EX-99.1 2 prov8k102622exh991.htm
Exhibit 99.1

3756 Central Avenue | NEWS RELEASE
Riverside, CA 92506 |
(951) 686-6060 |

PROVIDENT FINANCIAL HOLDINGS REPORTS
FIRST QUARTER OF FISCAL 2023 RESULTS
Net Income of $2.09 Million in the September 2022 Quarter
Net Interest Margin Expands 12 Basis Points in Comparison
to the Prior Sequential Quarter(1)
Loans Held for Investment Increase 6% from June 30, 2022 to $993.9 Million
Total Deposits Increase 3% from June 30, 2022 to $985.3 Million
Improving Asset Quality with a $70,000 Provision for Loan Losses
Non-Interest Expenses Remain Well-Controlled
Riverside, Calif. – October 25, 2022 – Provident Financial Holdings, Inc. (“Company”), NASDAQ GS: PROV, the holding company for Provident Savings Bank, F.S.B. (“Bank”), today announced first quarter earnings for the fiscal year ending June 30, 2023.
For the quarter ended September 30, 2022, the Company reported net income of $2.09 million, or $0.29 per diluted share (on 7.31 million average diluted shares outstanding), down 22 percent from net income of $2.67 million, or $0.35 per diluted share (on 7.58 million average diluted shares outstanding), in the comparable period a year ago. Compared to the same quarter last year, the decrease in earnings was primarily attributable to salaries and employee benefits expenses increasing $1.02 million resulting from the $1.20 million credit from the Employee Retention Tax Credit (“ERTC”) recognized in the first quarter of last year (not replicated this quarter) and a $409,000 change to a $70,000 provision for loan losses this quarter in contrast to a $339,000 recovery from the allowance for loan losses in the same quarter last year, partly offset by a $1.08 million increase in net interest income.
“We continue to make progress on improving our fundamental financial performance as demonstrated by the growth in loans held for investment, the expansion of the net interest margin, our well controlled operating expenses, and strong credit quality” said Craig G. Blunden, Chairman and Chief Executive Officer of the Company. “To date, we have not experienced a meaningful deterioration in the financial operating environment as a result of higher inflation or higher interest rates. Nonetheless, if deteriorating general economic conditions progress and begin to impact us, we remain confident that our strong capital position will help us weather the storm,” said Mr. Blunden.
Page 1 of 14

Return on average assets for the first quarter of fiscal 2023 was 0.69 percent, down from 0.89 percent for the same period of fiscal 2022; and return on average stockholders’ equity for the first quarter of fiscal 2023 was 6.42 percent, down from 8.39 percent for the comparable period of fiscal 2022(1).
On a sequential quarter basis, the $2.09 million net income for the first quarter of fiscal 2023 reflects a 15 percent decrease from $2.46 million in the fourth quarter of fiscal 2022. The decrease in earnings for the first quarter of fiscal 2023 compared to the fourth quarter of fiscal 2022 was primarily attributable to a $492,000 increase in non-interest expenses (mainly in professional expenses and premises and occupancy expenses), a $162,000 decrease in non-interest income and a $481,000 change to a $70,000 provision for loan losses this quarter in contrast to a $411,000 recovery from the allowance for loan losses in the fourth quarter of fiscal 2022, partly offset by a $459,000 increase in net interest income. Diluted earnings per share for the first quarter of fiscal 2023 were $0.29 per share, down 15 percent from the $0.34 per share during the fourth quarter of fiscal 2022. Return on average assets was 0.69 percent for the first quarter of fiscal 2023, down from 0.83 percent in the fourth quarter of fiscal 2022; and return on average stockholders’ equity for the first quarter of fiscal 2023 was 6.42 percent, down from 7.72 percent for the fourth quarter of fiscal 2022(1).
In the first quarter of fiscal 2023, net interest income increased $1.08 million or 14 percent to $8.97 million from $7.89 million for the same quarter last year. The increase in net interest income was primarily due to a higher net interest margin primarily due to a shift in the composition of interest-earning assets towards higher yielding loans held for investment and an increase in the average yield on interest-earning deposits reflecting recent increases in the targeted federal funds rate. The net interest margin during the first quarter of fiscal 2023 increased 34 basis points to 3.05 percent from 2.71 percent in the same quarter last year. The average yield on interest-earning assets increased 35 basis points to 3.36 percent in the first quarter of fiscal 2023 from 3.01 percent in the same quarter last year while the average cost of interest-bearing liabilities increased by only three basis points to 0.35 percent in the first quarter of fiscal 2023 from 0.32 percent in the same quarter last year. The average balance of interest-earning assets increased by one percent to $1.18 billion in the first quarter of fiscal 2023 from $1.16 billion in the same quarter last year. The increase in the average balance of loans held for investment was mainly offset by decreases in the average balance of investment securities and interest-earning deposits.
Interest income on loans receivable increased by $925,000, or 11 percent, to $9.10 million in the first quarter of fiscal 2023 from $8.18 million in the same quarter of fiscal 2022. The increase was due to a higher average balance, partly offset by a lower average yield. The average balance of loans receivable increased by $107.9 million, or 13 percent, to $960.6 million in the first quarter of fiscal 2023 from $852.7 million in the same quarter last year. Total loans originated and purchased for investment in the first quarter of fiscal 2023 were $84.6 million, up 39 percent from $60.9 million in the same quarter last year. Loan principal payments received in the first quarter of fiscal 2023 were $31.7 million, down 41 percent from $53.9 million in the same quarter last year. The average yield on loans receivable decreased by four basis points to 3.79 percent in the first quarter of fiscal 2023 from an average yield of 3.83 percent in the same quarter last year. Net
Page 2 of 14

