in default.
Furthermore, federal
regulators have
prosecuted a
 number of
mortgage servicing
companies for
alleged consumer
law violations.
If new
state or
federal laws
or regulations
 are ultimately enacted
that significantly raise
the cost of residential
foreclosures or raise
outright barriers, they
 an adverse effect on our business, financial condition,
 We are exposed to risk of environmental liability
when we take title to property.

 A
portion
of
our
loan
is
by
real
estate,
and
we
could
to
environmental
 liabilities with respect
to one or
more of these
properties, or with
respect to properties that
we own in
operating our business.
 During the ordinary course of business,
we may foreclose on and take title to
properties securing defaulted loans. In
doing
 so, there is
a risk that
hazardous or toxic
substances could
be found on
these properties. If
hazardous conditions
or toxic
 substances are found
on these properties,
we may be
liable for remediation
costs, as well
as for personal
injury and property
 damage, civil
fines and
criminal penalties
regardless
of when
the hazardous
conditions or
toxic substances
first affected
 any particular property.
The costs associated with investigation or
remediation activities could be substantial.
In addition, if
 we are the owner or former owner
of a contaminated site, we may be
subject to common law claims by
third parties based
 on damages and
costs resulting
from environmental
contamination emanating
property.
If we become
 significant environmental liabilities, our business, financial condition
and results of operations could be adversely affecte
d.
 We
are
to
risks,
including,
but
not
limited
to,
customer,
or
 fraud and data processing system failures and errors.

 Employee errors and employee or
customer misconduct could subject us
to financial losses or
regulatory sanctions and
 seriously harm our reputation. Misconduct by our employees could include hiding unauthorized
activities from us, improper
 or unauthorized activities on behalf of our customers or improper use of confidential information. It is not
always possible to
 prevent employee
errors and
misconduct, and
the precautions we
take to
prevent and
detect this
activity may
 in all cases. Employee errors could also subject us
to financial claims for negligence.

 We have
implemented a
system of
internal controls
designed to
mitigate operational
risks, including
data processing
 system failures
and errors
and customer
or employee
fraud, as
coverage
designed to
protect us
from
with
these
risks,
from
any
interruption.
If
our
 internal controls fail
to prevent or
detect an
occurrence, or if
any resulting loss
is not
insured or exceeds
applicable insurance
 limits, it could adversely affect our business,
prospects, cash flow, liquidity,
 We
also
rely
on
the
integrity
and
of
a
of
third
party
processors,
payment,
clearing
and
settlement
 systems, as well
as the various
participants involved
in these systems,
many of which
have no direct
relationship with us.
 Failure
by
these
participants
or
their
to
our
customers'
transaction
data
may
put
us
at
risk
for
 losses due
to fraud
or operational
disruption. At
the date
of this
Annual Report
Form 10-K,
there is
no knowledge or
indication
 that customer
sensitive information
was compromised
as a
third parties
system vulnerabilities,
but management
 continues to monitor developments and vendor communications.
 When we originate loans, we rely
heavily upon information supplied by third parties,
including the information contained
 in credit
applications, property
appraisals, title
information, equipment
pricing and
valuation and
employment and
 documentation, in deciding which loans we will originate, as well as the terms of those loans. If any of the information upon
 which
we
rely
is
misrepresented,
either
fraudulently
or
inadvertently,
and
the
misrepresentation
is
not
detected
prior
to
 funding,
of
the
loan may
be significantly
lower
than expected,
or we
may
fund a
loan that
we
would not
have
 funded or
on terms
that do
not comply
with our
general underwriting
standards. Whether
a misrepresentation
is made
by
 the applicant, the borrower,
one of our employees or another
third party,
we generally bear the risk of
loss associated with
 the misrepresentation. A loan
subject to a material
misrepresentation is typically
unsellable or subject to
repurchase if it
is
 sold prior to detection of the
misrepresentation. The sources of
the misrepresentations are often
difficult to locate, and
it is
 often difficult
to recover
any
resulting monetary
losses we
may suffer,
which
could
 We
face
risks
the
of
the
involves
a
high
 volume of transactions
.
 We
operate
in
diverse
markets
and
rely
on
the
of
our
employees
and
to
process
a
high
number
of
 transactions. Operational
risk is
the risk of
loss resulting from
our operations,
including but not
limited to, the
risk of fraud
 by employees or
persons outside
the Company,
the execution
of unauthorized
transactions by
employees, errors
relating
 to transaction
processing and technology, breaches of
our internal
control systems and
compliance requirements. Insurance
 coverage may
not be available
for such
losses, or
where available, such
losses may
exceed insurance
limits. This
risk of
 loss
also
legal
that
could
arise
as
a
of
deficiencies
or
as
a
of
non-
 compliance with applicable regulatory standards,
adverse business decisions or their
implementation, or customer attrition
 due to
potential adverse publicity. In the
event of a
breakdown in our
internal control systems,
improper operation of
 or improper employee actions, we could suffer financial
loss, face regulatory action, and/or suffer damage to
our reputation.
 We have several
large depositor relationships,
the loss of which
could force us to
fund our business
 more expensive and less stable sources.

 Withdrawals of deposits by any
one of our largest depositors
could force us to
rely more heavily on more expensive
and
 less
stable
sources.
Consequently,
the
occurrence
of
such
event
could
have
a
on
our
 business, financial condition and results of operations. At
December 31, 2024, our top 10 depositors held
16.7% of our total
 portfolio. As of December
31, 2024, 45% of
our deposits are estimated
to be FDIC-insured. At such
date, our public funds
 are 5% of total deposits and are partially collateralized. The estimated average account size of our deposit portfolio is $105
 thousand.
In
the
Bank
was
considered
a
"well
capitalized"
as
of
2024
and
2023.
 Consequently,
the occurrence of
such event could have
a material adverse effect
on our business, financial
condition and
 results of operations.
 Our securities portfolio performance in difficult market conditions could have adverse effects on
our results of
.
 Unrealized losses on
investment securities result from
changes in credit
spreads and liquidity
issues in the
marketplace,
 along
with
in
the
profile
of
issuers.
Under
GAAP,
we
are
to
our
periodically
for
the
presence
of credit
of
our securities,
taking
into consideration
and
the
and
of
in
fair
value,
issuer
rating
and
trends,
volatility
of
 earnings, current
analysts' evaluations,
and intent
to hold
investments until
a recovery
of fair
value, as
 other factors. Adverse developments with respect to one or more of
the foregoing factors may require us to deem particular
 securities to be impaired, with the credit-related portion of
the reduction in the value recognized as a
charge to our earnings
 through an allowance. Subsequent valuations,
in light of factors prevailing at that
time, may result in significant changes
in

 the values of these securities in future
periods. Any of these factors could require us
to recognize further impairments in the
 value of our securities portfolio, which may have an adverse
effect on our results of operations in future periods.
 We may not
effectively execute
on our expansion
strategy, which
may adversely affect
our ability to
 our historical growth and earnings trends.

 Our
expansion
strategy
focuses
on
organic
growth,
supplemented
by
of
 institutions and
banking teams;
however,
able to
successfully execute
on these
aspects of
our expansion
 strategy,
which
may
cause
our
rate
to
decline
below
our
levels,
or
may
prevent
us
from
 growing at
all. More
specifically,
not be able
to generate
sufficient new
deposits within
acceptable risk
 and
tolerances
or
the
personnel
or
for
growth.
Various
factors,
such
as
 economic conditions
and competition with
other financial
institutions, may impede
or restrict the
growth of our
 Further, we may be unable to attract
and retain experienced bankers, which could adversely
affect our growth. The success
 of our strategy also depends on our ability to manage our growth effectively,
which in turn depends on a number of factors,
our
to
adapt
our
operational,
technology,
risk
and
 infrastructure to accommodate expanded operations.
Even if we are successful in continuing our growth,
such growth may
 not offer the same
levels of potential profitability,
and we may not
be successful in
controlling costs and
maintaining asset
 quality in the
face of that
growth. Accordingly,
our inability
to maintain growth
or to
effectively manage
growth could
have
 an adverse effect on our business, financial condition
 New lines of business, products, product enhancements
or services may subject us to additional risk.

 From time to time, we
may implement new lines
of business or offer
new products and product
enhancements as well
 as new
services within
our existing
lines of
business. There
are substantial
risks and
uncertainties associated
with these
 efforts. In
developing, implementing
or marketing new
lines of business,
products, product
enhancements or
services, we
 may invest significant time and
resources. We may underestimate the appropriate level
of resources or expertise
 to
make
new
lines
of
or
successful
or
to
realize
their
benefits.
We
may
not
achieve
the
 milestones
set
in
initial
timetables
for
the
and
introduction
of
new
lines
of
products,
product
 enhancements or services, and price
and profitability targets may not
prove feasible. External factors, such
as compliance
 with regulations, competitive
alternatives and shifting
market preferences, may
also impact the
ultimate implementation of
 a new line of business or offerings of new products, product
enhancements or services. Any new line of business,
product,
 product enhancement or service could have a significant impact on the effectiveness of our system of internal controls. We
 may also
decide to
discontinue
businesses
or products,
due to
lack
of customer
acceptance
or unprofitability.
Failure to
 successfully develop and implement new lines of business or offerings of new products, product enhancements or services
 could have an adverse effect on our business, financial condition and results
of operations and could subject us to new and
 unanticipated operational, credit, regulatory and reputational risks,
among other risks.
 Our business
needs and
future growth
may require
us to
raise additional
capital and
that capital
be
 available on terms acceptable to us or may be dilutive to
existing shareholders.

 We believe that we
have sufficient capital
to meet our capital
needs for our current
growth plans. However,
we expect
 that we would need to raise additional capital,
in the form of debt or equity securities,
in the future to have sufficient capital
to
meet
our
longer-term
plans,
if
the
quality
of
our
or
were
to
deteriorate
 significantly.
In addition, we
are required by federal
regulatory authorities to
maintain adequate levels
of capital to support
 our operations.
 Our ability
to raise
capital will
depend on,
among other
things, conditions
capital markets,
which are
outside of
 our control, and our financial performance. Accordingly,
we cannot provide assurance that such capital will
be available on
 terms acceptable to us or at all. Any occurrence
that limits our access to capital may adversely
affect our capital costs and
 our ability to raise capital. Further, if we need to raise capital in the future, we may have to do so when many other financial
 institutions are also
seeking to
raise capital and
would then have
to compete with
those institutions for
investors. Any inability
 to raise capital on acceptable terms when needed may cause us to
either issue additional shares of common stock or other
 securities on less than
desirable terms or
reduce our rate of
growth until market conditions
become more favorable. If
any
 of such
events occur, they could
have a material
adverse effect on
our business, financial
condition and results
 and could be dilutive to both tangible book value and our
share price.
 Federal law requires that a holding company act as a source of financial and managerial strength to its subsidiary bank
commit
to support
such subsidiary
bank. Under
the "source
of strength"
doctrine, the
Federal Reserve
 may
a
to
make
injections
into
a
troubled
subsidiary
bank
and
may
charge
the
 company with
engaging
in unsafe
and unsound
practices
for failure
to commit
to a
subsidiary
bank. A
 injection may be required
at times when the
holding company may
not have the resources
to provide it and
therefore may

 be required to attempt to
borrow the funds or raise
capital. Thus, any borrowing that must
be done by the Company
to make
 a required
capital injection becomes
more difficult and
expensive and
an adverse
effect on our
business, financial
Moreover, it is possible that we will be
unable to borrow funds or
otherwise raise capital
 at a
time when
it is
needed. In
addition, an
inability to
raise capital
when needed
may subject
us to
increased regulatory
 supervision and
the
imposition of
and business.
These restrictions
could
negatively
our
to
operate
or
further
expand
our
loan
growth,
or
the
establishment
of
 branches. These restrictions may also
result in increases in operating
expenses and reductions in revenues
that could have
 a material adverse effect on our financial condition,
results of operations and our share price.
 We may
grow through
mergers or
acquisitions,
a strategy
successful or,
if successful,
may
 produce risks in successfully integrating and managing the merged companies or acquisitions and may dilute our
 shareholders.

 As
part
of
our
strategy,
we
may
pursue
mergers
and
of
banks
and
non-bank
 companies within or outside our principal market areas that fit within the mission-driven values of our franchise and that we
 believe support our business and make financial and strategic
sense. We may have difficulty identifying suitable acquisition
 candidates or executing on acquisitions that we pursue, and we may
not realize the anticipated benefits of any transactions
 we complete. Additionally,
for any opportunistic
acquisition we were
to consider,
we expect to
face significant
 from
numerous
other
many
of
which
will
have
than
we
do.
attractive opportunistic
may
available to
us. There
can be
no assurance
that we
will
be
 successful in identifying or completing any future acquisitions.
 Mergers and acquisitions involve numerous risks, any
of which could harm our business, including:
 •

the possibility that expected benefits
may not materialize in the
time frame expected or at
all, or may be more
costly
 to achieve, or that the acquired business will not perform
to our expectations;
 •

time,
and
difficulties
in
integrating
the
and
services,
technologies,
 existing contracts, accounting processes
and personnel of the target
and realizing the anticipated synergies
 combined businesses;
 •

incurring the
time and
expense associated with
identifying and
evaluating potential acquisitions
and merger
partners
 and negotiating potential transactions, resulting in management's attention being diverted from the operation of our
 existing business;
 •

difficulties in supporting and transitioning customers
of the target and disruption of our ongoing banking
business;
 •

the price we
pay or other
resources that we
devote may exceed
the value we
realize, or the
value we could
have
 realized if we had allocated the purchase consideration
or other resources to another opportunity;
 •

entering new markets or areas in which we have limited or
no experience;
 •

the possibility that our culture is disrupted as a result of
an acquisition;
 •

potential loss of key personnel and customers from either
our business or the target's business;
 •

assumption of unanticipated problems, claims or other liabilities
of the acquired business;
 •

an inability to realize expected synergies or returns on
investment;
 •

the possibility of regulatory approval for the acquisition being delayed,
impeded, restrictively conditioned, including
 the requirement to divest
various activities, or denied
due to existing or
new regulatory issues surrounding
us, the
 target institution or the proposed combined entity and
the possibility that any such issues associated with
the target
 institution, of which
we may or
may not be
aware at the
time of the
acquisition, could adversely impact
the combined
 entity after completion of the acquisition;
 •

the possibility that the acquisition may not be timely completed,
if at all;
 •

the need to raise capital; and
 •

inability to generate sufficient revenue to offset
acquisition costs.
 Any acquisition activities we engage in could require us to use a substantial amount of cash, other liquid assets, and/or
 incur debt. Also, if
we finance acquisitions by issuing equity securities,
our existing shareholders' ownership may be
diluted,
 which
could
negatively
the
price
of
our
Class
A
if
the
goodwill
in
 connection with our potential future acquisitions were determined to be impaired, then we would be required to recognize a
 charge against our earnings, which
could materially and adversely affect our
results of operations during the
period in which
 the impairment was recognized. Acquisitions
may also involve the payment
of a premium over book
and market values and,
 therefore, some
dilution of
our tangible
book value
and net
income per
common share
may occur
in connection
with any
 future transaction.

 As a result, we
may not achieve the
anticipated benefits of
any such merger or
acquisition, and we
may incur costs
in
 excess
of
what
we
anticipate.
Our
failure
to
successfully
evaluate
and
execute
mergers,
or
or

 otherwise adequately address and
manage the risks associated
with such transactions could have
a material adverse effect
 on our business, results of operations and financial condition,
including short-term and long-term liquidity.
 The loss of
one or more
of our key
personnel, or our
failure to attract
and retain other
highly qualified personnel
 in the future, could harm our business.

 Our future success will, to some extent, depend on the continued service of our directors, executive officers and senior
team.
The
loss
of
the
of
any
of
these
individuals
could
have
a
on
our
 business. In particular,
we believe that retaining Luis de la
Aguilera, our Chairman, President,
and Chief Executive Officer,
 Robert Anderson,
our Chief
Financial Officer,
and William
Turner,
our Chief
Credit Officer,
is important
continuing
 success.
Although we
have
entered
into employment
agreements
with
members
executive and
 senior management team, including Mr. de la Aguilera and Mr. Anderson, no assurance can be given that these individuals
 will continue
to be
employed by
us. The
loss of
these individuals
could negatively
to achieve
our
 growth strategy and could have a material adverse effect
on our business and results of operations.
 We also need to continue
to attract and retain other senior
management and to recruit qualified
individuals to succeed
key
personnel
to
ensure
the continued
and successful
operation
business.
We
may
be unable
to
 attract or
retain qualified
key
personnel
future due
intense competition
for qualified
 personnel
among
in
the
and
businesses.
The
loss
of
the
of any
 senior management personnel, or the inability to recruit
and retain qualified personnel in the future, could
have an adverse
 effect on our business, results of
operations, financial condition and prospects.
to attract and retain personnel
 with appropriate skills and
knowledge to support our
business, we may offer
a variety of benefits, including
equity awards,
 which may reduce our earnings or adversely affect our
business, results of operations, financial condition or prospects.
 Damage to our reputation could significantly harm
our businesses.
 Our ability to attract
and retain customers and
highly-skilled management and employees is impacted
by our reputation.
 A negative public
opinion of us
and our business
can result from
any number of
activities, including our
lending practices,
and
acquisitions,
complaints
and
taken
by
 organizations in
response to
these activities.
Furthermore, negative
publicity regarding
us as
an employer
an
impact on
our reputation,
especially
with respect
to
matters of
diversity,
pay equity
and workplace
harassment.
 Significant
harm
to
our
reputation
could
also
arise
as
a
of
or
governmental
actions,
and
the
 activities of our customers, other
participants in the financial services
industry or our contractual counterparties, such
as our
 service providers
and vendors.
The potential
harm
is heightened
given
increased attention
to how
corporations
address
 environmental, social
and governance
issues. In
addition, a cybersecurity
event affecting
us or our
customers' data
could
 have a negative
impact on our
reputation and
customer confidence
in us and
our cybersecurity
practices. Damage
 reputation could also
our credit ratings
and access to
the capital markets.
whereas negative
 public opinion once was
primarily driven by adverse
news coverage in traditional
media, the widespread use
of social media
 platforms by
virtually every
segment of
society facilitates
the rapid
dissemination
of information
or misinformation,
which
 magnifies the potential harm to our reputation.
 We
face
strong
from
and
other
that
offer
 services, which could materially and adversely affect
our business.

 The financial
services industry has
become even
more competitive as
a result
of legislative,
regulatory and technological
 changes and
continued
banking consolidation,
which
may increase
as a
current economic,
market and
political
 conditions. We
face substantial
in all
phases
from
a variety
of competitors,
including local
regional
banks
and,
more
recently,
technology,
or
"fintech"
companies.
Many
of
our
 competitors offer the same banking services that
we offer and our success depends on
our ability to adapt our
products and
to
evolving
industry
and
requirements.
Increased
in
our
may
in
 reduced new
loan and
lease production
and/or decreased
deposit balances
or less
favorable terms
on loans
and leases
 and/or deposit
accounts. We also
face competition
from many
other types
institutions, including
without limitation,
 non-bank
specialty
lenders,
private
funds,
and
other
 intermediaries. Should competition in
the financial services industry
intensify, our ability to market our
products and services
 may be adversely affected. If we are unable to attract and retain banking customers, we may be
unable to grow or maintain
 the levels
deposits and
our results
and financial
condition may
be adversely
affected as
a
 result. Ultimately, we
may not be able to compete successfully against current
and future competitors.

 We must respond to rapid technological changes
to remain competitive.

 We will have to continue to respond
to future technological changes, which are occurring at a
rapid pace in the financial
 services industry
in order
to remain
competitive. We
expect that
new technologies
and business
processes applicable
to
 the banking industry will
continue to emerge, and
these new technologies and
business processes may be
better than those
 we currently
use. Because
the pace
of technological
change is
high and
our industry
is intensely
competitive,
our future
 success will depend, in
part, upon our ability
to address the needs
of our customers by
using technology to provide
 and
that
will
satisfy
demands
for
convenience,
as
well
as
to
create
efficiencies
in
our
 operations. We may
not be able to
implement new technology-driven
products and services effectively
or be successful in
 marketing
these
and
to
our
customers.
Failure
to
keep
pace
successfully
with
technological
 affecting the
financial services
industry could
harm our
ability to compete
effectively and
an adverse
 our business, financial condition and results of
operations. As these technologies improve in the future,
we may be required
 to make significant capital expenditures in order to remain competitive, which may increase our overall expenses and have
 an adverse effect on our business, financial condition
 We
continually
encounter
technological
change,
and
we
may
have
fewer
than
many
of
our
 competitors to invest in technological improvements.
 The financial
industry
continues to
undergo
rapid
technological
with
frequent
introductions
of new
 technology-driven
and
services.
The
use
of
increases
efficiency
and
enables
 institutions to
better serve customers
reduce costs. Our
future success will
depend, in part,
upon our ability
to address
 the
needs
of
our
by
using
to
and
that
will
satisfy
client
demands
for
 convenience, as well as to create additional efficiencies in our operations. Many national vendors provide turn-key services
 to
such
as
internet
and
remote
capture
that
allow
smaller
banks
to
compete
with
 institutions that have
substantially greater resources to
invest in technological
improvements. We may not
be able, however,
 to effectively
implement new
technology-driven
and services
or be
successful
in marketing
these products
and
 services to our customers.
 Our current and
future uses of artificial
intelligence (AI) and other
emerging technologies may create additional
 risks.
 The increasing adoption of AI in financial services
presents significant opportunities but also introduces a range of
risks
 that
could
our
and
trust.
AI
introduces
model
risk,
where
flawed
 algorithms or
biased data could
result in inaccurate
credit decisions,
compliance violations,
or discriminatory
outcomes in
 lending or customer
service. Cybersecurity
threats, such
as data breaches,
adversarial attacks,
and data poisoning,
pose
 significant challenges,
particularly as these
systems handle
large volumes of
sensitive customer
information. Additionally,
 the opaque nature of some AI models, often referred to as "black-box" systems, raises regulatory compliance concerns, as
 regulators increasingly require transparency and explainability
in AI-driven decision-making.

 Operational risks also arise from potential system failures, over-reliance
on AI, and integration challenges with existing
 infrastructure. Disruptions in AI systems could impact critical functions such as fraud detection, transaction monitoring, and
 customer support.
Ethical and reputational
risks, including
unintended consequences
or perceived unfairness
in AI-driven
 decisions,
may
erode
trust
and
expose
us
to
scrutiny.
Mitigating
these
risks
a
robust
framework,
testing
and
auditing
of
AI
models,
and
strong
human
oversight.
Investments
in
 cybersecurity, data
privacy protections, and employee training are critical
to managing these risks.
 A
failure,
interruption,
or
breach
in
the
of
our
or
those
of
our
contracted
vendors,
could
 disrupt
our
in
the
of
confidential
damage
our
reputation,
and
create
 significant financial and legal exposure.
 Although we
devote significant
resources to maintain
and regularly update
our systems and
processes that are
 to
the
of
our
computer
software,
networks
and
other
as
well
as
the
 confidentiality,
integrity and availability
of information belonging
to us and
our customers,
there is no
assurance that
all of
 our
will
absolute
security.
Many
us,
have
been
subjected
to
 attempts to infiltrate the security of their websites or other systems, some involving sophisticated targeted
attacks intended
 to obtain
unauthorized access
to confidential
information, destroy
data, disrupt
or degrade
service, sabotage
systems or
 cause other damage, including through the introduction of
computer viruses or malware, cyber-attacks and other means. At
 this point,
although there
is no
knowledge or
indication that we
have experienced a
material cyber-incident or
security breach
 that has been successful in compromising our
data or systems to date, we can
never be certain that all of our
systems are
 entirely free from vulnerability to breaches of security or
other technological difficulties or failures.

 Despite efforts to
ensure the integrity
and security of
our systems, it
is possible that
we may not
be able to
anticipate,
 detect or recognize
threats to our
systems or to
implement effective
preventive measures
against all efforts
to breach our
 security inside or outside our business, especially because the techniques used to attack our systems
change frequently or
 are
not
until
launched,
and
cyber-attacks
can
originate
from
a
wide
of
 individuals or groups who are associated with
external service providers or who are or
may be involved in organized crime
 or linked
to terrorist
organizations or
hostile foreign
governments. Those
parties may
also attempt
to fraudulently
induce
 employees, customers, third-party service providers or other users of our systems to disclose sensitive information in order
 to gain access
to our data or
that of our customers
or clients. Similar
to other companies,
our risks and exposures
 to cybersecurity attacks have increased as
a result of the related increased
reliance on remote working (largely
as a result
 of the COVID-19 pandemic)
and the increase in
digital operations. Such
risks and exposures
are expected to
remain high
 for the foreseeable
future due
to the rapidly
evolving nature
and sophistication
threats and
the expanding
 technology, as our web
-based product offerings grow and we expand
internal usage of web-based applications.
 A successful
penetration
or
circumvention
including those
vendors,
 could
cause
serious
consequences,
disruption
of
our
misappropriation
of
 confidential information,
or damage
to computers
or systems,
and may
result in violations
of applicable
privacy and
other
 laws, financial loss,
loss of confidence
in our security measures,
customer dissatisfaction, increased
insurance premiums,
 significant litigation exposure and harm to our reputation, all of which could have a material adverse effect on our business,
 financial condition, results of operations, and future prospects.
 We
rely
on
other
to
key
components
of
our
infrastructure
and
our
 could
be
interrupted
if
our
service
providers
experience
difficulty,
terminate
their
or
fail
to
 comply with banking regulations.

 Third parties
provide key
components of
operations such
as data
processing, recording
and monitoring
 transactions,
online
interfaces
and services,
Internet
connections
and
network
access.
While
we
have
selected
 these third-party
vendors carefully,
performing upfront
due diligence
and ongoing
monitoring activities,
we do
not control
 their actions. Any problems caused by these third parties, including those resulting from disruptions in services provided by
 a
vendor
as
a
of
a
cyber-attack,
other
event
or
a
natural
disaster),
or
 operational difficulties
for the vendor,
issues at third-party
vendors to our
vendors, failure of
a vendor to
handle current or
 higher volumes, failure of a vendor to provide services for
any reason, poor performance of services, failure to comply
with
 applicable laws
and regulations,
or fraud
or misconduct
part of
employees of
our vendors,
could adversely
 affect our ability
to deliver products
and services to
our customers, our
reputation and our
ability to conduct
 which could
prospects, cash
flow,
liquidity,
financial condition
and results
In
situations,
replacing
these
vendors
could
also
create
delay,
expense,
and
 difficulties, which
could also
our business.
such third
parties creates
an unavoidable
 and inherent
risk to
operations. Such
risk is
generally expected
to remain
elevated as
many of
our vendors
 have also
been, and
may
further be,
affected
by increased
reliance
on remote
work
environments,
volatility
and
 other factors
that increase
their risks
of business
disruption or
otherwise affect
their ability
to perform
 terms of any agreements with us or provide essential services.
 Our operations could be interrupted or
materially impacted if any of our
third-party service providers fail to comply
with
 banking regulations
applicable laws.
The Federal
Reserve, FDIC,
FOFR, and
other regulators
expect financial
to
be
responsible
for
all
aspects
of
their
performance,
aspects
that
they
delegate
to
third
parties.
we will
be responsible
for deficiencies
oversight and
control of
our third
party relationships
and in
the
 performance of the parties with which
we have these relationships. As
a result, if our regulators conclude that
we have not
 exercised adequate oversight and control over our third party vendors or
other ongoing third party business relationships or
 that
such
third
parties
have
not
performed
appropriately,
we
could
be
to
remedial
actions,
 including civil
money penalties
or other
administrative
or judicial
penalties or
fines
as requirements
for customer
 remediation, any of which could have a material adverse
effect our business, financial condition or results
 Litigation and regulatory actions,
including possible enforcement actions, could subject
us to significant fines,
judgments
or
other
in
or
on
our
 activities.

 In the normal course of
business, from time to time, we
have in the past and
may in the future be
named as a defendant
 in various
legal actions
arising in
connection with
our current
and/or prior
activities. Legal
actions could
 claims for substantial compensatory and/or
punitive damages or claims for indeterminate
amounts of damages. Further,
in
 the future
our
state
bank
may
consent
orders,
civil
money
matters
requiring
 attention, or similar types of
supervisory penalties or criticism. We may also,
from time to time, be
the subject of subpoenas,
 requests
for
reviews,
investigations
and
proceedings
(both
formal
and
informal)
by
governmental

 regarding our
and/or prior
activities.
Any such
legal or
actions may
us to
substantial
 compensatory
or
punitive
damages,
fines,
to
our
practices
or
other
 requirements resulting
in increased
expenses, diminished
income and
damage to
our reputation.
Our involvement
in any
 such matters,
whether tangential
or otherwise
and
even if
the matters
are ultimately
favor,
could also
 cause significant harm to our
reputation and divert management attention away from
the operation of our business.
 any settlement, consent order or adverse judgment in connection with any formal or informal proceeding or investigation by
 government
may
in
litigation,
investigations
or
proceedings
as
other
litigants
and
government
 begin independent
reviews of
activities. As
a result,
the outcome
of legal
and regulatory
actions could
have an
 adverse effect on our business, results of operations
 Certain of
our directors may
have conflicts
of interest in
determining whether to
present business
opportunities
 to us or another entity with which they are, or may
become, affiliated.

 Certain of our
directors are or may
become subject to fiduciary
obligations in connection with
their service on the
boards
 of
of
other
corporations,
institutions.
A
director's
association
with
other
 which give rise to
fiduciary or contractual obligations to such other
institutions, may create conflicts of interest. To the extent
 that any of our directors
become aware of acquisition
opportunities that may be
suitable for entities other
than us to which
 they have fiduciary or contractual obligations, or they are
presented with such opportunities in their capacities as fiduciaries
 to such
entities, they
may honor
such obligations
to such
other entities.
You
should assume
that to
the extent
our
 directors become aware
of an opportunity
that may be
suitable both for
us and another
entity to which
such person has
a
 fiduciary obligation
or contractual
obligation
to present
such
opportunity as
set forth
above,
he or
she may
first give
the
 opportunity to such other entity
or entities and may give
such opportunity to us only
to the extent such other
entity or entities
 reject
or
are
unable
to
pursue
such
opportunity.
In
you
should
assume
that
to
the
any
of
our
aware
of
an
acquisition
opportunity
that
does
not
fall
the
above
parameters,
but
that
may
otherwise
be
 suitable for us, he or she may not present such opportunity to
us.
 Pursuant to an agreement between us and each of our Significant Investors
(as defined below), each of the Significant
 Investors has the right
to nominate one
director to serve
on our Board, including
Board committees, and
to designate one
 non-voting Board
observer.
The directors
and Board
observers
designated by
the Significant
Investors have
the right
to,
 and have
no duty
not to,
engage in
or similar
business activities
or lines
of business
as us.
In the
event that
a
 director or Board observer designated by a Significant Investor acquires knowledge of a potential transaction or matter that
a corporate opportunity
for us,
such person shall
have no
duty to
communicate or
present such corporate
opportunity
 to us
and shall
liable to
us or
our shareholders
for breach
of any
duty by
reason of
the fact
that such
person or
a
 related investment fund
thereof, directly or
indirectly, pursues or acquires such opportunity
for itself, directs
such opportunity
 to another person, or does not present such opportunity
to us.

 Risks Related to Our Tax,
Accounting and Regulatory Compliance
 Our ability to recognize
the benefits of
our deferred tax
assets is dependent
on future cash flows
and taxable
 income and may be materially impaired upon significant
changes in ownership of our common stock.
 We recognize the expected future tax
benefit from deferred tax assets when
it is more likely than
not that the tax benefit
 will be
realized. Otherwise,
a valuation
allowance
is applied
against our
tax assets,
reducing
of such
 assets. Assessing
the recoverability
of deferred
tax assets
requires management
to make significant
estimates related
to
of
taxable
from
all
reversal
of
taxable
temporary
differences,
forecasted
and
tax
planning
strategies.
Estimates
of
taxable
are
based
on
forecasted
 income from operations and the application of existing tax laws in each jurisdiction. The improved risk profile of the Bank is
 a key
component used
in the determination
realize the
expected future
benefit of
our deferred
tax assets.
 To
the extent that future taxable income differs
significantly from estimates as a result
of the interest rate environment and
 loan growth capabilities or other factors, our ability to realize
the net deferred tax assets could be negatively
affected.
 Subject to certain exceptions, our Class A common stock is subject
to transfer restrictions as set forth in our Articles of
 Incorporation that are
designed to preserve
our deferred tax
assets. Notwithstanding these
protective provisions, the
Articles
 of Incorporation include
an exception that
allows our Significant
Investors the right
to effect any
transfer that would
otherwise
 be prohibited, which transfer could result in the loss of the deferred
tax assets.
significant future
issuances of
or common
stock equivalents,
or changes
direct or
 indirect ownership
or common
stock equivalents,
could cause
an ownership
change and
could limit
 our ability to
utilize our net
operating loss
carryforwards and other
tax attributes
pursuant to Section
382 and Section
 of the Internal
Revenue Code,
as 1986, as
amended.
Future changes in
tax law or
changes in ownership
structure could
 limit our ability to utilize our recorded net deferred tax assets.

 The
accuracy
of
our
and
disclosures
could
be
affected
if
the
judgments,
 assumptions or estimates used in our critical accounting
policies are inaccurate.
 The
preparation
of
our
and
disclosures
in
conformity
with
GAAP
us
to
make
 judgments,
and
that
the
in
our
and
 accompanying notes. In some cases, management
must select the accounting policy or method
to apply from two or more
 alternatives,
which
reasonable
under
the circumstances,
yet
which
may result
in
our
materially
than
would
have
been
under
a
alternative.
Certain
are
or
 significant to presenting our financial
condition and results of
operations. Our critical accounting policies, which
are included
 in the section captioned "Management's Discussion and Analysis of Financial Condition and Results
of Operations" in Item
 7 of this Annual Report
on Form 10-K, describe
those significant accounting
policies and methods used
in the preparation
 of
our
that
we
consider
they
judgments,
and
 estimates that materially affect our consolidated financial statements and related disclosures. As a result, if
future events or
 regulatory views concerning such analyses differ significantly from the judgments, assumptions and estimates in
our critical
 accounting policies,
those events
or assumptions
a material
impact on
our consolidated
financial statements
 and
disclosures,
in
each
case
in
our
need
to
revise
or
restate
prior
statements,
cause
 damage to our
reputation and
the price
of our Class
A common stock
and adversely affect
our business, prospects,
cash
 flow, liquidity,
 As a public company, we may not efficiently or effectively create an effective internal control environment, and
 any future
failure to
internal control
over financial
could impair
the reliability
statements,
which
in
turn
could
harm
our
impair
investor
confidence
in
the
accuracy
and
 completeness of
our financial
reports and
our access
capital markets,
cause the
price of
our Class
 stock to decline and subject us to regulatory penalties.
 Our management is responsible for establishing
and maintaining adequate internal control over financial
reporting and
 for evaluating
and
on
that
of
control.
Our
over
consists
of
a
 process
to
reasonable
assurance
the
reliability
of
and
the
preparation
of
 financial statements for external purposes in accordance with GAAP.
As a public company,
we are required to comply with
 SEC regulations, including
the SOA and
other rules that
govern public companies
that we previously
were not required
to
 comply with
as a
private company.
In particular,
required to
certify our
compliance with
Section 404
SOA,
 which requires
us to
annually
furnish
a report
by management
effectiveness
over
 reporting. When evaluating our internal controls over financial reporting, we may identify material weaknesses that we may
 not be able to remediate
in time to meet the applicable
deadline imposed upon us for
compliance with the requirements
of
 Section 404
of the SOA.
We periodically
review our
formal policies,
processes and practices
related to
financial reporting
 and to the
identification of key financial
reporting risks, assess their
potential impact and the
linkage of those
risks to specific
 areas and controls within our organization.
 If we fail to achieve and maintain the adequacy of
our internal controls, as such standards are modified, supplemented,
 or amended from time to
time, we may not
be able to ensure
that we will be able
to conclude on an ongoing
basis that we
 have effective
internal controls
over financial
reporting in
accordance with
Section 404
SOA. We
cannot be
 as to
the
timing
of completion
of
our
evaluation,
testing,
and
any
remediation
or
the
of
the
same
on
our
 operations. If we fail to adequately comply with the requirements of Section 404 of the SOA, we may
be subject to adverse
 regulatory consequences and there
could be a
negative reaction in
the financial markets due
to a loss
of investor confidence
 in us and the
reliability of our
financial statements. In
addition, we may be
required to incur
costs in improving
our internal
 control system
and hiring
additional personnel.
Any such
action could
negatively
financial condition,
 results of operations, and the price of our Class A common
stock may decline.
 While we
remain an emerging
growth company, we will
required to include
an attestation report
on internal
 over financial
reporting issued
by our
independent registered
public accounting
firm. To
prepare for
eventual compliance
 with
the
auditor
attestation
requirement
of
of
the
SOA
once
we
no
longer
qualify
as
an
emerging
 company or as a non-accelerated smaller
reporting company,
we are engaged in a process
to document and evaluate our
 internal control over financial reporting, which is
both costly and challenging. In this regard,
we will need to dedicate internal
 resources, potentially engage outside consultants and adopt a detailed work plan to assess and document the adequacy of
 internal control over financial
reporting, continue steps to improve
control processes as appropriate, validate
through testing
 that
are
functioning
as
documented
and
to
refine
our
and
improvement
process
for
 control over financial reporting. Despite our efforts, there is a risk that we will not be able to conclude, within the prescribed
 time frame
or at
all, that
our internal
control over
financial reporting
is effective
as required
by Section
404 of
Sarbanes-
 Oxley. If we identify one or
more material weaknesses, it could result in an adverse reaction in the financial markets
due to
 a loss of confidence in the reliability of our financial statements.

