Provident Financial Holdings, Inc. (“Company”), NASDAQ GS: PROV, the holding company for Provident Savings Bank, F.S.B. (“Bank”), announced results for the fourth quarter and fiscal year ended June 30, 2026.

The Company reported net income of $2.18 million, or $0.35 per diluted share, for the quarter ended June 30, 2026, compared with $1.35 million, or $0.21 per diluted share, in the third quarter of fiscal 2026 and $1.63 million, or $0.24 per diluted share, in the comparable quarter a year earlier. The quarterly increase from the prior period was driven primarily by a $95,000 recovery of credit losses, compared with a $326,000 provision for credit losses in the prior quarter, and a $570,000 increase in non-interest income, mainly from higher gains on other equity investments. The increase from the same quarter last year was mainly due to a $429,000 increase in net interest income and a $403,000 increase in non-interest income, partly offset by a $129,000 increase in non-interest expense.

For the fiscal year ended June 30, 2026, net income increased $400,000, or six percent, to $6.66 million from $6.26 million in fiscal 2025. Diluted earnings per share rose 11 percent to $1.03 from $0.93 in the prior year. The improvement in annual net income was primarily attributable to an $859,000 increase in net interest income and a $195,000 increase in non-interest income, mainly from higher loan servicing and other fees and a higher gain on other equity investments. These gains were partly offset by a $363,000 increase in the provision for income taxes, including $251,000 related to the write-off of deferred tax assets tied to the expiration of non-qualified stock options.

“Our fourth quarter results reflect sustained momentum in our business. The net interest margin expanded for the fourth consecutive quarter, credit quality remained excellent, and operating expenses were tightly managed. Together with our share repurchases, these results underscore our continued commitment to delivering shareholder value,” said Donavon P. Ternes, President and Chief Executive Officer. “We are well positioned to further strengthen our fundamentals in fiscal 2027, supported by our disciplined credit culture, strong capital position, and a more favorable interest rate environment,” he added.

Return on average assets was 0.73 percent in the fourth quarter of fiscal 2026, compared with 0.45 percent in the third quarter of fiscal 2026 and 0.53 percent in the fourth quarter of fiscal 2025. Return on average stockholders’ equity was 6.85 percent, compared with 4.21 percent in the prior quarter and 5.01 percent in the same quarter last year.

Net interest income in the fourth quarter of fiscal 2026 increased $429,000, or five percent, to $9.31 million from $8.88 million a year earlier. The improvement reflected a $595,000 decline in funding costs, driven by lower interest expense on FHLB advances due to reduced average borrowings and lower borrowing rates, partially offset by a $166,000 decline in income from interest-earning assets. Net interest margin increased 27 basis points to 3.21 percent from 2.94 percent in the same quarter last year, reflecting lower funding costs and higher loan yields despite lower average interest-earning assets.

Interest income on loans receivable was essentially unchanged at $13.12 million in the fourth quarter of fiscal 2026, compared with $13.10 million in the same quarter last year. A higher average loan yield was mostly offset by a lower average loan balance. The yield on loans receivable increased 13 basis points to 5.10 percent from 4.97 percent a year earlier, primarily reflecting adjustable-rate loan repricing and a decrease in net deferred loan cost amortization to $407,000 from $463,000. Over the last 12 months, approximately $256.8 million of adjustable-rate loans repriced to a weighted average rate of 6.98 percent, up 59 basis points from 6.39 percent before repricing. The average balance of loans receivable declined $24.2 million, or two percent, to $1.03 billion, as loan principal payments of $176.8 million exceeded loans originated for investment of $162.3 million during the period.

Interest income from investment securities declined $70,000, or 16 percent, to $376,000 from $446,000 in the prior-year quarter. The decrease reflected a lower average balance, partly offset by a higher average yield. The average balance of investment securities was $93.4 million, down $20.2 million, or 18 percent, from the same quarter last year, reflecting continued runoff of the held-to-maturity portfolio. The yield on investment securities increased four basis points to 1.61 percent from 1.57 percent, driven by lower premium amortization of $52,000 versus $80,000 a year earlier.

The Bank received $177,000 in cash dividends from FHLB–San Francisco stock and other equity investments in the fourth quarter of fiscal 2026, compared with $209,000 in the same quarter last year. The cash dividend yield was 6.80 percent, down from 8.12 percent, while the average balance increased slightly to $10.4 million from $10.3 million.