deferred loan cost amortization in the first quarter of fiscal 2023 decreased 33 percent to $296,000 from $441,000 in the same quarter last year, attributable primarily to fewer loan payoffs.
Interest income from investment securities increased $118,000, or 28 percent, to $536,000 in the first quarter of fiscal 2023 from $418,000 for the same quarter of fiscal 2022. This increase was attributable to a higher average yield, partly offset by a lower average balance. The average yield on investment securities increased 40 basis points to 1.16 percent in the first quarter of fiscal 2023 from 0.76 percent for the same quarter last year. The increase in the average investment securities yield was primarily attributable to a lower premium amortization during the current quarter in comparison to the same quarter last year ($238,000 vs. $510,000) attributable to a lower total principal repayment ($9.3 million vs. $17.0 million) and, to a lesser extent, the upward repricing of adjustable-rate mortgage-backed securities. The average balance of investment securities decreased by $35.5 million, or 16 percent, to $184.4 million in the first quarter of fiscal 2023 from $219.9 million in the same quarter last year.
In the first quarter of fiscal 2023, the Federal Home Loan Bank – San Francisco (“FHLB”) distributed a $123,000 cash dividend to the Bank on its FHLB stock, up slightly from $122,000 in the same quarter last year. The average balance of FHLB – San Francisco stock in the first quarter of fiscal 2023 was $8.2 million, virtually unchanged from the same quarter of fiscal 2022 and the average yield was also virtually unchanged.
Interest income from interest-earning deposits, primarily cash deposited at the Federal Reserve Bank of San Francisco, was $139,000 in the first quarter of fiscal 2023, up 348 percent from $31,000 in the same quarter of fiscal 2022. The increase was due to a higher average yield, partly offset by a lower average balance. The average yield earned on interest-earning deposits in the first quarter of fiscal 2023 was 2.30 percent, up 215 basis points from 0.15 percent in the same quarter last year. The average balance of the Company’s interest-earning deposits decreased $58.6 million, or 71 percent, to $23.6 million in the first quarter of fiscal 2023 from $82.2 million in the same quarter last year primarily due to the utilization of these excess funds for loan portfolio growth.
Interest expense on deposits for the first quarter of fiscal 2023 was $317,000, a small increase from $313,000 for the same period last year. The increase in interest expense on deposits was attributable to a higher average balance. The average balance of deposits increased $10.0 million, or one percent, to $962.3 million in the first quarter of fiscal 2023 from $952.3 million in the same quarter last year. The average cost of deposits was unchanged at 0.13 percent as compared to the same quarter last year.
Transaction account balances or “core deposits” increased $7.9 million, or one percent, to $842.3 million at September 30, 2022 from $834.4 million at June 30, 2022 and time deposits increased $21.9 million, or 18 percent, to $143.0 million at September 30, 2022 from $121.1 million at June 30, 2022. The increase in time deposits was primarily due to an increase in brokered certificates of deposit of $30.0 million with a weighted average cost of 2.83% (including broker fees).
Page 3 of 14

Interest expense on borrowings, consisting of FHLB – San Francisco advances, for the first quarter of fiscal 2023 increased $71,000, or 13 percent, to $616,000 from $545,000 for the same period last year. The increase in interest expense on borrowings was primarily the result of a higher average cost and, to a lesser extent, a higher average balance. The average cost of borrowings increased by 18 basis points to 2.39 percent in the first quarter of fiscal 2023 from 2.21 percent in the same quarter last year, and the average balance of borrowings increased by $4.5 million to $102.2 million in the first quarter of fiscal 2023 from $97.7 million in the same quarter last year.
During the first quarter of fiscal 2023, the Company recorded a provision for loan losses of $70,000, as compared to the $339,000 recovery from the allowance for loan losses recorded during the same period last year and the $411,000 recovery from the allowance for loan losses recorded in the fourth quarter of fiscal 2022 (sequential quarter). The provision for loan losses primarily reflects an increase in loans held for investment in the first quarter of fiscal 2023 while the overall loan credit quality remains very strong.
Non-performing assets, comprised solely of non-performing loans with underlying collateral located in California, decreased $459,000 or 32 percent to $964,000, or 0.08 percent of total assets, at September 30, 2022, compared to $1.4 million, or 0.12 percent of total assets, at June 30, 2022. The non-performing loans at September 30, 2022 are comprised of five single-family loans, while the non-performing loans at June 30, 2022 were comprised of seven single-family loans. At both September 30, 2022 and June 30, 2022, there was no real estate owned.
Net loan recoveries for the quarter ended September 30, 2022 were $4,000 or 0.00 percent (annualized) of average loans receivable, as compared to net loan recoveries of $165,000 or 0.08 percent (annualized) of average loans receivable for the quarter ended September 30, 2021 and net loan recoveries of $6,000 or 0.00 percent (annualized) of average loans receivable for the quarter ended June 30, 2022 (sequential quarter).
Classified assets were $964,000 at September 30, 2022 which consist solely of loans in the substandard category; while classified assets at June 30, 2022 were $1.6 million, consisting of $224,000 of loans in the special mention category and $1.4 million of loans in the substandard category.
The allowance for loan losses was $5.6 million or 0.57 percent of gross loans held for investment at September 30, 2022, virtually unchanged from the $5.6 million or 0.59 percent of gross loans held for investment at June 30, 2022. Management believes that, based on currently available information, the allowance for loan losses is sufficient to absorb potential losses inherent in loans held for investment at September 30, 2022 under the incurred loss methodology.
Non-interest income decreased by $66,000, or six percent, to $1.00 million in the first quarter of fiscal 2023 from $1.07 million in the same period last year, primarily due to a $78,000 decrease in loan servicing and other fees, attributable primarily to lower loan prepayment fees. On a sequential quarter basis, non-interest income decreased $162,000, or 14 percent, primarily as a result of decreases in loan servicing and other fees and in card and processing fees.
Page 4 of 14