 We
operate
in
a
highly
regulated
environment,
and
the
laws
and
that
govern
our
 corporate governance,
executive compensation
and accounting
principles, or
changes in
them, or
our failure
to
 comply with them, could adversely affect us.
 We operate in a
highly regulated industry and
we are subject to
examination, supervision and comprehensive
regulation
 by various federal and state agencies,
including the Federal Reserve, the
FDIC and the FOFR. As
such, we are subject to
 extensive regulation, supervision and
legal requirements that govern almost
all aspects of our operations.
These laws and
are
not
to
our
shareholders.
Rather,
these
laws
and
are
to
 customers, depositors, the Deposit Insurance Fund,
or DIF, and the overall financial health and
stability of the United
States
system.
These
laws
and
regulations,
among
other
matters,
prescribe
minimum
 limitations on the
business activities
and investments
in which we
can engage, regulate
and restrict our
lending activities,
 require us to provide certain banking services broadly within the communities in which we operate,
determine the locations
 of our branch
offices and impose certain
specific accounting requirements on us
that may be more
restrictive and may result
 in
or
earlier
charges
to
or
reductions
in
our
than
GAAP
would
require.
We
are
also
to
 capitalization
by
our
regulators,
which
us
to
to
support
our
 business.
Compliance
with
laws
and
can
be
difficult
and
costly,
and
to
laws
and
often
 impose additional operating costs. Further, we must obtain approval from our
regulators before engaging in many activities,
 and
our
have
the
to
compel
us
to,
or
restrict
us
from,
taking
entirely.
There
can
be
no
 assurance that any regulatory approvals we may require
or otherwise seek will be obtained.
 Regulations affecting
banks and
other financial
institutions are
undergoing continuous
review and
frequently change,
 and the ultimate effect of such changes cannot be predicted. Changes to the legal and regulatory framework governing our
 operations, including
the Dodd-Frank
Wall
Street Reform
and Consumer
Protection Act,
or the
Dodd-Frank
Act, and
the
 Economic Growth, Regulatory Relief and Consumer
Protection Act, or the Regulatory Relief
Act, have significantly revised
 the laws and regulations under which we operate. Such regulations and laws may be modified or repealed at any time, and
 new legislation may be enacted that will affect us and
our subsidiaries.
 Our failure to comply with these laws and regulations, even if the failure follows good faith effort
or reflects a difference
 in
interpretation,
could
us
to
on
our
activities,
and
fines
and
other
any
of
which
could
our
of
levels
and
the
price
of
our
 securities. Further, any new laws, rules and
regulations, such as were imposed
under the Dodd-Frank Act or
the Regulatory
 Relief Act, could make
compliance more difficult
or expensive or otherwise
adversely affect our
business, prospects, cash
 flow, liquidity,
 We
face
a
risk
of
noncompliance
with
the
Bank
Secrecy
Act
and
other
statutes
and
 regulations and corresponding enforcement proceedings.
 The BSA, the
Act, and other
laws and regulations
require financial
institutions, among other
duties, to
 institute
and
programs
and
to
file
suspicious
activity
and
currency
transaction
 reports,
as
appropriate.
FinCEN,
by
the
U.S.
Treasury
Department
to
administer
the
Bank
Secrecy
Act,
is
 authorized to impose significant civil money
penalties for violations of those requirements
and has engaged in coordinated
efforts
with
the
regulators,
as
well
as
the
U.S.
Department
of
Justice,
Drug
 Enforcement
Administration
and
Internal
Revenue
Service.
South
has
been
designated
as
a
"High
 Intensity Financial Crime
Area" ("HIFCA")
by FinCEN and
a "High Intensity
Drug Trafficking
Area" ("HIDTA")
by the Office
 of National Drug Control
Policy.
The HIFCA program
is intended to concentrate
law enforcement efforts
to combat money
 laundering efforts
in higher-risk
areas. There
is also
increased scrutiny
of compliance
rules enforced
by OFAC.
 Federal and
state bank
regulators have
for many
years focused
on compliance
BSA and
anti-money laundering
 regulations. In
order to
comply with
regulations,
guidelines and
examination
in this
area, we
have dedicated
 significant resources
anti-money laundering
program, especially
due to
the regulatory
focus on
financial and
other
 institutions located in South
Florida. Our business includes
supporting our customers, including foreign
financial institutions,
 with respect to their international banking needs and our policies, procedures and systems have been designed to address
 federal and
state anti-money
laundering compliance.
If our policies,
procedures and
systems are
deemed deficient
or the
 policies,
and
of
the
that
we
may
acquire
are
deficient,
we
would
be
to
fines,
and
that
are
deemed
in
order
to
remediate
such
deficiencies
and
 prevent the recurrence
thereof. In recent
years, sanctions that
the regulators have
imposed on banks
that have not
complied
 with
all
have
been
especially
severe.
Failure
to
and
implement
 programs to
combat money
laundering and
terrorist financing
could also
have serious
reputational consequences
for us,
 which could have a material adverse effect on
our business, financial condition and results of operations.

 Significantly
heightened
and
supervisory
and
scrutiny
in
the
United
States
have
our
regulatory,
and
other
risks
and
costs
and
us
to
legal
and
 examinations, investigations, and enforcement actions.
 The regulatory and political environment has generally been challenging for
U.S. financial institutions, which have been
increased regulatory
scrutiny,
including in
the wake
of the failures
of several
regional banks
 stresses in recent periods. The
general heightened scrutiny and expectations from
regulators could lead to a more
stringent
 regulatory posture by the regulators, investigations and other
inquiries, as well as remediation requirements, regulatory and
restrictions,
more
or
other
proceedings,
civil
and
substantial
 regulatory and other risks and costs.
Our regulators have broad powers
and discretion under their supervisory
authority. A
 failure to comply
with regulators' expectations and
requirements, even if inadvertent,
or to resolve
any identified deficiencies
 in
a
timely
and
sufficiently
satisfactory
manner
to
regulators,
could
in
oversight;
 restrictions,
including,
among
others,
imposition
of
on
distributions
or
other
or
 operations; enforcement proceedings; penalties; and
fines. Responding to regulatory inquiries
and proceedings can be
time
 consuming and
costly and
divert management
attention from
our other
business activities.
As a result
 efforts and pressures,
like many other
financial institutions, from
time to time,
we may be
subject to public
and non-public
 written
agreements,
cease
and
desist
orders,
consent
orders,
memoranda
of
understanding
or
other
or
 supervisory actions by our regulators.
 We
are
to
adequacy
and
may
to
more
stringent
 requirements, which could adversely affect our
financial condition and operations.
 In
2013,
the
published
new
rules
based
on
the
standards,
 known as
Basel III,
that were
developed by
the Basel
Committee on
Banking Supervision.
The new
rules raised
the risk-
 based capital
and revised
the
methods for
calculating
risk-weighted
assets, usually
in higher
risk
 weights. The new rules now apply to us.

 The Basel III rules increased
capital requirements and included
two new capital measurements,
a risk-based common
 equity Tier 1 ratio
and a capital conservation buffer.
Common Equity Tier
1 (CET1) capital is a subset
of Tier 1 capital
and
 is limited to common
equity (plus related surplus), retained earnings,
accumulated other comprehensive income and certain
 other
items.
Other
instruments
that
have
historically
qualified
for
Tier
treatment,
noncumulative
perpetual
 preferred stock,
are consigned
to a
category known
as Additional
Tier
1 capital
and must
be phased
out of
CETI over
a
 period of
nine years
beginning in
2014. In
order to
be a
"well-capitalized" depository
institution under
the new
regime, an
 institution must maintain a
CET1 capital ratio of 7.0%
or more; a Tier
1 capital ratio of 8.5%
or more; a total capital
ratio of
 10.5%
or more;
and
a
Tier
1 leverage
ratio
of
4% or
more. Institutions
must
also
a capital
conservation
buffer
 consisting of
common equity
Tier
1 capital
(which amount
(2.5%) is
reflected above
CET1, Tier
1 and
total capital
 ratios). In addition
to the higher
required capital
ratios and
the new
deductions and
adjustments, the
final rules
 the risk
weights for
assets, meaning
that we
will have
to hold
more capital
against these
assets. We
are also
be
 required to hold capital against short-term commitments
that are not unconditionally cancellable.
 While we currently meet these new
requirements of the Basel III-based capital requirements, we
may fail to do so
 future. The failure
to meet applicable
regulatory capital
requirements could result
in one or
more of our
regulators placing
 limitations or conditions on our activities, including our growth initiatives, or restricting the commencement of new activities,
 and could affect customer and investor confidence, our costs of funds and level of required deposit insurance
 to the FDIC,
our ability to
pay dividends on
our capital stock,
our ability to
make acquisitions, and
our business, results
of
 operations and financial condition, generally.
 In addition, in the current economic
and regulatory environment bank regulators
may impose capital requirements that
 are
more
stringent
than
those
by
regulations.
The
application
of
more
stringent
 requirements for us could, among other things, result
in lower returns on equity, require the raising of additional capital, and
 result in regulatory actions
if we were to be
unable to comply with
such requirements. Implementation
of changes to asset
 risk weightings for risk-based capital
calculations, items included
or deducted in calculating
regulatory capital or additional
 capital conservation buffers, could result in management modifying our business strategy
and could limit our ability to make
 distributions, including paying
dividends.
 We are periodically subject
to examination and
scrutiny by a
number of banking agencies
and, depending upon
 the findings and determinations
of these agencies, we may
be required to make adjustments
to our business that
 could adversely affect us.
 As part of
the bank regulatory process,
the Federal Reserve, the
FDIC and the FOFR
periodically conduct examinations
 of our business,
including compliance
with applicable
laws and regulations.
If, as a
result of an
examination, one

were
to
determine
that
the
resources,
asset
quality,
asset
concentration,
 earnings prospects, management, liquidity sensitivity
to market risk, risk
management and internal controls
or other aspects
 of any of our operations has become unsatisfactory, or that we or our management are in violation of any law or regulation,
 the banking
agency could
take a
number of
different remedial
or punitive
actions as
it deems
appropriate. These
 include the power to prohibit the continuation of "unsafe
or unsound" practices, to require affirmative
actions to correct any
from
any
violation
or practice,
to
issue an
administrative
order
or enforcement
that
can
be judicially
 enforced, to direct an increase
in our capital, to restrict our
growth, to change the asset composition
of our loan or securities
 portfolios
or
sheet,
to
assess
civil
monetary
our
officers
or
directors,
to
remove
officers
and
 directors and, if
it is concluded
that such conditions
cannot be corrected
or there is
an imminent risk
of loss to
depositors,
 to
terminate
our
and
force
us
to
terminate
our
If
we
to
such
 regulatory actions, our business, financial condition, results
of operations and reputation may be negatively impacted.
 We
are
to
numerous
laws
and
of
to
 consumers, including the Community Reinvestment
Act, or CRA, and fair lending laws, and failure
to comply with
 these laws could lead to a wide variety of sanctions.
 The CRA directs all insured depository institutions to help meet the credit needs of the local communities
in which they
 operate
branches,
low-
and
moderate-income
neighborhoods.
Each
is
examined
periodically
by
its
 primary federal
regulator,
which assesses
the institution's
CRA performance.
The Equal
Credit Opportunity
Act, the
Fair
 Housing
Act
and
other
fair
laws
and
nondiscriminatory
on
 institutions. The U.S. Department of Justice, the Federal Reserve, and other federal agencies are responsible for enforcing
 these laws and regulations. A successful regulatory challenge to our performance under the CRA, fair lending or consumer
laws
and
could
in
a
wide
of
sanctions,
damages
and
civil
money
 injunctive
relief,
restitution,
on
mergers
and
activity,
on
expansion,
and
on
entering
new
lines.
Private
parties
may
also
have
the
to
challenge
an
under
fair
laws
in
private
class
action
litigation.
Such
could
have
an
on
our
 business, financial condition and results of operations.
 Climate change and related legislative and regulatory initiatives may materially affect our business and results
 The effects
of climate change
continue to create
a significant level
of concern
for the state
of the global
environment.
 As a result, the global business community has increased
its political and social awareness surrounding the issue,
 United States
has entered
into international
agreements in
an attempt
to reduce
global temperatures,
reentering
 the Paris Agreement.
the U.S. Congress,
state legislatures and
federal and state
regulatory agencies
continue to
 propose numerous
initiatives to
supplement the
global effort
to combat
climate change,
including provisions
contained in
 the Inflation Reduction Act
of 2022. Furthermore, additional
initiative may be undertaken
in the future, including potentially
 increasing supervisory expectations with respect to banks' risk management practices, accounting for the effects of climate
 change in stress testing scenarios
and systemic risk assessments,
revising expectations for credit
portfolio concentrations
 based
on
climate-related
and
encouraging
by
banks
in
climate-related
initiatives
and
to
 communities disproportionately impacted by the effects of climate change. The lack of
empirical data surrounding the credit
 and other financial risks posed by climate change render it difficult,
or even impossible, to predict how climate change may
 impact our financial
condition and results
of operations;
however,
the physical effects
of climate change
may also directly
 impact us. Specifically,
unpredictable and more frequent weather
disasters may adversely impact
the real property,
real property,
securing the
loans in
our portfolios.
if insurance
obtained by
our borrowers
is
 insufficient to cover
any losses sustained
collateral, or if
insurance coverage is
otherwise unavailable to
our borrowers,
 the collateral securing our
loans may be negatively
impacted by climate change,
natural disasters and related events,
which
 could impact our financial condition and results of operations.
Further, the effects
of climate change may negatively impact
 regional and local economic activity, which could adversely affect our customers and the communities in which we operate.
 Overall, climate change, its effects
and the resulting unknown impact
could have a material adverse
effect on our financial
 Increasing scrutiny
and evolving expectations
from customers,
regulators, investors,
and other stakeholders
 with respect to our environmental, social and
governance practices may impose additional
costs on us or expose
 us to new or additional risks.
 Companies have
faced and
may continue
to face
increased scrutiny
from customers,
regulators, investors,
 stakeholders related
to their
environmental, social,
and governance
("ESG") practices
and disclosure.
Investor advocacy
 groups,
funds,
and
influential
investors
are
also
increasingly
focused
on
these
practices,
especially
as
they
 relate
to
the
environment,
health
and
safety,
diversity,
labor
and
human
rights.
Increased
ESG-related
 compliance costs
could result
in increases
overall operational
costs. Failure
to adapt
to or
comply with

 requirements, or
investor or
stakeholder expectations
and standards,
could negatively
impact our
reputation, ability
to do
 business with certain partners, and our stock price.

 Recent
in
the
landscape
under
the
new
U.S.
administration
have
moved
toward
a
reduction
in
 emphasis on certain ESG priorities, particularly
around climate change and diversity, equity, and inclusion ("DEI"). This shift
 is leading to
the rollback of
regulations that mandate specific
disclosures and operational practices
in these areas.
 some
stakeholder
groups
to
demand
transparency
and
action,
in
a
complex
and
potentially
 conflicting environment for
companies. If
regulatory enforcement of
ESG-related policies becomes
less stringent,
 may
face
reputational
risks
if
their
practices
are
seen
as
insufficient
or
inconsistent
with
broader
societal
expectations,
 especially related to DEI and environmental stewardship. As a result, navigating this evolving regulatory and public opinion
 landscape may require us to balance compliance with regulatory requirements against maintaining investor,
customer, and
 stakeholder trust.
 Risks Related to Our Class A Common Stock
 Our ability to pay dividends is subject to restrictions.
 Holders of our Class A common stock
are only entitled to receive cash dividends when, as
and if declared by our Board
 out of funds
legally available
for dividends.
is a bank
holding company
that conducts
substantially all
of its
 operations through the Bank,
which is a legal entity
separate and distinct from
the Company.
As a result, our ability
to pay
on
our
stock
will substantially
depend
upon
the
receipt
of
and
other
distributions
from
the
 Bank,
the
profitability
of
which
is
to
the
fluctuating
cost
and
availability
of
money,
in
rates
and
 economic conditions in general. There
are numerous laws and banking
regulations and guidance that limit
the Bank's ability
 to
pay
to
us
and
our
to
pay
on
our
The
Bank
may
not
pay
to
the
 Company without the prior
approval of the FDIC. Similarly,
we have agreed to notify
the Federal Reserve before
declaring
 and paying any dividends on our Class A common stock.
 The market price and trading volume of our Class A
common stock may be volatile, which could result in rapid
 and substantial losses for our shareholders.
 The market
price
of
our
Class
stock
may
be highly
volatile
and
could
be
to
wide
fluctuations.
In
 addition, the trading volume on
our Class A common stock may
fluctuate and cause significant price variations to
occur. We
 cannot assure you that the market price of our Class A common stock will not fluctuate or decline significantly in the future.
 Some, but
certainly not
all, of
the factors
that could
negatively affect
the price
common stock,
or result
in
 fluctuations in the price or trading volume of our Class
A common stock, include but not limited to:
 •
general market conditions;
 •
domestic and international economic factors unrelated
to our performance;
 •
variations in our quarterly operating results or failure to
meet the market's earnings expectations;
 •
publication of research reports about us or the financial services
industry in general;
 •
the determination of securities analysts to not cover our
Class A common stock;
 •
the opinion of securities analysts about our stock as an investment;
 •
additions to or departures of our key personnel;
 •
future sales of our Class A common stock;
 •
adverse market reactions to any indebtedness we may
incur or securities we may issue in the future;
 •
actions by our shareholders;
 •
the operating and securities price performance of companies
that investors consider to be comparable to us;
 •
changes or proposed changes in laws or regulations affecting
our business; and
 •
actual or potential litigation and governmental investigations.
 In
if
the
for
stocks
in
our
industry,
or
the
stock
in
general,
experiences
a
loss
of
investor
 confidence, the
trading price
could decline
for reasons
unrelated to
 condition or results of operations.
If any of the foregoing occurs,
it could cause our Class A common
stock price to fall and
 may expose us to lawsuits that, even if unsuccessful, could
be costly to defend and a distraction to management.
 There are significant restrictions in our Articles of Incorporation that restrict the
ability to sell our capital stock
 to shareholders that would own 4.95% or more of our stock,
excluding our Significant Investors.
 Because the
continued availability
"deferred tax
assets" depends,
in part,
our stock
owned by
 shareholders owning 5% or
more of our
stock, our amended Articles
of Incorporation, except as
otherwise may be approved
 by the Board or
except for transfers by
our Significant Investors, prohibits
any direct or indirect
transfer of stock
or options

 to
acquire
stock
to
any
person
who,
as
a
of
the
transfer,
would
own
4.95%
or
more
of
our
as
long
as
the
 Company continues to have "deferred tax assets." Such
restrictions may limit the ability to transfer our stock.
we
are
an
emerging
and
we
have
decided
to
take
advantage
of
 exemptions from
various reporting
requirements applicable
to emerging
growth companies,
our Class
 A common stock could be less attractive to investors.
 We are
an "emerging
growth company,"
as defined
JOBS Act.
For as
long as
we remain
an emerging
 company,
we will
have the
option to take
advantage of
certain exemptions
from various
reporting and
other requirements
 that are applicable to other public companies that are not
emerging growth companies, including:
 •

we
may
present
only
two
years
of
audited
and
only
two
years
of
 discussion and analysis of financial condition and results
 •

we
are
exempt
from
the
to
an
attestation
and
from
our
auditors
on
 assessment of our internal control over financial reporting
under the SOA;
 •

we are permitted to have less extensive disclosure about our
executive compensation arrangements; and
 •

we
are
not
to
give
our
non-binding
advisory
votes
on
or
golden
 parachute arrangements.
 We may
continue to
take advantage
of some
or all
reduced regulatory
and reporting
requirements that
will be
 available to
us as
long as
we continue
to
qualify
as an
emerging
company.
We
will remain
an emerging
 company until the
earliest to occur
of (i) the
last day of
the first fiscal
year in which
our annual gross
revenues exceed $1.235
 billion, (ii) the date that the market
value of our Class A common stock
that is held by non-affiliates
exceeds $700.0 million
 as of the
last business day in
June of that
year, (iii) the date on
which we have, during
the previous three-year period, issued
 more than $1.0 billion
in non-convertible debt, or
(iv) the end of fiscal
year following the fifth
anniversary of the completion
 of our initial public offering (which will be December
31, 2026).
 It is possible
that some
investors may
find our Class
A common stock
less attractive
since we chose
to rely
on these
 exemptions. If some investors find our Class A common
stock less attractive, there may be a less
active trading market for
 our Class A common stock and our stock price may be
more volatile.
 Because we have elected
to use the extended
transition period for complying
with new or revised
 standards for an "emerging growth company," our financial statements may not be comparable to companies that
 comply with these accounting standards as of the
public company effective dates.
 As an emerging
growth company,
we elected to
use the extended
transition period
for complying
with new
or revised
 accounting standards under Section 7(a)(2)(B) of the Securities Act. This election allows us to delay the adoption of new or
 revised accounting standards
that have different
effective dates for
public and private
companies until those
standards apply
 to private companies. As a
result of this election, our
financial statements may not be
comparable to companies that comply
 with these
accounting standards
as of
the public
company effective
dates. Because
our financial
be
 comparable
to
that
comply
with
dates,
investors
may
have
difficulty
evaluating
or
 comparing our
business, performance
or prospects
in comparison to
other public
companies, which
may have a
 impact on the value and liquidity of our Class A common stock. We cannot predict if investors will find our Class A common
 stock
less
attractive
we
have
relied
on
this
exemption.
If
some
investors
find
our
Class
A
stock
less
 attractive as a result, there
may be a less active trading
market for our Class A common
stock and our stock price
 more volatile.
 We have existing investors that own
a significant amount of our
common stock whose individual interests may
 differ from yours.

 A significant percentage of our Class A common stock is currently held by a few institutional investors, including Patriot
 Financial Partners II,
L.P.
and Patriot Financial
Partners Parallel II, L.P.
(collectively,
"Patriot"), and Priam
Capital Fund II,
 LP
("Priam,"
and
together
with
Patriot,
the
"Significant
Investors").
As
of
February
28,
2025
Patriot
and
Priam
own
 approximately 22.4% and 22.5%, respectively, of our outstanding shares of Class A common stock. In addition, Patriot and
 Priam are
each entitled
to nominate
a director
Board and
have certain
subscription rights
to purchase
new equity
 securities that we
issue in the
future, in each
case as long
as certain equity
ownership criteria
are met. Patriot
and Priam
 also have certain registration rights,
including demand registration rights, and information
rights. Although Patriot and Priam
 are
independent
of
each
other,
these
institutional
investors
will
to
have
a
level
of
influence
over
us
 because of
their
level of
Class
stock ownership
and their
right to
representation
Board. For
example,
 Patriot and
Priam will
have a greater
ability than our
other shareholders to
influence the election
of directors
and the potential
 outcome of
other matters
submitted
to a
vote
shareholders,
including mergers
acquisition
transactions,

 amendments
to
our
amended
Articles
of
Incorporation
and
Amended
and
Restated
Bylaws,
and
other
extraordinary
 corporate matters. The interests of these
investors could conflict with the interests
of our other shareholders, and any
 transfer by
these investors of
their shares
of Class
stock to
other investors
who have
different business objectives
 could adversely affect our business, results
of operations, financial condition, prospects
or the market value of our Class A
 common stock.
 Provisions
in
our
governing
documents
and
law
may
have
an
anti-takeover
and
there
are
 substantial regulatory limitations on changes of control
of the Company.
 Our corporate organizational documents and provisions of federal
and state law to which we
are subject contain certain
 provisions that could
have an anti-takeover
effect and
may delay,
make more difficult
or prevent an
attempted acquisition
 that you may favor or an attempted replacement of our
Board or management.
 Our governing documents include provisions that:
 •

empower our Board, without shareholder approval, to issue shares of preferred stock, the terms of
which, including
 voting power, are set by our
Board;
 •

provide that directors may be removed from office only for cause and only upon a majority vote
of the shares of our
 Company with voting power;
 •

prohibit holders of our Class A common stock to take action
by written consent in lieu of a shareholder meeting;

 •

require holders of at least 10% of our Class A common
stock to call a special meeting;
 •

do not provide for cumulative voting in elections of our
directors;
 •

provide that
our Board
has the
authority to amend
our Amended
and Restated Bylaws
without shareholder approval;
 •

require shareholders that wish to bring business before annual or special meetings of shareholders, or to nominate
 candidates for election as directors at our annual meeting of shareholders, to provide
timely notice of their intent in
 writing and satisfy disclosure requirements; and
 •

enable our Board to increase, between
annual meetings, the number of
persons serving as directors and
to fill the
 vacancies created
as a
the increase until
the next
meeting of
shareholders by a
majority vote
 present at a meeting of directors.
certain provisions
of Florida
law may
delay,
discourage, or
prevent an
attempted acquisition
or change
in
 control. Furthermore,
banking laws
impose notice,
approval, and
ongoing regulatory
requirements on
any shareholder
or
 other party that seeks to acquire direct or indirect "control" of a
bank holding company,
which includes the Change in Bank
 Control Act
Bank Holding
Company Act.
These laws
could delay
or prevent
an acquisition.
Also, for
preservation
 and continued availability of our "deferred tax assets," our amended Articles of Incorporation
prohibits any direct or indirect
 transfer of stock or options to acquire stock to any person who, as a result of the transfer,
would own 4.95% or more of our
as
long
as
we
to
have
"deferred
tax
assets,"
to
limited
exceptions
as
provided
in
our
amended
 Articles of Incorporation. Because of the requirements to overcome this restriction, this
provision of the amended Articles of
 Incorporation could
have an
anti-takeover effect
and
may delay,
make more
difficult
or prevent
an attempted
acquisition
 that you may favor.

 Item 1B. Unresolved Staff Comments

 None.
 Item 1C. Cybersecurity

 Risk Management and Strategy Overview
 Customers
depend
on
the
to
properly
nonpublic
gathered
and
stored
in
 connection with the services we provide. The Company realizes that cyber incidents can have financial, reputational,
legal,
 and operational impacts that can
significantly adversely affect our customers, capital, and
earnings. Therefore, we integrate
 cybersecurity processes throughout the Company as part of our enterprise-wide governance process. Regulatory agencies
 are
charged
with
ensuring
the
and
are
compliant
with
the
intent
of
the
set
forth
by
the
Institutions
Examination
Council
("FFIEC").
The
FFIEC
 framework offers a set of guidelines
and best practices to help
financial institutions manage and mitigate cybersecurity risks
 effectively.
It focuses on ensuring the confidentiality,
integrity, and availability
of sensitive information and systems.

 The Information
Security Officer
("ISO") is
an integral
member of
the Risk
Management and
Compliance Department
 ("RMCD") of
and who
provides expert
counsel on
matters of
cybersecurity and
presents periodic
reports to
the
 Risk Committee of our Board of Directors.

 As part
program, periodic
risk assessments
are performed
to determine
inherent and
residual
 cybersecurity risk, the
maturity level of the program,
the risk of cyber
threats, and the effectiveness
of controls currently
in
 practice. The
Company utilizes
the National
Institute of
Standards and
Technology
("NIST") Framework
FFIEC's
 Cybersecurity
Assessment
Tool
("Cybersecurity
Assessment")
to
help
identify
its
risks
and
determine
the
 Company's cybersecurity posture.
Through the
 implementation

of rigorous procedures
and controls, augmented
by ongoing
 training initiatives for both management and staff, the institution cultivates a safe cybersecurity environment. This approach
 encompasses
diverse
methodologies
defense-in-depth
and
proactive
awareness
training
aimed
at
 fortifying the institutions cybersecurity controls and fostering
a resilient operational framework.

 Assessment and Response to Cybersecurity Threats
 It is the policy of
the Company and its
technology service providers
("TSPs") to ensure that
they can identify,
mitigate,
 and respond to cyber-attacks involving destructive
malware and invasive attacks such
as phishing, ransomware, malware,
 DDoS
attacks,
etc.
This
commitment
aligns
with
the
risk
appetite,
Incident
Response
Policy,
and
Business
 Continuity Plan,
which incorporates
business continuity
planning and
testing activities
to enhance response
and recovery
 capabilities.

 The Company realizes that it faces a variety of risks from cyber-attacks involving destructive malware, including

liquidity,
 capital, operational,
and reputation
risks, due
to events
fraud, data
loss, and
disruption of
service. As
 such, it
is the
policy of
to ensure
that its
risk management
processes, and
business continuity
planning address
 these risks by:

Establishing
a
encompassing
and
to
administer
and
 oversee
the
information/cybersecurity
programs
to
ensure
adherence
to
and
industry
best
 practices.

Securely configuring systems and services to mitigate the impact of cyberattacks.
This includes measures such as
 logical
network
segmentation,
hard
backups,
maintaining
an
inventory
of
authorized
devices
and
software,
and
 physical
segmentation
of
systems.
Consistency
in
configuration
fosters
a
secure
network
 environment by removing or disabling unused applications, functions,
or components.

Implementing and testing
controls around critical
systems on a regular
basis to ensure appropriate
access control
 and segregation of duties. Limits on sign-on attempts
for critical systems are enforced, with accounts
being locked
 upon
threshold
exceedance.
Alert
notify
of
baseline
on
with
the
 effectiveness and
adequacy of
controls periodically
tested and
the results
reported to
senior management
and, if
 applicable,
the
Risk
Committee,
along
with
recommended
risk
mitigation
strategies
and
progress
to
remediate
 findings.

Performing security
monitoring, prevention,
and risk
mitigation activities
to ensure
the effectiveness
of protection
 and detection systems.
This includes maintaining
up-to-date intrusion detection
systems, antivirus protection,
and
 properly configured firewall
rules. Systems are
monitored to identify,
prevent, and contain
attack attempts from
all
 sources.

Maintaining robust business
continuity planning processes
to swiftly
recover, resume, and maintain
operations post-
 cyber-attack incidents
involving destructive
malware. These
processes encompass
data and business
 recovery,
network
capability
rebuilding,
and
data
protection
for
offline
backups
in
the
event
of
cyber-attacks
 impacting the Company or its critical service providers.

Conducting ongoing
information security
risk assessments
to address
new and
evolving threats
to online
 and loan accounts. This involves identifying, prioritizing, and assessing risks to
critical systems, including threats to
 applications controlling
various system parameters and implementing
necessary security prevention measures.

Reviewing, updating, and testing incident response and business
continuity plans annually to ensure effectiveness.
 Testing
encompasses
both
in-house
and
processor
scenarios
to
validate
understanding
of
 responsibilities and adherence to Company protocols.

 Executive Oversight and Roles

 The
 responsibility

for
adopting
and
maintaining
an
is
assigned
to
the
RMCD,
who
 collaborates
with
functional
area
departmental
level
managers,
and
other
relevant
staff.

 committees and
the Board
of Directors
review reports submitted
RMCD detailing the
Company's inherent and
residual
 cybersecurity risk, program sophistication level, and high-risk
threats identified in the cybersecurity risk assessment.

 The
Board
oversees
the
and
maintenance
of
the
program,
 accountable.
committees
ensure
integration
and
effectiveness,
with
the
RMCD
responsible
for
 cybersecurity controls and procedures.
The Board receives regular
 reports

on cybersecurity risk assessment
and program
 updates,
and
to
and
them
accountable
for
oversight
and
 coordination, assignment of responsibility,
and the effectiveness of the information and cybersecurity
security program.

 Annually, or as required, the RMCD
provides a comprehensive report
to the Board or
a designated committee regarding
 the status
of
the

. This
encompasses
assessments,
utilization
of
the
Cybersecurity
 Assessment, discussion
of significant
program matters
the annual
risk assessment,
risk management
decisions,
 monitoring of
service provider
compliance, results
of key
controls testing,
security breaches
or violations,
 responses, and recommendations for program enhancements.

 Engagement with Third Party Vendors
 The engagement
of third-party
providers
involves potential
risks
strategic, reputational,
operational,
 transaction,
financial,
and
considerations.
Third-party
providers
whose
involve
 transmittal,
storage
and
processing
of
non-public
represent
a
level
of
risks,
 specifically as
it relates
to compliance
requirements of the
Gramm Leach Bliley
Act (GLBA)
regulation and applicable
Privacy
 Laws and Regulations.

 The Bank has
developed general guidelines for
the identification, risk assessment, monitoring
and management of
risks
 associated to the engagement of third-party providers
or vendors.
 Certain
aspects
of
the
risk
process
may
the
involvement
of
the
officer,
 officers, finance
officers,
internal auditors,
and legal
counsel to
identify potential
risks that
may arise
 engagement as
identify performance
criteria, internal
controls, reporting
needs and
any contractual
 that should be implemented for the ongoing assessment and
control of risks that derive from the third-party
engagement.
 Compliance with Regulatory Standards
 Annual testing or
more frequently if
deemed necessary
of cybersecurity controls
and procedures will
be conducted
to
 ensure compliance.
In instances
of identified
deficiencies or
vulnerabilities,
remedial action
plans will
be implemented
to
 rectify issues or establish mitigating
controls. Any exceptions deemed significant will
be promptly reported, with remediation
 efforts prioritized.
 Annually,
or
as
required,
the
RMCD
will
a
to
the
Board
or
a
designated
committee
the
status
of
the
This
will
encompass
assessments,
utilization
of
the
 Cybersecurity Assessment, and discussion of other significant
program matters.

 As of the end of
the reporting period set
forth in this Annual
Report on Form 10-K,
there is no knowledge
or indication
 that
sensitive
was
compromised
as
a
of
third-parties'
vulnerabilities.
 continues to monitor developments and vendor communications.

 Item 2.
Properties
 The Company's corporate
offices
are headquartered at
2301 N.W.
87th Avenue, Doral,
Florida 33172. The
Company,
 through the Bank,
operates 10 banking
centers in South
Florida within Miami-Dade and
Broward counties. Of
the 10 banking
 centers, nine of these locations are leased
and one is owned. The banking
center that is owned is located at
3999 Sheridan
 St, Hollywood,
FL 33021.
Management believes
that each
of these locations
are in good
condition and
adequate to
meet
 our present and foreseeable needs, subject to possible future
expansion.