Interest income from interest-earning deposits, primarily cash deposited at the Federal Reserve Bank of San Francisco, totaled $264,000 in the fourth quarter of fiscal 2026, down $78,000, or 23 percent, from $342,000 a year earlier. The decline reflected both a lower yield and a lower average balance. The yield fell 75 basis points to 3.65 percent from 4.40 percent, due to a lower average interest rate on FRB reserve balances after decreases in the targeted federal funds rate since the prior year. The average balance declined $2.1 million, or seven percent, to $28.6 million.

Interest expense on deposits was $3.03 million in the fourth quarter of fiscal 2026, up $46,000, or two percent, from $2.98 million in the same period last year, reflecting higher rates paid on average deposits of $892.6 million compared with $898.5 million. The average cost of deposits increased three basis points to 1.36 percent from 1.33 percent, largely because of a greater proportion of time deposits, including brokered certificates of deposit.

For the fiscal year ended June 30, 2026, transaction account balances, or core deposits, decreased $19.3 million, or three percent, to $557.1 million, while time deposits increased $40.9 million, or 13 percent, to $353.2 million, reflecting continued customer preference for higher-yielding deposit products. Brokered certificates of deposit totaled $161.4 million at June 30, 2026, up $30.4 million, or 23 percent, from June 30, 2025. The weighted average cost of brokered certificates of deposit declined 31 basis points to 3.93 percent from 4.24 percent, reflecting the lower interest rate environment.

Interest expense on borrowings, primarily FHLB advances, decreased $641,000, or 29 percent, to $1.59 million in the fourth quarter of fiscal 2026 from $2.24 million in the same quarter last year. The decline was due to a $37.7 million, or 19 percent, reduction in average borrowings to $158.1 million, along with a 54-basis-point decrease in the average cost of borrowings to 4.04 percent from 4.58 percent.

At June 30, 2026, the Bank had approximately $255.9 million of remaining borrowing capacity with the FHLB–San Francisco, an additional $187.5 million available through a borrowing facility with the Federal Reserve Bank of San Francisco, and an unused unsecured federal funds borrowing facility of $50.0 million with its correspondent bank. Total available borrowing capacity across all sources was approximately $493.4 million. The Bank also remained well capitalized under all applicable regulatory capital requirements.

During the fourth quarter of fiscal 2026, the Company recorded a $95,000 recovery of credit losses, including an $11,000 recovery related to unfunded loan commitment reserves. That compared with a $164,000 recovery of credit losses in the same quarter last year and a $326,000 provision for credit losses in the third quarter of fiscal 2026. The recovery was primarily driven by a decrease in the expected life of the loan portfolio as adjustable-rate loans repriced upward during the quarter. It was also supported by strong loan quality, lower historical loss rates, and improved forward-looking economic indicators, partly offset by a modest increase in the loan portfolio balance.

Non-performing assets, comprised solely of non-accrual loans secured by properties located in California, decreased $909,000, or 64 percent, to $505,000, representing 0.04 percent of total assets at June 30, 2026, compared with $1.4 million, or 0.11 percent of total assets, at June 30, 2025. At June 30, 2026, non-performing loans consisted of three single-family loans and one multi-family loan, compared with seven single-family loans and one multi-family loan a year earlier. At both dates, the Bank had no real estate owned and no loans 90 days or more past due that were still accruing interest. No loan charge-offs occurred during the quarters ended June 30, 2026 and 2025.

Classified assets were $2.5 million at June 30, 2026, including $792,000 of loans in the special mention category and $1.7 million of loans in the substandard category. This compares with $5.0 million at June 30, 2025, consisting of $1.1 million of loans in the special mention category and $3.9 million of loans in the substandard category.

The allowance for credit losses on loans held for investment was $5.9 million, or 0.57 percent of gross loans held for investment, at June 30, 2026, down from $6.4 million, or 0.62 percent of gross loans held for investment, at June 30, 2025. The decline was primarily due to a shorter estimated average life of the loan portfolio, reflecting lower mortgage interest rates, and a lower loan portfolio balance from June 30, 2025. Management said it believes, based on currently available information, that the allowance for credit losses is sufficient to absorb expected losses inherent in loans held for investment at June 30, 2026.

Non-interest income increased $403,000, or 46 percent, to $1.28 million in the fourth quarter of fiscal 2026 from $880,000 in the same period last year, primarily due to higher other non-interest income, driven by a higher gain on other equity investments. The increase was mainly due to a conversion of VISA shares in May 2026, which resulted in a gain of $311,000. On a sequential-quarter basis, non-interest income increased $570,000, or 80 percent, mainly due to a higher gain on other equity investments resulting from the VISA share conversion and a higher valuation of VISA Class C shares.

Non-interest expense increased $129,000, or two percent, to $7.75 million in the fourth quarter of fiscal 2026 from $7.62 million in the same quarter last year, primarily due to a $126,000, or three percent, increase in salaries and employee benefits. Compared with the prior quarter, non-interest expense increased $110,000, or one percent, mainly due to higher salaries and employee benefits.