Non-interest expenses increased by $1.27 million or 22 percent to $6.94 million in the first quarter of fiscal 2023 from $5.67 million for the same quarter last year. The increase in the non-interest expense in the first quarter of fiscal 2023 was primarily due to the $1.20 million credit from the ERTC in the first quarter last year (not replicated this quarter). On a sequential quarter basis, non-interest expenses increased by $492,000 or eight percent to $6.94 million in the first quarter of fiscal 2023 from $6.45 million in the fourth quarter of fiscal 2022, primarily due to increases in professional expenses and premises and occupancy expenses.
The Company’s efficiency ratio(1), defined as non-interest expense divided by the sum of net interest income and non-interest income, in the first quarter of fiscal 2023 was 70 percent, up from 63 percent in the same quarter last year and 67 percent in the fourth quarter of fiscal 2022 (sequential quarter).
The Company’s provision for income taxes was $867,000 for the first quarter of fiscal 2023, down 10 percent from $961,000 in the same quarter last year primarily due to a decrease in income before income taxes. The effective tax rate in the first quarter of fiscal 2023 was 29.3 percent, up from 26.5 percent in the same quarter last year. The higher effective tax rate in the first quarter of last year was primarily attributable to the non-taxable treatment of the ERTC for state tax purposes in the first quarter of fiscal 2022 that was not applicable in this quarter.
The Company repurchased 49,624 shares of its common stock with an average cost of $14.57 per share during the quarter ended September 30, 2022 pursuant to its April 2022 stock repurchase plan. As of September 30, 2022, a total of 314,635 shares or 86 percent of the shares authorized for repurchase under the plan remain available to purchase until the plan expires on April 28, 2023.
The Bank currently operates 13 retail/business banking offices in Riverside County and San Bernardino County (Inland Empire).
The Company will host a conference call for institutional investors and bank analysts on Wednesday, October 26, 2022 at 9:00 a.m. (Pacific) to discuss its financial results. The conference call can be accessed by dialing 1-844-291-5491 and referencing access code number 3547024. An audio replay of the conference call will be available through Wednesday, November 2, 2022 by dialing 1-866-207-1041 and referencing access code number 7668330.
For more financial information about the Company please visit the website at www.myprovident.com and click on the “Investor Relations” section.

(1) | The Company uses certain non-GAAP financial measures to provide meaningful supplemental information regarding the Company’s operational performance and to enhance investors’ overall understanding of such financial performance. However, these non-GAAP financial measures are supplemental and are not a substitute for an analysis based on GAAP measures. As other companies may use different calculations for these adjusted measures, this presentation may not be comparable to other similarly titled adjusted measures reported by other companies.

Page 5 of 14

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. You should not place undue reliance on these statements, as they are subject to risks and uncertainties. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Company may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Company. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors which could cause actual results to differ materially from the results anticipated or implied by our forward-looking statements include, but are not limited to potential adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company's business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a potential recession or slowed economic growth caused by increasing political instability from acts of war including Russia’s invasion of Ukraine, as well as increasing oil prices and supply chain disruptions, and any governmental or societal responses to the COVID-19 pandemic, including the possibility of new COVID-19 variants; increased competitive pressures; changes in the interest rate environment; changes in general economic conditions, including the effects of inflation, and conditions within the securities markets; legislative and regulatory changes, including as a result of the COVID-19 pandemic; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission (“SEC”) - which are available on our website at www.myprovident.com and on the SEC’s website at www.sec.gov. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements whether as a result of new information, future events or otherwise. These risks could cause our actual results for fiscal 2023 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us and could negatively affect our operating and stock price performance.

Contacts: |  | Craig G. Blunden |  | Donavon P. Ternes
|  | Chairman and |  | President, Chief Operating Officer,
|  | Chief Executive Officer |  | and Chief Financial Officer