 See Note 4 "Leases"
and Note 5 "Premises
and Equipment"
to the Consolidated
Financial Statements included
in this
 Annual Report on Form 10-K for additional information.
 Item 3.
Legal Proceedings

 We are not currently subject to any material legal proceedings. We are from time to time subject to claims and litigation
 arising
in
the
ordinary
of
business.
These
claims
and
may
include,
among
other
allegations
of
 violation of banking and other applicable regulations, competition
law, labor laws and consumer
protection laws, as well as
 claims or
relating
to intellectual
property,
securities, breach
of contract
and tort.
We
intend to
defend ourselves
 vigorously against any pending or future claims and litigation.
 The
previously
disclosed
that
(the
"Litigation")
had
been
commenced
on
July
13,
2023
by
three
 individuals
who
were
of
the
Bank
prior
to
the
reorganization
into
the
form
of
 organization in 2021
(the "Plaintiffs")
against six
persons, all
of whom were
directors of
the Bank at
the relevant
time (the
 "Defendants"), in the Circuit Court, Eleventh Judicial Circuit for Miami-Dade County, Florida (the "Court") (Benes et al. v. de
 la
Aguilera
et
al.)
alleging
the
Defendants
(i) caused
the
Bank,
as
thereof,
to
in ultra
vires
conduct by
 devising
and
approving
the
exchange
transaction
effected
in
July
2021
pursuant
to
which
the
then
 shares of Class C and Class D preferred stock was exchanged for shares of Class A voting common stock in the
Bank (the
 "Exchange Transaction"),
which action
the Plaintiffs
allege was
not permitted
Bank's Articles
of Incorporation,
and
 (ii) breached
their
fiduciary
duty as
Bank
by
approving
and
engaging
in
the
Exchange
Transaction.
The
 Plaintiffs sought the
Court to certify the
action as a class
action and to award
damages in an
amount to be
proven at trial.
 The Plaintiffs sought damages exceeding $750,000
plus attorney's fees and costs
as well as such other relief as the Court
 determined to award.
 The Defendants filed a motion to dismiss the Litigation with
prejudice (the "Motion"). On December 27, 2023, the Court,
 after reviewing
the Motion,
the Plaintiff's response
thereto and
the Defendant's reply
oral arguments presented
 by
the
parties
on
14,
2023,
granted
the
Motion,
dismissing
the
Litigation
with
prejudice
and
rendering
final
 judgment in favor
of the Defendants
(the "Order"). The Court
reserved jurisdiction to award
costs or grant
any post-judgment
 relief.
 On May 1,
2024, the
Plaintiffs filed
in the Third
District Court
of Appeal for
the State of
Florida (the "Appellate
Court")
 an appeal (the
"Appeal"), appealing
the issuance
Order and seeking
a reversal
of the Order.
The Plaintiffs
claimed
 the Court erred by
concluding (i) the Exchange Transaction was not
ultra vires, and (ii)
that the Legacy Shareholders (which
 includes the Plaintiffs)
lacked direct standing.
The Plaintiffs
filed their initial
brief and the
Defendants filed
on July 1,
2024
 their answer brief ("Answer Brief") responding to the allegations
contained in the Appeal.

 Oral argument was
heard before the
Court on January
14, 2025. On
February 18,
Appellate Court
affirmed
 the lower court's ruling and dismissed
the lawsuit, in favor of the Defendants
(the "Dismissal").
The Plaintiffs have the right
 to appeal the
Dismissal,
but they have not done so as of the date of the
filing of this Annual Report on Form 10-K.
 The Company believes
that the positions
in the Appeal
are legally
and factually without
merit, and it
intends to vigorously
 defend against
any appeal
Dismissal of
the Appeal
,
pursue any
potential counterclaims
against the
Plaintiffs
as it
 deems appropriate, and seek coverage from its
insurance carriers. Furthermore, there is also no assurance
that we will be
 able to secure coverage from
our insurance carriers for
any expenses incurred by us
in connection with defending
 the Appeal.
 At
this
time,
in
the
opinion
of
the
likelihood
is
remote
that
the
of
such
proceedings,
either
 individually or
aggregate, would
have a
material adverse
consolidated results
of operations,
or cash
flows. However,
one
or more
unfavorable
outcomes
in any
claim or
us, including
the
 aforementioned Appeal
regarding the
Exchange Transaction,
a material
adverse effect
on the period
in which
 such claims
or litigation
are resolved.
regardless of
their merits
or their
ultimate outcomes,
such matters
are
 costly, divert management's
attention and may materially adversely affect our
reputation, even if resolved in our favor.

 There can be no
assurance that any
future legal proceedings
to which we are
a party will not
be decided adversely
to
 our interests and have a material adverse effect
on our financial condition and operations.
 Item 4.
Mine Safety Disclosures

 Not applicable.

 Item 5.
Market
for
Registrant's
Common
Equity,
Related
Stockholder
Matters
and
Issuer
Purchases
of
Equity
 Securities
 (a)

Market Information
 In July
2021, the Bank's
Class A common
stock began trading
Nasdaq Stock Market
under ticker
symbol "USCB".

 Effective December
30, 2021,
acquired all
issued and
outstanding shares
of Class
stock of
 the
Bank
in
connection
with
the
bank
reorganization.
Each
of
the
of
the
stock
formerly
held
by
its
was
converted
into
and
exchanged
for
one
newly
share
of
the
 Company's common stock. The Company's Class A common stock is also listed on the Nasdaq Stock Market and uses
the
 same ticker symbol.

 The listing of our Class
A common stock on the
Nasdaq Stock Market has
resulted in a more active
trading market for
 our Class A common
stock. However, we cannot assure investors that
a liquid trading market
for our Class A
 will be sustained.
 Prior
to
our
listing
on
the
Nasdaq
Stock
Market
there
was
not
an
trading
for
the
Class
A
 common shares. The
following table shows
the quarterly high and
low closing prices
of our Class A
common stock traded
 on the Nasdaq Stock Market for the last two fiscal years
:
 Stock Price
 High
 Low
 Quarter Ended:
 March 31, 2023
 $
 12.71
 $
 9.89
 June 30, 2023
 $
 10.94
 $
 8.86
 September 30, 2023
 $
 12.09
 $
 10.31
 $
 12.65
 $
 10.11
 March 31, 2024
 $
 12.44
 $
 10.85
 June 30, 2024
 $
 12.83
 $
 10.25
 September 30, 2024
 $
 16.66
 $
 11.99
 $
 20.78
 $
 14.16
 As of
December 31, 2024,
our Class
B common
stock is
not listed
or traded
on any
stock exchange
and no
shares were
 issued and outstanding at such date.
 Holders
 As
of
31,
2025,
the
Class
A
were
held
by
approximately
of
 record,
not including
the number
of persons
or entities
whose stock
is held
in nominee
or "street"
name through
various
 brokerage firms and banks.
 Dividends
 As a bank holding company, the Company's ability to declare and pay dividends depends on various federal regulatory
 considerations, including
the guidelines
of the Federal
Reserve regarding
capital adequacy
and dividends.
 has agreed to provide notice to the Federal Reserve prior to paying
any cash dividends on its Class A common stock.
 Because we are
a bank holding
company and currently do
not engage directly in
business activities of a
material nature,
 our ability to pay dividends
to our shareholders depends,
in large part, upon
our receipt of dividends
from the Bank, which
 is also subject to
numerous limitations on
the payment of dividends
under federal and state
banking laws, regulations
and
 policies. The Bank cannot
declare and pay and
cash dividends to
the Company without receiving
the prior approval of
the
 FDIC.
 The principal
source of
revenue with
which to
pay dividends
on common
shares are
dividends the
Bank may
declare
 and
pay
out
of
funds
legally
for
of
dividends.
As
a
corporation,
we
are
only
permitted
to
pay
 dividends to shareholders if, after giving effect to the dividend, (i) the Company is able to pay its debts as they become due
 in the ordinary course
of business and
(ii) the Company's
assets exceeds the
sum of Company's
(a) liabilities plus
(b) the

 amount that
would be
needed for
to satisfy
the preferential
rights
upon dissolution
of shareholders
whose
 preferential rights are superior to those receiving the dividend,
if any.
 Securities Authorized for Issuance Under Equity Compensation
Plans
 See Note
9 "Equity
Based and
Other Compensation
Plans" to
the Consolidated
Financial Statements
included in this
 Annual Report Form on 10-K for additional information
required.
 Stock Price Performance
 The graph below compares the
cumulative total return
to stockholders of our Class
A common stock between July
23,
 2021 (the
date the
commenced
trading on
the Nasdaq
Stock Market)
and December
31,
 2024, with the cumulative total return
of (a) the Nasdaq Bank Index
(b) the NASDAQ ABA Community Bank
Index, and (c)
 the Nasdaq
Composite Index
over the same
period. This
graph assumes
the investment
of $100
in our Class
 stock at the closing sale price of $10.82 per share on
July 23, 2021, and assumes the reinvestment of dividends.

 The comparisons shown
in the graph
below are based
upon historical data.
We caution that
the stock price
 shown in the graph below is not indicative of, nor is it intended to forecast, the potential future performance
of our common
 07/23/2021
 12/31/2021
 12/31/2022
 12/31/2023
 12/31/2024
 USCB Financial Holdings, Inc. (USCB)
 $
 $
 $
 $
 $
 NASDAQ Bank (BANK)
 $
 $
 $
 $
 $
 NASDAQ ABA Community Bank (QABA)
 $
 $
 $
 $
 $
 NASDAQ Composite (IXIC)
 $
 $
 $
 $
 $
 Recent Sales of Unregistered Securities
 The Company did not sell any of its equity securities during
2024 that were not registered under the Securities
Act.
 Purchases of Equity Securities by Issuer and Other Affiliates

 On January 24,
2022, the Board
of Directors approved
the first share
repurchase program
of up to
750,000 shares
of
 Class A common stock. On April
22, 2024 the Board of
Directors approved the second share repurchase
program of up to
 500,000 shares of
Class A common
stock. Under the
repurchase programs,
the Company may
purchase shares
of Class
 A
stock
on
a
discretionary
basis
from
time
to
time
open
repurchases,
privately
negotiated
 transactions, or otherwise
in compliance with
Rule 10b-18 under
the Exchange Act.
31, 2024, the
 had
repurchased
712,020
of
Class
A
stock
under
the
first
and
no
under
the
second
The
did
not
any
of
its equity
for
the
quarter
ended
31,
 2024.
As
of
31,
2024,
537,980
remained
authorized
for
under
the
two
stock
 repurchase programs.
 Item 6.
Reserved

 Item 7.
Management's Discussion and Analysis of Financial Condition
and Results of Operations

 Management's
discussion
and
analysis
of
and
of
analyzes
the
 financial condition and results of operations of the Company and
the Bank, its wholly owned subsidiary, for the years ended
31, 2024
and
2023. This
discussion
and
analysis
is best
read
in
conjunction
with
the
 Statements and related
footnotes of the Company
presented in Item
8 "Financial Statements
and Supplementary Data"
of
 this Annual Report on Form
10-K. In addition to
historical information, this
discussion contains forward-looking
 that
involve
risks,
uncertainties
and
that
could
cause
to
differ
materially
from
 expectations.
Factors
that
could
cause
such
differences
are
discussed
in
the
sections
entitled
"Forward-Looking
 Statements" and Item 1A "Risk Factors" of this Annual Report.
 In this Annual Report on Form 10-K, unless the context indicated otherwise, references to "we," "us,", and "our" refer to
 the Company and the Bank, as
the contest dictates. However, if
the discussion relates to a period
before the Effective Date,
 the terms refer only to the Bank.

 CAUTIONARY NOTE REGARDING FORWARD
-LOOKING STATEMENTS
 This
Annual
Report
on
Form
that
are
not
in
are
to
be,
and
are
 hereby identified as, forward-looking
statements for purposes of
the safe harbor provided by
Section 21E of the Securities
 Exchange Act
of 1934,
as amended.
The words
"may," "will," "anticipate," "could,"
"should," "would," "believe,"
"contemplate,"
 "expect," "aim,"
"plan," "estimate,"
"seek," "continue,"
and "intend,"
as other
similar words
and expressions
 future, are intended to identify forward-looking statements. These forward-looking statements include statements related to
 our projected growth, anticipated future financial performance, and management's long-term performance goals, as well as
 statements relating to
the anticipated effects
on results of
operations and financial
condition from expected
developments
 or events, or business and growth strategies, including
anticipated internal growth and balance sheet restructuring.
 These forward-looking statements involve significant risks and uncertainties that could cause our actual results to differ
 materially from those anticipated in such statements.
Potential risks and uncertainties include, but are not
limited to:
 •

the strength of the United States economy
in general and the strength of the local
economies in which we conduct
 operations;
 •

our ability to successfully manage interest rate risk, credit
risk, liquidity risk, and other risks inherent to our industry;
 •

the accuracy of our financial statement estimates and assumptions, including the estimates used for our credit loss
 reserve and deferred tax asset valuation allowance;
 •

the efficiency and effectiveness of our
internal control environment;
 •

to comply
extensive laws
to which
subject, including
the laws
for each
 jurisdiction where we operate;
 •

or
in
the
and
markets,
or
stresses
in
the
 banking industry;
 •

deposit attrition and the level of our uninsured deposits;
 •

legislative or regulatory
changes and changes
in accounting
principles, policies,
practices or guidelines,
 the on-going effects of the implementation of CECL;
 •

the lack of a significantly diversified loan portfolio and concentration in the South Florida market, including the risks
 of geographic, depositor,
and industry concentrations,
including our concentration
in loans secured by
real estate,
 in particular, commercial real estate;
 •

the effects of climate change;
 •

the concentration of ownership of our common stock;
 •

fluctuations in the price of our common stock;
 •

our ability to fund or access the capital markets at attractive
rates and terms and manage our growth, both organic
 growth as well as growth through other means, such as
future acquisitions;
 •

inflation, interest rate, unemployment rate, market, and monetary
fluctuations;
 •

impacts of international hostilities and geopolitical events;
 •

and
its
on
the
of
our
and
as
well
as
our
net
rate
 spread and net interest margin;
 •

the loss of key employees;

 •

the effectiveness of our risk management strategies, including operational risks, including, but not limited to, client,
 employee, or third-party fraud and cybersecurity breaches;
and

 •

other risks described in this Annual Report on Form 10-K
and other filings we make with the SEC.
 All
are
necessarily
only
of
results,
and
there
can
be
no
assurance
that
 actual results will
not differ
materially from expectations.
Therefore, you are
cautioned not to
place undue reliance
on any
statements.
included in
this
Annual Report
on Form
10-K are
made
 only
as of
the
date
hereof,
and
we
undertake
no
obligation
to
update
or
revise
any forward
-looking
to reflect
 events or circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events,
 unless required to do so under
the federal securities laws. You
should also review the risk
factors described in this Annual
 Report on
Form 10-K
and in
the reports
filed or
will file
SEC and,
for periods
prior to
the Effective
 Date, the Bank filed with the FDIC.

 Non-GAAP Financial Measures
 This Annual Report on Form 10-K includes
financial information determined by methods
other than in accordance with
accepted
principles
("GAAP").
This
 measures. Management has included these non-GAAP
measures because it believes these measures may
provide useful
 supplemental information
for evaluating
underlying performance
trends. Further,
management uses
these
in
managing
and
evaluating
the
and
intends
to
refer
to
them
in
discussions
about
our
 operations and performance.
Operating performance
measures should be
viewed in addition
to, and not
as an alternative

 to or
substitute
for,
in
with
GAAP,
and
are
not
necessarily
comparable
to non-GAAP
that
may
be
by
other
companies.
To
the
applicable,
reconciliations
of
these
non-GAAP
 measures to the most directly
comparable GAAP measures can be found
in the 'Non-GAAP Reconciliation Tables' included
 in this Annual Report on form 10-K.
 Overview
 For the year ended December 31, 2024, the Company reported net income of
$24.7 million compared with net income
 of
$16.5 million for the year ended December 31,
2023.

 In
evaluating
our
performance,
we
consider
the
level
of
and
trends
in
net
income,
the
net
 margin, the
cost of
deposits, growth
and composition
loan portfolio,
levels and
composition of
non-interest income
 and non-interest
expense,
ratios,
asset
quality ratios,
ratios,
and any
event or
 transaction.
 The following significant highlights are of note for the year
ended December 31, 2024:
 •

On January 29,
2024, the Company
announced that its
Board of Directors
had adopted a
quarterly cash dividend
 program. The quarterly dividend for all quarters in 2024 was $0.05 per share
of Class A common stock.
 •

Net interest
income before
provision for
totaled $69.9
million, an
increase of
$11.4 million
or 19.4%,
 compared to $58.6 million for the year ended December
31, 2023.

 •

Net interest
margin ("NIM")
was 2.94%
year ended
, an
improvement from
2.79% for
 the year ended December 31, 2023.

 •

Total assets grew to
$2.6 billion at December
31, 2024, an increase
of $242.1 million
or 10.4%, compared
to $2.3
 billion at December 31, 2023.
 •

Total loans held for investment
grew to $2.0 billion at
December 31, 2024, an
increase of $192.0 million or
10.8%,
 compared to $1.8 billion at December 31, 2023.
 •

Return on average assets for the year ended December
31, 2024 was 0.99% compared to 0.75% for 2023.
 •

Return on average stockholders' equity
for the year ended December 31, 2024 was 12.11% compared
to 8.99% for
 2023.
 •

Nonperforming
totaled
$2.7
at
2024
compared
to
$468
at
 2023.

 •

maintained its
strong capital
position. As of
December 31, 2024,
was well-capitalized
for
 regulatory capital purposes,
with a
total risk-based capital
ratio of 13.34%,
a tier 1
risk-based capital ratio
of 12.10%,
 a common equity tier 1 capital ratio of 12.10%, and a leverage ratio of 9.38%. As of December 31, 2024 and 2023,
 all of the Bank's regulatory
capital ratios exceeded the
thresholds to be well-capitalized
under the applicable bank
 regulatory requirements.
 •

In April 2024, the Board of
Directors approved a
new share repurchase
program of up to
500,000 shares of
Class
 A common stock or approximately 2.5% of the Company's then issued and outstanding shares
of common stock.
 •

During the year ended December 31, 2024, the Company repurchased 42,100
shares of Class A common stock at
 a
price
per
share
of
$11.85.
The
aggregate
purchase
price
for
these
was
 approximately
$501
thousand,
transaction
costs.
These repurchases
were
made
open
 purchases
pursuant
to
the
publicly
announced
programs.
As
of
31,
2024,
 537,980 shares remained authorized for repurchase under
the current two programs.
 •

During the third
quarter in 2024,
the Company unwound four
fair value interest rate
swaps with a
notional aggregate
 amount of $200 million.

 Critical Accounting Policies and Estimates
 The
are
prepared
based
on
the
application
of
U.S.
GAAP,
the
most
of
 which are described
in Note 1 "Summary
of Significant Accounting
Policies" to our
Consolidated Financial Statements.
To
 prepare financial statements in conformity with GAAP,
management makes estimates, assumptions,
and judgments based
 on
information.
These
estimates,
assumptions,
and
judgments
the
in
the
 statements and accompanying notes. These estimates, assumptions, and judgments are based on
information available as
 of
the
date
of
the
and,
as
this
changes,
could
differ
from
the
estimates,
and
judgments
reflected
in
the
statements.
In
particular,
has
identified
 policies that, due to
the estimates, assumptions
and judgments inherent
in those policies, are
critical in understanding
our
 financial statements.
has presented
the application
audit and
risk committee
 Board.

 Allowance for Credit Losses - Loans
 The allowance for credit
losses ("ACL") is
a valuation allowance that
is established through charges
to earnings in the
 form of
a provision for
credit losses. The
amount of the
ACL is
affected by the
following: (i) charge-offs
of loans that
decrease
 the allowance;
(ii) subsequent
recoveries on
loans previously
charged off
that increase
the allowance;
and (iii)
provisions
 for credit losses charged to income that increase or decrease the allowance. Management considers the policies related to
 the ACL as the most critical to the financial statement presentation.

 On
1,
2023,
the
implemented
ASU
2016-13
Instruments
-
326):
 Measurement of Credit Losses on Financial Instruments, as amended. This update replaces the incurred
loss methodology
 with
the
CECL
methodology.
The
CECL
and
applies
to
 measured at
amortized cost,
including loan
receivables and
held-to-maturity debt
securities. It
also applies
to off-balance
 sheet
exposures
not
accounted
for
as
(e.g.,
loan
commitments,
standby
letters
of
 guarantees, and similar instruments), as
well as net investments in leases
recognized by lessors in accordance
with Topic
 842 on leases.
 Under CECL, the Company estimates the allowance for credit losses by utilizing pertinent available data, sourced both
 internally and
externally,
relating to
past events,
current conditions,
and reasonable
and supportable
forecasts. Historical
 credit losses provide the foundation for the
estimation of expected credit losses. Qualitative
adjustments are applied to the
 estimated
for
the
loan
to
account
for
constraints
of
the
quantitative
model.
employs
a
scorecard
to
facilitate
the
evaluation
of
qualitative
factor
adjustments
made
to
 losses.
 The estimation's
quantitative aspect
relies on
the statistical
correlation between
the anticipated
an economic
 indicator and the
historical loss
experience implied
within a
selected group
of peers.
The Company conducted
regression
 analyses using
peer data,
inclusive of
itself, where
observed credit
losses and chosen
economic indicators
 were utilized to identify
appropriate drivers for
modeling the lifetime
probability of default
("PD") rates. A
loss given default
 rate ("LGD") is assigned to each pool
of loans for each period based on
these PD outcomes. The model
primarily employs
discounted cash
flow ("DCF")
analysis for
segments within
portfolio. This
DCF analysis
operates at
 the
instrument
level
and
various
loan-specific
data
points
and
segment-specific
to
 ascertain the lifetime expected
loss associated with each
instrument. An implicit "hypothetical
loss" is determined for
each
 period of the DCF,
aiding in establishing the
present value of future
cash flows for each
period. The reserve allocated
to a
 particular loan represents the disparity
between the sum of the
present value of future cash
flows and the book
balance of
 the loan at the measurement date.
uses
the
Remaining
Life
("WARM")
for
five
segments
the
loan
For
each
 segment,
a
loss
rate
is
computed
and
applied
quarterly
throughout
the
remaining
life
of
the
pool.
 Qualitative assessments
are conducted
to adjust for
economic expectations.
To
estimate the remaining
life, management
 employed a software solution utilizing an attrition-based calculation. This software conducts quarterly cohort-based attrition
 measurements based on the loan portfolio.
 Portfolio
segments
represent
the
level
at
which
loss
are
applied
to
a
pool of
by
the
 similarity of
risk characteristics inherent
included instruments, based
on collateral
codes and
FFIEC Call Report
codes.
 Currently,
the Company segments
the portfolio based on
collateral codes to establish
reserves. Each segment
is linked to
 regression
models
(Loss
Driver
Analyses)
using
peer
data
for
loans
with
risk
characteristics.
The
has
 established connections
internal portfolio
segmentation and
FFIEC Call
Report codes
for this
purpose. The
loss
 driver
for
each
loan
is
derived
from
a
readily
and
reasonable
forecast,
Bank
projections
of
the
U.S.
civilian
unemployment
rate
and
year-over-year
real
GDP
growth.
For
the

loan
segment,
House
Price
("HPI")
projections
published
by
Fannie
Mae's
Economic
and
Strategic
 Research Group are utilized for the forecast. Forecasts are applied for the first four
quarters of the credit loss estimate and
 then linearly revert to the historical mean of the economic indicator
over the expected life of the loans.
 The model integrates qualitative
factor adjustments to
fine-tune risk calibration
for each portfolio
segment, addressing
 aspects that quantitative analysis may
not fully capture. Decisions concerning
qualitative adjustments reflect management's
 anticipation of loss conditions deviating from those already accounted
for in the quantitative aspect of the model.
 Our ACL
included residential
loans. To
assess the
potential impact
of changes
in qualitative
factors related
to these
performed
a sensitivity
analysis.
evaluated
the
HPI
used
in calculating
 expected losses on the residential loan segment.
As of December 31, 2024, for every
100 basis points increase in the HPI
 index, the
forecast reduces
reserves by
approximately $582
thousand and
about 3
basis points
reserve coverage
 ratio, everything else being
constant. This sensitivity analysis
provides a hypothetical result
to assess the sensitivity
 ACL and does not represent a change in management's
judgement.
we stress
tested two
qualitative factors
in our commercial
loan pool,
as it's
the
 largest segment
portfolio. We
evaluated the
impact of
a change
qualitative factors
from no
risk to
maximum
 loss
to measure
the
qualitative
factors.
The change
resulted
in
a $9.6
or
39.8%
 allowance for credit losses.
This sensitivity analysis
provides a hypothetical result
to assess the sensitivity
of the ACL and
 does not represent a change in management's judgement
.
 The Company calculates a reserve for unfunded commitments, distinct from
the allowance for credit losses reported in
 other liabilities.
This reserve
is determined
using both
quantitative and
qualitative factors
identical to
those applied
 collectively evaluated loan portfolio.
 Results of Operations
 General
 The following tables
present selected balance sheet, income statement, and profitability ratios for the dates and for the
 periods indicated (in thousands, except ratios):
 As of December 31,
 2024
 2023
 Consolidated Balance Sheets:
 Total
 $
 2,581,216
 $
 2,339,093
 Total
loans
 (1)
 $
 1,972,848
 $
 1,780,827
 Total
 $
 2,174,004
 $
 1,937,139
 Total
stockholders' equity
 $
 $
 (1)
Loan amounts include deferred fees/costs.
 2024
 2023
 Consolidated Statements of Operations:
 Net interest income before provision for credit losses
 $
 69,936
 $
 58,568
 Provision fro credit losses
 $
 3,157
 $
 2,367
 Total
non-interest income
 $
 12,740
 $
 7,403
 Total
non-interest expense
 $
 47,042
 $
 41,808

 $
 $
 Net income available to common stockholders
 $
 $
 Profitability:
 Efficiency ratio
 56.90%
 63.37%
 Net interest margin

 2.94%
 2.79%
 The Company's results
depend substantially on
net interest income
and non-interest income.
Other factors
 contributing to the
results of operations
include our provision
for credit losses,
non-interest expense, and
the provision for
 income taxes.

year ended
was $24.7 million
,
compared with
of $16.5 million
for
period in
2023. The Company
per diluted
share for
ended December 31,
2024 of
 $1.24 compared to net income per diluted share for the
same period in 2023 of $0.84.

 Net Interest Income
 Net
is
the
difference
earned
on
interest-earning
and
incurred
on
 interest-bearing liabilities and
is the
primary driver of
core earnings. Interest
income is generated
from interest and
 on
interest-earning
and
other
short-term
investments.
is
 incurred
from
paid
on
interest-bearing
liabilities,
interest-bearing
deposits,
FHLB
advances
and
other
 borrowings.
 To evaluate net
interest income, we
measure and monitor
(i) yields on
loans and other
interest-earning assets, (ii)
the
 costs of deposits
and other funding
sources, (iii) net
interest spread, and
(iv) net interest margin.
Net interest spread is
equal
 to the difference
between the weighted
average yields
earned on interest
-earning assets
and the weighted
average rates
 paid on interest-bearing liabilities.
Net interest margin is
equal to the
net interest income divided
by average interest-earning
 assets. Because non-interest-bearing
sources of funds,
such as non-interest-bearing
deposits and stockholders'
equity, also
 fund interest-earning assets, net interest margin includes
the benefit of these non-interest-bearing sources.
 Changes in
the market
interest rates
and interest
rates we
earn on
or pay on
interest-bearing
 liabilities, as well
as the volume
and types of
interest-earning assets and interest-bearing
and non-interest-bearing liabilities,
 are usually the
largest drivers of
periodic changes in
net interest spread,
net interest margin
and net interest
income. The
 Asset-Liability Committee ("ALCO") has in place asset-liability management techniques to manage major factors that affect
 net interest income and net interest margin.

contains information
related to average
balances, average
yields on assets,
and average
costs of
 liabilities for the periods indicated (in thousands).
 2024
 2023
 Average

(1)
 Yield/Rate
 Average

(1)
 Yield/Rate
 Assets
 Interest-earning assets:
 Loans

 (2)
 $
 1,862,013
 $
 115,236
 6.19
 %
 $
 1,606,960
 $
 87,884
 5.47
 %
 Investment securities

 (3)
 427,567
 11,480
 2.68
 %
 423,749
 10,012
 2.36
 %
 Other interest-earnings assets
 88,758
 4,517
 5.09
 %
 65,986
 3,121
 4.73
 %
 Total
 2,378,338
 131,233
 5.52
 %
 2,096,695
 101,017
 4.82
 %
 Non-interest earning assets
 108,215

 109,541

 Total
 $
 $2,486,553

 $
 2,206,236

 Liabilities and stockholders' equity

 Interest-bearing liabilities:

 $
 54,667
 1,509
 2.76
 %
 $
 53,324
 1.69
 %
 1,109,853
 40,098
 3.61
 %
 963,708
 29,658
 3.08
 %
 326,373
 13,354
 4.09
 %
 268,715
 8,500
 3.16
 %
 Total
interest-bearing deposits
 1,490,893
 54,961
 3.69
 %
 1,285,747
 39,059
 3.04
 %
 Borrowings and repurchase agreements
 158,484
 6,336
 4.00
 %
 94,936
 3,390
 3.57
 %
 Total
interest-bearing liabilities
 1,649,377
 61,297
 3.72
 %
 1,380,683
 42,449
 3.07
 %
 Non-interest bearing demand deposits
 596,073

 607,506

 Other non-interest-bearing liabilities
 37,399

 34,010

 Total
 2,282,849

 2,022,199

 Stockholders' equity
 203,704

 184,038

 Total
liabilities and stockholders' equity
 $
 $2,486,553

 $
 2,206,236

 Net interest income
 $
 69,936

 $
 58,568

 Net interest spread

 (4)

 1.80
 %

 1.74
 %
 Net interest margin

 (5)

 2.94
 %

 2.79
 %
 (1)
Average balances - Daily average balances are used
to calculate yields/rates.
 (2)
Average loan balances include non-accrual loans. Interest income
on loans includes accretion of deferred
loan fees, net of deferred loan costs.
 (3)
At fair value except for securities held to maturity. This amount includes
FHLB stock.
 (4)
Net interest spread is the weighted average
yield on total interest-earning assets minus the weighted
average rate on total interest-bearing liabilities.
 (5)
Net interest margin is the ratio of net interest
income to average total interest-earning assets.
 Net interest
income before
the provision
for credit
losses was
$69.9 million for
ended December 31,
2024, a
 increase of $11.4 million
or 19.4%, from
$58.6 million for
the year ended
December 31, 2023. This
increase was
 attributable to increase in weighted average yields on interest-earning assets growing at a higher pace than the increase in
 weighted average rates paid on
interest-earning liabilities. Additionally, the increase
in the volume of
 was higher than interest-earning liabilities.

 The net
interest margin was
2.94% for
the year ended
December 31, 2024 and
2.79%
year ended 2023.
Although
 the overall and
individual yields for
and interest-bearing liabilities
both increased in
2024, the yield
 on interest-earning assets, especially on loans, had a greater
increase when compared to 2023. The increase in our yields
 and cost of funds was primarily due to the interest rate
market.

 The Company did not have any tax-exempt securities
at both December 31, 2024 and 2023.

 Provision for Credit Losses
 ACL represents expected
portfolio as
the measurement
date. We
maintain an
adequate ACL that
 can
mitigate
in
the
loan
The ACL
is
by
the
for
and
is
 decreased by charge-offs, net
of recoveries on prior
loan charge-offs. There are
multiple credit quality metrics
that we use
 to base
our determination
ACL and
corresponding
for credit
losses. These
credit metrics
 evaluate the
credit quality
and level
of credit
risk inherent
loan portfolio,
assess non-performing
charge-
 offs levels, consider statistical trends and economic conditions
and other applicable factors.

 The
for
loss
for
the
year
ended
2024,
was
$3.2
compared
to
$2.4
in
 provision expense for the
same period in 2023. The ACL as a
percentage of total
loans was 1.22%
at December 31, 2024
 compared to 1.18% at December 31, 2023.
 See "Allowance
for Credit
Losses" below
for further
discussion on
how the
ACL
was calculated for
the periods
presented.

 Non-Interest Income
 Net interest income
and other types of
recurring non-interest
income are generated
from our operations.
Our services
 and products generate service charges and fees, mainly from our depository accounts. We also
generate income from gain
 on sale
of loans
though our
swap and
SBA programs. In
addition, we
own life
insurance policies
on several
 employees and generate income reflecting the increase in
the cash surrender value of these policies.
 The following table presents the components of non-interest
income for the periods indicated (in thousands):
 2024
 2023
 Service fees
 $
 8,839
 $
 5,055
 Gain (loss) on sale of securities available for sale, net
 (1,859)
 Gain on sale of loans held for sale, net
 Other non-interest income
 3,140
 3,406
 Total
non-interest income
 $
 12,740
 $
 7,403
 Non-interest income
year ended
was $12.7
million compared
to $7.4
million for
 period in 2023. This
increase was primarily
driven by a
$2.9 million increase
in interest rate
swap income, $415
in
wire
transfer
fees,
and
$530
in
prepayment
under
service
fees.
 Additionally, in
Company executed
a portfolio
restructuring strategy
which resulted
sale of
lower-yielding
 available-for-sale securities at a loss
in order to better
position our securities portfolio.
The loss on the sale
of securities was
 $1.9 million for
2023. Proceeds from
the sale transactions
were primarily reinvested
in securities and
loans bearing yields
 higher than those on the securities that were sold.
 Non-Interest Expense
 The following table presents the components of non-interest
expense for the periods indicated (in thousands):
 2024
 2023
 Salaries and employee benefits
 $
 28,793
 $
 24,429
 Occupancy
 5,258
 5,230
 Regulatory assessment and fees
 1,766
 1,453
 Consulting and legal fees
 1,568
 1,899
 Network and information technology services
 1,993
 2,016
 Other operating
 7,664
 6,781
 Total
non-interest expense
 $
 47,042
 $
 41,808
 Non-interest expense for
the year ended
increased $5.2 million
or 12.5%, compared
to the same
 period in 2023. The increase is primarily due to $4.4 million or
17.9% increase in salaries and employee benefits consisting
 of
a
$1.2
or
6.5%
due
to
merit
promotions
and
new
hires,
a
$1.8
in
bonus
and
sales
 incentives, and a $1.1 million
increase in stock-based compensation
due to the Company's financial
performance in 2024.
 Other operating
expense had
an increase
of $883
thousand or
13.0% consisting
of a
$157 thousand
increase in
internet

 banking fees,
a $123
increase in
insurance expense,
a $229
increase in
director's fees,
and a
$374
 thousand in other expenses.

 Provision for Income Tax
 Fluctuations in the effective tax rate reflect the effect of the differences in the inclusion or deductibility of certain income
 and expense for income tax purposes.
Therefore, future decisions on the investments we
choose will affect our effective tax
 rate. Changes in the
cash surrender value
of bank-owned life
insurance policies for
key employees, purchasing
municipal
 bonds, and overall taxable income will be important elements
in determining our effective tax rate.
 Income tax
expense for
ended
2024 was
$7.8 million,
compared
to $5.3
year
 ended December 31, 2023. The
effective tax rate for
the year ended December 31, 2024
was 24.0% and for the
year ended
 December 31, 2023 was 24.1%.
 For a further
discussion on income taxes, see
Note 6 "Income Taxes"
to the Consolidated Financial Statements
set forth
 in Item 8 of this Annual Report on Form 10-K.
 Rate/Volume Analysis
 The
table
below
sets
forth
in
and
for
the
periods
 indicated (in thousands).
For each category of
interest-earning assets and interest-bearing liabilities,
information is provided
 on changes attributable to (i) changes in rate (changes in rate multiplied by old volume); (ii) changes in volume (changes in
 volume multiplied by old rate); and (iii) changes in rate-volume (change in
rate multiplied by change in volume). Changes in
 rate-volume are proportionately allocated between rate and volume
variance (in thousands).
 Years Ended 2024 vs. 2023
 Years Ended 2023 vs. 2022
 Increase (decrease) due to change in
 Increase (decrease) due to change in
 Volume
 Rate
 Net
 Change
 Volume
 Rate
 Net
 Change
 Interest-earning assets:
 Loans
 (1)
 $
 13,949
 $
 13,403
 $
 27,352
 $
 12,026
 $
 15,033
 $
 27,059
 Investment securities
 (2)
 1,378
 1,468
 (929)
 1,595
 Other interest-earning assets
 1,077
 1,396
 (64)
 2,256
 2,192
 Total increase in interest income
 $
 15,116
 $
 15,100
 $
 30,216
 $
 11,033
 $
 18,884
 $
 29,917
 Interest-bearing liabilities:
 $
 $
 $
 $
 (15)
 $
 $
 4,498
 5,942
 10,440
 1,032
 23,453
 24,485
 1,824
 3,030
 4,854
 6,660
 6,991
 Borrowings and repurchase agreements
 2,269
 2,946
 1,734
 2,719
 Total increase in interest expense
 8,614
 10,235
 18,848
 2,333
 32,677
 35,010
 Increase (decrease) in net interest income
 $
 6,502
 $
 4,865
 $
 11,368
 $
 8,700
 $
 (13,793)
 $
 (5,093)
 (1)
Average loan balances include non-accrual loans. Interest income
on loans includes accretion of deferred
loan fees, net of deferred loan costs.
 (2)
At fair value except for securities held to maturity. This amount includes
FHLB stock.
 Both average yields
earned on interest-earning
assets and average
rates paid on
interest-bearing liabilities
 in 2024 as a compared to 2023, reflecting the
changes in the macro interest rate environment.
However, the average yields
 earned on interest-earning
assets increased to a
greater degree than
rates paid on interest
-bearing liabilities. Additionally,
 interest-earning assets volume growth was greater than
the volume growth of interest-bearing liabilities.