The Company’s efficiency ratio, defined as non-interest expense divided by the sum of net interest income and non-interest income, was 73 percent in the fourth quarter of fiscal 2026, improving from 78 percent in the same quarter last year and 77 percent in the third quarter of fiscal 2026.

The provision for income taxes was $756,000 in the fourth quarter of fiscal 2026, up 11 percent from $680,000 in the same quarter last year and up 36 percent from $557,000 in the third quarter of fiscal 2026. The increase from both periods reflected higher pre-tax income, partly offset by lower effective tax rates. The effective tax rate was 25.7 percent, compared with 29.5 percent a year earlier and 29.2 percent in the prior quarter. The lower rate was primarily due to $94,000 of tax benefits related to the vesting of restricted stock in May 2026.

In line with its stated commitment to shareholder value, the Company repurchased 89,974 shares of common stock at an average cost of $16.97 per share during the quarter ended June 30, 2026, and paid a quarterly cash dividend of $0.14 per share. As of June 30, 2026, 174,605 shares remained available for future purchase under the current repurchase program.

The Bank operates 13 retail and business banking offices in Riverside County and San Bernardino County, collectively known as the Inland Empire.

The Company will host a conference call for institutional investors and bank analysts on Wednesday, July 29, 2026, at 9:00 a.m. Pacific time to discuss its financial results. The call can be accessed by dialing 1-800-715-9871 and referencing Conference ID number 7361828. An audio replay will be available through Wednesday, August 5, 2026, by dialing 1-800-770-2030 and referencing Conference ID number 7361828.

For more financial information about the Company, visit www.myprovident.com and click on the “Investor Relations” section.

Safe-Harbor Statement

This press release contains statements that the Company believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to the Company’s financial condition, liquidity, results of operations, plans, objectives, future performance, or business. Readers should not place undue reliance on these statements, which are subject to various risks and uncertainties. These statements speak only as of the date they are made and are based only on information then actually known to the Company.

A number of factors could cause actual results to differ materially from those expressed or implied by these forward-looking statements and from historical performance, including adverse economic conditions in the Company’s local market areas or other markets in which it has lending relationships; changes in employment levels, labor shortages, persistent inflation, recessionary pressures, or slowing economic growth; changes in interest rate levels and volatility, including actions by the Board of Governors of the Federal Reserve System, which could affect revenues and expenses, asset values and obligations, and the availability and cost of capital and liquidity; the impact of inflation and related monetary and fiscal policy responses; federal government shutdowns, debt ceiling standoffs, or other fiscal policy uncertainty; credit risks associated with lending activities; increased competitive pressures; the quality and composition of the securities portfolio; fluctuations in deposits; secondary market conditions for loans; liquidity risks; the Company’s ability to implement growth initiatives and strategic priorities; the impact of bank failures or adverse developments at other banks; regulatory examinations and enforcement actions; technological change, including advances in artificial intelligence, digital banking platforms, and cybersecurity; legislative or regulatory changes; the use of estimates in determining fair value; vulnerabilities in information systems or third-party service providers; geopolitical developments and international conflicts; staffing fluctuations; the Company’s ability to pay dividends on its common stock; environmental, social and governance matters; climate change, severe weather, natural disasters, pandemics, epidemics, acts of war or terrorism, domestic political unrest, and other external events; and other factors described in the Company’s latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other reports filed with or furnished to the Securities and Exchange Commission.

The Company does not undertake, and specifically disclaims, any obligation to revise any forward-looking statements to reflect events or circumstances after the date of such statements, whether as a result of new information, future events, or otherwise. These risks could cause fiscal 2027 and beyond results to differ materially from any forward-looking statements and could negatively affect operating and stock price performance.

(1) Weighted-average yield earned on all instruments included in the balance of the respective line item.

(2) Includes uninsured deposits of approximately $178.6 million, of which $61.2 million are collateralized, at June 30, 2026, and $158.7 million, of which $54.0 million are collateralized, at June 30, 2025.

(3) The average balance of deposit accounts was approximately $40 thousand at June 30, 2026 and $37 thousand at June 30, 2025.

(4) The Bank had approximately $255.9 million of remaining borrowing capacity at the FHLB–San Francisco, approximately $187.5 million of borrowing capacity at the Federal Reserve Bank of San Francisco, and $50.0 million of borrowing capacity with its correspondent bank at June 30, 2026.

ASSET QUALITY:

(1) The non-performing loan balances are net of individually evaluated or collectively evaluated allowances, specifically attached to the individual loans.