Page 6 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Condensed Consolidated Statements of Financial Condition
(Unaudited –In Thousands, Except Share Information)

|  | September 30, |  | June 30, |  | March 31, |  | December 31, |  | September 30,
|  | 2022 |  | 2022 |  | 2022 |  | 2021 |  | 2021
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | $ | 38,701 |  | $ | 23,414 |  | $ | 60,121 |  | $ | 85,680 |  | $ | 88,249
Investment securities – held to maturity, at cost |  |  | 176,162 |  |  | 185,745 |  |  | 195,579 |  |  | 205,065 |  |  | 205,821
Investment securities - available for sale, at fair value |  |  | 2,517 |  |  | 2,676 |  |  | 2,944 |  |  | 3,118 |  |  | 3,316
Loans held for investment, net of allowance for loan losses of $5,638; $5,564; $5,969; $6,608 and $7,413, respectively; includes $1,350; $1,396; $1,470; $1,555 and $1,577 at fair value, respectively |  |  | 993,942 |  |  | 939,992 |  |  | 893,563 |  |  | 852,006 |  |  | 859,035
Accrued interest receivable |  |  | 3,054 |  |  | 2,966 |  |  | 2,850 |  |  | 2,862 |  |  | 2,909
FHLB – San Francisco stock |  |  | 8,239 |  |  | 8,239 |  |  | 8,155 |  |  | 8,155 |  |  | 8,155
Premises and equipment, net |  |  | 8,707 |  |  | 8,826 |  |  | 8,957 |  |  | 8,942 |  |  | 9,014
Prepaid expenses and other assets |  |  | 14,593 |  |  | 15,180 |  |  | 15,665 |  |  | 16,577 |  |  | 15,782
Total assets |  | $ | 1,245,915 |  | $ | 1,187,038 |  | $ | 1,187,834 |  | $ | 1,182,405 |  | $ | 1,192,281
Liabilities and Stockholders’ Equity |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Non interest-bearing deposits |  | $ | 123,314 |  | $ | 125,089 |  | $ | 117,097 |  | $ | 112,022 |  | $ | 120,883
Interest-bearing deposits |  |  | 862,010 |  |  | 830,415 |  |  | 846,403 |  |  | 844,326 |  |  | 835,859
Total deposits |  |  | 985,324 |  |  | 955,504 |  |  | 963,500 |  |  | 956,348 |  |  | 956,742
Borrowings |  |  | 115,000 |  |  | 85,000 |  |  | 80,000 |  |  | 80,000 |  |  | 90,000
Accounts payable, accrued interest and other liabilities |  |  | 16,402 |  |  | 17,884 |  |  | 16,717 |  |  | 18,123 |  |  | 17,304
Total liabilities |  |  | 1,116,726 |  |  | 1,058,388 |  |  | 1,060,217 |  |  | 1,054,471 |  |  | 1,064,046
Stockholders’ equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Preferred stock, $.01 par value (2,000,000 shares authorized; none issued and outstanding) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | —
Common stock, $.01 par value; (40,000,000 shares authorized; 18,229,615; 18,229,615; 18,229,615; 18,229,615 and 18,229,615 shares issued respectively; 7,235,560; 7,285,184; 7,320,672; 7,389,943 and 7,491,705 shares outstanding, respectively) |  |  | 183 |  |  | 183 |  |  | 183 |  |  | 183 |  |  | 183
Additional paid-in capital |  |  | 98,559 |  |  | 98,826 |  |  | 98,617 |  |  | 98,404 |  |  | 98,179
Retained earnings |  |  | 203,750 |  |  | 202,680 |  |  | 201,237 |  |  | 200,569 |  |  | 199,344
Treasury stock at cost (10,994,055; 10,944,431; 10,908,943; 10,839,672 and 10,737,910 shares, respectively) |  |  | (173,286) |  |  | (173,041) |  |  | (172,459) |  |  | (171,280) |  |  | (169,537)
Accumulated other comprehensive income, net of tax |  |  | (17) |  |  | 2 |  |  | 39 |  |  | 58 |  |  | 66
Total stockholders’ equity |  |  | 129,189 |  |  | 128,650 |  |  | 127,617 |  |  | 127,934 |  |  | 128,235
Total liabilities and stockholders’ equity |  | $ | 1,245,915 |  | $ | 1,187,038 |  | $ | 1,187,834 |  | $ | 1,182,405 |  | $ | 1,192,281

Page 7 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Condensed Consolidated Statements of Operations
(Unaudited - In Thousands, Except Earnings Per Share)

|  | Quarter Ended
|  | September 30,
|  | 2022 |  | 2021
Interest income: |  |  |  |  |  |
Loans receivable, net |  | $ | 9,100 |  | $ | 8,175
Investment securities |  |  | 536 |  |  | 418
FHLB – San Francisco stock |  |  | 123 |  |  | 122
Interest-earning deposits |  |  | 139 |  |  | 31
Total interest income |  |  | 9,898 |  |  | 8,746
Interest expense: |  |  |  |  |  |
Checking and money market deposits |  |  | 60 |  |  | 57
Savings deposits |  |  | 44 |  |  | 41
Time deposits |  |  | 213 |  |  | 215
Borrowings |  |  | 616 |  |  | 545
Total interest expense |  |  | 933 |  |  | 858
Net interest income |  |  | 8,965 |  |  | 7,888
Provision (recovery) for loan losses |  |  | 70 |  |  | (339)
Net interest income, after provision (recovery) for loan losses |  |  | 8,895 |  |  | 8,227
Non-interest income: |  |  |  |  |  |
Loan servicing and other fees |  |  | 108 |  |  | 186
Deposit account fees |  |  | 343 |  |  | 312
Card and processing fees |  |  | 381 |  |  | 405
Other |  |  | 171 |  |  | 166
Total non-interest income |  |  | 1,003 |  |  | 1,069
Non-interest expense: |  |  |  |  |  |
Salaries and employee benefits |  |  | 4,139 |  |  | 3,120
Premises and occupancy |  |  | 861 |  |  | 905
Equipment |  |  | 311 |  |  | 288
Professional expenses |  |  | 592 |  |  | 461
Sales and marketing expenses |  |  | 147 |  |  | 142
Deposit insurance premiums and regulatory assessments |  |  | 135 |  |  | 137
Other |  |  | 756 |  |  | 615
Total non-interest expense |  |  | 6,941 |  |  | 5,668
Income before income taxes |  |  | 2,957 |  |  | 3,628
Provision for income taxes |  |  | 867 |  |  | 961
Net income |  | $ | 2,090 |  | $ | 2,667
Basic earnings per share |  | $ | 0.29 |  | $ | 0.35
Diluted earnings per share |  | $ | 0.29 |  | $ | 0.35
Cash dividend per share |  | $ | 0.14 |  | $ | 0.14