 The Company did not have any tax-exempt securities
at both December 31, 2024 and December 31, 2023.
 Analysis of Financial Condition
 Total
assets at December 31, 2024, were $2.6 billion, an increase of $242.1 million, or 10.4%, over total assets of $2.3
 billion at
December 31, 2023. Total loans increased
$192.0 million,
or 10.8%,
to $2.0
billion at
December 31, 2024 compared
 to $1.8 billion at December 31, 2023. Total
deposits increased by $236.9 million,
or 12.2%, to $2.2 billion at December
31,
 2024 compared to $1.9 billion at December 31, 2023.

 Investment Securities
 The investment portfolio
is used and
managed to provide
liquidity through cash
flows, marketability
and, if necessary,
 collateral for
borrowings. The
investment portfolio
is also
used as
a tool
to manage
risk and
 capital market risk exposure. The
operating philosophy of the portfolio is
to maximize the Company's profitability,
taking into
 consideration the
Company's risk
appetite and
tolerance, manage
it's asset
composition and
diversification, and
 adequate risk-based capital ratios.
 The
is
managed
in
with
the
Asset
and
Liability
("ALM")
policy,
which
guidelines,
by
the
Board.
Such
policy
is
reviewed
at
least
annually
or
more
frequently
if
 deemed necessary,
depending on
unexpected
events.
The investment
composition
is
to
depending
on
the
and
needs
of
the
Company,
and
the
risk
 objectives directed by the ALCO. The portfolio of investments can be used to modify the duration of the
balance sheet. The
 allocation of cash into securities takes into consideration anticipated
future cash flows (uses and sources) and all available
 sources of credit.
 Our
consists
of
by
U.S.
government-sponsored
agencies,
agency
 mortgage-backed securities,
collateralized mortgage
obligation securities,
municipal securities,
debt securities,
 all with varying contractual maturities and coupons. Due to the optionality embedded in these securities, the final maturities
 do not
necessarily represent the
expected life of
the portfolio. Some
securities will be
called or paid
down depending
 on capital market conditions and expectations. The investment portfolio is regularly reviewed by the Chief Financial Officer,
 Treasurer, and/or the ALCO of the Company to ensure an appropriate risk and return profile as
well as for adherence to the
 Company's investment policy.
 As of December 31, 2024, the investment portfolio consisted of available-for-sale
("AFS") and held-to-maturity ("HTM")
 debt securities.
In 2022, the Company transferred investment securities from AFS to
HTM with an amortized cost basis and
$74.4 million
and $63.8
million, respectively.
On the
date of
transfer,
these securities
had a
total net
 unrealized loss of $10.6 million. The transfer of the debt securities from the AFS to HTM
category was made at fair value at
 the date
of transfer.
The unrealized
gain
or loss
date
of transfer
is retained
in
accumulated
other
 income (loss)
and in the
carrying value
of the HTM
securities. Such
amounts are
amortized over
the remaining
life of the
 security. There was no impact to net income on the date of transfer. There were no securities transferred from AFS to HTM
 in 2024 or 2023.
 The book value of the AFS securities is adjusted quarterly for
unrealized gain or loss as a valuation allowance, and any
 gain or loss is reported on an after-tax basis as a component of other comprehensive income (loss) in stockholders' equity.

 CECL requires a loss reserve for securities
classified as HTM. The reserve should reflect
historical credit performance
 as well as the impact
of projected economic forecast.
For U.S. Government bonds
and U.S. Agency issued bonds
in HTM
 the explicit guarantee of the U.S.
Government is sufficient to conclude that a
credit loss reserve is not required.
The reserve
 requirement
is
for three
groups:
municipal
and
non-agency
securitizations.
The
 Company calculates quarterly the loss reserve
utilizing Moody's ImpairmentStudio. The CECL measurement for investment
data,
containing
defaults
and
recoveries
and
baseline
 forecast. The
solution uses
probability of
default/loss
given default
("PD/LGD")
approach. PD
represents the
likelihood a
 borrower will
default.
Within the
model, this
is determined
using historical
default data,
adjusted for
the current
 economic environment. LGD projects the expected loss
if a borrower were to default.
monitors the credit
quality of HTM
securities through the
credit ratings. Credit
ratings are monitored
 by the Company
on at least
a quarterly basis.
December 31, 2023,
all HTM securities
held
 by the Company were rated investment grade.
 At December 31, 2024, HTM securities
included $155.5 million of U.S. Government and
U.S. Agency issued bonds and
securities.
of
the
explicit
implicit
guarantee
on
these
the
holds
no
 reserves
on
these
holdings.
The
remaining
portion
of
the
HTM
is
made
up
of
$9.2
in
grade
 corporate bonds. The required reserve for these
holdings is determined each quarter using the model described above.
For
 the portion of the HTM exposed to non-government credit risk,
the Company utilized the PD/LGD methodology
to estimate
 a $6 thousand
ACL as of
December 31, 2024.
The book value
for debt securities
classified as HTM
represents amortized
 cost less ACL.
 As of December 31, 2024, securities with a market value of $66.1 million were pledged to secure public deposits.
As of
 December 31, 2024, the Company did not have any tax-exempt
securities in the portfolio.

 The
table
presents
the
amortized
cost
and
fair
value
of
for
the
dates
indicated
(in
 Cost
 Gains
 $
 14,279
 $
 $
 (1,668)
 $
 (22,918)
 (12,063)
 86,604
 (7,905)
 24,925
 -
 (5,614)
 24,314
 (1,044)
 23,708
 $
 310,925
 $
 $
 (51,212)
 $
 $
 42,538
 $
 -
 $
 (5,094)
 $
 37,444
 (7,785)
 49,259
 40,681
 (4,613)
 36,121
 15,272
 -
 (1,385)
 13,887
 9,222
 -
 (393)
 8,829
 $
 164,700
 $
 $
 (19,270)
 $
 Allowance for credit losses - securities held-to-maturity
 (6)
 Securities held-to maturity, net of allowance for credit losses
 $
 164,694
 Cost
 Gains
 $
 9,664
 $
 -
 $
 (1,491)
 $
 8,173
 103,645
 -
 (23,039)
 80,606
 63,795
 -
 (11,608)
 52,187
 49,212
 (6,504)
 42,764
 25,005
 -
 (5,667)
 28,106
 (2,033)
 26,261
 $
 279,427
 $
 $
 (50,342)
 $
 $
 43,626
 $
 $
 (5,322)
 $
 38,306
 62,735
 -
 (7,983)
 54,752
 43,784
 (4,533)
 39,599
 15,439
 -
 (1,257)
 14,182
 9,398
 -
 (727)
 8,671
 174,982
 $
 $
 (19,822)
 $
 Allowance for credit losses - securities held-to-maturity
 (8)
 Securities held-to maturity, net of allowance for credit losses
 $
 174,974

 AFS and
HTM investment
securities in
aggregate increased
$20.6 million
or 5.1%
to $424.9
million at
 2024 from $404.3 million at December 31, 2023.
table shows
the weighted
average yields,
categorized by
contractual maturity,
for investment
 as of December 31, 2024 (in thousands, except ratios):

 Within 1 year
 After 1 year
 through 5 years
 After 5 years
 through 10 years
 After 10 years
 Total
 Cost
 Yield
 Cost
 Yield
 Cost
 Yield
 Cost
 Yield
 Cost
 Yield
 $
 -
 -
 $
 -
 -
 $
 2,379
 3.14%
 $
 11,900
 4.61%
 $
 14,279
 4.37%
 -
 -
 -
 -
 -
 -
 1.62%
 1.62%
 -
 -
 -
 -
 -
 -
 1.70%
 1.70%
 -
 -
 1,596
 4.41%
 4,097
 4.71%
 80,911
 3.25%
 86,604
 3.34%

 -
 -
 -
 -
 20,680
 1.72%
 4,245
 1.86%
 24,925
 1.75%
 -
 -
 2,926
 9.27%
 21,388
 5.11%
 -
 -
 24,314
 5.61%
 $
 -
 -
 $
 4,522
 7.56%
 $
 48,544
 3.54%
 $
 257,859
 2.30%
 $
 310,925
 2.57%

 $
 -
 -
 $
 7,951
 1.02%
 $
 20,078
 1.45%
 $
 14,509
 1.85%
 $
 42,538
 1.51%
 -
 -
 -
 -
 -
 -
 1.66%
 1.66%
 -
 -
 4,322
 1.86%
 5,882
 1.75%
 30,477
 2.38%
 40,681
 2.23%
 -
 -
 3,057
 1.62%
 -
 -
 12,215
 2.59%
 15,272
 2.40%
 -
 -
 9,222
 2.81%
 -
 -
 -
 -
 9,222
 2.81%
 $
 -
 -
 $
 24,552
 1.92%
 $
 25,960
 1.52%
 $
 114,188
 1.98%
 $
 164,700
 1.90%
 The Company did not have any tax-exempt securities
at both December 31, 2024 and 2023.

 Loans
 Loans are
the largest
category of
Balance Sheets,
and usually
 higher yields than the remainder of the Company's
interest-earning assets. Higher yields typically carry
inherent credit and
 liquidity risks in
comparison to lower
yielding assets. The
Company manages and
mitigates such risks
in accordance with
 the credit and ALM policies, risk tolerance and balance
sheet composition.
 The following table shows the loan portfolio composition
as of the dates indicated (in thousands):

 Total
 Percent of
 Total
 Total
 Percent of
 Total
 $
 14.8
 %
 $
 11.5
 %
 57.8
 %
 58.8
 %
 13.1
 %
 12.4
 %
 4.2
 %
 6.5
 %

 10.1
 %
 10.8
 %
 Total
gross loans
 100.0
 %
 100.0
 %
 Plus: Deferred costs
 7,630
 2,183
 Total
loans net of deferred costs
 1,972,848
 1,780,827
 Less: Allowance for credit losses
 Total
net loans
 $
 1,948,778

 $
 1,759,743
 Total
loans
held
for
net
of
costs
by
$192.0 million
or
10.8%
at
2024
 compared to December 31, 2023. The most significant growth was in the residential real estate and commercial real estate
 loan pools. Our loan
portfolio continues to diversify
as commercial and industrial loans
continue to increase as
a percentage
 to total loans. However, we do not expect any significant
changes over the foreseeable future in
the composition of our loan
 portfolio. Commercial
real
estate continues
to be
the main
portfolio,
reflective
in which
we
 operate.
 The
experienced
over
the
last
couple
of
years
is
due
to
implementation
of
our
relationship-based
model,
our
diversified
verticals,
and
the
success
of
our
relationship
managers
in
competing
for
new

 business in a highly competitive metropolitan area. Many of
our larger loan clients have lengthy relationships with members
 of our senior management team or our relationship managers
that date back to former institutions.

 From a
liquidity perspective,
our loan
portfolio provides
us with
liquidity due
to repayments
or unexpected
 prepayments.
The
table
shows
maturities
and
to
rate
for
the
loan
at
 December 31, 2024 (in thousands):
 Due in 1 year or
 less
 Due in 1 to 5
 years
 Due after 5 to 15
 years
 Due after 15
 years
 Total
 $
 10,713

$

 64,513

$

 68,677

$

 146,059
 $
 85,967
 378,704
 666,276
 5,471
 7,726
 82,601
 123,166
 44,818
 -
 -
 -
 2,179
 1,883
 19,118
 174,911
 Total
gross loans
 $
 189,023
 $
 527,700
 $
 877,237
 $
 371,258
 $
 Interest rate sensitivity:
 Fixed interest rates
 $
 164,523
 $
 203,861
 $
 163,800
 $
 282,633
 $
 814,817
 Floating or adjustable rates
 24,500
 323,839
 713,436
 88,626
 1,150,401
 Total
gross loans
 $
 189,023
 $
 527,700
 $
 877,236
 $
 371,259
 $
 The information
presented in
the table
above is
based upon
contractual maturities
individual loans,
which may
 be subject to renewal at their contractual maturity. Renewals will depend on approval by our credit department and balance
 sheet composition
time of
the analysis,
as any
modification of
terms at
the loan's maturity. Additionally, maturity
 concentrations,
loan duration,
prepayment
speeds
and
other interest
rate
are discussed,
reviewed,
 and analyzed by the ALCO. Decisions on term and rate
modifications are discussed as well.

 As of
2024, approximately
58.5%
loans
have adjustable/variable
rates
and
41.5%
loans
 have fixed rates.
The adjustable/variable
loans re-price to
different benchmarks
and tenors in
different periods
of time. By
 contractual characteristics, there are no
material concentrations on anniversary repricing. Additionally, it is
important to note
 that most
loans have
floors. This
embedded option
protects the
Company from
a decrease
in interest
 rates and positions us to gain in the scenario of higher interest
rates.
 As of
December 31, 2024, the
commercial real estate
portfolio was $1.1
billion or 57.8%
total gross loans
 At
such
date,
$200.8
of
balances
are
characterized
as
owner
occupied
and
$935.6
are
 characterized as non-owner occupied.
The retail sector
was the largest
segment comprising $305.0 million
of the non-owner
 occupied commercial real estate portfolio.
 The
table
is
a
summary
of
the
distribution
of
non-owner
occupied
real
loans
held
for
 investment by loan type (dollars in thousands):
 # of Notes
 % of Total
 Gross Loans
 Average Loan Size
 Non-Accruals
 Weighted Avg
 LTV
 (1)
 Retail
 $
 305,027

 16%
 $
 3,145
 $
 -

 57%
 Multifamily
 210,576
 7,122
 11%
 -
 56%
 Warehouse
 132,269
 7%
 2,362
 -
 54%
 Office
 114,043
 6%
 2,112
 -
 52%
 Hotels/Motels
 102,480
 5%
 5,124
 -
 56%
 Construction/Land
 37,974
 2%
 1,999
 -
 47%
 Other
 33,212
 2%
 1,582
 -
 55%
 $
 935,581

 7,389

 48%
 $
 $
 -
 $
 55%
 (1) Loan-to-value is calculated based on the real estate value at the time of origination, renewal, or update, whichever is more recent.

 The following table is a summary of non-owner occupied commercial real estate loans held for investment by collateral
 geographical location (dollars in thousands):
 South Florida
 (1)
 Rest of Florida
 (2)
 Outside Florida
 (3)
 % of Non-
 Owner
 Occupied
 CRE Loans
 % of Non-
 Owner
 Occupied
 CRE Loans
 % of Non-
 Owner
 Occupied
 CRE Loans
 Retail
 $
 185,838
 20%
 $
 47,007
 5%
 $
 72,182
 8%
 Multifamily
 159,172
 17%
 51,404
 5%

-

 0%
 Warehouse
 71,438
 8%
 53,923
 6%
 6,908
 1%
 Office
 75,813
 8%
 29,401
 3%
 8,829
 1%
 Hotels/Motels
 74,439
 8%
 28,041
 3%

-

 0%
 Construction/Land
 33,277
 4%
 4,697
 1%

-

 0%
 Other
 26,294
 3%
 6,919
 1%

-

 0%
 $
 626,271
 67%
 $
 221,392
 24%
 $
 87,919
 9%
 (1) Miami-Dade, Broward, and West Palm Beach counties
 (2) All other Florida counties
 (3) Within the U.S.

67% of the
non-owner occupied
CRE portfolio
were located
within South Florida,
and only
 12 loan
notes with
an outstanding
balance of
$87.9 million
are located
outside Florida.
Balances
of non-owner
 occupied CRE loans outside Florida were: $67.2 million in New York, $6.9 million in Georgia,
$4.4 million in Arkansas, $4.2
 million in North Carolina, $2.8 million in Indiana, and $2.5 million
in New Jersey.
 Asset Quality

 Our asset quality grading
analysis estimates the capability of
the borrower to repay
the contractual obligation of
 agreement as scheduled or at all. The Company's internal credit risk grading system is based on experiences with similarly
 graded loans. Internal
credit risk
grades are evaluated
at least annually,
or more frequently
if deemed necessary.
Internal
risk
ratings
may
based
on
of
the
from
the
annual
review,
 monitoring and other developments observed with borrowers.

 The internal credit risk grades used by the Company to
assess the credit worthiness of a loan are shown below:
 Pass
 – Loans indicate different levels of satisfactory
financial condition and performance.

– 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.

 – Loans classified as substandard are inadequately protected
by the current net worth and paying
 capacity of the obligator 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.

– Loans classified as doubtful have all the weaknesses inherent
in those classified at 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.

 Loss
 – Loans classified as loss are considered uncollectible.

 Loan credit exposures by internally assigned grades are
as follows for the dates indicated (in thousands):

 Pass
 Total
 $
 289,401
 $
 -
 $
 $
 -
 $
 1,133,965
 -
 2,452
 -
 256,031
 -
 2,280
 -
 -
 -
 -

 -
 1,990
 -
 $
 1,957,936
 $
 -
 $
 7,282
 $
 -
 $
 Pass
 Total
 $
 204,127
 $

-

 $
 $

-

 $
 1,040,032

-

 7,561

-

 218,129

-

 1,628

-

-

-

-

-

-

-

 $
 1,769,163
 $

-

 $
 9,481
 $

-

 $
 Non-Performing Assets
 The following table presents non-performing assets as
of December 31, 2024 and 2023 (in thousands, except
ratios):
 2024
 2023
 Total
non-performing loans
 $
 2,707
 $
 Other real estate owned
 -
 -
 Total
non-performing assets
 2,707
 Asset quality ratios:

 -
 -
 Allowance for credit losses to total loans
 1.22%
 1.18%
 Allowance for credit losses to non-performing loans
 889%
 4505%
 Non-performing loans to total loans
 0.14%
 0.03%
 Non-performing
all
loans
categorized
as non-accrual
or restructured,
impaired
securities,
OREO
and
 other repossessed assets. Problem loans for which the collection or liquidation in full is reasonably uncertain are placed on
 a
non-accrual
status.
This
determination
is
based
on
facts
concerning
values
and
the
paying
 capacity of the borrower. When the collection of the full contractual balance is unlikely,
the loan is placed on non-accrual to
 avoid overstating the Company's income for a
loan with increased credit risk.

 If the
principal or
interest on
a commercial
loan becomes
due and
unpaid for
90 days
or more,
is placed
on
 non-accrual status as of
the date it becomes
90 days past due
and remains in non-accrual
status until it meets
the criteria
 for restoration to accrual status.
Residential loans, on
the other hand, are placed
on non-accrual status when
the principal
 or interest
becomes due
and unpaid
for 120
days or
more and remains
in non-accrual
status until
it meets
the criteria
for
 restoration
to
accrual
status.
Restoring
a
loan
to
accrual
status
is
when
the
resumes
of
all
 principal and interest
payments for a period
of six months
and the Company
has a documented
expectation of repayment
 of the remaining contractual principal and interest or the
loan becomes secured and in the process of collection.
 The
may
grant
a
loan
concession
to
a
difficulties.
This
determination
is
 performed during
the annual
review process
or whenever
problems are
surfacing regarding
the client's
repay in
 accordance with
the original
terms of
or line
of credit.
The concessions
are given
debtor in
various forms,
 including interest rate
reductions, principal forgiveness, extension
of maturity date,
waiver, or deferral of
payments and other
 concessions intended to minimize potential losses.
 For further discussion on non-performing loans, see Note
3 "Loans" to the Consolidated Financial Statements
set forth
 in Item 8 of this Annual Report on Form 10-K.

 Allowance for Credit Losses
 On January 1,
2023, the Company
adopted FASB ASU 2016-13, which
introduced the CECL methodology
and required
 us to
estimate all
expected credit
losses over
the remaining
life of
our loan
portfolio. Accordingly,
the ACL
represents an
that,
in
evaluation,
is
to
coverage
for
all
on
 outstanding loans as of the
measurement date. Additionally,
qualitative adjustments are made to
the ACL when, based on
 management's judgment, there
are factors impacting
the allowance estimate
not considered by
the quantitative calculations.
 See Note 3 "Loans" to the Consolidated Financial Statements set
forth in Item 8 of Part 1
of this Annual Report as Form 10-
 K for more information on the allowance for credit losses.
 The following table presents ACL and net charge-offs to average loans by
type for the periods indicated (in thousands):
 Residential
 and Industrial
 Correspondent

 Banks
 Consumer
 and Other
 Total
 December, 31, 2024

 Beginning balance
 $
 2,695
 $
 $
 3,974
 $
 $
 3,138
 $
 (1)
 2,403
 (1,578)
 (257)
 1,752
 2,960
 Recoveries
 -
 -
 Charge-offs
 -
 -
 -
 -
 (19)
 (19)
 Ending Balance

 $
 5,121
 $
 8,788
 $
 4,633
 $
 $
 4,874
 $
 Average loans
 $
 256,112
 $
 1,068,574
 $
 238,266
 $
 103,345
 $
 195,716
 $
 1,862,013
 Net charge-offs (recoveries) to
 average loans

 (0.01)%

 -

 (0.01)%

 -

 0.01%

 (0.00)%
 December, 31, 2023

 Beginning balance
 $
 1,352
 $
 10,143
 $
 4,163
 $
 $
 1,109
 $
 17,487
 Cumulative effect of adoption of
 accounting principle
 (2)
 1,238
 1,105
 (2,158)
 1,066
 (3)
 (882)
 1,897
 1,225
 2,503
 Recoveries
 -
 -
 Charge-offs
 -
 -
 -
 -
 (57)
 (57)
 Ending Balance

 $
 2,695
 $
 $
 3,974
 $
 $
 3,138
 $
 Average loans
 $
 186,854
 $
 986,234
 $
 179,574
 $
 93,364
 $
 160,934
 $
 1,606,960
 Net charge-offs (recoveries) to
 average loans
 (0.01)%

 -

 (0.04)%

 -

 0.03%

 (0.00)%
 (1) Provision for credit losses excludes $199 thousand release for unfunded commitments included in other liabilities and $2 thousand
 release for investment securities held to maturity.
 (2) Impact of CECL adoption on January 1, 2023.
 (3) Provision for credit losses excludes $144 thousand release for unfunded commitments included in other liabilities and $8 thousand
 provision for investment securities held to maturity.

 The
table
presents
ACL
by
type
and
its
percentage
to
total
loans
for
the
periods
indicated
(in

 2024
 2023
 Loan Category
 % of Loans in
 Each Category to
 Total Loans
 % of Loans in
 Each Category to
 Total Loans
 $
 5,121
 21.3
 %
 $
 2,695
 11.5
 %

 8,788
 36.5
 %
 58.8
 %
 4,633
 19.2
 %
 3,974
 12.4
 %
 2.7
 %
 6.5
 %
 4,874
 20.3
 %
 3,138
 10.8
 %
 Total
 $
 100.0
 %
 $
 100.0
 %
 Bank-Owned Life Insurance
 At
2024,
the
combined
cash
value
of
all
bank-owned
life
("BOLI")
was
 $53.5 million.
Changes
in
cash
value
are
in
non-interest
on
the
of
 Operations. In
2024, the Company
maintained BOLI
policies with
five insurance
carriers. The
Company is
the beneficiary
 of these policies.
 Deposits
 Customer deposits are the
primary funding source for
the Bank's growth.
Through our network of
banking centers, we
 offer a competitive array of deposit
accounts and treasury management services designed
to meet our customers' business
 needs. Our primary
deposit customers
are SMBs,
and the personal
business of owners
and operators
of these SMBs,
as
 well as the retail/consumer relationships of the employees
of these businesses. Our focus on quality and customer
service
 has created a strong brand recognition within
our depositors, which reflects in the composition
of our deposits; most of our
 funding sources
are core
deposits. In
addition to
our banking
centers
network, we
have developed
verticals to
 diversify our portfolio in
different specialty
industries and we offer
public fund deposit
products to municipalities
and public
 agencies in our geographical footprint.

 Furthermore, our
personal and
private banking
line of
business is
focused on
the needs
owners
 and operators of
our business customers,
offering a suite
of checking, savings,
money market and
time deposit accounts,
 and utilizing superior
client service
to build and
expand client relationships.
A unique aspect
of our business
model is our
 ability to offer correspondent services to banks in
Central America and the Caribbean.
table presents
the daily
average balance
and average
rate paid
on deposits
by category
years
 ended December 31, 2024 and 2023 (in thousands, except
ratios):
 2024
 2023
 Average Balance
 Average Rate
 Paid
 Average Balance
 Average Rate
 Paid
 Non-interest bearing demand deposits
 $
 596,073
 0.00%
 $
 607,506
 0.00%
 54,667
 2.76%
 53,324
 1.69%
 1,109,853
 3.61%
 963,708
 3.08%
 326,373
 4.09%
 268,715
 3.16%
 $
 2,086,966
 2.63%
 $
 1,893,253
 2.06%
 Total average deposits for the year ended December 31, 2024 was $2.1 billion,
an increase of $193.7 million,
or 10.2%
 over total
average deposits
of $1.9 billion
same period
in 2023.
The greatest
increase was
in money
market and
 savings deposits which increased
by $146.1 million,
or 15.2%. Non-interest-bearing demand
deposits decreased by $11.4
 million or
1.9% due
to customers
moving deposits
to interest-bearing
accounts due
to increases
in rate
paid on
 due to increases in the interest rate market.

 The
uninsured
are
estimated
based
on
the
FDIC
limit
of
$250 thousand
for
all
 accounts at
per account
holder.
Total
estimated uninsured
deposits was
$1.2 billion
at December 31,
 $1.1 billion at December
31, 2023. As of
December 31, 2024,
45%
of our deposits
are estimated to be
FDIC-insured. Our
 public funds
are 5%
deposits and
are partially
collateralized.
Brokered deposits
are 6%
deposits and
are
 FDIC-insured. The estimated average
account size of our deposit
portfolio is $105 thousand.
with balances
 of $250 thousand or more
totaled $94.0 million and
$58.1 million at December 31,
2024 and 2023, respectively.
 maintains a well-diversified deposit
base. At December 31,
2024, our top
10 depositors only
held 16.7% of
our total portfolio.
 Critical elements of our liquidity
risk management include: effective corporate governance consisting of
oversight by the
 Board and ALCO and
involvement by senior management;
appropriate strategies, policies,
procedures, and limits
used to
 identify
and
mitigate
risk;
risk
and
monitoring
of
the
and
prospective
cash
flows
or
sources
and
uses
of
funds)
that
are
commensurate
with
the
 complexity and business
activities of the
Company; management of intraday
liquidity and collateral;
an appropriately diverse
 mix
of
and
sources;
levels
of
highly
liquid
marketable
free
of
legal,
 regulatory,
or
impediments,
that
can
be
used
to
meet
needs
in
stressful
situations;
 contingency
plans
that
sufficiently
address
events
and
emergency
cash
flow
 requirements;
and
controls and
audit
processes
sufficient
to
determine
the
adequacy
of
the
 liquidity risk management process.
 We
expect
funds
to
be
from
several
basic
activity
the
core
base,
the
 repayment and maturity of loans and investment security
cash flows. Other potential funding sources include
federal funds
 purchased, brokered
certificates of
deposit, listing
certificates of
deposit, Fed
Funds lines
and borrowings
FHLB
 Atlanta. Accordingly, our liquidity resources were at sufficient levels to
fund loans and meet other
cash needs as necessary.
 The following table shows scheduled maturities of uninsured
time deposits as of December 31, 2024 (in thousands):
 Three months or less
 $
 38,848
 Over three through six months
 31,977
 Over six through twelve months
 22,239
 Over twelve months
 $
 94,006
 Borrowings
 As
a
member
of
the
FHLB
Atlanta,
we
are
to
advances
with
various
terms
and
conditions.
This
 accessibility of additional
funding allows us
to efficiently and
timely meet both
expected and unexpected
outgoing cash flows
 and collateral needs without adversely affecting
either daily operations or the financial condition
of the Company.
 Outstanding fixed-rate
advances from the
FHLB were at
$163.0 million and
$183.0 million,
as of December
 and December 31,
2023, respectively.
The weighted average
rate for outstanding
FHLB advances was
3.8% and 4.4%
at
 December 31, 2024, and December 31, 2023, respectively.

 The following table presents the FHLB fixed rate advances
as of December 31, 2024 (in thousands):
 December, 31, 2024
 Interest Rate
 Type of Rate
 Maturity Date
 2.05%
 Fixed
 March 27, 2025
 $
 1.07%
 Fixed
 July 18, 2025
 6,000
 3.76%
 Fixed
 January 24, 2028
 11,000
 3.77%
 Fixed
 April 25, 2028
 3.68%
 Fixed
 September 13, 2027
 21,000
 3.79%
 Fixed
 March 23, 2026
 20,000
 4.65%
 Fixed
 February 13, 2025
 45,000
 $
 163,000
 December, 31, 2023
 Interest Rate
 Type of Rate
 Maturity Date
 1.04%
 Fixed
 July 30, 2024
 5,000
 1.07%
 Fixed
 July 18, 2025
 6,000
 2.05%
 Fixed
 March 27, 2025
 $
 3.76%
 Fixed
 January 24, 2028
 11,000
 3.77%
 Fixed
 April 25, 2028
 5.57%
 Fixed
 December 26, 2024
 101,000
 $
 183,000
 We
have
also
Fed
Funds
lines
of
with
our
upstream
banks
to
manage
temporary
 fluctuations in our daily
cash balances. As of
December 31, 2024, there were no
outstanding balances under the Fed
Funds
 line of credit.
 The Board
of Governors
of the Federal
Reserve System,
on March
12, 2023,
announced the
creation of
a new
Bank
 Term
Funding Program ("BTFP"). The BTFP offered loans of up to one year in length to banks, savings associations, credit
 unions,
and
other
pledging
U.S.
Treasuries,
U.S.
agency
debt
and
 securities, and other qualifying assets as collateral. The
BTFP program ceased making new loans as of March
2024.

 The Company paid off $80 million in borrowings under the BTFP
program during the third quarter of 2024. The original
 maturity of this borrowing by the Bank under the BTFP program was January 2025, and there are no remaining borrowings
 under this program.
 Off-Balance Sheet Arrangements
 We engage
in various financial
transactions in
our operations
that, under GAAP,
may not be
included on
the balance
 sheet. To
meet the financing needs
of our customers we may
include commitments to extend
credit and standby letters
of
 credit. To
a varying
degree, such
commitments involve
elements of
credit, market,
and interest
rate risk
in excess
 amount recognized
balance sheet.
We use
more conservative
credit and
collateral policies
in making
these credit
 commitments as we
do for on-balance sheet
items. We are not
aware of any accounting
loss to be
incurred by funding
these
 commitments; however,
we maintain an allowance
for off-balance sheet
credit risk which is
recorded under other liabilities
 on the Consolidated Balance Sheets.
 Since commitments associated with letters of
credit and commitments to extend
credit may expire unused, the
 shown do not necessarily
reflect the actual
future cash funding requirements
.
presents lending related
 commitments outstanding as of December 31, 2024 and
2023 (in thousands):
 Commitments to grant loans and unfunded lines of credit
 $
 122,578
 $
 85,117
 Standby and commercial letters of credit
 5,389
 3,987
 Total
 $
 127,967
 $
 89,104
 Commitments to extend credit are agreements to lend funds to a client, as long as there is no violation of any condition
in
the
contract,
for
a
purpose.
Commitments
have
variable
rates,
fixed
expiration
 dates or
other
termination
clauses
and
may require
of
a fee.
Since many
commitments
are
expected to

 expire without being
fully drawn, the
total commitment
amounts disclosed
above do not
necessarily represent
future cash
 requirements.
 Unfunded lines of credit represent unused portions of credit facilities to our current borrowers that represent no change
 in credit risk in our portfolio. Lines of credit
generally have variable interest rates. The
maximum potential number of future
 payments we could
be required to
make is represented
by the contractual
amount of the
commitment, less
the amount of
 any advances made.
 Letters of credit are
conditional commitments issued
by us to guarantee
the performance of a
client to a third
party.
In
 the event of nonperformance by
the client in accordance with the
terms of the agreement with the
third party,
we would be
 required to fund
the commitment.
If the commitment
is funded, we
would be entitled
to seek recovery
from the client
from
 the underlying collateral,
which can include
commercial real estate,
physical plant and
property, inventory, receivables, cash
 or marketable securities.
 Asset and Liability Management Committee
 The asset and liability management committee of our Company, or ALCO, consists of members of senior management
 and our Board. Senior management is responsible for
ensuring in a timely manner that Board
approved strategies, policies,
 and procedures
for managing
and mitigating
risks are
appropriately executed
within the
designated lines
of authority
and
 responsibility.
 ALCO
oversees
the
establishment,
approval,
implementation,
and
of
rate
risk,
and
 mitigation strategies, ALM related policies, ALCO procedures
and risk tolerances and appetite.
 While some degree of interest
rate risk ("IRR") exposure is inherent
to the banking business, our ALCO
has established
 what it believes are sound risk management practices
in place to identify,
measure, monitor and mitigate IRR exposures.
 When assessing the scope
of IRR exposure and
impact on the consolidated
balance sheet, cash flows
and statement
 of operations,
management considers
both earnings
and economic
impacts. Asset price
variations, deposits
volatility and
 reduced earnings or outright losses could adversely affect
the Company's liquidity,
performance, and capital adequacy.
 Income simulations
are used
to assess
the impact
of changing
rates on
earnings under
different rates
scenarios and
 time horizons.
These simulations
utilize both
instantaneous and
parallel changes
level of
interest rates,
as
 non-parallel changes such as changing slopes (flat and steeping) and
twists of the yield curve, Static simulation models are
 based on current exposures and
assume a constant balance sheet with
no new growth. Dynamic simulation analysis
is also
 utilized to have a
more comprehensive assessment
on IRR. This simulation
relies on detailed
assumptions outlined in
our
 budget and strategic plan, and in assumptions regarding changes in
existing lines of business, new business, management
 strategies and client expected behavior.
 To
have a more complete
picture of IRR, the Company
also evaluates the economic
value of equity.
This assessment
 allows
us
to
measure
the
degree
to
which
the
values
will
under
rate
scenarios.
The
 economic value of equity approach focuses on a longer-term time horizon and captures all future cash flows expected from
 existing assets and liabilities. The economic value model utilizes a static approach in that the analysis does not incorporate
 new business; rather, the
analysis shows a snapshot in time of the risk inherent
in the balance sheet.
 Market and Interest Rate Risk Management

According to our ALCO model, as
of December 31, 2024, the Bank's balance sheet was neutral for
year one and asset
 sensitive for year two. Asset sensitivity indicates that
our assets generally reprice faster than our
liabilities, which results in
 a favorable impact to
net interest income when market
interest rates increase. Liability sensitivity
indicates that our liabilities
 generally reprice
faster
than our
assets, which
in a
favorable
impact to
net interest
when market
 rates decrease.
Neutral indicates
minimal changes
to the net
interest income
due to changes
on the market
interest rate.
 Many assumptions
are used
to calculate
the impact
of interest
rate variations
net interest
income, such
as asset
 prepayment speeds,
non-maturity
deposit price
sensitivity,
pricing correlations,
deposit truncations
and decay
rates, and
 key interest rate drivers.
 Because of the inherent use
of these estimates and
assumptions in the model,
our actual results may,
and most likely
 will, differ from static measures results. In addition, static measures like the economic value of equity
do not include actions
 that management may undertake to
manage the risks in response
to anticipated changes in interest
rates or client deposit
 behavior. As part of our ALM strategy and
policy, management has the ability to modify the balance sheet
to either increase

 or decrease
asset
duration
and
or decrease
liability
duration
to
modify
the balance
sheet
to interest
 rates.

 According to our model, as of
end of 2024, the NIM will
remain fairly stable for static rate
scenarios (-400 basis points:
 +400 basis points). Additionally, utilizing an EVE approach, we analyze the risk to
capital from the effects of various interest
 rate scenarios through a long-term discounted cash flow model. This measures the difference between the economic value
 of our assets
and the economic
value of our
liabilities, which is
a proxy for
our liquidation value.
According to our
 sheet composition, and as
expected, our model stipulates
that an increase of
interest rates will have
a negative impact on
 the EVE. Results and analysis are presented quarterly
to the ALCO, and strategies are reviewed and refined.
 Additionally, in the last year we have been reducing our asset sensitivity by extending asset duration. This has reduced
 our NII volatility for the first and
second year in the analysis and has helped us
to maintain the NII in accordance with ALCO
 expectations.

 Liquidity

Liquidity is
defined as
a Company's capacity
to meet
its cash
and collateral
obligations at
a reasonable
cost. Maintaining
 an adequate level of liquidity depends on the Company's ability to
efficiently meet both expected and unexpected cash flow
 and collateral needs without adversely affecting
either daily operations or the financial condition of the
Company.
 Liquidity risk
is the
risk that
we will
be unable
to meet
our short-term
and long-term
obligations as
they become
due
 because of an
inability to liquidate
assets or obtain
adequate funding on
acceptable terms in
a timely matter. The
 obligations, and the funding sources used to meet them, depend significantly
on our business mix, balance sheet structure
 and composition, credit quality of
our assets, interest rate
environment and the cash flow
profiles of our on- and
off-balance
 sheet obligations.
 In
managing
cash
inflows
and
outflows,
monitors
situations
that
can
give
rise
to
 liquidity risk.
These include
funding mismatches, market
constraints on
the ability
to convert
assets (particularly investments)
 into cash or in
accessing sources of
funds (i.e., market
liquidity), and contingent
liquidity events. Management
presents to
 the ALCO,
on a
quarterly basis, liquidity
stress tests following
the scenarios
described in
the Company's contingency
 plan.

 Changes
in
macroeconomic
to
deterioration,
market,
operational,
legal
and
reputational
 risks, including cybersecurity risk and
social media events could
also affect the Company's liquidity risk
profile unexpectedly
 and are considered in the assessment of liquidity and ALM
framework.
 Management has established
a comprehensive and
holistic management process for
identifying, measuring, monitoring
 and
mitigating
risk.
Due
to
its
importance
to
the
viability
of
the
Company,
risk
is
 integrated into our risk management processes, Contingency
Funding Plan and ALM policy.
 Critical elements of our liquidity
risk management include: effective corporate governance consisting of
oversight by the
 Board and ALCO and
involvement by senior management;
strategies, policies, procedures,
and limits used to
identify and
 mitigate
risk;
risk
and
monitoring
of
the
 current and prospective cash flows or sources and uses of funds) that are commensurate with the complexity and
Company;
of intraday
liquidity and
collateral;
a diverse
mix of
and
 funding sources; adequate levels of highly liquid marketable securities free
of legal, regulatory, or operational impediments,
 that can
be used
to meet
liquidity needs
in stressful situations;
comprehensive contingency
funding plans
that sufficiently
 address potential adverse
liquidity events and
emergency cash
flow requirements; and
internal controls and
internal audit
 processes sufficient to determine the adequacy
of the institution's liquidity risk management
process.
 We
expect
funds
to
be
from
several
basic
activity
the
core
base,
the
 repayment and maturity of loans and investment security
cash flows. Other potential funding sources include
federal funds
 purchased, brokered
certificates of
deposit, listing
certificates of
deposit, Fed
Funds lines
and borrowings
FHLB
 Atlanta. Accordingly, our liquidity resources were at sufficient levels to
fund loans and meet other
cash needs as necessary.
 At December 31, 2024,
the Company had $412.8
million in available liquidity
on balance sheet, including
$339.7 million in
 unpledged securities available to
use as collateral and
$73.1 million in
excess cash. The Company
had an additional $267.0
 million in off-balance sheet liquidity,
excluding access to brokered deposits and other off-balance sheet sources of funding.

 Capital Adequacy
 As
of
2024,
the
Bank
was
well
capitalized
under
the
FDIC's
prompt
corrective
action
framework.
we follow the capital conservation
buffer framework, and according to
our actual ratios, the Bank
exceeds the
 capital conversation
buffer in
all capital ratios
as of December
31, 2024. The
Company is not
subject to regulatory
 requirements because it is deemed by the Federal Reserve
to be a small bank holding company.
 The
table
presents
the
ratios
for
the
Bank
at
2024
and
2023
(in
thousands,
except
 ratios):
 Actual
 Minimum Capital
 Requirements

 To be Well Capitalized Under
 Prompt Corrective Action
 Provisions
 Ratio
 Ratio
 Ratio
 Total
risk-based capital:
 $
 266,387
 13.34%
 $
 159,795
 8.00%
 199,744
 10.00%
 Tier 1 risk-based capital:
 $
 12.10%
 $
 119,846
 6.00%
 159,795
 8.00%
 Common equity tier 1 capital:
 $
 12.10%
 $
 89,885
 4.50%
 129,834
 6.50%
 Leverage ratio:
 $
 9.38%
 $
 103,074
 4.00%
 128,843
 5.00%

 Total
risk-based capital:
 $
 233,109
 12.65%
 $
 147,432
 8.00%
 184,290
 10.00%
 Tier 1 risk-based capital:
 $
 11.48%
 $
 110,574
 6.00%
 147,432
 8.00%
 Common equity tier 1 capital:
 $
 11.48%
 $
 83,931
 4.50%
 119,789
 6.50%
 Leverage ratio:
 $
 9.17%
 $
 92,328
 4.00%
 115,410
 5.00%
 Impact of Inflation
 Our Consolidated
Financial Statements
and related
notes have been
prepared in
accordance with U.S.
GAAP,
which
 requires the
measurement of
financial position
and operating
results in
terms of
historical dollars,
without considering
the
in
the
relative
purchasing
power
of
money
over
time due
to
inflation.
The
of
inflation
is
reflected
in
the
 increased cost of operations.
Unlike most industrial companies,
nearly all our assets and
liabilities are monetary in
nature.
 As a result,
interest rates have a
greater impact on our
performance than do the
effects of general levels
of inflation. Periods
 of high inflation
are often accompanied
by relatively higher
interest rates, and
periods of low
inflation are accompanied
by
 relatively lower interest rates.
As market interest rates
rise or fall in relation
to the rates earned
on loans and investments,
 the value of these assets decreases or increases respectively.
 Recently Issued Accounting Pronouncements

 Recently issued accounting
pronouncements are discussed
in Note 1 "Summary
of Significant Accounting
Policies" in
 the Consolidated Financial Statements of this Annual Report
on Form 10-K.

 Reconciliation and Management Explanation of Non
-GAAP Financial Measures
 Management has included
the non-GAAP measures
set forth below
because it believes
these measures may
 useful supplemental information
for evaluating the Company's
underlying performance trends.
Further, management
uses
 these measures in managing and evaluating the Company's business and intends to refer to them in discussions about our
 operations and performance.
Operating performance
measures should be
viewed in addition
to, and not
as an alternative
 to or
substitute
for,
in
with
GAAP,
and
are
not
necessarily
comparable
to non-GAAP
that
by other
companies.
believes
these
non-GAAP
measurements
are key
 indicators of the
earnings power
of the Company.
table reconciles
the non-GAAP
financial measurement
of
 operating net income available to common stockholders
for the periods presented (in thousands,
except per share data):
 As of and for the years ended December 31,
 2024
 2023
 Pre-Tax Pre-Provision ("PTPP") income: (1)
 Net income (GAAP)
 $
 $
 Plus: Provision for income taxes
 7,803
 5,251
 Plus: Provision for credit losses
 3,157
 2,367
 PTPP income
 $
 35,634
 $
 24,163
 Operating net income: (1)
 Net income (GAAP)
 $
 $
 Less: Net gain (loss) on sale of securities
 (1,859)
 Less: Tax
effect on sale of securities
 (4)
 Operating net income
 $
 24,664
 $
 17,933
 Operating PTPP income: (1)
 PTPP income
 $
 35,634
 $
 24,163
 Less: Net gain (loss) on sale of securities
 (1,859)
 Operating PTPP Income
 $
 35,620
 $
 26,022
 (1) The Company believes these non-GAAP measurements are key indicators of the ongoing earnings power of the Company.

 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk

 As a smaller reporting company,
we are not required to provide the information required
by this item.

 Item 8.
Financial Statements and Supplementary Data

 INDEX TO CONSOLIDATED
FINANCIAL STATEMENTS
 Report of Independent Registered Public Accounting Firm

(
 Crowe LLP
, PCAOB ID:
)
 Consolidated Balance Sheets
 Consolidated Statements of Operations
 Consolidated Statements of Comprehensive Income (Loss)
 Consolidated Statements of Changes in Stockholders' Equity
 Consolidated Statements of Cash Flows

 Crowe LLP
 Independent Member Crowe Global

 REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM

 Stockholders and the Board of Directors of
 Doral, Florida
 Opinion on the Financial Statements
 We have audited the accompanying consolidated
balance sheets of USCB Financial Holdings, Inc. (the
 "Company") as of December 31, 2024 and 2023, the related consolidated
statements of operations,
 comprehensive income (loss), changes in stockholders' equity,
and cash flows for the years then ended,
 and the related notes (collectively referred to as the "financial statements").
In our opinion, the financial
 statements present fairly, in all material respects, the
financial position of the Company
as of December 31,
 2024 and 2023, and the results of its operations and its
cash flows for the years then ended, in conformity
 with accounting principles generally accepted in the United
States of America.
 Basis for Opinion
 These financial statements are the responsibility of the Company's
management. Our responsibility is to
 express an opinion
on the Company's financial
statements based on our
audits. We are a
public accounting
 firm registered with the Public Company Accounting Oversight
Board (United States) ("PCAOB") and are
 required to be
independent with respect to
the Company in accordance
with the U.S.
federal securities laws
 and the applicable rules and regulations of the Securities
and Exchange Commission and the PCAOB.
 We conducted our audits in accordance with the
standards of the PCAOB. Those standards require that
 we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are
 free of material misstatement, whether due to error or fraud.
 Our audits included performing procedures to assess
the risks of material misstatement of the financial
 statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such
 procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the
 financial statements. Our audits also included evaluating the accounting
principles used and significant
 estimates made by management, as well as evaluating the
overall presentation of the financial statements.
 We believe that our audits provide a reasonable
basis for our opinion.

 /s/ Crowe LLP

 Crowe LLP
 We have served as the Company's auditor since
2017.
 Fort Lauderdale, Florida

 Consolidated Balance Sheets
 (Dollars in thousands,
except share and per share data)

 2024
 2023
 ASSETS:
 Cash and due from banks
 $
 6,986
 $
 8,019
 Interest-bearing deposits in banks
 70,049
 33,043
 Total cash and cash equivalents
 77,035
 41,062
 Investment securities held to maturity net allowance of
$

and $
, respectively (fair value $

and
 $
, respectively)
 164,694
 174,974
 Investment securities available for sale, at fair value
 Federal Home Loan Bank stock, at cost
 9,379
 10,153
 Loans held for investment, net of allowance of
$

and $
, respectively
 1,948,778
 1,759,743
 Accrued interest receivable
 10,945
 10,688
 Premises and equipment, net
 4,563
 4,836
 Bank owned life insurance
 53,472
 51,781
 Deferred tax asset, net
 29,646
 37,282
 Lease right-of-use asset
 8,451
 11,423
 14,032
 7,822
 Total assets
 $
 2,581,216
 $
 2,339,093
 LIABILITIES:
 Deposits:
 Non-interest bearing demand deposits
 $
 $
 367,388
 288,403
 Total deposits
 2,174,004
 1,937,139
 Federal Home Loan Bank advances
 163,000
 183,000
 Lease liability
 8,451
 11,423
 Accrued interest and other liabilities
 20,373
 15,563
 Total liabilities
 2,365,828
 2,147,125
 Commitments and contingencies (See Notes 10
and 19)
 (nil)

 (nil)

 STOCKHOLDERS' EQUITY:
 Preferred stock - Class C; $
 1.00

par value; $
 1,000

per share liquidation preference;
 52,748

 authorized; 0 issued and 0 outstanding as of
December 31, 2024 and 2023
 -
 -
 Preferred stock - Class D; $
 1.00

par value; $
 5.00

per share liquidation preference;
 12,309,480

 authorized; 0 issued and 0 outstanding as of
December 31, 2024 and 2023
 -
 -
 Preferred stock - Class E; $
 1.00

par value; $
 1,000

per share liquidation preference;
 3,185,024

 authorized; 0 issued and 0 outstanding as of
December 31, 2024 and 2023
 -
 -
 Common stock - Class A Voting; $
 1.00

par value;
 45,000,000

shares authorized;
 19,924,632

and
 19,575,435

issued and outstanding as of December 31,
2024 and 2023
 19,925
 19,575
 Common stock - Class B Non-voting; $
 1.00

par value;
 8,000,000

shares authorized; 0 issued and 0
 outstanding as of December 31, 2024 and 2023
 -
 -
 Additional paid-in capital on common stock
 307,810
 305,212
 Accumulated deficit
 ( 67,813)
 ( 88,548)
 Accumulated other comprehensive loss
 ( 44,534)
 ( 44,271)
 Total stockholders' equity
 Total liabilities and stockholders' equity
 $
 2,581,216
 $
 2,339,093

 Consolidated Statements of Operations
 (Dollars in thousands,
except per share data)

 2024
 2023
 Interest income:

Loans, including fees
 $
 115,236
 $
 87,884

Investment securities
 11,480
 10,012

Interest-bearing deposits in financial institutions
 4,517
 3,121

Total interest income
 131,233
 101,017
 Interest expense:

Interest-bearing deposits
 1,509

Savings and money markets accounts
 40,098
 29,658

 13,354
 8,500

Federal Home Loan Bank advances
 6,336
 3,390

Total interest expense
 61,297
 42,449

Net interest income before provision for
 69,936
 58,568
 3,157
 2,367

Net interest income after provision for
 66,779
 56,201
 Non-interest income:

Service fees
 8,839
 5,055

Bank owned life insurance income
 1,691
 2,160

Gain (loss) on sale of securities available for sale,
net
 ( 1,859)

Gain on sale of loans held for sale, net

Other non-interest income
 1,449
 1,246

Total non-interest income
 12,740
 7,403
 Non-interest expense:

Salaries and employee benefits
 28,793
 24,429

Occupancy
 5,258
 5,230

Regulatory assessment and fees
 1,766
 1,453

Consulting and legal fees
 1,568
 1,899

Network and information technology services
 1,993
 2,016

Other operating
 7,664
 6,781

Total non-interest expense
 47,042
 41,808

Net income before income tax expense
 32,477
 21,796
 Income tax expense
 7,803
 5,251

 Net income available to common stockholders
 $
 $
 Per share information:
 Class A common stock
 Net income per share, basic
 $
 1.25
 $
 0.84
 Net income per share, diluted
 $
 1.24
 $
 0.84
 Weighted average shares outstanding:
 Class A common stock
 Basic
 19,675,444

 19,621,698
 Diluted
 19,831,421

 19,687,634

 Consolidated Statements of Comprehensive Income
(Loss)
 (Dollars in thousands)

 2024
 2023
 $
 $
 Other comprehensive income (loss):
 Unrealized loss on investment securities
 ( 592)
 ( 1,801)
 Amortization of net unrealized losses on securities transferred
from available-for-sale to held-to-maturity
 Reclassification adjustment on sale of available
for sale securities for (income) loss included in net
 ( 14)
 1,859
 Unrealized (loss) gain on cash flow hedge
 ( 13)
 Tax effect
 ( 163)
 Total other comprehensive income (loss), net of tax
 ( 263)
 Total comprehensive income
 $
 24,411
 $
 17,025

 Consolidated Statements of Changes in Stockholders'
Equity
 (Dollars in thousands,
except per share data)

 Common Stock
 Additional Paid-in
 Capital on
 Common Stock
 Accumulated
 Deficit
 Accumulated
 Other
 Comprehensive
 Income (Loss)
 Shares
 Par Value
 Total
 Stockholders'
 Equity
 Balance at January 1, 2024
 19,575,435
 $
 19,575
 $
 305,212
 $
 ( 88,548)
 $
 ( 44,271)
 $
 -
 -
 -
 -
 Other comprehensive loss
 -
 -
 -
 -
 ( 263)
 ( 263)
 Repurchase of Class A common stock
 ( 42,100)
 ( 42)
 ( 459)
 -
 -
 ( 501)
 Restricted stock issued
 ( 278)
 -
 -
 -
 Restricted stock forfeiture
 ( 8,625)
 ( 8)
 -
 -
 -
 Exercise of stock options
 122,000
 1,197
 -
 -
 1,319
 Dividend payment
 -
 -
 -
 ( 3,939)
 -
 ( 3,939)
 Stock-based compensation
 -
 -
 2,130
 -
 -
 2,130
 Balance at December 31, 2024
 19,924,632
 $
 19,925
 $
 307,810
 $
 ( 67,813)
 $
 ( 44,534)
 $
 Balance at January 1, 2023
 20,000,753
 $
 20,001
 $
 311,282
 $
 ( 104,104)
 $
 ( 44,751)
 $
 182,428
 After tax cumulative effect of adoption of accounting principle
related to
 ASC 326
 -
 -
 -
 ( 989)
 -
 ( 989)
 Adjusted beginning balance after cumulative effect adjustment
 20,000,753
 20,001
 311,282
 ( 105,093)
 ( 44,751)
 181,439
 -
 -
 -
 -
 Other comprehensive income
 -
 -
 -
 -
 Repurchase of Class A common stock
 ( 669,920)
 ( 670)
 ( 6,913)
 -
 -
 ( 7,583)
 Restricted stock issued
 242,713
 ( 242)
 -
 -
 -
 Restricted stock forfeiture
 ( 8,111)
 ( 8)
 -
 -
 -
 Exercise of stock options
 -
 -
 Stock-based compensation
 -
 -
 1,012
 -
 -
 1,012
 Balance at December 31, 2023
 19,575,435
 $
 19,575
 $
 305,212
 $
 ( 88,548)
 $
 ( 44,271)
 $

 Consolidated Statements of Cash Flows
 (Dollars in thousands)
 2024
 2023
 Cash flows from operating activities:

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

 3,157
 2,367
 Depreciation and amortization
 Accretion of premiums on securities, net
 ( 521)
 ( 770)
 Amortization (accretion) of deferred loan fees, net
 ( 184)
 Stock-based compensation
 2,130
 1,012
 (Gain) loss on sale of available for sale securities
 ( 14)
 1,859
 Gain on sale of loans held for sale
 ( 747)
 ( 801)
 Increase in cash surrender value of bank owned
life insurance
 ( 1,691)
 ( 2,160)
 Decrease in deferred tax asset
 7,725
 5,251
 Net change in operating assets and liabilities:

 Accrued interest receivable
 ( 257)
 ( 3,142)
 ( 6,223)
 Accrued interest and other liabilities
 4,610
 1,718
 Net cash provided by operating activities
 34,090
 22,546
 Cash flows from investing activities:
 Purchase of investment securities held to maturity
 -
 ( 86,788)
 Proceeds from maturities and pay-downs of investment
securities held to maturity
 10,461
 101,541
 Purchase of investment securities available for
sale

 ( 85,673)
 ( 40,379)
 Proceeds from maturities and pay-downs of investment
securities available for sale
 20,045
 15,189
 Proceeds from sales of investment securities available
for sale
 34,753
 24,185
 Net increase in loans held for investment
 ( 134,439)
 ( 239,361)
 Purchase of loans held for investment
 ( 66,605)
 ( 45,645)
 Additions to premises and equipment
 ( 314)
 ( 163)
 Proceeds from the sale of loans held for
sale
 9,137
 12,530
 Purchase of Bank owned life insurance, net
 -
 ( 6,840)
 Proceeds from the redemption of Federal Home
Loan Bank stock
 11,733
 15,495
 Purchase of Federal Home Loan Bank stock
 ( 10,959)
 ( 22,766)
 Net cash used in investment activities
 ( 211,861)
 ( 273,002)
 (Continued)

 Consolidated Statements of Cash Flows (Continued)
 (Dollars in thousands)
 2024
 2023
 Cash flows from financing activities:
 Proceeds from exercise of Class A common stock
options, net
 1,319
 Cash dividends paid
 ( 3,939)
 -
 Repurchase of Class A common stock
 ( 501)
 ( 7,583)
 Net increase in deposits
 236,865
 107,858
 Proceeds from Federal Home Loan Bank advances
and other borrowings
 227,000
 529,350
 Repayments on Federal Home Loan Bank advances
and other borrowings
 ( 247,000)
 ( 392,350)
 Net cash provided by financing activities
 213,744
 237,350
 Net increase (decrease) in cash and cash equivalents
 35,973
 ( 13,106)
 Cash and cash equivalents at beginning of period
 41,062
 54,168
 Cash and cash equivalents at end of period
 $
 77,035
 $
 41,062
 Supplemental disclosure of cash flow information:
 Interest paid
 $
 60,544
 $
 41,306
 Supplemental schedule of non-cash investing and
financing activities:
 Transfer of loans held for investment to loans held for
sale
 $
 8,390
 $
 11,729
 Transfer of investment securities from available-for-sale to held-to-maturity
 $
 -
 $
 -
 Lease liability arising from obtaining right-of-use asset
 $
 -
 $
 -

 1.
SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES

 Overview
 USCB Financial Holdings,
Inc., a Florida
corporation incorporated
in 2021, is
a bank holding
company with one
direct
 wholly owned subsidiary,
U.S. Century Bank (the "Bank"), together referred to as "the Company".
The Bank, established in
 2002, is a Florida state-chartered,
non-member financial institution providing
financial services through its
banking centers
 located in South Florida.
 In December 2021, USCB Financial
Holdings, Inc. acquired all issued
and outstanding shares of the Class
 stock of
in connection
reorganization of the
Bank into
a holding
company structure. Each
 shares of the Bank's
common stock, par
value $
 1.00

per share, formerly
held by its
stockholders were converted
into and
 exchanged for one newly issued share of the Company's
Class A common stock, par value $
 1.00

per share.
owns a
subsidiary,
Florida Peninsula
Title LLC,
that offers
our clients
title insurance
policies for
 transactions closed at the Bank. Licensed in the State of Florida and approved by the Department of Insurance Regulation,
 Florida Peninsula tittle LLC began operations in 2021.

 Principles of Consolidation
 Intercompany transactions
and balances
are eliminated
in consolidation.
The consolidated
financial statements
have
 been prepared in accordance with GAAP.

 Use of Estimates
 The
has
and
that
are
to
ensure
methods
are
 controlled and
applied consistently
from period
to period.
These estimates
and assumptions,
which may
materially affect
 the reported amounts of
certain assets, liabilities, revenues and
expenses, are based on
information available as of
the date
financial statements,
and changes
in this
information over
time and
the use
of revised
estimates and
 could materially affect amounts reported in subsequent
financial statements.

 Cash and Cash Equivalents
 The
considers
with
a
maturity
of
days
or
less
from
its
original
purchase
date
to
be
cash
 equivalents. For
the Consolidated
Statements of
Cash Flows,
cash and cash
equivalents include
cash on hand,
 due from banks, and interest-bearing deposits in banks.

 Restricted Cash
 The Company may be required to maintain
funds at other banks to satisfy
the terms of a loan participation agreement.
 The Company reports
restricted cash within
cash and
cash equivalents. At
both December
 had $

in restricted cash.

 Interest-Bearing Deposits in Other Financial Institutions
 Interest-bearing deposits in other financial institutions consist
of Federal Reserve Bank of Atlanta, Federal
Home Loan
 Bank of Atlanta and other accounts.

 Investment Securities
 Debt securities
are recorded
at fair
value except
for those
securities which
has the
positive intent
and
hold to
maturity.
generally determines
the appropriate
classification
of its
time of
 purchase and accounts for them on a trade date basis.

 Debt securities that
management has the
positive intent and
ability to hold
to maturity are
classified as "held-to-maturity"
 and recorded at amortized cost. Trading securities are
recorded at fair value with
changes in fair value included
in earnings.
 Securities not classified
as held-to-maturity or
trading are classified
as "available-for-sale"
and recorded at
fair value, with
 unrealized gains and
losses excluded from
earnings and reported
in other comprehensive
income (loss). Equity
 must be recorded at fair value with changes in fair value
included in earnings.

 Purchase premiums and discounts are amortized or accreted over
the estimated life of the related available-for-sale or
 held-to-maturity
as
an
adjustment
to
yield
using
the
method.
Prepayments
of
are
 considered in determining the estimated life of
the security. Such amortization and accretion are included in interest income
 in the Consolidated
Statements of Operations.
Dividend and interest
income are recognized
when earned. Gains
and losses
 on the sale of securities are recorded on trade date and are determined
on a specific identification basis.
 On
1,
2023,
the
ASU
2016-13
Instruments
-
326):
 Measurement of Credit Losses
on Financial Instruments,
as amended, which replaces
the incurred loss methodology
with
loss methodology
that is
referred to as
the CECL
methodology.
The measurement
of expected
 under the CECL methodology
is applicable to financial
assets measured at amortized
cost, including loan receivables
and
 held-to-maturity debt
securities. In
addition, ASC
326 amended
the accounting
for available-for-sale
debt securities.
One
 such change is
to require credit
losses to be
presented as an
allowance rather than
as a write-down
on available-for-sale
 debt securities management does not intend to sell or
believes that it is more likely than not they will be required
to sell.
 CECL requires a loss reserve for securities
classified as HTM. The reserve should reflect
historical credit performance
 as well as the impact
of projected economic forecast.
For U.S. Government bonds
and U.S. Agency issued bonds
in HTM
 the
explicit
implicit
guarantee
of
the
U.S.
Government
is
sufficient
to
conclude
that
a
loss
reserve
is
not
 required. The reserve
requirement is for
three primary assets
groups: municipal bonds,
corporate bonds, and
non-agency
 securitizations.
The
calculates
quarterly
the
loss
reserve
utilizing
ImpairmentStudio.
The
CECL
for
data,
containing
defaults
and
recoveries
and
 Moody's baseline
economic forecast.
The solution
uses probability
of default/loss
given default ("PD/LGD")
approach. PD
 represents the likelihood a borrower will
default. Within the Moody's model,
this is determined using historical
default data,
 adjusted for the current economic environment. LGD projects
the expected loss if a borrower were to default.

 Federal Home Loan Bank (FHLB) Stock
 The Bank is a member of the FHLB system. Members are required to
own a certain amount of stock based on the level
 of borrowings and
other factors and
may invest in
additional amounts. FHLB
stock is carried
at cost, classified
as a restricted
 asset, and
periodically evaluated
for impairment
ultimate recovery
of par
value. As
of December
31, 2024
and
 2023, FHLB
stock amounted
to $
 9.4

million and
$
 10.2

million, respectively,
with no
impairment deemed
necessary.
Both
 cash and stock dividends are reported as interest income.

 Loans Held for Investment and Allowance for Credit
Losses ("ACL")
 Loans held for investment ("loans") are reported at their outstanding principal
balance net of charge-offs, deferred loan
 cost,
unearned
income, and
the ACL.
Interest income
is generally
when
income is
earned using
the interest
 method.
Loan
origination
and
commitment
fees
and
the
costs
with
the
origination
of
loans
are
and
 amortized, using the interest method or the straight-line
method, over the life of the related loan.

 If the
principal or
interest on
a commercial
loan becomes
due and
unpaid for
90 days
or more,
is placed
on
 non-accrual status as of
the date it becomes
90 days past due
and remains in non-accrual
status until it meets
the criteria
 for restoration to accrual status.
Residential loans, on
the other hand, are placed
on non-accrual status when
the principal
 or interest
becomes due
and unpaid
for 120
days or
more and remains
in non-accrual
status until
it meets
the criteria
for
 restoration
to
accrual
status.
Restoring
a
loan
to
accrual
status
is
when
the
resumes
of
all
 principal and interest payments for a period of six consecutive months and the Company
has a documented expectation of
 repayment of the remaining contractual principal and interest or the loan becomes secured and in the process of collection.
 All interest accrued but not
collected for loans that are
placed on nonaccrual status is
reversed against interest income. The
 interest on
these loans is
accounted for on
the cash-basis or
cost-recovery method, under
which cash collections
are applied
 to unpaid principal, which may change as conditions
dictate.

 The Company has determined
that the entire
balance of a
loan is contractually delinquent
for all loan
categories if the
 minimum
is
not
received
by
the
specified
due
date
on
the
borrower's
statement.
and
fees
to
 accrue on past due loans until the date the loan goes into
nonaccrual status.
 The Company provides for loan losses through a provision for credit losses charged to operations. When management
 believes that a
loan or a portion
of the loan balance
is uncollectible, that
amount is charged
against the ACL.
Subsequent
 recoveries, if any,
are credited to the ACL.

 The
ACL
reflects
judgment
of
loan
in
the
at
the
sheet
date.
 Management uses a disciplined
process and methodology
to establish the ACL
each quarter.
To
determine the total
ACL,
estimates the
reserves needed
for each
segment of
the portfolio,
including loans
analyzed individually
and
 loans analyzed on a pooled basis. The ACL consists
of the amount applicable to the following segments:
 •
Residential real estate
 •
Commercial real estate
 •
 •
 •
Other loans (secured and unsecured consumer loans)
 Residential
real
loans
are
underwritten
the
of
the
which
a
of
the
 borrower's credit, capacity
and the collateral
securing the loan.
The borrower's ability
to repay involves
an analysis of
 including: current income,
employment status, monthly
payment of
the loan,
current debt
obligations, monthly debt
to income
 ratio and credit history. The Company relies on appraisals in determining the value of the property.
Risk is mitigated by this
 analysis and the diversity of the residential portfolio.
 Commercial real estate
loans are
secured by liens
on commercial properties,
land, construction and
multifamily housing.
 Underwriting of commercial real estate loans will analyze the key market and business factors to arrive at a decision on the
 credit worthiness of the borrower. The analysis may include the capacity of the borrower,
income generated by property for
 debt service,
other
sources
of repayment,
analysis
to fluctuations
in market
including vacancy
and
 rental rates in geographic
location and loan
to value. Land
and construction loan
analysis will include
the time to
develop,
 sell or lease
the property.
Appraisals are used
to determine the
value of the
underlying collateral.
Risk is mitigated
 properties securing the commercial real estate loans
are diverse in type, location, and loan structure.

and
industrial
loans
are
by
the
of
the
and
may
equipment,
 inventory, and receivables.
The loans are underwritten based on the
income capacity of the business, the ability
to service
 the debt based
on operating cash
flows, the credit
worthiness of the
borrower,
other sources
of repayment
and collateral.
 The Company mitigates the risk in the commercial portfolio
through industry diversification.

 Correspondent bank loans are
short-term loans with international
correspondent banking institutions primarily domiciled
 in Latin America.
Most of these
loans are for
trade capital and
have a life
of less than
one year. The Company's credit
 includes a credit analysis, peer comparison and current
country risk overview.
Annual re-evaluation of the risk rating of the
 borrower and country where the borrower is
located and a review by the authorized signer
within the Company.
The risk is
 mitigated as these loans are short term, have limited exposure,
and are geographically dispersed.

 Other loans
are secured
and unsecured
loans including
yacht loans,
personal loans,
home equity
lines of
overdrafts,
and
account
collateralized
loans.
Repayment
of
these
loans
are
from
the
 income of the borrowers. Loans are underwritten based on the credit worthiness of the borrower. The risk on these loans is
 mitigated by small loan balances.

 Under
CECL,
the
the
ACL
using
relevant
from
both
and
external
relating
to
past
events,
and
reasonable
and
supportable
forecasts.
Historical
 provide the basis for estimation of expected credit losses. Qualitative adjustments are applied to the expected credit losses
 estimated
for
the
loan
in
relation
to
of
the
quantitative
model.
A
scorecard
is
used
to
aid
 management in the assessment of qualitative factor adjustments
applied to expected credit losses.
 The
quantitative
component
of
the
estimate
relies
on
the
statistical
relationship
the
projected
value
of
an
indicator
and
the
implied
loss
experience
among
a
curated
group
of
peers.
The
utilized
 regression
analyses
of peer
data,
in
which
the
was
included,
and
where
observed
and selected
 economic factors were used
to determine suitable
loss drivers for modeling
the lifetime rates of
probability of default (PD).
 A
loss
given
default
rate
(LGD)
is
assigned
to
each
pool
for
each
based
on
these
PD
outcomes.
The
model
 fundamentally utilizes
discounted cash
flow (DCF)
analysis for loan
portfolio segments.
The DCF
analysis is
 run
at
the
instrument-level
and
an
array
of
loan-specific
data
points
and
segment-implied
to
 determine the lifetime expected
loss attributable to each
instrument. An implicit "hypothetical
loss" is derived
for each period
DCF and
helps establish
the present
future cash
flows for
each period.
The reserve
applied to
a specific
 instrument is the difference
between the sum of the present
value of future cash flows
and the book balance of
the loan at
 the measurement date.

elected
the
Remaining
Life
(WARM)
for
five
loan
segments.
For
each
of
these
 segments, a
long-term average
loss rate
is calculated
and applied
on a
quarterly basis
remaining life
pool.
 Adjustments
for
are
made
qualitative
assessments.
For
the
remaining
life
estimated,
 management implemented a software
solution that uses an
attrition-based calculation that performs quarterly, cohort-based
 attrition measurements based on the loan portfolio.
 Portfolio segments are the level at which loss assumptions
are applied to a pool of loans based on the similarity
of risk
 characteristics inherent in the
included instruments, relying on
collateral codes and FFIEC
Call Report codes. The
 currently segments the
portfolio based on
collateral codes for
the
purpose of establishing
reserves. Each of
these segments
 is
paired
to
regression
models
(Loss
Driver
Analyses)
based
on
peer
data
for
loans
of
risk
characteristics.
The
 Company has established relationships between internal segmentation and FFIEC
Call Report codes for this purpose. The
 loss driver for each loan
portfolio segment is derived
from a readily available and
reasonable economic forecast, including
 the Federal Reserve Bank
projections of U.S. civilian
unemployment rate and the
year-over-year real GDP
growth; for the
loan
the
HPI
projections
published
by
Fannie
Mae's
Economic
and
Strategic
Research
Group
are
 utilized for the
forecast. Forecasts
are applied to
the first four
quarters of the
credit loss estimate
and revert on
a straight-
 line basis to the lookback period's historical mean for the
economic indicator over the expected life of loans.
 The model incorporates qualitative
factor adjustments in order to
calibrate the model for risk
in each portfolio segment
not be captured
through quantitative
analysis. Determinations
regarding qualitative
adjustments are
reflective of
expectation
of loss
differing
from those
already
captured
in
the
quantitative
component
of
the
 model.
 Qualitative factors ("Q-Factors") used in the ACL methodology
include:
 • Changes in lending policies, procedures, and strategies
 • Changes in international, national, regional, and local
 • Changes in nature and volume of portfolio
 • Changes in the volume and severity of past due loans
and other similar conditions
 • Concentration risk
 • Changes in the value of underlying collateral
 • The effect of other external factors: e.g., competition,
legal, and regulatory requirements
 • Changes in lending management, among others
 Management evaluates
on an individual
basis collateral
dependent loans
using the fair
value of the
collateral method
 to determine
if a
credit loss
reserve is
necessary.
The ACL
is measured
the difference
fair
the
 collateral and
the recorded
(amortized
cost
basis of
the
loan), if
the final
is less
than the
 recorded investment
loan a
reserve amount
is calculated.
If the
valuation is
equal to
or greater
than the
 recorded investment of the loan, no reserve is determined.

 The Company estimates a
reserve for unfunded commitments,
which is reported separately
from the ACL within
other
 liabilities. The reserve is based upon the same quantitative and qualitative factors applied to the collectively evaluated loan

 Concentration of Credit Risks
risk
represents
the
loss
that
would
be
at
the
date
if
counterparties
failed
to
 perform as contracted and any collateral or security proved to be insufficient
to cover the loss. Concentrations of credit risk
 (whether on or off-balance sheet) arising from financial instruments exist in relation to certain
groups of customers. A group
 concentration arises
when a number
of counterparties
have similar economic
characteristics that would
cause their ability
 to meet contractual obligations to be similarly affected by changes in economic or other conditions. The Company does not
 have a significant exposure to any individual customer
or counterparty.
 Most of the Company's business activity is
with customers located within its primary market area, which
is generally the
 State of Florida. The Company's loan portfolio is concentrated largely in real estate and commercial loans in South Florida.
 Many of the
Company's loan
customers are engaged
in real estate
development. Circumstances
which negatively
 the South Florida real estate industry
or the South Florida economy, in general, could adversely impact
the Company's loan

Company had
a concentration
of risk
with loans
outstanding to
 top ten lending relationships
totaling $
 236.2

 163.1

million, respectively.
At December 31, 2024 and
2023, this
 concentration represented
 12.0
 % and
 9.2
 % of net
loans outstanding,
respectively.
At December
 31,
2023,
the
largest
real
loan
note
outside
was
 one

real
loan
with
an
 outstanding balance of $
 19.8

 20.0

million, respectively, collateralized
by a 1
 st

lien commercial property located
 in New York
State.