Page 8 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Condensed Consolidated Statements of Operations – Sequential Quarters
(Unaudited – In Thousands, Except Share Information)

|  | Quarter Ended
|  | September 30, |  | June 30, |  | March 31, |  | December 31, |  | September 30,
|  | 2022 |  | 2022 |  | 2022 |  | 2021 |  | 2021
Interest income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans receivable, net |  | $ | 9,100 |  | $ | 8,485 |  | $ | 7,581 |  | $ | 7,920 |  | $ | 8,175
Investment securities |  |  | 536 |  |  | 540 |  |  | 515 |  |  | 433 |  |  | 418
FHLB – San Francisco stock |  |  | 123 |  |  | 121 |  |  | 123 |  |  | 123 |  |  | 122
Interest-earning deposits |  |  | 139 |  |  | 69 |  |  | 39 |  |  | 35 |  |  | 31
Total interest income |  |  | 9,898 |  |  | 9,215 |  |  | 8,258 |  |  | 8,511 |  |  | 8,746
Interest expense: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Checking and money market deposits |  |  | 60 |  |  | 51 |  |  | 54 |  |  | 58 |  |  | 57
Savings deposits |  |  | 44 |  |  | 44 |  |  | 42 |  |  | 45 |  |  | 41
Time deposits |  |  | 213 |  |  | 160 |  |  | 178 |  |  | 199 |  |  | 215
Borrowings |  |  | 616 |  |  | 454 |  |  | 446 |  |  | 546 |  |  | 545
Total interest expense |  |  | 933 |  |  | 709 |  |  | 720 |  |  | 848 |  |  | 858
Net interest income |  |  | 8,965 |  |  | 8,506 |  |  | 7,538 |  |  | 7,663 |  |  | 7,888
Provision (recovery) for loan losses |  |  | 70 |  |  | (411) |  |  | (645) |  |  | (1,067) |  |  | (339)
Net interest income, after provision (recovery) for loan losses |  |  | 8,895 |  |  | 8,917 |  |  | 8,183 |  |  | 8,730 |  |  | 8,227
Non-interest income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loan servicing and other fees |  |  | 108 |  |  | 189 |  |  | 237 |  |  | 444 |  |  | 186
Deposit account fees |  |  | 343 |  |  | 336 |  |  | 329 |  |  | 325 |  |  | 312
Card and processing fees |  |  | 381 |  |  | 457 |  |  | 378 |  |  | 399 |  |  | 405
Other |  |  | 171 |  |  | 183 |  |  | 170 |  |  | 200 |  |  | 166
Total non-interest income |  |  | 1,003 |  |  | 1,165 |  |  | 1,114 |  |  | 1,368 |  |  | 1,069
Non-interest expense: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Salaries and employee benefits |  |  | 4,139 |  |  | 4,055 |  |  | 4,203 |  |  | 4,455 |  |  | 3,120
Premises and occupancy |  |  | 861 |  |  | 690 |  |  | 836 |  |  | 758 |  |  | 905
Equipment |  |  | 311 |  |  | 350 |  |  | 330 |  |  | 314 |  |  | 288
Professional expenses |  |  | 592 |  |  | 311 |  |  | 299 |  |  | 348 |  |  | 461
Sales and marketing expenses |  |  | 147 |  |  | 165 |  |  | 186 |  |  | 149 |  |  | 142
Deposit insurance premiums and regulatory assessments |  |  | 135 |  |  | 134 |  |  | 136 |  |  | 136 |  |  | 137
Other |  |  | 756 |  |  | 744 |  |  | 909 |  |  | 739 |  |  | 615
Total non-interest expense |  |  | 6,941 |  |  | 6,449 |  |  | 6,899 |  |  | 6,899 |  |  | 5,668
Income before income taxes |  |  | 2,957 |  |  | 3,633 |  |  | 2,398 |  |  | 3,199 |  |  | 3,628
Provision for income taxes |  |  | 867 |  |  | 1,170 |  |  | 699 |  |  | 935 |  |  | 961
Net income |  | $ | 2,090 |  | $ | 2,463 |  | $ | 1,699 |  | $ | 2,264 |  | $ | 2,667
Basic earnings per share |  | $ | 0.29 |  | $ | 0.34 |  | $ | 0.23 |  | $ | 0.30 |  | $ | 0.35
Diluted earnings per share |  | $ | 0.29 |  | $ | 0.34 |  | $ | 0.23 |  | $ | 0.30 |  | $ | 0.35
Cash dividends per share |  | $ | 0.14 |  | $ | 0.14 |  | $ | 0.14 |  | $ | 0.14 |  | $ | 0.14