 At
2024,
the
had
a
concentration
of
risk
with
loans
totaling
$
 82.4

to
banks
located
in
Ecuador,
Dominican
Republic,
Honduras,
and
Panama.
At
2023,
the
 Company also had a concentration
of risk with loans outstanding
totaling $
 105.4

million to correspondent banks
located in
 Ecuador,
Dominican
Republic, Honduras,
and
El Salvador.
These banks
maintained
with right
of
offset
totaling
 $
 62.6

 43.9

million at December 31, 2024 and 2023, respectively.
 At various times during
the year,
the Company has maintained
deposits with other
financial institutions. The exposure
 to the Company from
these transactions is solely
dependent upon daily balances
and the financial strength
of the respective
 institutions.

 Premises and Equipment, net
 Land is
carried at
cost. Premises
and equipment
are stated
at cost
less accumulated
depreciation
and amortization.
 Depreciation is computed
on the straight-line
method over the
estimated useful life
of the asset. Leasehold
improvements
 are amortized over the
remaining term of the
applicable leases or their
useful lives, whichever
is shorter.
Estimated useful
 lives of these assets were as follows:
 Building
s

years
 Furniture, fixtures and equipment

to

years
 Computer hardware and software

to

years
 Leasehold improvements
Shorter of life or term of lease
 Maintenance
and
repairs
are
charged
to
as
incurred
while
improvements
and
betterments
are
capitalized.
 When items are retired or are
otherwise disposed of, the related costs
and accumulated depreciation and amortization
are
 removed from the accounts and any resulting gains or losses
are credited or charged to income.

 Other Real Estate Owned
 OREO consists of real estate properties acquired through,
or in lieu of, foreclosure that are
held for sale and are initially
 recorded at
the fair
the property
less estimated
selling costs
date
of foreclosure,
establishing
a new
cost
 basis. Subsequent to
foreclosure, valuations
are periodically performed
by management and
the assets are
carried at the
 lower of carrying
amount or
less cost
to sell.
Subsequent write-downs
are recognized
as a
valuation allowance
 with
the
offset
in
the
of
Operations.
Carrying
costs
are
charged
to
other
real
 owned
in
the
accompanying
of
Operation.
Gains
or
on
sale
of
OREO
are
 recognized when
consideration has
been exchanged,
all closing
conditions have
been met
and permanent
financing has
 been arranged.

 Bank Owned Life Insurance
 BOLI is carried at
the amount that could
be realized under the
contract at the balance sheet
date, which is typically
cash
value.
Changes
in
cash
value
are
in
non-interest
income.
At
2024,
the
maintained
BOLI
with
five
carriers
with
a
combined
cash
value
of
$
 53.5

 These policies cover certain present and former executives
and officers; the Company is the beneficiary
of these policies.

 Employee 401(k) Plan
has an 401(k)
plan covering substantially
all eligible
employees. Employee
401(k) plan
expense is
the
 amount of matching contributions.

 Income Taxes
 Income taxes are accounted for under the
asset and liability method. Deferred tax
assets and liabilities are recognized
tax
consequences
attributable
to differences
between the
carrying
of existing
 assets and
liabilities and
their respective
tax bases
and operating
loss and
tax credit
carryforwards. Deferred
tax assets
 and
are
measured
using
enacted
tax
rates
to
apply
to
taxable
in
the
years
in
which
those
 temporary differences are expected to be recovered
or settled. The effect on deferred tax assets and
liabilities of a change
 in tax rates is recognized in income in the period that includes
the enactment date.

 Management is required to
assess whether a valuation
allowance should be established
on the net deferred tax
asset
 based on the
consideration of
all available evidence
using a more
likely than not
standard. In its
evaluation, Management
 considers taxable loss
carry-back availability, expectation of sufficient
taxable income, trends
in earnings, the
future reversal
 of temporary differences, and available tax planning
strategies.

 The Company recognizes positions taken
or expected to be
taken in a tax
return in accordance with existing accounting
 guidance on
income taxes
which prescribes
a recognition threshold
and measurement
process. Interest
and penalties
on
 tax liabilities, if any, would
be recorded in interest expense and other operating noninterest
expense, respectively.

 Impairment of Long-Lived Assets
 The Company's long-lived
assets, such as premises
and equipment, are reviewed
for impairment whenever
events or
 changes in circumstances
indicate that
the carrying
an asset may
not be recoverable.
Recoverability of
 to be held and
used is measured by a
comparison of the carrying amount of
an asset to estimated undiscounted future
cash
 flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an
 impairment charge
is recognized
amount by
which the
carrying amount
asset exceeds
the fair
the
 asset. Assets
to be
disposed of
would be
separately
presented in
the Consolidated
Balance Sheets
and reported
 lower of
the carrying
amount or
less costs
to sell
and are
no longer
depreciated. The
assets and
liabilities of
a
 disposal group classified as held for
sale would be presented separately in
the appropriate asset and liability sections of
the
 Consolidated Balance Sheets.

 Transfer of Financial Assets
 Transfers of
financial assets
are accounted for
as sales,
when control over
the assets
has been surrendered.
Control
 over
transferred
is
deemed
to
be
surrendered
when
(i)
the
have
been
isolated
from
the
-
put
 presumptively
beyond
the
reach
of
the
transferor
and
its
creditors,
even
in
bankruptcy
or
other
receivership,
(ii)
the
 transferee obtains
the right
(free of conditions
that constrain
it from taking
advantage of
that right)
to pledge
or exchange
 the transferred
and
(iii) the
does not
maintain effective
over
the transferred
an
 agreement to repurchase them before their maturity or
the ability to unilaterally cause the holder to return specific assets.

 Comprehensive Income (Loss)
 Under
GAAP,
in
and
liabilities,
such
as
gains
and
on
 available-for-sale, are
excluded from
current period
earnings and
reported as
a separate
component of
the stockholders'
 equity section of the Consolidated Balance
Sheets. Such items, along with net
income, are components of comprehensive
 income (loss).
any unrealized
gains or
losses on
transfers of
investment securities
from available-for-sale
to
 held-to-maturity are recorded to
accumulated other comprehensive income (loss)
on the date
of transfer and amortized
over
 the remaining life of each security. The amortization
of the unrealized gain or loss on transferred securities is reported as a
 component of comprehensive income (loss). See Note 2 "Investment
Securities" for further discussion.

 Advertising Costs
 Advertising costs are expensed as incurred.

 Earnings per Common Share
 Basic earnings
per common
share is
available to
common stockholders
divided by
the weighted
 number
of
during
the
period.
Diluted
per
share
included
the
of
 additional potential common shares issuable under vested
stock options and unvested shares of
restricted stock. Basic and
 diluted earnings per
share are updated
to reflect the
effect of
stock splits as
occurred. See Note
14 "Earnings
Per Share"

 for additional information on
earnings per common share.
See Note 13
"Stockholders' Equity" for further discussion
on stock
 splits.

 Interest Income
 Interest income is recognized as earned, based upon the principal
amount outstanding, on an accrual basis.

 Operating Segments
 While the Company monitors
the revenue streams of
the various products
and services, operations
are managed and
 financial performance
is evaluated on
a Company wide
basis. Operating results
of the individual
products are
not used to
 make resource allocations or performance decisions by Company
management.

 Stock-Based Compensation
 Stock-based compensation accounting guidance requires that the compensation
cost relating to share-based payment
 transactions be recognized in the accompanying Consolidated
Financial Statements. That cost will be measured
 the grant
date fair
the equity
or liability
instruments issued.
The stock-based
compensation accounting
 covers
a
wide
range
of
share-based
arrangements
stock
options,
restricted
share
awards,
 performance-based awards, share appreciation rights, and
employee share purchase plans.
 The stock-based compensation accounting guidance
requires that compensation cost
for all stock
awards be calculated
 and recognized over
the employees' service
period, generally defined
as the vesting
period. For awards
with graded vesting,
 compensation cost
is recognized
on
a straight-line
basis over
the
requisite service
period for
the
entire award.
A Black-
 Scholes model is used to estimate the fair value of stock
options.

 Loss Contingencies
 Loss
contingencies,
claims
and
legal
arising
in
the
normal
of
are
as
 liabilities when the
likelihood of loss is
probable, and an
amount or range of
loss can be
reasonably estimated. In the
opinion
 of management, none of these actions, either individually or in the aggregate, is expected to have a material adverse effect
 on the Company's Consolidated Financial Statements.
See Note 19 "Loss Contingencies" for further details.

 Dividend Restrictions
 Banking
maintaining
levels
and
may
limit
the
paid
by
the
Bank
to
the
 Company or by the Company to the stockholders.

 Fair Value Measurements
 Fair values
instruments are
estimated using
relevant market
information and
other assumptions,
as more
 fully disclosed in Note
12 "Fair Value
Measurements". Fair value estimates
involve uncertainties and
matters of significant
 judgment. Changes in assumptions or in market conditions
could significantly affect the estimates.

 Derivative Instruments
 Derivative financial instruments are
carried at fair
value and reflect
the estimated amount that
would have been
received
 to
terminate
these
contracts
at
the
date
based
upon
or
models
applied
to
 information.
 Rate Swaps Designated as Cash Flow Hedges
 The
in
fair
value
on
these
rate
swaps
are
in
other
or
other
with
a
 corresponding recognition
in other comprehensive
income (loss)
and subsequently reclassified
to earnings when
gains or
 losses are realized. As of December 31, 2024, the cash
flow hedge was effective.

 Interest Rate Swaps Designated as Fair Value
Hedges

 The
in
fair
value
on
these
rate
swaps
are
in
other
or
other
with
a
 corresponding recognition in the assets being hedged.

 Interest Rate Swaps
 The Company enters into interest rate swaps
agreements to provide commercial loan clients
the ability to swap from a
 variable interest rate to a fixed rate. The Company
enters into a floating-rate loan with a customer with
a separately issued
 swap agreement allowing
the customer to convert
floating payments on
the loan into a
fixed interest rate. To
mitigate risk,
 the Company enters into a matching agreement with
a third party to offset the exposure on
the customer agreement. These
 swaps are
not considered
to be
qualified hedging
transactions and
the unmatched
unrealized gain
or loss
is recorded
in
 other non-interest income.

rate
swap
agreements
are
used
by
the
as
part
of
its
asset-liability
strategy
to
help
 manage its interest
rate risk exposure.
The notional amount
of the interest
rate swaps does
not represent actual
 exchanged by the parties.
The amounts exchanged are determined
by reference to the
notional amount and the
other terms
 of the individual interest rate swap agreements.

 Revenue from Contracts with Customers
 Revenue from
contracts with customers
is recognized in
an amount that
reflects the consideration
the Company expects
 to receive for the
services the Company
provides to its
customers. The main
revenue earned by
the Company from
loans
 and investment
are excluded
accounting standard
update "Revenue
from Contracts
with Customers".

 Deposit and
service charge
fees, consisting
of primarily
monthly maintenance
fees, wire
fees, ATM
interchange fees
and
 other transaction-based fees, are the most
significant types of revenue within
the accounting standard update.
Revenue is
 recognized when the service provided by the
Company is complete. The aggregate amount
of revenue within the scope of
 this standard that is received from sources other than deposit
service charges and fees is not material.

 Cash Flow Statement
 The Company reports the net activity rather than gross activity in the Consolidated
Statements of Cash Flows. The net
 cash
flows
are
for
loans
held
for
investment,
accrued
receivable,
tax
other
 customer deposits, accrued interest payable, other liabilities, and
proceeds from the issuance of Class A common shares.

 Reclassifications
 Certain
in
the
have
been
reclassified
to
conform
to
the
 presentation. Reclassifications had no impact on the net income
or stockholders' equity of the Company.

 Recently Issued Accounting Standards

 Issued and Adopted
 Guidance on Accounting for Credit Losses on Financial Instruments
 On January 1, 2023, the Company implemented Accounting Standard Update ("ASU") 2016-13 Financial Instruments -
 Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as amended. This update replaces the
 incurred
loss
with
the
CECL
methodology.
The
CECL
and
 applies to
financial assets
measured at
amortized cost,
including loan
receivables and
held-to-maturity debt
securities. It
 also applies to off-balance sheet credit
exposures not accounted for as insurance
(e.g., loan commitments, standby letters
 of
guarantees,
and
instruments),
as
well
as
net
in
leases
by
lessors
in
 accordance with Topic 842 on leases. Furthermore, ASC 326 amended the accounting treatment for available-for-sale debt
 securities. One notable
change is the
requirement for
credit losses to
be reported
as an allowance
rather than as
a write-
 down on available-for-sale debt securities that management does not intend
to sell or believes it is
more likely than not they
 will not need
to sell. CECL
requires a
loss reserve
for securities
classified as
held-to-maturity (HTM).
The reserve
should
 reflect historical credit performance as well as the impact
of projected economic forecast.
 At adoption
of CECL,
 % or
$
 1.3

billion of
loan receivables
were collectively
evaluated under
the Discounted
Cash
 Flow ("DCF)" method
and
 % or $
 251.0

million of loan
receivables were collectively
evaluated under the
Remaining Life
 method. The remaining $
 7.9

million of loan receivables of the total loan portfolio
were individually evaluated.

 The impact of
adoption of the
ASU 2016-13 in
January 1, 2023,
was an increase
to ACL on
loans receivables of
$
 1.1
 million and an
increase to the
reserve for unfunded
commitments of
$

thousand. This
one-time, net
of tax, cumulative
 adjustment resulted in
a increase of
$
 1.0

million in accumulated
deficit. The following
table reflects the
impact of adopting
 CECL on the Company's Consolidated Balance
Sheet (in thousands):

 January 1, 2023
 As Reported Under ASC
 Pre - ASC 326 Adoption
 Impact of ASC 326
 Adoption
 Assets
 Allowance for credit losses
 $
 18,553
 $
 17,487
 $
 1,066
 Deferred tax asset, net
 42,696
 42,360
 Liabilities
 Reserve for unfunded credit commitments
 Stockholder's Equity
 Retained earnings
 $
 ( 105,093)
 $
 ( 104,104)
 $
 ( 989)

 See "Allowance for Credit Losses" section in Note 3 for
more information on the ACL.
 Guidance on Accounting for Trouble
Debt Restructuring and Vintage Disclosures
 In
March
2022,
the
FASB
ASU
2022-02,
which
eliminates
creditor
for
troubled
debt
 restructurings ("TDR")
for entities
that have
adopted ASU
2016-13, Financial
Instruments-Credit
Losses (Topic
326) and
 enhances Vintage Disclosures
of Gross Write-offs.
This ASU eliminates
Subtopic 310-40 guidance
for TDRs and
 creditors to apply
the loan refinancing and
restructuring guidance in Subtopic
310-20 when evaluating modifications granted
 to
borrowers
difficulty
to
determine
the
modification
is
considered
a
continuation
of
an
 existing loan or a new loan. The vintage disclosure component of the ASU
requires entities to disclose current-period gross
 write-offs
by
origination
year
for
financing
receivables
and
leases
the
scope
of
Subtopic
326-20.
The
 Company adopted ASU 2022-02 concurrently with the
adoption of ASU 2016-13.
 Reference
 Rate Reform
 In
March
2020,
the
Accounting
Standards
Board
("FASB")
ASU
2020-04,
Reference
Rate
Reform
848), aiming to facilitate the impacts
of reference rate reform on financial reporting.
This initiative was subsequently
 clarified
in
2021
ASU
2021-01,
optional
directives
for
a
designated
timeframe
to
alleviate
 challenges
with
for,
or acknowledging
the
effects
of, reference
rate reform
on financial
reporting.
 These
amendments
offer
discretionary
for
a
to
alleviate
complexities
 associated with reference rate reform in financial reporting. The
expedients and exceptions provided by these amendments
applicable to
contract modifications
executed and
hedging relationships
initiated or
reviewed after
 2022, except
for
pre-existing
hedging
relationships
as
of December
31,
2022,
for
which
an
entity
has
opted
for
 optional expedients, and which
are retained until the conclusion
of the hedging relationship.
the amendments
 permit entities to make a one-time choice to divest, transfer,
or both divest and transfer debt securities categorized as held
 to maturity, referencing a rate impacted by reference rate reform,
and classified as held to maturity
prior to January 1, 2020.
 In December 2022, the
FASB issued new guidance extending the
expiration date of this
guidance from December 31,
2022,
 to December
after which
entities will
no longer
be authorized
to apply
the relief
provided under
this guidance.
 Before this recent guidance, these amendments
were effective for all
entities from March 12, 2020 to
December 31, 2022.
 The
executed
its
strategy
in
preparation
for
the
cessation
of
the
London
Intrabank
Offered
Rate
 ("LIBOR") and the adjustment of
its existing financial instruments affecte
d
by LIBOR, whether directly or
indirectly.
LIBOR-
 based originations were ceased as of June 30, 2023, and for existing LIBOR-based transactions,
the Company substituted
 Secured Overnight
Financing Rate
("SOFR") for
LIBOR. The
Company has
completed its
transition away
from LIBOR
for
 its loan and other financial instruments.
 Improvements to Reportable Segment Disclosures
 In November
2023, FASB
issued ASU
No. 2023-07,
Segment Reporting
280), aiming
to augments
reportable
it
enhances
disclosures.
this
amendment

 enhances
interim
clarifies
multiple
of
profit
or
loss,
new
for
entities
with
a
single
reportable
and
other
requirements.
The
this
ASU
in
2024.
The
adoption
of
this
did
not
have
a
on
the
 consolidated financial statements.

 Issued and Not Yet
Adopted
 Improvements to Income Tax
Disclosures
 In
2023,
the
FASB
Accounting
Standards
Update
(ASU)
2023-09,
Income
Taxes
740):
 Improvements to Income Tax
Disclosures. This ASU pertains to
disclosures regarding effective
tax rates and cash income
 taxes paid with the goal of providing stakeholders with more transparent
and relevant information. This ASU is effective for
 public business
entities for
annual periods
beginning after
15, 2024.
is currently
assessing the
 potential impact of this
ASU on its financial
reporting and has
not yet concluded whether
the changes will materially
 its business operations or consolidated financial statements.

 2.
INVESTMENT SECURITIES

tables present
a summary
of the amortized
cost, unrealized
or unrecognized
gains and
losses,
and fair
 value of investment securities at the dates indicated (in

 Cost
 Gains
 $
 14,279
 $
 $
 ( 1,668)
 $
 ( 22,918)
 ( 12,063)
 86,604
 ( 7,905)
 24,925
 -
 ( 5,614)
 24,314
 ( 1,044)
 23,708
 $
 310,925
 $
 $
 ( 51,212)
 $
 $
 42,538
 $
 -
 $
 ( 5,094)
 $
 37,444
 ( 7,785)
 49,259
 40,681
 ( 4,613)
 36,121
 15,272
 -
 ( 1,385)
 13,887
 9,222
 -
 ( 393)
 8,829
 $
 164,700
 $
 $
 ( 19,270)
 $
 Allowance for credit losses - securities held-to-maturity
 ( 6)
 Securities held-to maturity, net of allowance for credit losses
 $
 164,694

 Cost
 Gains
 $
 9,664
 $
 -
 $
 ( 1,491)
 $
 8,173
 103,645
 -
 ( 23,039)
 80,606
 63,795
 -
 ( 11,608)
 52,187
 49,212
 ( 6,504)
 42,764
 25,005
 -
 ( 5,667)
 28,106
 ( 2,033)
 26,261
 $
 279,427
 $
 $
 ( 50,342)
 $
 $
 43,626
 $
 $
 ( 5,322)
 $
 38,306
 62,735
 -
 ( 7,983)
 54,752
 43,784
 ( 4,533)
 39,599
 15,439
 -
 ( 1,257)
 14,182
 9,398
 -
 ( 727)
 8,671
 174,982
 $
 $
 ( 19,822)
 $
 Allowance for credit losses - securities held-to-maturity
 ( 8)
 Securities held-to maturity, net of allowance for credit losses
 $
 174,974

 There were
 no

investment securities that
were transferred from
AFS to HTM for
the years ended December
 and 2023.
 Transfers
of
debt
into
the
HTM
from
the
AFS
are
made
at
fair
value
as
of
the
date
of
 transfer.
The
gain or
loss at
the
date
of transfer
is retained
in
AOCI and
carrying
value
held-to-
 maturity securities.
There was no impact to net income. Such amounts are
amortized over the remaining life of the security.
 For the years
ended December 31, 2024 and
2023, total amortization out
of AOCI for the
net unrealized losses on
 transferred from AFS to HTM in 2022 was $

thousand and $

thousand, respectively. In addition for these securities,
 the
of
the
net
retained
in
AOCI
was
$
 9.3

at
31,
2024
and
$
 9.5

at
 December 31, 2023.
table presents
the proceeds,
realized gross
gains and
realized gross
losses on
sales and
calls of
AFS
 debt securities for the years ended December 31, 2024 and
2023 (in thousands):

 2024
 2023
 Proceeds from sales and call of securities
 $
 34,753
 $
 24,185
 Gross Gains
 $
 $
 Gross Losses
 ( 181)
 ( 1,862)
 Net realized gains (losses)
 $
 $
 ( 1,859)

 The
amortized
cost
and
fair
value
of
securities,
by
contractual
maturity,
are
shown
below
for
the
date
 indicated (in thousands).
Actual maturities may
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 are
shown
 separately.

 Available-for-sale
 Held-to-maturity
 Cost
 Cost
 Due within one year
 $
 -
 $
 -
 $
 -
 $
 -
 Due after one year through five years
 2,926
 3,037
 9,222
 8,829
 Due after five years through ten years
 42,068
 36,788
 -
 -
 Due after ten years
 4,245
 3,194
 -
 -
 14,279
 42,538
 37,444
 49,259

 40,681
 36,121

 86,604
 15,272
 13,887
 $
 310,925
 $
 $
 164,700
 $

2023, there
were no
securities to
any one
issuer,
in an
amount greater
than 10%
 stockholders'
equity
other
than
the
U.S.
Government
and
U.S.
Government
Agencies.
All
the
collateralized
mortgage
 obligations and mortgage-backed securities are issued
by U.S. sponsored entities at December 31, 2024 and
2023.
 Information
pertaining
to
both
AFS
and
HTM
with
gross
losses,
aggregated
by
and
length
of
time
that
those
have
been
in
a
continuous
loss
position,
are
 presented as of the following dates (in thousands):

 Less than 12 months
 12 months or more
 Total
 Unrealize
 d Losses
 Unrealize
 d Losses
 $
 4,468
 $
 ( 76)
 $
 44,895
 $
 ( 7,817)
 $
 49,363
 $
 ( 7,893)
 3,101
 ( 23)
 122,210
 ( 34,998)
 125,311
 ( 35,021)
 4,758
 ( 92)
 76,935
 ( 19,031)
 81,693
 ( 19,123)
 48,433
 ( 1,422)
 37,739
 ( 9,312)
 86,172
 ( 10,734)

 -
 -
 ( 5,613)
 ( 5,613)
 -
 -
 14,352
 ( 1,044)
 14,352
 ( 1,044)
 -
 -
 8,829
 ( 214)
 8,829
 ( 214)
 $
 60,760
 $
 ( 1,613)
 $
 324,271
 $
 ( 78,029)
 $
 385,031
 $
 ( 79,642)

 Less than 12 months
 12 months or more
 Total
 $
 -
 $
 -
 $
 46,479
 $
 ( 8,043)
 $
 46,479
 $
 ( 8,043)
 -
 -
 135,358
 ( 35,566)
 135,358
 ( 35,566)
 5,290
 ( 47)
 83,484
 ( 18,365)
 88,774
 ( 18,412)
 20,292
 ( 611)
 33,083
 ( 8,623)
 53,375
 ( 9,234)

 -
 -
 ( 5,667)
 ( 5,667)
 8,600
 ( 331)
 12,287
 ( 1,703)
 20,887
 ( 2,034)
 -
 -
 8,671
 ( 406)
 8,671
 ( 406)
 $
 34,182
 $
 ( 989)
 $
 338,700
 $
 ( 78,373)
 $
 372,882
 $
 ( 79,362)

 The
with
$
 111.1

of
transferred
from
the
AFS
 portfolio to the HTM portfolio represent unrealized losses since the date of purchase, independent of the impact associated
 with changes in the cost basis upon transfer between portfolios.
 On
1,
2023,
the
ASU
2016-13
Instruments
-
326):
 Measurement of Credit Losses
on Financial Instruments,
as amended, which replaces
the incurred loss methodology
with
loss methodology
that is
referred to
as CECL.
The measurement
of expected
CECL
 methodology is applicable
to financial assets
measured at amortized
cost, including loan
receivables and
held-to-maturity

 debt securities. In addition, ASC 326 amended the accounting
for available-for-sale debt securities. One such change
is to
 require credit losses to be presented as an allowance
rather than as a write-down on available-for-sale debt
securities.
 CECL requires a loss reserve for securities
classified as HTM. The reserve should reflect
historical credit performance
 as well as the impact of projected economic forecast.
For U.S. Government bonds and U.S. Agency issued
bonds in HTM,
 the explicit guarantee of the U.S.
Government is sufficient to conclude that a
credit loss reserve is not required.
The reserve
 requirement
is
for three
groups:
municipal
and
non-agency
securitizations.
The
 Company calculates quarterly the loss reserve
utilizing Moody's ImpairmentStudio. The CECL measurement for investment
data,
containing
defaults
and
recoveries
and
baseline
 forecast. The
solution uses
probability of
default/loss
given default
("PD/LGD")
approach. PD
represents the
likelihood a
will
default.
Within
model,
this
is
using
default
data,
adjusted
for
the
 economic environment. LGD projects the expected loss
if a borrower were to default.
 The Company monitors
the credit
quality of held
to maturity
securities through
the use of
credit ratings.
Credit ratings
 are monitored by the Company on at least a quarterly basis. As of
December 31, 2024 and December 31, 2023, all held-to-
 maturity securities held by the Company were rated investment
grade.
 At December 31, 2024, HTM securities
included $
 155.5

million of U.S. Government and
U.S. Agency issued bonds and
securities.
of
the
explicit
implicit
guarantee
on
these
the
holds
 no
 reserves
on
these
holdings.
The
remaining
portion
of
the
HTM
is
made
up
of
$
 9.2

in
grade
 corporate bonds. The required reserve for these
holdings is determined each quarter using the model described above.
For
 the portion of the HTM exposed to non-government
credit risk, the Company utilized the PD/LGD
methodology to estimate
 a $

thousand ACL as
of December 31,
2024. The book
value for debt
securities classified as
HTM represents amortized
 cost less ACL.

 The
that
an
ACL
on
its
debt
for
sale
as
of
31,
2024
was
not
 required.
 At
31,
2024,
the
had
$
 56.7

of
on
and
 collateralized mortgage
obligations of
U.S. Government
sponsored entities
having a
of $
 303.8

million that
were
 attributable
to
a
combination
of
factors,
relative
in
rates
since
the
time
of
purchase.
The
 contractual cash flows for these securities are guaranteed by U.S. Government agencies
and U.S. Government sponsored
 entities. The municipal bonds are of high credit
quality and the declines in fair value are
not due to credit quality.
Based on
 the assessment of
these mitigating factors, management
believes that the
unrealized losses on these
debt security holdings
 are a function of changes in investment spreads and interest
rate movements and not changes in credit quality.
 In 2018, the Company
became a Qualified Public Depository
("QPD") with the State
of Florida. As a
QPD, the Company
 has the
authority to
legally maintain public
deposits from cities,
municipalities, and the
State of
Florida. These public
 are secured by securities pledged to
the State of Florida at a ratio of
 % of the average outstanding amount
of uninsured
 deposits. The Company must
also maintain a minimum amount of
pledged securities to be in the
program related to these
 deposits.
2024, the
Company had
 twenty-one

securities with
an aggregate
fair value of
$
 66.1

million pledged
 to
the
State
of
under
the
funds
The
held
a
total
of
$
 110.5

in
funds
at
 December 31, 2024.
 At December 31, 2023, the Company
had
 twenty-eight

securities with an aggregate fair value
of $
 86.9

million pledged
 to
the
State
of
under
the
funds
The
held
a
total
of
$
 268.4

in
funds
at
 December 31, 2023.
 The Board
of Governors
of the Federal
Reserve System,
on March
12, 2023,
announced the
creation of
a new
Bank
 Term
Funding Program ("BTFP"). The BTFP offered loans of up to one year in length to banks, savings associations, credit
 unions,
and
other
pledging
U.S.
Treasuries,
U.S.
agency
debt
and
 securities, and other qualifying assets as collateral. The
BTFP program ceased making new loans as of March
2024.

paid off
$

million in
borrowings under
the BTFP
program during
the third
quarter 2024.
The original
 maturity of this
borrowing under the
BTFP program
was January 2025,
and there
are no remaining
borrowings under
this

 3.
LOANS

 The following table is a summary of the distribution of
loans held for investment by type (in thousands):

 Total
 Percent of
 Total
 Total
 Percent of
 Total
 $
 14.8
 %
 $
 11.5
 %
 57.8
 %
 58.8
 %
 13.1
 %
 12.4
 %
 4.2
 %
 6.5
 %

 10.1
 %
 10.8
 %
 Total
gross loans
 100.0
 %
 100.0
 %
 Plus: Deferred costs
 7,630
 2,183
 Total
loans net of deferred costs
 1,972,848
 1,780,827
 Less: Allowance for credit losses
 Total
net loans
 $
 1,948,778

 $
 1,759,743

 At December 31, 2024 and 2023, the Company had $
 518.8

 534.2

million, respectively, of commercial real
 estate and residential mortgage loans pledged as collateral on lines of credit with the FHLB and the
Federal Reserve Bank
 of Atlanta. At December 31, 2024 and 2023, the Company
had
 no

real estate loans in the process of foreclosure.

 Allowance for Credit Losses
 In general, the Company utilizes
the Discounted Cash Flow (DCF)
method or the Remaining Life
(WARM) methodology
 to estimate
the quantitative
portion of the
ACL for
loan pools.
The DCF
uses a
loss driver
analysis (LDA)
and discounted
 cash flow analyses.
The Company engaged
advisors and consultants
with experience in
CECL model development
to assist
 in development of
a loss driver
analysis based on
regression models
and supportable
forecast. Peer group
data obtained
 from FFIEC Call Report
filings is used to
inform regression analyses
to quantify the impact
of reasonable and
supportable
 forecasts in projective
models. Economic forecasts
applied to regression
models to estimate
probability of default
for loan
 receivables use at least
one of the following economic
indicators: civilian unemployment rate (national), real gross
domestic
 product growth
(national
GDP) and/or
the HPI.
For each
segments in
which the
WARM
is used,
the
 long-term average loss rate is calculated and applied on a quarterly basis for the remaining life of the pool. Adjustments for
 economic expectations are made through qualitative factors.
 Qualitative factors ("Q-Factors") used in the ACL methodology
include:
 • Changes in lending policies, procedures, and strategies
 • Changes in international, national, regional, and local conditions
 • Changes in nature and volume of portfolio
 • Changes in the volume and severity of past due loans
and other similar conditions
 • Concentration risk
 • Changes in the value of underlying collateral
 • The effect of other external factors: e.g., competition,
legal, and regulatory requirements
 • Changes in lending management, among others
 The
segments
the
by
pools
grouping
loans
that
share
risk
characteristics
and
employing
 collateral type and lien position to group loans according to risk. The Company evaluates
five segments using the loss rate
 methodology 'Remaining
Life Method'
or WARM.
The remaining
is calculated
the annual
attrition rate
observed
 for the Company's own
portfolio experience. The
peer group includes historical
losses for U.S. The
Company also applies
 a scorecard methodology
to determine
qualitative factors
for WARM
segments. The
scorecard is
built using
a peer group
 loss. The maximum losses for
these peers are derived selecting
periods were higher than normal
loss rates are observed.
 In estimating
credit losses,
also considers
qualitative and
environmental factors
cause estimated
 credit losses for the loan portfolio to differ from historical
losses.

 Changes in the ACL for the years ended December 31, 2024
and 2023 are as follows (in thousands):

 Residential
 and Industrial
 Correspondent
 Banks
 Consumer
 and Other
 Total
 Beginning balance
 $
 2,695
 $
 $
 3,974
 $
 $
 3,138
 $
 (1)

 2,403
 ( 1,578)
 ( 257)
 1,752
 2,960
 Recoveries

-

-

 Charge-offs

-

-

-

-

 ( 19)
 ( 19)
 Ending Balance

 $
 5,121
 $
 8,788
 $
 4,633
 $
 $
 4,874
 $
 Beginning balance
 $
 1,352
 $
 10,143
 $
 4,163
 $
 $
 1,109
 $
 17,487
 Cumulative effect of adoption of
 accounting principle

(2)
 1,238
 1,105
 ( 2,158)
 1,066
 (3)
 ( 882)
 1,897
 1,225
 2,503
 Recoveries

-

-

 Charge-offs

-

-

-

-

 ( 57)
 ( 57)
 Ending Balance

 $
 2,695
 $
 $
 3,974
 $
 $
 3,138
 $
 (1) Provision for credit losses excludes $

thousand provision for unfunded commitments included
in other liabilities and $

thousand release for
 investment securities held to maturity.
 (2) Impact of CECL adoption on January 1, 2023
 (3) Provision for credit losses excludes $

thousand release for unfunded commitments
included in other liabilities and $

thousand provision for
 investment securities held to maturity.

 Allowance for credit losses and the outstanding balances in
loans as of December 31, 2024 and 2023 are as
follows (in

 Residential
 and Industrial
 Correspondent
 Banks
 Consumer
 and Other
 Total
 Allowance for credit losses:
 Individually evaluated
 $
 $
 -
 $
 $
 -
 $
 $
 Collectively evaluated
 5,081
 8,788
 4,606
 4,223
 23,352
 Balances, end of period
 $
 5,121
 $
 8,788
 $
 4,633
 $
 $
 4,874
 $
 Loans:
 Individually evaluated
 $
 6,788
 $
 -
 $
 $
 -
 $
 1,990
 $
 9,468
 Collectively evaluated
 283,173
 257,621
 1,955,750
 Balances, end of period
 $
 $
 $
 $
 $
 $
 Allowance for credit losses:
 Individually evaluated
 $
 $
 -
 $
 $
 -
 $
 -
 $
 Collectively evaluated
 2,550
 3,846
 3,138
 20,811
 Balances, end of period
 $
 2,695
 $
 $
 3,974
 $
 $
 3,138
 $
 Loans:
 Individually evaluated
 $
 6,994
 $
 -
 $
 1,668
 $
 -
 $
 -
 $
 8,662
 Collectively evaluated
 197,425
 218,089
 1,769,982
 Balances, end of period
 $
 $
 $
 $
 $
 $

 Credit Quality Indicators
 The Company grades loans based on the estimated capability of the borrower to repay the contractual obligation of the
 loan agreement based
on relevant information
which may include:
current financial information
on the borrower,

experience,
documentation
and
other
trends.
Internal
risk
grades
are
evaluated
 periodically.

 The Company's internally assigned credit risk grades are as follows:
 Pass
 – Loans indicate different levels of satisfactory
financial condition and performance.

– 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.

 – Loans classified as substandard are inadequately protected
by the current net worth and paying
 capacity of the obligator 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.

– Loans classified as doubtful have all the weaknesses inherent
in those classified at 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.

 Loss
 – Loans classified as loss are considered uncollectible.

 Loan credit exposures by internally assigned grades are
presented below for the periods indicated (in thousands):

 As of December 31, 2024
 Term Loans by Origination Year
 Revolving
 Loans
 Total
 2024
 2023
 2022
 2021
 2020
 Prior
 Residential real estate
 Pass
 $
 109,590
 $
 39,666
 $
 34,315
 $
 23,039
 $
 5,791
 $
 66,115
 $
 10,885
 $
 289,401
 -
 -
 -
 -
 -
 -
 Total
 109,590
 39,666
 34,315
 23,039
 5,791
 66,675
 10,885
 Commercial real estate
 Pass
 175,023
 130,503
 317,971
 175,535
 98,695
 231,558
 4,680
 1,133,965
 -
 -
 -
 1,765
 -
 -
 2,452
 Total
 175,023
 130,503
 317,971
 177,300
 99,382
 231,558
 4,680
 Commercial and
 industrial
 Pass
 68,405
 80,644
 33,962
 30,495
 3,891
 11,839
 26,795
 256,031
 -
 -
 -
 -
 1,093
 2,280
 Total
 68,405
 80,644
 33,962
 31,014
 3,891
 12,932
 27,463
 Pass
 -
 -
 -
 -
 -
 -
 Total
 -
 -
 -
 -
 -
 -
 loans

 Pass
 40,921
 51,392
 65,603
 35,181
 1,698
 -
 -
 1,990
 -
 -
 -
 -
 1,990
 Total
 40,921
 51,392
 67,593
 35,181
 1,698
 Total
Loans
 Pass
 476,377
 302,205
 451,851
 264,250
 108,868
 310,327

 44,058
 1,957,936
 -
 -
 -
 -
 -
 -
 -
 -
 -
 -
 1,990
 2,284
 1,653
 7,282
 -
 -
 -
 -
 -
 -
 -
 -
 Total
 $
 476,377
 302,205
 453,841
 266,534
 109,555
 311,980
 44,726

 As of December 31, 2023
 Term Loans by Origination Year
 Revolving
 Loans
 Total
 2023
 2022
 2021
 2020
 2019
 Prior
 Residential real estate
 Pass
 $
 44,365
 $
 36,325
 $
 26,180
 $
 6,080
 $
 9,325
 $
 75,654
 $
 6,198
 $
 204,127
 -
 -
 -
 -
 -
 -
 Total
 44,365
 36,325
 26,180
 6,080
 9,617
 75,654
 6,198
 Commercial real estate
 Pass
 148,311
 337,938
 184,024
 104,182
 78,153
 182,714
 4,710
 1,040,032
 -
 -
 6,867
 -
 -
 -
 7,561
 Total
 148,311
 337,938
 190,891
 104,876
 78,153
 182,714
 4,710
 Commercial and
 industrial
 Pass
 97,753
 37,414
 34,090
 6,499
 13,706
 3,113
 25,554
 218,129
 -
 -
 -
 1,298
 -
 -
 1,628
 Total
 97,753
 37,414
 34,420
 6,499
 15,004
 3,113
 25,554
 Pass
 -
 -
 -
 -
 -
 -
 Total
 -
 -
 -
 -
 -
 -
 loans

 Pass
 71,593
 74,387
 41,966
 1,337
 1,472
 Total
 71,593
 74,387
 41,966
 1,337
 1,472
 Total
Loans
 Pass
 476,967
 486,064
 286,260
 117,376
 101,744
 262,818

 37,934
 1,769,163
 -
 -
 -
 -
 -
 -
 -
 -
 -
 -
 7,197
 1,590
 -
 -
 9,481
 -
 -
 -
 -
 -
 -
 -
 -
 Total
 $
 476,967
 486,064
 293,457
 118,070
 103,334
 262,818
 37,934

 Loan Aging
also considers the
performance of loans
in grading
and in
evaluating the
credit quality
loan portfolio.
analyzes credit
quality and
loan grades
payment performance
aging status
loan.

 The following table include an aging analysis
of accruing loans and total non-accruing
loans as of December 31, 2024 and
 2023 (in thousands):

 As of December 31, 2024:
 Current
 Past Due
 30-89 Days
 Past Due >
 90 Days
 and Still
 Total
 Non-
 Accrual
 Total Loans
 Residential real estate:
 Home equity line of credit and other
 $
 1,120
 $
 -
 $
 -
 $
 1,120
 $
 -
 $
 1,120
 1-4 family residential
 225,334
 2,886
 -
 228,220
 -
 228,220
 Condo residential
 58,956
 1,351
 -
 60,307
 60,621
 285,410
 4,237
 -
 289,647
 Commercial real estate:
 Land and construction
 40,090
 -
 -
 40,090
 -
 40,090
 Multi-family residential
 214,912
 -
 -
 214,912
 -
 214,912
 Condo commercial
 57,402
 -
 -
 57,402
 -
 57,402
 Commercial property
 823,326
 -
 824,013
 -
 824,013
 Leasehold improvements
 -
 -
 -
 -
 -
 -
 1,135,730
 -
 -
 Commercial and industrial:
 Secured
 232,779
 -
 233,300
 233,703
 Unsecured
 24,608
 -
 -
 24,608
 -
 24,608
 257,387
 -
 257,908
 -
 -
 -
 -
 -
 1,990
 Total
 $
 1,957,066
 $
 5,445
 $
 -
 $
 1,962,511
 $
 2,707
 $

 As of December 31, 2023:
 Current
 Past Due
 30-89 Days
 Past Due
 > 90 Days
 and Still
 Total
 Non-
 Accrual
 Total Loans
 Residential real estate:
 Home equity line of credit and other
 $
 $
 -
 $
 -
 $
 $
 -
 $
 1-4 family residential
 155,842
 -
 156,553
 -
 156,553
 Condo residential
 43,572
 3,735
 -
 47,307
 -
 47,307
 199,973
 4,446
 -
 -
 Commercial real estate:
 Land and construction
 33,710
 -
 -
 33,710
 -
 33,710
 Multi-family residential
 181,287
 -
 -
 181,287
 -
 181,287
 Condo commercial
 58,106
 -
 -
 58,106
 -
 58,106
 Commercial property
 772,569
 1,890
 -
 774,459
 -
 774,459
 Leasehold improvements
 -
 -
 -
 1,045,703
 1,890
 -
 -
 Commercial and industrial:
 Secured
 200,235
 -
 200,264
 200,732
 Unsecured
 19,025
 -
 -
 19,025
 -
 19,025
 219,260
 -
 219,289
 -
 -
 -
 -
 -
 -
 Total
 $
 1,771,811
 $
 6,365
 $
 -
 $
 1,778,176
 $
 $

 There were
 no

loans over 90 days past due and accruing as of December
31, 2024 and 2023.
 Non-accrual Status
includes the amortized
cost basis of
loans on non-accrual
status and loans
past due over
90 days
 and still accruing as of December 31, 2024 and December
31, 2023 (in thousands):

 Nonaccrual Loans
 With No Related
 Nonaccrual Loans
 With Related
 Total

 Non-accruals
 Loans Past Due
 Over 90 Days and
 Still Accruing
 Residential real estate
 $
 $
 -
 $
 $
 -
 -
 -
 1,990
 1,990
 -
 Total
 $
 $
 2,393
 $
 2,707
 $
 -
 Nonaccrual Loans
 With No Related
 Nonaccrual Loans
 With Related
 Total

 Non-accruals
 Loans Past Due
 Over 90 Days and
 Still Accruing
 $
 -
 $
 $
 $
 -
 Total
 $
 -
 $
 $
 $
 -

 Accrued interest
receivable is
excluded from
the estimate
of credit
losses. There
was
 no

interest income
 attributable
to non-accrual
loans
during the
years
ended
31, 2024
and
2023.
on

 these
loans
for
the
year
ended
31,
2024
and
2023,
would
have
been
approximately
$

and
$
 thousand, respectively,
had these loans performed in accordance with their
original terms.

 Collateral-Dependent Loans
 A
loan
is
dependent
when
the
is
difficulty
and
repayment
of
the
loan
is
 expected to be
provided substantially
through the
sale or
operation of the
collateral. There
were
 two

collateral dependent
 loans as of December 31, 2024 and
 no

collateral dependent loans as of December 31, 2023.

table includes
the amortized cost
basis of
collateral dependent
loans related
to borrowers
 financial difficulty by type of collateral as of December
31, 2024 (in thousands):

 As of December 31, 2024
 Collateral type

 Boat
 Specific Reserves
 Consumer and other loans

 $
 1,990
 $
 Total
 $
 1,990
 $

 Management evaluates
on an individual
basis collateral
dependent loans
using the fair
value of the
collateral method
 to determine
if a
credit loss
reserve is
necessary.
The ACL
is measured
the difference
fair
the
 collateral and
the recorded
(amortized
cost
basis of
the
loan), if
the final
is less
than the
 recorded investment
loan a
reserve amount
is calculated.
If the
valuation is
equal to
or greater
than the
 recorded investment of the loan, no reserve is determined.

 Loan Modifications to Borrowers Experiencing Financial
Difficulties
table present
newly restructured
loans, by
type of
modification, which
occurred during
the years
ended
 December 31, 2024 and December 31, 2023 (dollars
in thousands):

 Recorded Investment Prior to Modification
 Recorded Investment After Modification
 Loans
 Combination
 Total
 Loans
 Combination
 Total
 $
 $
 $
 $
 $
 $
 $
 $
 Recorded Investment Prior to Modification
 Recorded Investment After Modification
 Loans
 Combination
 Total
 Loans
 Combination
 Total
 $
 $
 $
 $
 $
 $
 $
 $

had
 one

new modification
to borrowers
experiencing financial
difficulties for
ended December
 31,
2024.
The
had
 two

new
modifications
to
borrowers
difficulties
for
the
year
ended
 December 31, 2023.

 4.
LEASES

 The
enters
into
leases
in
the
normal
of
for
centers
and
back-office
 operations. As of
December 31, 2024, the
Company leased nine
of the ten
banking centers and
the headquarter building.
is obligated
under non-cancelable
operating leases
for these
premises with
expiration dates
ranging from
 2026 to 2036. Many of these leases have extension
clauses which the Company could exercise which
would extend these
 dates.

has classified
all leases as
operating leases.
Lease expense
for operating
leases are
recognized on
a
 straight-line basis over
the lease term.
Right-of-use ("ROU")
assets represent the
right to use
the underlying
asset for the
 lease
term
and
lease
represent
the
obligation
to
make
lease
payments
arising
from
the
lease.
The
 elected the short-term
lease recognition exemption
for all leases
that qualify,
meaning those with
terms under 12
months.
 ROU assets or lease liabilities are not to be recognized
for short-term leases.
 ROU assets and
lease liabilities are
recognized at the lease
commencement date based on
the estimated present value
 of lease payments
over the
lease term.
In the Company's
Consolidated Balance
Sheets, ROU
assets are
reported under
 other assets while lease liabilities are classified under
accrued interest and other liabilities.

 As
most
of
the
leases
do
not
an
implicit
rate,
the
incremental
borrowing
rate
based
on
the
 information available
at commencement
date is
used. The
incremental borrowing
rate is
the FHLB
 advances rate matching or nearing the lease term.

 The following table presents the ROU assets and lease liabilities
as of December 31, 2024 and 2023 (in thousands):

 2024
 2023
 ROU assets:
 Operating leases

 $
 8,451
 $
 11,423
 Lease liabilities:
 Operating leases

 $
 8,451
 $
 11,423

 The weighted average remaining lease term and weighted average
discount rate as of December 31, 2024 and 2023:

 2024
 2023
 Weighted average remaining lease term (in years):
 Operating leases
 5.95
 6.35
 Weighted average discount rate:
 Operating leases

 2.94
 %
 2.94
 %

 Future lease payment obligations and a reconciliation to lease
liability as of December 31, 2024 (in thousands):

 2025
 $
 3,312
 2026
 2,383
 2027
 2028
 2029
 Thereafter
 2,509
 Total
future minimum lease payments
 10,125
 Less: interest component
 ( 1,674)
 Total
lease liability
 $
 8,451

 5.
PREMISES AND EQUIPMENT

 A summary of premises and equipment are presented
below as of December 31, 2024 and 2023 (in thousands):

 2024
 2023
 Land
 $
 $
 Building
 1,952
 1,952
 Furniture, fixtures and equipment
 9,137
 8,981
 Computer hardware and software
 4,623
 4,592
 Leasehold improvements
 10,584
 10,457
 Premises and equipment, gross
 27,268
 26,954
 Accumulated depreciation and amortization
 ( 22,705)
 ( 22,118)
 Premises and equipment, net
 $
 4,563
 $
 4,836

 Depreciation
and
amortization
was
$

and
$

for
the
years
ended
 2024 and 2023, respectively.

 6.
INCOME TAXES

 The Company's provision
for income taxes is
presented in the following
table for the years
ended December 31, 2024
 and 2023 (in thousands):

 2024
 2023
 Current:
 $
 -
 $
 -
 State
 -

 -
 Total
 -

 -
 Deferred:
 6,122

 4,121
 State
 1,681

 1,130
 Total
 7,803

 5,251
 Total
tax expense
 $
 7,803
 $
 5,251

 The actual income
tax expense for the
years ended December 31, 2024
and 2023 differs from
the statutory tax expense
 for the year (computed by applying the U.S. federal
corporate tax rate of
 % for 2024 and
 % for 2023 to income before
 provision for income taxes) as follows (in thousands):

 2024
 2023
 Federal taxes at statutory rate
 $
 6,820
 $
 4,577
 State income taxes, net of federal tax benefit
 1,411

 Bank owned life insurance
 ( 428)

 ( 273)
 Other, net
 -

 -
 Total
tax expense
 $
 7,803
 $
 5,251

 The following table presents
the deferred tax assets
and deferred tax liabilities
as of December 31, 2024
and 2023 (in

 2024
 2023
 Deferred tax assets:
 Net operating loss
 $
 9,276
 $
 16,430
 Allowance for credit losses
 6,100
 5,410
 Lease liability
 2,142
 2,895
 Unrealized loss on available for sale securities
 15,200
 15,114
 Depreciable property
 Equity compensation
 Accruals
 Other, net
 Deferred tax asset
 $
 34,027
 $
 41,074
 Deferred tax liability:
 Deferred loan cost
 ( 1,934)
 ( 553)
 Lease right of use asset
 ( 2,142)
 ( 2,895)
 Deferred expenses
 ( 224)
 ( 180)
 Cash flow hedge
 ( 81)
 ( 85)
 Other, net
 -
 ( 79)
 Deferred tax liability
 $
 ( 4,381)
 $
 ( 3,792)
 Net deferred tax asset
 $
 29,646
 $
 37,282

 At December
had approximately $
 32.7

million of
Federal and
$
 55.5

million of
State net
 loss carryforwards expiring
in various amounts
from 2032 to
2036. If unused
after 2036, their
utilization is limited
to future
 taxable earnings of the Company.
 In assessing the
realizability of deferred
tax assets, management considered
whether it is
more likely than
not that some
 portion or
all of
the deferred
tax assets
will not
be realized.
The ultimate
realization
of deferred
tax assets
is dependent
 upon the generation of
future taxable income
during the periods
in which those temporary
differences become deductible.
 Management considers the scheduled reversal
of deferred tax liabilities, projected future taxable
income, and tax planning
 strategies in making this assessment.
 The U.S.
Federal jurisdiction
and Florida
are the
major tax
jurisdictions where
files income
tax returns.
 The Company is generally no longer subject to U.S. Federal or
State examinations by tax authorities for years before 2021.
 For
the
years
ended
2023,
the
did
 no
 t have
any unrecognized
tax benefits
as a
tax positions
taken during
a prior
period or
during the
current period.
 no

interest or
were
 recorded as a result of tax uncertainties.

 7.
DEPOSITS

 The following table presents deposits by type at December 31,
2024 and 2023 (in thousands):

 2024
 2023
 Non-interest bearing demand deposits
 $
 $
 367,388
 288,403
 Total
 $
 2,174,004
 $
 1,937,139

 Time
deposits exceeding
the FDIC
deposit insurance
limit of
$250 thousand
per account
at December 31,
 2023 were $
 94.0

 117.2

million, respectively.

 As of
31,
2024,
had
$
 133.0

in
brokered
CDs
at
a weighted
rate
of
 4.38
 %.
 Brokered CDs were
 6.1
 % of total deposits at such date.

 As
of
31,
2023,
the
had
$
 50.0

of
brokered
CDs
at
rate
of
 4.98
 %.
 Brokered CDs were
 2.6
 % of total deposits at such date.

 At December 31, 2024, the scheduled maturities of time deposits
were (in thousands):

 2025
 $
 329,989
 2026
 35,215
 2027
 1,628
 2028
 2029
 $
 367,388

aggregate amount
of demand
deposits reclassified
to loans
as overdrafts
was
 $

thousand and $

thousand, respectively.

 8.
BORROWINGS

 Borrowed funds
consist of
fixed-rate advances
FHLB. At
December 31, 2024,
FHLB advances
were $
 163.0
 million and at December 31, 2023 were $
 183.0

 The following table presents outstanding FHLB advances
at December 31, 2024 and 2023 (in thousands):

 At December 31, 2024
 Interest Rate
 Type of Rate
 Maturity Date
 2.05
 %
 Fixed
 March 27, 2025
 $
 1.07
 %
 Fixed
 July 18, 2025
 6,000
 3.76
 %
 Fixed
 January 24, 2028
 11,000
 3.77
 %
 Fixed
 April 25, 2028
 3.68
 %
 Fixed
 September 13, 2027
 21,000
 3.79
 %
 Fixed
 March 23, 2026
 20,000
 4.65
 %
 Fixed
 February 13, 2025
 45,000
 $
 163,000
 At December 31, 2023
 Interest Rate
 Type of Rate
 Maturity Date
 1.04
 %
 Fixed
 July 30, 2024
 $
 5,000
 1.07
 %
 Fixed
 July 18, 2025
 6,000
 2.05
 %
 Fixed
 March 27, 2025
 3.76
 %
 Fixed
 January 24, 2028
 11,000
 3.77
 %
 Fixed
 April 25, 2028
 5.57
 %
 Fixed
 December 26, 2024
 101,000
 $
 183,000

 The
FHLB
holds
a
blanket
lien
on
the
loan
that
may
be
pledged
as
for
 advances, subject
to eligibility
borrowing agreement.
may also
choose to
assign cash
balances
 held at the FHLB as additional collateral. See Note 3 "Loans"
for further discussion on pledged loans.
 The Board
of Governors
of the Federal
Reserve System,
on March
12, 2023,
announced the
creation of
a new
Bank
 Term
Funding Program ("BTFP"). The BTFP offered loans of up to one year in length to banks, savings associations, credit
 unions,
and
other
pledging
U.S.
Treasuries,
U.S.
Agency
debt
and
 securities, and other qualifying assets as collateral. The
BTFP program ceased making new loans as of March
2024.

 On January
12, 2024,
borrowed $
 80.0

million at
a rate
of
 4.81
 %, maturing
on
 January 10, 2025
, under
 the BTFP
program. Subsequently,
paid off
$
 80.0

million in
borrowings under
the BTFP
program during
the
 third quarter
2024. The
original maturity
of this
borrowing under
the BTFP
program was
January 2025,
and there
are no
 remaining borrowings by the Company under this program.

 9.
EQUITY BASED AND OTHER COMPENSATION
PLANS

 Employee 401(k) Plan
has an
401(k) plan
(the "Plan")
covering substantially all
eligible employees.
The Plan
includes a
 that the employer may contribute
to the accounts of
eligible employees for whom
a salary deferral is made.
 contributed
$

and
$

to
the
Plan
during
the
years
ended
2024
and
2023,
 respectively;
the
contributions
are
included
under
salaries
and
in
the
of
 Operations.
 Stock-Based Compensation
 In
2015,
the
stockholders
the
2015
Equity
Incentive
Plan
(the
"2015
Option
Plan"),
which
 authorized grants
of options
to purchase
up to
 2,000,000

shares of
common stock.
The
 2015
 Option
Plan
provided that
 vesting
schedules
will
be
upon
issuance
of
options
by
the
Board
of
Directors
or
committee.
 Options granted
2015 Option
Plan have
a
 -year life
and, in
no event
shall an
option be
exercisable after
the
 expiration of

years from the
grant date. The
2015 Option Plan
had a
 -year life and
initially would have
terminated in
 2025. In
July 2020,
the stockholders
Company approved
the amendment
2015 Option
plan to
authorize the
 issuance of
an additional
 3,000,000

shares of common
stock and
extending the
life of
the plan

additional years, terminating
 in 2030. The
authorized shares,
after being adjusted
to reflect the
1 for 5
reverse stock
split, totaled
 1,000,000

shares. In
2021,
the
of
the
the
amendment
of
the
2015
Option
Plan
to
authorize
the
 issuance of
an additional
 1,400,000

shares of
issue restricted
stock grants
(up to
 600,000

shares) for a total of
 2,400,000

shares.
2024, there
were
 996,436

shares available
for grant
2015 Option
Plan. At
 2023, there were
 1,160,564
 shares available for grant under the 2015 Option Plan.

 Stock Options
 The Company recognizes compensation expense based
on the estimated grant date
fair value method using the
Black-
 Scholes
option
model and
accounts
for this
using
a prorated
straight-line
amortization
method over
the
 vesting
of
the
option.
Stock-based
is
based
on
awards
that
the
expects
will
 ultimately vest,
reduced by estimated forfeitures.
Estimated forfeitures consider the voluntary
termination trends as well as
 actual option forfeitures.
 The
is
under
salaries
and
in
the
accompanying
of
Operations.
Compensation
totaling
$

was
for
the
year
ended
and $

thousand for
ended December
31, 2023.
There was
 no

related tax
benefit for
the
 years ended December 31, 2024 and 2023.
 Unrecognized compensation
cost remaining
on stock-based
compensation totaled
$

thousand and
$

 for the years ended December 31, 2024 and 2023, respectively.
 Cash
flows
from
excess
tax
are
to
be
classified
as
a
part
of
cash
flows
from
 activities. Excess tax benefits
are realized tax benefits
from tax deductions for
exercised options in
excess of the deferred
 tax asset attributable to the compensation cost for such
options.
 There were
 no

options granted in 2024.

 For the fair value of options granted in 2023, the following
were the assumptions:

 Assumption
 2023
 Risk-free interest rate
 3.53
 %
 Expected term
 years
 Expected stock price volatility
 %
 Dividend yield
 %

 The following table presents a summary of stock options
for the years ended December 31, 2024 and 2023:

 Stock Options
 Weighted Average
 Exercise Price
 Weighted Average
 Remaining
 Contractual Years
 Aggregate Intrinsic
 Value (in
 thousands)
 Balance at January 1, 2024
 947,167
 $
 10.97
 6.5
 Granted
 —
 $
 -
 Exercised
 ( 122,000)
 $
 10.81
 Forfeitures
 ( 100,000)
 $
 11.99
 Balance at December 31, 2024
 725,167
 $
 10.86
 5.3
 Exercisable at December 31, 2024
 720,499
 $
 10.85
 5.3
 $
 4,972

 Balance at January 1, 2023
 965,667
 $
 10.91
 7.4
 Granted
 7,500
 $
 12.41
 Exercised
 ( 10,000)
 $
 7.50
 Forfeitures
 ( 16,000)
 $
 10.34
 Balance at December 31, 2023
 947,167
 $
 10.97
 6.5
 Exercisable at December 31, 2023
 758,000
 $
 10.71
 6.1
 $
 1,195

 The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value of exercisable options at the
 dates presented
(the
difference
the
stock
exercise
price,
multiplied
 number of
options considered
in-the-money) that
would have
been received
option holders
had all
option holders
 exercised their options.
 The weighted average per share fair value of options granted for the year ended December 31, 2023, was $
 3.91
; there
 were no grants in 2024.

 Restricted Stock
 In 2024, the Company issued

shares of Class A common stock to employees and
directors as restricted stock
 awards pursuant
Company's 2015
Option Plan.
Awards under
the 2015
Option Plan
be sold
or otherwise
 transferred until
certain restrictions have
lapsed. The Company
primarily issues restricted
stock awards with
a
 -year vesting
 period. However,
out of
the

of Class
stock issued
pursuant restricted
stock awards
in 2024,
 150,000

shares issued in
October 2024 had
a modified vesting
period. The
 150,000

shares vested
 % of the
award in a
 period of two months in 2024, and
 % remaining will vest in the next 2 years.

 In 2023, the Company issued
 242,713

shares of Class A common stock to employees and
directors as restricted stock
 awards pursuant
Company's 2015
Option Plan.
Awards under
the 2015
Option Plan
be sold
or otherwise
 transferred until certain restrictions
have lapsed.
 The
total
share-based
for
these
awards
is
based
on
the
price
of
the
 Company's common
stock as
of the date
of grant
applied to
the total
number of
shares granted
and is
amortized straight
 line
over
the
vesting
which
is
three
years
unless
the
Board
of
Directors
approves
a
vesting
 schedule for
the grants.
As of
2024, unearned
share-based compensation
expense associated
with these
 awards totaled $
 4.3

 Compensation expense totaling $
 1.9

million was recognized for
the year ended December
31, 2024 and reported
under
 salaries and
benefits in
the
accompanying
Statement
of Operations.
Compensation
expense totaling
$
 thousand was recognized for the year ended December
31, 2023.

 The following table presents a summary of restricted stock
awards for the years ended December 31, 2024 and 2023:

 Restricted Stock
 Weighted Average Grant Date
 Balance at January 1, 2024
 218,422
 $
 12.19
 Granted
 $
 14.33
 Forfeited
 ( 8,625)
 $
 12.63
 Vested
 ( 85,643)
 $
 13.84
 Balance at December 31, 2024
 402,076
 $
 13.31
 Restricted Stock
 Weighted Average Grant Date
 Balance at January 1, 2023
 -
 $
 -
 Granted
 242,713
 $
 12.24
 Forfeited
 ( 8,111)
 $
 12.67
 Vested
 ( 16,180)
 $
 12.67
 Balance at December 31, 2023
 218,422
 $
 12.19

 10.
OFF-BALANCE SHEET ARRANGEMENTS

 The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business in order to
 meet the financial
needs of
its customers
and to reduce
its own
exposure to
fluctuations in
interest rates.
These financial
 instruments include
unfunded commitments
under lines
of credit,
commitments to
extend credit,
standby and
 letters of
credit. Those
instruments involve,
to varying
degrees, elements
of credit
and interest
rate risk
in excess
 amount recognized in the Company's Consolidated Balance Sheets. The Company uses the
same credit policies in making
 commitments and conditional obligations as it does for on-balance-sheet
instruments.
 The Company's
exposure to credit
loss in the
event of nonperformance
by the other
party to the
financial instruments
 for unused lines of credit, and standby letters of credit
is represented by the contractual amount of these commitments.
 On
1,
2023,
the
ASU
2016-13
Instruments
-
326):
 Measurement of Credit Losses
on Financial Instruments,
as amended, which replaces
the incurred loss methodology
with
loss methodology
that is
referred to as
the CECL
methodology.
The measurement
of expected
 under the CECL methodology
is applicable to financial
assets measured at amortized
cost, including loan receivables
and
 held-to-maturity debt securities.
records
a
liability
for
on
off-balance-sheet
in
with
 ASC
326.
The
uses
the
loss
rate
and
of
default
to
estimate
a
reserve
for
unfunded
 commitments. Loss rates
for the expected funded
balances are determined
based on the
associated pooled loan
analysis
 loss rate and the exposure at default is
based on an estimated utilization given
default. The off-balance sheet commitment
 allowance were $

thousand and $

thousand as of December 31, 2024 and December
31, 2023, respectively.

 A
summary
of
the
of
the
instruments
with
off-balance
sheet
risk
are
shown
below
at
 December 31, 2024 and 2023 (in thousands):

 2024
 2023
 Commitments to grant loans and unfunded lines of credit
 $
 122,578
 $
 85,117
 Standby and commercial letters of credit
 5,389
 3,987
 Total
 $
 127,967
 $
 89,104

 Commitments to
extend credit
are agreements
to lend
to a
customer as
long as
there is
no violation
of any
 established in the contract. Commitments generally have
fixed expiration dates or other termination clauses.

 Unfunded lines of
credit and revolving
credit lines are
commitments for possible
future extensions
of credit to
 customers. These lines of
credit are uncollateralized and
usually do not contain
a specified maturity date
and ultimately may
 not be drawn upon to the total extent to which the Company
is committed.
 Standby
and
letters
of
are
conditional
commitments
by
the
to
guarantee
the
 performance of a
customer to
a third
party. Those letters of
credit are
primarily issued to
support public and
private borrowing
 arrangements. Essentially all letters of credit have fixed maturity dates and many of them expire without being drawn upon,
 they do not generally present a significant liquidity risk
to the Company.

 11.
DERIVATIVES

 The Company utilizes interest rate swap agreements
as part of its asset-liability management strategy to help
manage
 its interest
rate risk
position. The
notional amount
swaps do
not represent
amounts exchanged
 parties. The amounts exchanged are
determined by reference to
the notional amount and the
other terms of the individual
 interest rate swap agreements.

 Rate Swaps Designated as Cash Flow Hedges
the Company had
 two

interest rate swap
agreements with
a notional aggregate
 $

million that were designated as cash flow hedges of certificates of deposit. The interest rate swap agreements have an
maturity
of
 1.38

the
fixed-rate
paid
is
 3.59
 %,
with
the
3-month
 compound SOFR (Secured Overnight Financing Rate) being received.
31, 2023,
the Company had
 two

interest rate swap
agreements with
a notional aggregate
 $

million that were designated as cash flow hedges of certificates of deposit. The interest rate swap agreements have an
maturity
of
 2.38

the
fixed-rate
paid
is
 3.59
 %,
with
the
3-month
 compound SOFR (Secured Overnight Financing Rate)
being received.
 The
in
fair
value
on
these
rate
swaps
are
in
other
or
other
with
a
 corresponding recognition
in other comprehensive
income (loss)
and subsequently reclassified
to earnings when
gains or
 losses are realized.
 Interest Rate Swaps Designated as Fair Value
Hedges
 During the
third quarter
in 2024,
unwound
 four

swaps with
a notional
aggregate
$

million. The
decision to
unwind these
swaps was
driven by
changes in
forecasts and
asset-
 liability management
strategies. The
early termination fee
to unwind
the fair
value swaps
totaled $
 3.7

million. The
termination
 fees allocated to
each loan category
will be amortized
over the remining
life of the
hedge loans on
a monthly
straight-line
 basis
with
full
recognition
of
the
unamortized
cost
upon
the
early
payoff
of
the
hedge
loan.
The
amortization
of
the
 termination fee
is reflected
loan interest
income line
Company's Consolidated
Statement of
Operations. The
 original
maturities
of
these
fair
value
swaps
were
2025
and
2026.
The
fair
value
rate
swap
 agreements had an average maturity of
 1.51

years at the date of termination.
 As of
Company had
 four

swap agreements
with a
notional aggregate
$

million that
were designated
as fair
value hedges
on loans.
The interest
rate swap
agreements have
an
maturity
of
 2.23

the
fixed-rate
paid
is
 4.74
 %,
with
the
3-month
 compound SOFR being received
 The
in
fair
value
on
these
rate
swaps
are
in
other
or
other
with
a
 corresponding recognition in the assets being hedged.

 Interest Rate Swaps
 The Company also
enters into
interest rate swaps
with its
loan customers. The
Company had

and

 swaps with loan customers with
a notional aggregate amount of $
 206.3

 46.5

million at December 31, 2024 and
 2023, respectively.
These interest rate
swaps have maturity
dates of between
2025 and 2051.
The Company entered
into
 corresponding
and
offsetting
derivatives
with
third
parties.
The
fair
value
of
liability
on
these
derivatives
the

 Company to provide the counterparty
with funds to be held as collateral
which the Company reports as other
assets under
 the Consolidated
Balance Sheets.
While these
derivatives represent
economic hedges,
they do
not qualify
as hedges
for
 accounting purposes.

 The following table reflects the Company's customer
related interest rate swaps at the dates indicated (in

 Notional
 Collateral
 Balance Sheet Location
 Asset
 Liability
 Derivatives Designated as Cash Flow Hedges
 Interest rate swaps
 $
 $
 -
 $
 $
 -
 Derivatives not designated as hedging instruments:
 Interest rate swaps related to customer loans
 $
 206,258
 $
 4,943
 Other assets/Other liabilities
 $
 6,869
 $
 6,869
 Derivatives Designated as Cash Flow Hedges
 Interest rate swaps
 $
 $
 -
 $
 $
 -

 Derivatives Designated as Fair Value Hedges
 Interest rate swaps
 $
 200,000
 $
 -
 Other liabilities
 $
 -
 $
 3,430
 Derivatives not designated as hedging instruments:
 Interest rate swaps related to customer loans
 $
 46,463
 $
 1,326
 Other assets/Other liabilities
 $
 4,558
 $
 4,558

 12.
FAIR VALUE
MEASUREMENTS

 Determination of Fair Value
uses
measurements
to record
fair-value
adjustments
to certain
and liabilities
 determine fair value
disclosures. In accordance
with the fair
value measurements
accounting guidance, the
fair value of
a
 financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
 between market
participants
date.
Fair value
is best
determined based
upon quoted
market prices.
 However, in
many instances, there
are no quoted
market prices for the
Company's various financial
instruments. In cases
 where quoted
market prices
available, fair
values are
estimates using
present value
or other
 techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates
 of future cash flows. Accordingly, the fair value estimates may not be realized in
an immediate settlement of the instrument.
 The fair
value guidance provides
a consistent definition
of fair
value, which focuses
on exit
price in
an orderly transaction
 (that is,
not a
forced
liquidation
or distressed
sale) between
market participants
date
under current
 market conditions.
If there
has been
a significant
decrease
volume
and level
of activity
asset
or liability,
a
 change in
valuation technique or
the use
of multiple
valuation techniques may
be appropriate.
In such
instances, determining
 the
price
at
which
willing
participants
would
transact
at
the
date
under
 depends on the facts
and circumstances and
requires the use of
significant judgment. The fair
value is a reasonable
point
 within the range that is most representative of fair value under
current market conditions.
 Fair Value Hierarchy
 In accordance with
this guidance, the
Company groups its
financial assets
and financial liabilities
generally measured
 at fair
value in
three
levels, based
markets
in which
the assets
and liabilities
are traded,
reliability
 assumptions used to determine fair value.
 Level 1

- Valuation
is based
on quoted
prices in
active markets
for identical
assets or
liabilities that
the reporting
 entity has
the ability
to access
at the measurement
date. Level
1 assets
and liabilities
generally include
debt and
 equity securities that
are traded in
an active exchange
market. Valuations are obtained from
readily available pricing
 sources for market transactions involving identical assets
or liabilities.