Page 9 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands, Except Share Information)

|  | Quarter Ended |
|  | September 30, |
|  | 2022 |  | 2021 |
SELECTED FINANCIAL RATIOS: |  |  |  |  |  |  |
Return on average assets |  |  | 0.69 | % |  | 0.89 | %
Return on average stockholders' equity |  |  | 6.42 | % |  | 8.39 | %
Stockholders’ equity to total assets |  |  | 10.37 | % |  | 10.76 | %
Net interest spread |  |  | 3.01 | % |  | 2.69 | %
Net interest margin |  |  | 3.05 | % |  | 2.71 | %
Efficiency ratio |  |  | 69.63 | % |  | 63.28 | %
Average interest-earning assets to average interest-bearing liabilities |  |  | 110.56 | % |  | 110.76 | %
SELECTED FINANCIAL DATA: |  |  |  |  |  |  |
Basic earnings per share |  | $ | 0.29 |  | $ | 0.35 |
Diluted earnings per share |  | $ | 0.29 |  | $ | 0.35 |
Book value per share |  | $ | 17.85 |  | $ | 17.12 |
Shares used for basic EPS computation |  |  | 7,273,377 |  |  | 7,529,870 |
Shares used for diluted EPS computation |  |  | 7,310,490 |  |  | 7,575,320 |
Total shares issued and outstanding |  |  | 7,235,560 |  |  | 7,491,705 |
LOANS ORIGINATED AND PURCHASED FOR INVESTMENT: |  |  |  |  |  |  |
Mortgage Loans: |  |  |  |  |  |  |
Single-family |  | $ | 57,049 |  | $ | 34,420 |
Multi-family |  |  | 24,196 |  |  | 25,318 |
Commercial real estate |  |  | 3,325 |  |  | 1,200 |
Total loans originated and purchased for investment |  | $ | 84,570 |  | $ | 60,938 |

Page 10 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands, Except Share Information)

|  | Quarter |  | Quarter |  | Quarter |  | Quarter |  | Quarter |
|  | Ended |  | Ended |  | Ended |  | Ended |  | Ended |
|  | 09/30/22 |  | 06/30/22 |  | 03/31/22 |  | 12/31/21 |  | 09/30/21 |
SELECTED FINANCIAL RATIOS: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Return on average assets |  |  | 0.69 | % |  | 0.83 | % |  | 0.57 | % |  | 0.76 | % |  | 0.89 | %
Return on average stockholders' equity |  |  | 6.42 | % |  | 7.72 | % |  | 5.33 | % |  | 7.11 | % |  | 8.39 | %
Stockholders’ equity to total assets |  |  | 10.37 | % |  | 10.84 | % |  | 10.74 | % |  | 10.82 | % |  | 10.76 | %
Net interest spread |  |  | 3.01 | % |  | 2.91 | % |  | 2.58 | % |  | 2.61 | % |  | 2.69 | %
Net interest margin |  |  | 3.05 | % |  | 2.93 | % |  | 2.61 | % |  | 2.64 | % |  | 2.71 | %
Efficiency ratio |  |  | 69.63 | % |  | 66.68 | % |  | 79.74 | % |  | 76.39 | % |  | 63.28 | %
Average interest-earning assets to average interest-bearing liabilities |  |  | 110.56 | % |  | 110.51 | % |  | 110.79 | % |  | 110.65 | % |  | 110.76 | %
SELECTED FINANCIAL DATA: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic earnings per share |  | $ | 0.29 |  | $ | 0.34 |  | $ | 0.23 |  | $ | 0.30 |  | $ | 0.35 |
Diluted earnings per share |  | $ | 0.29 |  | $ | 0.34 |  | $ | 0.23 |  | $ | 0.30 |  | $ | 0.35 |
Book value per share |  | $ | 17.85 |  | $ | 17.66 |  | $ | 17.43 |  | $ | 17.31 |  | $ | 17.12 |
Average shares used for basic EPS |  |  | 7,273,377 |  |  | 7,291,046 |  |  | 7,357,989 |  |  | 7,435,218 |  |  | 7,529,870 |
Average shares used for diluted EPS |  |  | 7,310,490 |  |  | 7,323,138 |  |  | 7,412,516 |  |  | 7,482,812 |  |  | 7,575,320 |
Total shares issued and outstanding |  |  | 7,235,560 |  |  | 7,285,184 |  |  | 7,320,672 |  |  | 7,389,943 |  |  | 7,491,705 |
LOANS ORIGINATED AND PURCHASED FOR INVESTMENT: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family |  | $ | 57,049 |  | $ | 62,908 |  | $ | 54,978 |  | $ | 45,720 |  | $ | 34,420 |
Multi-family |  |  | 24,196 |  |  | 16,013 |  |  | 31,487 |  |  | 14,920 |  |  | 25,318 |
Commercial real estate |  |  | 3,325 |  |  | 6,971 |  |  | 7,011 |  |  | 3,005 |  |  | 1,200 |
Construction |  |  | — |  |  | — |  |  | 544 |  |  | 1,684 |  |  | — |
Total loans originated and purchased for investment |  | $ | 84,570 |  | $ | 85,892 |  | $ | 94,020 |  | $ | 65,329 |  | $ | 60,938 |