 Level 2

- Valuation
is based on inputs other
than quoted prices included
within Level 1 that are
observable for the
 asset
or
either
directly
or
indirectly.
The
may
be
based
on
quoted
prices
for
or
 liabilities; quoted
prices in
markets that are
not active;
or other inputs
that are observable
or can be
corroborated
 by observable market data for substantially the full term of the
asset or liability.
 Level 3

- Valuation
is based on
unobservable inputs that
are supported
by little or
no market activity
and that are
to
the
fair
value
of
the
or
liabilities.
Level
and
instruments
 whose value
is determined
using pricing
models, discounted
cash
flow
methodologies,
or similar
techniques,
as
 well as instruments for which determination of fair value
requires significant management judgment or estimation.
 A
instrument's
categorization
the
hierarchy
is
based
upon
the
lowest
level
of
input
that
is
 significant to the fair value measurement.
 Items Measured at Fair Value
on a Recurring Basis
 Investment securities:

When instruments are traded
in secondary markets and
quoted market prices do
not exist for
 such securities,
management generally
relies on
prices obtained
from independent
vendors or
third-party broker
-dealers.
 Management reviews pricing methodologies provided by the vendors and third-party broker-dealers in order to determine if
 observable market information is being utilized. Securities measured with pricing provided by independent vendors or
third-
 party broker-dealers
are classified within
Level 2 of
the hierarchy and
often involve using
quoted market
prices for similar
 securities, pricing models or discounted cash flow analyses
utilizing inputs observable in the market where available.
 Derivatives:

The
fair
value
of
derivatives
are
measured
with
provided
by
participants
and
are
 classified within Level 2 of the hierarchy.
 The
table
represents
the
and
measured
at
fair
value
on
a
recurring
basis
at
 December 31, 2024 and 2023 for each of the fair value
hierarchy levels (in thousands):

 2024
 2023
 Level 1
 Level 2
 Level 3
 Total
 Level 1
 Level 2
 Level 3
 Total
 Investment securities available for sale:
 $
 -
 $
 $
 -
 $
 $
 -
 $
 8,173
 $
 -
 $
 8,173
 -
 -
 -
 80,606
 -
 80,606
 -
 -
 -
 52,187
 -
 52,187
 -
 -
 -
 42,764
 -
 42,764
 -
 -
 -
 -
 -
 23,708
 -
 23,708
 -
 26,261
 -
 26,261
 Total
 -
 -
 -
 -
 Derivative assets
 -
 7,190
 -
 7,190
 -
 4,892
 -
 4,892
 Total assets at fair value
 $
 -
 $
 267,411
 $
 -
 $
 267,411
 $
 -
 $
 234,221
 $
 -
 $
 234,221
 Derivative liabilities
 $
 -
 $
 6,869
 $
 -
 $
 6,869
 $
 -
 $
 7,988
 $
 -
 $
 7,988
 Total liabilities at fair value
 $
 -
 $
 6,869
 $
 -
 $
 6,869
 $
 -
 $
 7,988
 $
 -
 $
 7,988

 Items Not Measured at Fair Value
presents the carrying
amounts and estimated
fair values of
financial instruments
not carried at fair
 value, at December 31, 2024 and 2023 are as follows (in thousands):

 Fair Value Hierarchy
 Carrying
 Level 1
 Level 2
 Level 3
 Financial Assets:
 Cash and due from banks
 $
 6,986
 $
 6,986
 $
 -
 $
 -
 $
 6,986
 Interest-bearing deposits in banks
 $
 70,049
 $
 70,049
 $
 -
 $
 -
 $
 70,049
 Investment securities held to maturity, net
 $
 164,694
 $
 -
 $
 $
 -
 $
 Loans held for investment, net
 $
 1,948,778
 $
 -
 $
 -
 $
 1,950,646
 $
 1,950,646
 Accrued interest receivable
 $
 10,945
 $
 -
 $
 1,372
 $
 9,573
 $
 10,945
 Financial Liabilities:

 Demand Deposits
 $
 $
 $
 -
 $
 -
 $
 Money market and savings accounts
 $
 $
 $
 -
 $
 -
 $
 Interest-bearing checking accounts
 $
 $
 $
 -
 $
 -
 $
 $
 367,388
 $
 -
 $
 -
 $
 366,479
 $
 366,479
 FHLB advances
 $
 163,000
 $
 -
 $
 161,375
 $
 -
 $
 161,375
 Accrued interest payable
 $
 2,125
 $
 -
 $
 $
 1,503
 $
 2,125
 Financial Assets:
 Cash and due from banks
 $
 8,019
 $
 8,019
 $
 -
 $
 -
 $
 8,019
 Interest-bearing deposits in banks
 $
 33,043
 $
 33,043
 $
 -
 $
 -
 $
 33,043
 Investment securities held to maturity, net
 $
 174,974
 $
 -
 $
 $
 -
 $
 Loans held for investment, net
 $
 1,759,743
 $
 -
 $
 -
 $
 1,723,210
 $
 1,723,210
 Accrued interest receivable
 $
 10,688
 $
 -
 $
 1,448
 $
 9,240
 $
 10,688
 Financial Liabilities:

 Demand Deposits
 $
 $
 $
 -
 $
 -
 $
 Money market and savings accounts
 $
 $
 $
 -
 $
 -
 $
 Interest-bearing checking accounts
 $
 $
 $
 -
 $
 -
 $
 $
 288,403
 $
 -
 $
 -
 $
 287,104
 $
 287,104
 FHLB advances
 $
 183,000
 $
 -
 $
 182,282
 $
 -
 $
 182,282
 Accrued interest payable
 $
 1,372
 $
 -
 $
 $
 $
 1,372

 Collateral Dependent Loans Measured for
Expected Credit Losses:
 Fair values of collateral-dependent yacht
loans
 and real estate loans
are based on recent
boat and real estate
appraisals less estimated costs of
sale, repossession, and/or
 holding costs.
Appraisals
are made
by a
third
party,
and
its evaluation
may use
either a
comparative
sales, cost
 income approach or a combination of methodologies.
 The fair value
of collateral dependent
loans considered Level 3
in the fair
value hierarchy was $
 2.0

million with a
 reserve of $

thousand at December 31, 2024. There were
 no

collateral-dependent loans at December 31, 2023.

 13.
STOCKHOLDERS' EQUITY

 Common Stock
 In July
2021, the
Bank completed
the initial
public offering
of its
Class
stock, in
which it
and sold
 4,600,000

shares of Class A
common stock at a
price of $
 10.00

per share. The Bank
received total net proceeds
of $
 40.0
 million after deducting underwriting discounts and expenses.
 In December 2021,
the Company acquired
all the issued
and outstanding shares
of the Class
A common stock
 Bank, which at the time were
the only issued and outstanding shares
of the Bank's capital stock,
in a share exchange (the
 "Reorganization")
effected
under
the
Business
Corporation
Act.
Each
share
of
the
Class
A

 common stock,
par value
$
 1.00

per share,
formerly held
by its
was
converted into
and exchanged
for
 one
 newly
share
of
the
Class
A
par
value
$
 1.00

per
share,
and
the
Bank
became
the
 Company's wholly owned subsidiary.
 In the
Reorganization,
each
shareholder
Bank
received securities
of
class,
having
substantially
the
 same designations,
rights,
powers, preferences,
qualifications,
and restrictions,
as those
that the
shareholder
 held in the Bank,
and the Company's
then current shareholders
owned the same
percentages of the
Company's common
 stock as they previously owned of the Bank's common
 In 2024, the Company issued

shares of Class A common stock to employees and directors as restricted stock
 awards pursuant to the Company's 2015 Option Plan.

 In 2023, the Company issued
 242,713

shares of Class A common stock to employees and directors as restricted stock
 awards pursuant to the Company's 2015 Option Plan.

 As previously announced,
on April 22,
2024, the
Board of Directors
approved a
new share repurchase
program of up
 to
 500,000

shares of
or approximately
 2.5
 % of
issued and
outstanding shares
of
Under
the
program,
the
may
purchase
of
Class
A
stock
on
a
 discretionary basis from time
to time through open
market repurchases, privately negotiated
transactions, or other means.
 The
has
no
expiration
date
and
may
be
modified,
suspended,
or
terminated
at
any
time.
The
new
 repurchase program
will commence
upon completion
of the Company's
current repurchase
program. Repurchases
under
 this new program will be funded from the Company's
existing cash and cash equivalents or future cash flow.
 During the year
ended December
repurchased
 42,100

shares of
Class A common
stock at
a
 weighted average price per share of $
 11.85
. The aggregate purchase price for these transactions was approximately $
 thousand, including transaction costs.
As of December 31,
2024,
 537,980

shares remained authorized for
repurchase under
 the Company's two stock repurchase programs.
 During the year ended December
31, 2023, the Company repurchased
 669,920

shares of Class A common
stock at a
 weighted average price per share
of $
 11.28
. The aggregate purchase
price for these transactions was
approximately $
 7.6
 million, including transaction costs. As
of December 31, 2023,
 80,080

shares remained authorized for repurchase under
the
 Company's first stock repurchase program.
 Shares of the Company's Class A common stock issued and
outstanding as of December 31, 2024 and December 31,
 2023 were
 19,924,632

and
 19,575,435
, respectively.
 Dividends
 Declaration of dividends
by the Board
is required before
dividend payments
are made. The
Company is
limited in the
cash dividends
that it
may pay.
Payment of
dividends is
generally limited
year
combined
with
the
retained
for
the
preceding
two
as
by
state
 regulations. However,
for any
dividend declaration,
must consider
additional factors
the amount
of
 current period net income, liquidity,
asset quality,
capital adequacy and economic conditions
at the Bank since the Bank is
 the primary source
of funds to fund
dividends by the Company.
It is likely that
these factors would
further limit the
 of dividends which
the Company could
declare. In addition,
bank regulators have
the authority to
prohibit banks and
bank
 holding companies from paying dividends if they deem
such payment to be an unsafe or unsound practice.
 As
of
31,
2024,
the
was
not
to
any
formal
supervisory
on
its
to
pay
but
has
agreed
to
notify
the
Bank
of
Atlanta
in
advance
of
any
proposed
dividend
to
the
 Company's shareholders
in light
Bank's negative
retained earnings.
under applicable
FDIC regulations
 and policy, because the Bank has negative retained
earnings, it must obtain the prior approval of the FDIC before effecting
 a cash dividend or other capital distribution.
 On January 29, 2024, the
Company announced that its Board of
Directors approved a quarterly cash dividend program.
 The quarterly dividend for all quarters in 2024 was $
 0.05

per share of Class A common stock. The aggregate distribution in
 connection with dividend payments paid during the year
ended December 31, 2024 was $
 3.9

 Declaration Date
 Record Date

 Payment Date
 Dividend Per Share
 Dividend Amount
 January 22, 2024

 February 15, 2024

 March 5, 2024

 $
 0.05
 $
 1.0

 April 22, 2024
 May 15, 2024
 June 5, 2024
 $
 0.05
 $
 1.0

 July 22, 2024
 August 15, 2024
 September 5, 2024

 $
 0.05
 $
 1.0

 October 28, 2024
 November 15, 2024
 December 5, 2024
 $
 0.05
 $
 0.9

 See Note 20, "Subsequent Events", for information regarding
dividends declared in January 2025.
 The
and
the
Bank
exceeded
all
and
remained
above
"well-capitalized"
 guidelines as of December 31, 2024 and December
31, 2023. At December 31, 2024, the total
risk-based capital ratios for
 the Company and the Bank were
 13.51
 % and
 13.34
 %, respectively.

 14.
EARNINGS PER SHARE

 Earnings
per
share
("EPS")
for
stock
is
calculated
using
the
two-class
method
for
participating
 securities. Basic EPS
is calculated by
dividing net income
(loss) available to
common stockholders by the
weighted-average
 number of common shares outstanding for
the period, without consideration for common
stock equivalents. Diluted EPS is
 computed by
dividing net
income (loss)
available to
common stockholders
weighted-average
number
of common
 shares outstanding for
the period and
the weighted-average number
of dilutive common
stock equivalents outstanding
for
 the period determined using the treasury-stock method. For
purposes of this calculation, common stock equivalents
 common stock options and are only included in the calculation
of diluted EPS when their effect is dilutive.

 The
table
reflects
the
calculation
of
net
to
stockholders
for
the
years
ended
 December 31, 2024 and 2023 (in thousands):

 2024
 2023
 Net Income
 $
 $
 Net income available to common stockholders
 $
 $

reflects the calculation
of basic and
diluted earnings per
common share
class for the
years ended
 December 31, 2024 and 2023 (in thousands, except
per share amounts):

 2024
 2023
 Basic EPS
 Numerator:
 Net income available to common shares
 $
 $
 Denominator:
 Weighted average shares outstanding
 19,675,444
 19,621,698
 Earnings per share, basic
 $
 1.25
 $
 0.84
 Diluted EPS
 Numerator:
 Net income available to common shares
 $
 $
 Denominator:
 Weighted average shares outstanding for basic EPS
 19,675,444
 19,621,698
 Add: Dilutive effects of assumed exercises of stock options
 155,977
 65,936
 Weighted avg. shares including dilutive potential common shares
 19,831,421
 19,687,634
 Earnings per share, diluted
 $
 1.24
 $
 0.84
 Anti-dilutive stock options excluded from diluted EPS
 15,000
 720,500
 Net income has not been allocated to unvested
restricted stock awards that are participating securities
because the amounts that would be allocated are
 not material to net income per share of common
stock. Unvested restricted stock awards that are participating
securities represent less than one percent
 of all of the outstanding shares of common stock
for each of the periods presented.

 15.
REGULATORY
MATTERS

 Banks and
bank holding
are subject
to regulatory
capital requirements
administered by
federal and
state
agencies.
Failure
to
meet
minimum
can
initiate
mandatory
and
possibly
 discretionary actions
by regulators that,
if undertaken,
could have a
direct material
 Financial Statements.
Under
capital adequacy
guidelines and
the regulatory
for prompt
corrective
action, the
 Company and the
Bank must meet
specific capital guidelines
that involve quantitative
measures of their
assets, liabilities,
 and certain
off-balance-sheet
items as
calculated under
regulatory accounting
practices. The
Company's and
the Bank's
and
classification
are
also
to
qualitative
judgments
by
the
about
components,
risk
 weightings, and other factors.
 Based on changes to the Federal Reserve's definition of a "Small Bank
Holding Company" that increased the threshold
 to $3.0 billion in assets
in August 2018, the Company
is not currently subject to
separate minimum capital measurements.
 At such time when the Company reaches the
$3.0 billion asset level, it will
be subject to capital measurements independent
 of the Bank.
elected to
permanently opt-out
inclusion of
accumulated other
comprehensive income
 calculations, as
permitted by the
regulations. This
opt-out reduces
the impact of
market volatility on
the Bank's
 capital levels.
 The Bank is
subject to the
rules of the
Basel III regulatory capital
framework and related Dodd-Frank
Wall Street Reform
 and Consumer Protection
Act. The rules include
the implementation of
a
 2.5
 % capital conservation
buffer that is
added to
 the minimum requirements
for capital adequacy
purposes. Failure
to maintain the
required capital conservation
buffer will
 limit the ability of
the Bank to pay
dividends, repurchase shares
or pay discretionary
bonuses. At December
 2023, the capital ratios for the Bank were sufficient
to meet the conservation buffer.
 Prompt
corrective
action
five
classifications:
well
capitalized,
adequately
capitalized,
 undercapitalized,
significantly
undercapitalized,
and
critically
undercapitalized,
although
these
terms
are
not
used
to
 represent overall financial condition. If
adequately capitalized, regulatory approval
is required to accept brokered
deposits.
 If
undercapitalized,
distributions
are
limited,
as
is
asset
and
expansion,
and
restoration
plans
are
 required.

most recent
notification from
the regulatory
authorities categorized
as
 well capitalized
regulatory framework
for prompt
corrective action.
Failure to
meet statutorily
mandated capital
could
the
Bank
to
a
of
remedies,
issuance
of
a
directive,
the
 termination of deposit
insurance by the
FDIC, a prohibition
on accepting or
renewing brokered deposits,
limitations on the
 rates of
interest that
may pay
on
its deposits
on
its business.
To
be categorized
 capitalized, an institution
must maintain minimum
total risk-based, Tier
1 risk-based and Tier
1 leverage ratios as
set forth
table below.
There are
no conditions
or events
since the
notification that
management believes
have changed
the
 Bank's category.

 Actual and required
capital amounts and
ratios are presented
below for the
Bank at December
2023 (in
 thousands, except ratios). The required amounts for capital adequacy
shown do not include the capital conservation buffer
 previously discussed.

 Actual
 Minimum Capital
 Requirements

 To be Well Capitalized
 Under Prompt Corrective
 Action Provisions
 Ratio
 Ratio
 Ratio
 Total
risk-based capital:
 $
 266,387
 13.34
 %
 $
 159,795
 8.00
 %
 $
 199,744
 10.00
 %
 Tier 1 risk-based capital:
 $
 12.10
 %
 $
 119,846
 6.00
 %
 $
 159,795
 8.00
 %
 Common equity tier 1 capital:
 $
 12.10
 %
 $
 89,885
 4.50
 %
 $
 129,834
 6.50
 %
 Leverage ratio:
 $
 9.38
 %
 $
 103,074
 4.00
 %
 $
 128,843
 5.00
 %
 Total
risk-based capital:
 $
 233,109
 12.65
 %
 $
 147,432
 8.00
 %
 $
 184,290
 10.00
 %
 Tier 1 risk-based capital:
 $
 11.48
 %
 $
 110,574
 6.00
 %
 $
 147,432
 8.00
 %
 Common equity tier 1 capital:
 $
 11.48
 %
 $
 82,931
 4.50
 %
 $
 119,789
 6.50
 %
 Leverage ratio:
 $
 9.17
 %
 $
 92,328
 4.00
 %
 $
 115,410
 5.00
 %

is limited in
the amount
of cash
dividends that
it may
pay.
Payment of dividends
is generally
limited to
 the Company's net income for the current year combined with the Company's
retained income for the preceding two years,
 as
by
state
regulations.
for
any
dividend
declaration,
the
must
consider
 factors such as the amount of current period net income, liquidity,
asset quality, capital adequacy
and economic conditions
 at the Bank.
It is likely
that these factors
would further limit
the amount of
dividends which the
Company could declare.
In
bank
have
the
authority
to
prohibit
banks
from
paying
to
their
parent
 holding company,
if they deem such payment to be an unsafe or unsound
practice.

 16.
RELATED PARTY
TRANSACTIONS

 In
the
ordinary
of
officers,
directors,
and
affiliates
may
in
with
the
 Company.
The
table
presents
loans
to
and
from
parties
included
the
accompanying
 Consolidated Financial Statements at December 31, 2024
and 2023 (in thousands):

 2024
 2023
 Consolidated Balance Sheets:
 Loans held for investment, net

 $
 -
 $
 -
 Deposits
 $
 4,551
 $
 2,792
 Consolidated Statements of Operations:
 Interest income
 $
 -
 $
 -
 Interest expense
 $
 $

 Loan Purchases
 During 2024, the Bank purchased $
 90.8

million of loans from entities that are
deemed to be related parties.
 paid those entities fees of $
 2.7

 During 2023, the Bank purchased $
 85.1

million of loans from entities that are
deemed to be related parties.
 paid those entities fees of $
 1.9

 17.
PARENT COMPANY
CONDENSED FINANCIAL INFORMATION

 In December
2021, USCB
Financial Holdings,
Inc. was
formed as
the parent
bank holding
company of
U.S. Century
 Bank.
The
condensed
sheet
is
below
for
USCB
Inc.
at
the
dates
indicated
(in

 ASSETS:
 Cash and Cash Equivalents
 $
 3,735
 $
 2,426
 Investment in bank subsidiary

 210,253

 188,827
 1,400
 Total
 $
 $
 LIABILITIES AND STOCKHOLDERS' EQUITY:
 Other liabilities
 $
 -
 $
 -
 Stockholders' equity
 Total
liabilities and stockholders' equity
 $
 $

 The condensed
income statement
is presented
below for
Holdings, Inc.
periods indicated
(in

 Years Ended
 INCOME:
 Dividends from subsidiaries
 $
 5,000
 $
 11,100
 Total

 5,000

 11,100
 EXPENSE:
 Employee compensation and benefits

 2,129

 Other operating
 2,268
 Total
 2,699
 2,821
 Income before income taxes and undistributed subsidiary income
 2,301
 8,279
 Benefit from income taxes
 ( 684)
 ( 715)
 Equity in undisbursed subsidiary income
 21,689
 7,551
 Net Income

 $
 $

 The condensed cash
flow is presented below
for USCB Financial Holdings,
Inc. for the periods
indicated (in thousands):

 Years Ended
 Cash flows from operating activities:
 $
 $
 Adjustments to reconcile net income to net cash provided
by operating

 activities:
 Equity in undistributed earnings of subsidiaries
 ( 21,689)
 ( 7,551)
 Stock-based compensation
 2,129
 Increase in deferred tax asset
 ( 684)
 ( 715)
 Net cash provided by operating activities

 4,430

 8,832
 Cash flows from investing activities:
 Capital contributions to subsidiary
 -
 -
 Other
 -
 -
 Net cash used in investing activities

 -
 -
 Cash flows from financing activities:
 Dividends paid
 ( 3,939)
 -
 Proceeds from exercise of stock options
 1,319
 Repurchase of common stock
 ( 501)
 ( 7,583)
 Net cash (used in) provided by financing activities
 ( 3,121)
 ( 7,508)
 Net increase in cash and cash equivalents

 1,309
 1,324
 Cash and cash equivalents, beginning of period

 2,426
 1,102
 Cash and cash equivalents, end of period

 $
 3,735
 $
 2,426

 18.
SEGMENT REPORTING

 Operating
segments
are components
of an
enterprise
about which
separate
is available
that
is
 evaluated
by
the
chief
decision
maker
("CODM")
in
assessing
and
in
deciding
how
to
 allocate resources. The Company's CODM is the
President, Chief Executive Officer,
and Chairman.
through the
Bank, its
sole direct
subsidiary,
operates

banking centers
in South
Florida providing
a
 wide range
of personal
and business
banking products
and services,
and through
a subsidiary
Bank, offers
 title insurance policies for real estate transactions closed at
the Bank. The Company's business activities are similar in their
 nature,
and
characteristics,
largely
serving
and
specialty
banking clients
with products
 and services
that are
offered through
similar processes
and platforms.
Accounting policies
and services
 referenced here are the same as those described in Note 1, "Summary of Significant Accounting Policies". The Company's
 segment revenue
is driven
primarily by
interest income
on loans
as fee
income from
the origination
of loans
and
 from fees charged on loans and deposit
accounts. Lending activities include loans
to individuals, which primarily consist of
 home equity lines of credit, residential real estate loans, yacht loans, and consumer loans, and loans to
commercial clients,
 which include
commercial and
industrial loans,
estate loans,
residential real
estate loans,
 banking loans, and letters of credit.

 The
CODM
reviews
and
expenses,
as
on
the
of
 Operations,
in
addition
to
on
the
Sheets.
The
 expenses that the CODM receives
regularly are interest expense, provision for
credit losses, salaries and wages, employee
 benefits,
and
occupancy.
The
CODM
evaluates
the
of
the
and
allocates
based
on
net
that
is
also
on
the
of
Operations
as
net
to
maximize
 shareholder value
.
internal financial
information is
used by
the CODM
to monitor
credit quality
 and credit loss expense. Furthermore, net income, as the measure of profit or loss, is used to monitor budget versus actual
 results and
to perform
competitive analyses
that benchmark
to competitors.
As a
result, the
Company has
 determined that it has only one reportable segment.

 19.
LOSS CONTINGENCIES

 Loss contingencies,
including claims
and legal actions
may arise in
the ordinary
course of
business. In
the opinion
of
 management, none
actions, either
individually or
in the aggregate,
is expected
to have
a material
adverse effect
 on the Company's Consolidated Financial Statements.

 20.
SUBSEQUENT EVENTS

 Dividends
 On January 21, 2025, the Company's Board of
Directors declared a quarterly cash dividend of
$
 0.10

per share of Class
 A common stock, to be paid on March 5, 2025, to stockholders of record as of the close of business
on February 14, 2025.

 BOLI
 In January 2025, the Company acquired a bank owned life insurance policy with a
cash surrender value of $
 4.0

 dollars.
 Liquidity
 In January
entered
into an
agreement
in connection
with
a
$
 20.0

million Fed
Funds unsecured
 uncommitted facility with another insured depository institution.

 In February
Company entered
into an
agreement in
connection with
a $
 20.0

million Fed
Funds unsecured
 uncommitted facility with another insured depository institution.

 As of February 28, 2025 there are
 no

advances under these new Fed Funds lines.

 Item 9.
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure

 None.
 Item 9A. Controls and Procedures

 Evaluation of Disclosure Controls and Procedures
 Under the supervision and
with the participation
of our management,
including our Chief Executive
Officer and our Chief
Officer,
we
evaluated
the
effectiveness
of
the
design
and
operation
of
the
and
as
of
2024.
Based
on
that
evaluation,
believes
that
the
and
were
to
collect,
process,
and
disclose
the
to
be
disclosed
in
the
 reports filed or
submitted under
the Exchange
Act within the
required time
periods as of
the end of
the period covered
by
 this Annual Report on Form 10-K.
 This
annual
does
not
an
integrated
audit
of
the
registered
firm
over
reporting.
Management's
was
not
to
audit
by
the
 registered public accounting
firm pursuant
rules of
the SEC
that permit
the Company,
as an
emerging growth company
 to provide only management's report in this annual report.
 Management's Report on Internal Control
over Financial Reporting
 Management is responsible for designing, implementing, documenting, and
maintaining an adequate system of internal
 control over financial
reporting, as
such term
is defined
in the Exchange
Act. An
adequate system
of internal control
over
 financial reporting encompasses the processes and procedures
that have been established by management to:
 •
maintain records that accurately reflect the Company's
transactions;
 •
prepare
and
footnote
disclosures
in
with
U.S.
GAAP
that
can
be
relied
upon
by
 external users; and
 •
prevent and detect unauthorized acquisition, use or disposition of the Company's assets that could have a material
 effect on the financial statements.
 Management conducted
an evaluation
effectiveness
internal control
over financial
 based on the criteria in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of
the
 Treadway
Commission
(COSO).
Based
on
this
evaluation
under
the
criteria
in
Internal
Control-Integrated
Framework,
 management concluded that
internal control over financial
reporting was effective
as of December 31,
2024. Furthermore,
 during the conduct of its assessment, management identified no material weakness in
its financial reporting control system.
 The Board of the Company,
through its Audit Committee, provides
oversight to management's
conduct of the financial
 reporting process.
The Audit
Committee, which
is composed
entirely of
independent directors,
is also
responsible for
the
 appointment of the independent registered public
accounting firm. The Audit Committee also
meets with management, the
audit
staff,
and
the
company's
independent
registered
firm
throughout
the
year
to
 assurance as to the adequacy of the financial
reporting process and to monitor the overall
scope of the work performed by
 the internal audit staff and the independent registered
public accounting firm.
 Because of its inherent limitations, the disclosure controls and
procedures may not prevent or detect misstatements.
A
 control system, no matter how well conceived and operated, can only provide reasonable, not absolute, assurance that the
 objectives of the control system are met. Because
of the inherent limitations in all control systems, no
evaluation of controls
 can provide absolute assurance that all control issues and instances of
fraud, if any,
have been detected. Also, projections
 of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of
 changes in conditions or that the degree of compliance with the
policies or procedures may deteriorate.
 Changes in Internal Control Over Financial Reporting
 There has been
no change in
our internal control
over financial reporting
(as defined in
Rules 13a-15(f) and
15d-15(f)
Exchange Act)
during our
most recent
fiscal quarter
that has
materially affected, or
is reasonably
likely to
materially
 affect, our internal control over financial reporting.

 Item 9B. Other Information

 (a)

None

 (b)

During
the
three
months
ended
31,
2024,
none
of
the
or
 officers

or
 terminated

any Rule 10b5-1
trading arrangement or
 non-Rule
 10b5-1

trading arrangement (as
 such terms are defined in Item 408 of the SEC's
Regulation S-K).
 Item 9C. Disclosure Regarding Foreign Jurisdictions
That Prevent Inspections
 Not applicable.

 Item 10. Directors, Executive Officers and Corporate Governance
 The information required
herein is incorporated
by reference from
the sections captioned
"Information with Respect
to
 Nominees for Director
and Information About
Executive Officers"
and "Beneficial Ownership
of Common Stock
by Certain
 Beneficial Owners and Management
– Delinquent Section 16(a) Reports"
in the Company's Definitive
Proxy Statement for
 the Annual Meeting
of Shareholders
currently expected
to be held
on May
27, 2025,
is expected
to be
filed with the
SEC
 within 120 days of December 31, 2024 ("2025 Definitive
Proxy Statement").
 The Company has
adopted a code
of ethics and
business conduct policy,
which applies to
all of its
directors, officers,
 including its principal executive officer, principal financial officer, principal accounting officer,
and employees generally. The
 Company will
provide a
copy
of its
code
of ethics
to any
person, free
of charge,
upon request.
Any requests
for a
copy
 should
be
made
to
the
Corporate
Secretary,
USCB
Inc.,
2301
N.W.
87th
Avenue,
Doral,
Florida.
In
 addition, a
copy
Code of
Ethics is
available at
website
at www.uscentury.com
under
the "Investor
 Relations" tab.
 There
have
been
no
to
the
by
which
may
recommend
nominees
to
the
 Company's Board.
 Item 11. Executive Compensation

 The information
required herein
is incorporated
by reference
sections captioned
"Executive Compensation"
 and "Information with Respect to Nominees for Director and Information About Executive Officers – Corporate Governance
 Principles and Board Matters" and "- Director Compensation"
in the Company's 2025 Definitive Proxy Statement.
 Item 12. Security Ownership of Certain Beneficial Owners
and Management and Related Stockholder
Matters

 Equity compensation Plan information
. The following table provide information as of December 31,
2024 with
 respect to shares of common stock that may be issued
under our existing equity compensation plans, which
consists of
 2015 Equity Incentive Plan (the "2015 Option Plan")
which was approved by our shareholders.
 Per Category
 securities issued
 or to be upon
 exercise of
 options, warrants
 and rights

 (a) (1)
 Weighted-average
 exercise price of
 options, warrants
 and rights

 (b) (1)
 Number of securities
 remaining available for
 future issuance under
 equity compensation
 plans (excluding
 securities reflected in
 column (a))

 (c)
 Equity compensation plans approved by security holders
 1,127,243
 $
 10.86
 966,436
 Equity compensation plans not approved by security holders

 -
 -
 -
 Total
 1,127,243
 $
 10.86
 966,436
 (1)

Includes 402,076 shares subject to restricted stock awards
which were not vested as of December 31, 2024. The
 weighted average exercise price excludes
such restricted stock awards.

 Security Ownership of Certain Beneficial Owners and
. Information regarding security ownership
 of certain beneficial owners and management is incorporated
by reference to "Beneficial Ownership of Common Stock
by
 Certain Beneficial Owners and Management" in the 2025
Definitive Proxy Statement.
 Item 13. Certain Relationships and Related Transactions,
and Director Independence

 The information
required herein
is incorporated
by reference
sections captioned
"Certain Relationships
and
 Related
Party
Transactions"
and
"Information
with
Respect
to
Nominees
for
and
Information
About
Executive
 Officers" in the 2025 Definitive Proxy Statement.
 Item 14. Principal Accountant Fees and Services

 The information required herein is incorporated by reference
from the section captioned "Ratification of
 Appointment of Independent Registered Public Accounting
Firm (Proposal Two)
– Audit Fees" in the 2025 Definitive Proxy
 Statement.

 Item 15. Exhibits and Financial Statement Schedules
 (a)

List of documents filed as part of this Annual Report:
 1)
 Financial Statements:
 Report of Independent Registered Public Accounting Firm
 Consolidated Balance Sheets as of December 31, 2024 and 2023
 Consolidated Statements of Operations for the years ended
December 31, 2024 and 2023
 Consolidated Statements of Comprehensive Income for
the years ended December 31, 2024 and 2023
 Consolidated Statements of Changes in Stockholders'
Equity for the years ended December 31, 2024 and
2023
 Consolidated Statements of Cash Flows for the years
ended December 31, 2024 and 2023
 Notes to Consolidated Financial Statements
 2)
 Financial Statement Schedules:
 Financial statement schedules are omitted as not required
or not applicable or because the information is
 included in the Consolidated Financial Statements or notes
thereto.
 (b)

List of Exhibits:
 The exhibit list in the Exhibit Index is incorporated herein
by reference as the list of exhibits required as part of
 this Annual Report on Form 10-K.

 EXHIBIT INDEX
 Exhibit
 Number
 Description of Exhibit
 2.1
 Agreement and Plan of Share Exchange, dated December 27, 2021, by and between U.S. Century Bank and USCB Financial
 Holdings, Inc. (incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K (File No. 001-41196)
 filed with the Securities and Exchange Commission on December 30, 2021).
 3.1
 Articles of Incorporation of USCB Financial Holdings, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant's Quarterly
 Report on Form 10-Q (File No. 001-41196) filed with the Securities and Exchange Commission on August 11, 2023).
 3.2
 Amended and Restated Bylaws of USCB Financial Holdings, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant's
 Current Report on Form 8-K (File No. 001-41196) filed with the Securities and Exchange Commission on July 26, 2023).
 4.1
 Side Letter Agreement, dated December 30, 2021, between USCB Financial Holdings, Inc., U.S. Century Bank, Priam Capital
 Fund II, LP, Patriot Financial Partners II, L.P. and Patriot Financial Partners Parallel II, L.P. (incorporated by reference to Exhibit
 4.1 to the Registrant's Current Report on Form 8-K (File No. 001-41196) filed with the Securities and Exchange Commission
 on December 30, 2021).
 4.2
 Registration Rights Agreement, dated March 17, 2015, between U.S. Century Bank, Priam Capital Fund II, LP, Patriot Financial
 Partners II, L.P., Patriot Financial Partners Parallel II, L.P., and certain other shareholders of U.S. Century Bank (incorporated
 by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K (File No. 001-41196) filed with the Securities and
 Exchange Commission on December 30, 2021).
 4.3
 Assignment and Assumption of Agreement, dated December 30, 2021, between U.S. Century Bank and USCB Financial
 Holdings, Inc. (incorporated by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K (File No. 001-41196)
 filed with the Securities and Exchange Commission on December 30, 2021).
 4.4
 Description of USCB Financial Holdings, Inc.'s securities (incorporated by reference to Exhibit 4.4 to the Registrant's Annual
 Report on Form 10-K for the year ended December 31, 2023 (File No. 001-41196) filed with the Securities and Exchange
 Commission on March 22, 2024).
 10.1
 U.S. Century Bank Amended and Restated 2015 Equity Incentive Plan (incorporated by reference to Exhibit 10.1 to the
 Registrant's Current Report on Form 8-K (File No. 001-41196) filed with the Securities and Exchange Commission on
 December 30, 2021).

*
 10.2
 Amended and Restated Employment Agreement by and among USCB Financial Holdings, Inc., U.S. Century Bank
 and Luis de la Aguilera dated as of January 29, 2023 (incorporated by reference to Exhibit 10.2 to the Registrant's
 Current Report on Form 8-K dated as of January 29, 2023 (File No. 001-41196) filed with the Securities and
 Exchange Commission on February 1, 2023).*
 10.3
 Amended and Restated Employment Agreement by and among USCB Financial Holdings, Inc., U.S. Century Bank
 and Robert Anderson dated as of January 29, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant's
 Current Report on Form 8-K dated as of January 29, 2023 (File No. 001-41196) filed with the Securities and
 Exchange Commission on February 1, 2023).*
 10.4
 Amendment No. 1 dated January 6, 2025 to the Employment Agreement by and among U.S. Century Bank, USCB
 Financial Holdings, Inc. and Robert Anderson dated as of January 29, 2023 (incorporated by reference to Exhibit
 10.1 the Registrant's Current Report on Form 8-K (File No. 001-41196) filed with the Securities and Exchange
 Commission on January 6, 2025).*
 10.5
 Change in Control Agreement between U.S. Century Bank and Nicholas Bustle dated May 17, 2019*, **
 10.6
 Change in Control Agreement between U.S. Century Bank and William Turner dated May 2, 2024*, **
 19.1
 Insider Trading and Disclosure Policy**
 21.1
 Subsidiaries of USCB Financial Holdings, Inc.
 **
 23.1
 Consent of Crowe LLP, Independent Registered Public Accounting Firm.
 **
 31.1
 Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934.
 **
 31.2
 Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934.
 **
 32.1
 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
 ***
 32.2
 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
 ***
 97.1
 Compensation Recovery Policy (incorporated by reference to Exhibit 97.1 to the Registrant's Annual Report on Form 10-K for
 the year ended December 31, 2023 (File No. 001-41196) filed with the Securities and Exchange Commission on March 22,
 2024)
.
 The following financial statements from
the Company's Annual Report on
Form 10-K for the year ended
December 31, 2021,
 formatted
in
Inline
(i)
Sheets,
(ii)
of
Operations,
(iii)

of
Comprehensive Income,
(iv) Consolidated
Statements of
Changes in
Stockholders' Equity,
(v)

 Statements of Cash Flows, (vi) Notes to Consolidated Financial Statements.
 *
 Management contract or compensatory plan or arrangement.
 **
 Filed herewith.
 ***
 Furnished hereby.

 Item 16. Form 10-K Summary

 None.

 SIGNATURES

 Pursuant to the requirements of the Exchange
Act, the registrant has duly caused this report
to be signed on its behalf
 by the undersigned thereunto duly authorized.
 Date: March 14, 2025
 By:
 /s/ Luis de la Aguilera
 Luis de la Aguilera
 President, Chief Executive Officer,
and Chairman
 Pursuant to the requirements
of the Exchange Ac,
this report has been
signed by the following
persons in the capacities
 and on the dates indicated.
 Signature
 Title
 Date
 /s/ Luis de la Aguilera
 Chairman, President, and Chief Executive
 Officer (Principal Executive Officer)
 Luis de la Aguilera
 /s/ Robert Anderson
 Chief Financial Officer (Principal Financial
 Officer and Principal Accounting Officer)
 Robert Anderson
 /s/ Aida Levitan
 Aida Levitan
 /s/ Howard Feinglass
 Howard Feinglass
 /s/ Kirk Wycoff
 Kirk Wycoff
 /s/ Ramon A. Abadin
 Ramon A. Abadin
 /s/ Bernardo B. Fernandez
 Bernardo B. Fernandez
 /s/ Ramon A. Rodriguez
 Ramon A. Rodriguez
 /s/ Maria C. Alonso
 Maria C. Alonso
 /s/ Robert E. Kafafian
 Robert E. Kafafian