Page 11 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

|  | As of |  | As of |  | As of |  | As of |  | As of |
|  | 09/30/22 |  | 06/30/22 |  | 03/31/22 |  | 12/31/21 |  | 09/30/21 |
ASSET QUALITY RATIOS AND DELINQUENT LOANS: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Recourse reserve for loans sold |  | $ | 160 |  | $ | 160 |  | $ | 160 |  | $ | 160 |  | $ | 200 |
Allowance for loan losses |  | $ | 5,638 |  | $ | 5,564 |  | $ | 5,969 |  | $ | 6,608 |  | $ | 7,413 |
Non-performing loans to loans held for investment, net |  |  | 0.10 | % |  | 0.15 | % |  | 0.22 | % |  | 0.33 | % |  | 0.77 | %
Non-performing assets to total assets |  |  | 0.08 | % |  | 0.12 | % |  | 0.17 | % |  | 0.24 | % |  | 0.55 | %
Allowance for loan losses to gross loans held for investment |  |  | 0.57 | % |  | 0.59 | % |  | 0.66 | % |  | 0.77 | % |  | 0.86 | %
Net loan charge-offs (recoveries) to average loans receivable (annualized) |  |  | — | % |  | — | % |  | — | % |  | (0.12) | % |  | (0.08) | %
Non-performing loans |  | $ | 964 |  | $ | 1,423 |  | $ | 1,996 |  | $ | 2,802 |  | $ | 6,616 |
Loans 30 to 89 days delinquent |  | $ | 1 |  | $ | 3 |  | $ | 2 |  | $ | 3 |  | $ | 20 |

|  | Quarter |  | Quarter |  | Quarter |  | Quarter |  | Quarter
|  | Ended |  | Ended |  | Ended |  | Ended |  | Ended
|  | 09/30/22 |  | 06/30/22 |  | 03/31/22 |  | 12/31/21 |  | 09/30/21
Recourse provision (recovery) for loans sold |  | $ | — |  | $ | — |  | $ | — |  | $ | (40) |  | $ | —
Provision (recovery) for loan losses |  | $ | 70 |  | $ | (411) |  | $ | (645) |  | $ | (1,067) |  | $ | (339)
Net loan charge-offs (recoveries) |  | $ | (4) |  | $ | (6) |  | $ | (6) |  | $ | (262) |  | $ | (165)

|  | As of |  | As of |  | As of |  | As of |  | As of |
|  | 09/30/2022 |  | 06/30/2022 |  | 03/31/2022 |  | 12/31/2021 |  | 09/30/2021 |
REGULATORY CAPITAL RATIOS (BANK): |  |  |  |  |  |  |  |  |  |  |
Tier 1 leverage ratio |  | 9.74 | % | 10.47 | % | 10.27 | % | 10.02 | % | 9.81 | %
Common equity tier 1 capital ratio |  | 17.67 | % | 19.58 | % | 19.32 | % | 19.69 | % | 18.90 | %
Tier 1 risk-based capital ratio |  | 17.67 | % | 19.58 | % | 19.32 | % | 19.69 | % | 18.90 | %
Total risk-based capital ratio |  | 18.54 | % | 20.47 | % | 20.29 | % | 20.79 | % | 20.12 | %

|  | As of September 30, |
|  | 2022 |  | 2021 |
|  | Balance |  | Rate(2) |  | Balance |  | Rate(2) |
INVESTMENT SECURITIES: |  |  |  |  |  |  |  |  |  |  |
Held to maturity: |  |  |  |  |  |  |  |  |  |  |
Certificates of deposit |  | $ | 200 |  | 2.50 | % | $ | 800 |  | 0.23 | %
U.S. SBA securities |  |  | 720 |  | 2.10 |  |  | 1,272 |  | 0.60 |
U.S. government sponsored enterprise MBS |  |  | 171,331 |  | 1.38 |  |  | 203,749 |  | 1.22 |
U.S. government sponsored enterprise CMO |  |  | 3,911 |  | 2.21 |  |  | — |  | — |
Total investment securities held to maturity |  | $ | 176,162 |  | 1.40 | % | $ | 205,821 |  | 1.21 | %
Available for sale (at fair value): |  |  |  |  |  |  |  |  |  |  |
U.S. government agency MBS |  | $ | 1,610 |  | 2.17 | % | $ | 2,062 |  | 2.08 | %
U.S. government sponsored enterprise MBS |  |  | 800 |  | 3.06 |  |  | 1,104 |  | 2.29 |
Private issue CMO |  |  | 107 |  | 3.02 |  |  | 150 |  | 2.53 |
Total investment securities available for sale |  | $ | 2,517 |  | 2.49 | % | $ | 3,316 |  | 2.17 | %
Total investment securities |  | $ | 178,679 |  | 1.42 | % | $ | 209,137 |  | 1.23 | %

(2) | The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.

Page 12 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

|  | As of September 30, |
|  | 2022 |  | 2021 |
|  | Balance |  | Rate(2) |  | Balance |  | Rate(2) |
LOANS HELD FOR INVESTMENT: |  |  |  |  |  |  |  |  |  |  |
Single-family (1 to 4 units) |  | $ | 429,575 |  | 3.56 | % | $ | 274,970 |  | 3.29 | %
Multi-family (5 or more units) |  |  | 468,031 |  | 4.18 |  |  | 489,550 |  | 4.06 |
Commercial real estate |  |  | 89,339 |  | 4.89 |  |  | 91,779 |  | 4.67 |
Construction |  |  | 3,151 |  | 3.84 |  |  | 2,574 |  | 5.98 |
Other mortgage |  |  | 118 |  | 5.25 |  |  | 137 |  | 5.25 |
Commercial business |  |  | 1,117 |  | 7.97 |  |  | 865 |  | 6.41 |
Consumer |  |  | 70 |  | 15.50 |  |  | 84 |  | 15.00 |
Total loans held for investment |  |  | 991,401 |  | 3.98 | % |  | 859,959 |  | 3.89 | %
Advance payments of escrows |  |  | 20 |  |  |  |  | 68 |  |  |
Deferred loan costs, net |  |  | 8,159 |  |  |  |  | 6,421 |  |  |
Allowance for loan losses |  |  | (5,638) |  |  |  |  | (7,413) |  |  |
Total loans held for investment, net |  | $ | 993,942 |  |  |  | $ | 859,035 |  |  |
Purchased loans serviced by others included above |  | $ | 11,172 |  | 3.57 | % | $ | 13,100 |  | 3.50 | %

(2) The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.

|  | As of September 30, |
|  | 2022 |  | 2021 |
|  | Balance |  | Rate(2) |  | Balance |  | Rate(2) |
DEPOSITS: |  |  |  |  |  |  |  |  |  |  |
Checking accounts – non interest-bearing |  | $ | 123,314 |  | — | % | $ | 120,883 |  | — | %
Checking accounts – interest-bearing |  |  | 339,961 |  | 0.04 |  |  | 341,281 |  | 0.04 |
Savings accounts |  |  | 336,075 |  | 0.05 |  |  | 318,318 |  | 0.05 |
Money market accounts |  |  | 42,968 |  | 0.25 |  |  | 40,785 |  | 0.22 |
Time deposits |  |  | 143,006 |  | 0.95 |  |  | 135,475 |  | 0.65 |
Total deposits |  | $ | 985,324 |  | 0.18 | % | $ | 956,742 |  | 0.13 | %
BORROWINGS: |  |  |  |  |  |  |  |  |  |  |
Overnight |  | $ | — |  | — | % | $ | — |  | — | %
Three months or less |  |  | 55,000 |  | 3.16 |  |  | — |  | — |
Over three to six months |  |  | — |  | — |  |  | 10,000 |  | 2.20 |
Over six months to one year |  |  | 20,000 |  | 2.00 |  |  | 20,000 |  | 1.75 |
Over one year to two years |  |  | 20,000 |  | 2.50 |  |  | 20,000 |  | 2.00 |
Over two years to three years |  |  | 20,000 |  | 2.70 |  |  | 20,000 |  | 2.50 |
Over three years to four years |  |  | — |  | — |  |  | 20,000 |  | 2.70 |
Over four years to five years |  |  | — |  | — |  |  | — |  | — |
Over five years |  |  | — |  | — |  |  | — |  | — |
Total borrowings |  | $ | 115,000 |  | 2.76 | % | $ | 90,000 |  | 2.23 | %

(2) | The interest rate described in the rate column is the weighted-average interest rate or cost of all instruments, which are included in the balance of the respective line item.

Page 13 of 14

PROVIDENT FINANCIAL HOLDINGS, INC.
Financial Highlights
(Unaudited - Dollars in Thousands)

|  | Quarter Ended |  | Quarter Ended |
|  | September 30, 2022 |  | September 30, 2021 |
|  | Balance |  | Rate(2) |  | Balance |  | Rate(2) |
SELECTED AVERAGE BALANCE SHEETS: |  |  |  |  |  |  |  |  |  |  |  |
Loans receivable, net |  | $ | 960,610 |  |  | 3.79 | % | $ | 852,741 |  | 3.83 | %
Investment securities |  |  | 184,352 |  |  | 1.16 |  |  | 219,907 |  | 0.76 |
FHLB – San Francisco stock |  |  | 8,239 |  |  | 5.97 |  |  | 8,155 |  | 5.98 |
Interest-earning deposits |  |  | 23,614 |  |  | 2.30 |  |  | 82,207 |  | 0.15 |
Total interest-earning assets |  | $ | 1,176,815 |  |  | 3.36 | % | $ | 1,163,010 |  | 3.01 | %
Total assets |  | $ | 1,210,762 |  |  |  |  | $ | 1,194,759 |  |  |
Deposits |  | $ | 962,266 |  |  | 0.13 | % | $ | 952,317 |  | 0.13 | %
Borrowings |  |  | 102,174 |  |  | 2.39 |  |  | 97,742 |  | 2.21 |
Total interest-bearing liabilities |  | $ | 1,064,440 |  |  | 0.35 | % | $ | 1,050,059 |  | 0.32 | %
Total stockholders’ equity |  | $ | 130,166 |  |  |  |  | $ | 127,160 |  |  |

(2) The interest rate described in the rate column is the weighted-average interest rate or yield/cost of all instruments, which are included in the balance of the respective line item.
ASSET QUALITY:

|  | As of |  | As of |  | As of |  | As of |  | As of
|  | 09/30/22 |  | 06/30/22 |  | 03/31/22 |  | 12/31/21 |  | 09/30/21
Loans on non-accrual status (excluding restructured loans): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family |  | $ | 243 |  | $ | 701 |  | $ | 716 |  | $ | 745 |  | $ | 739
Multi-family |  |  | — |  |  | — |  |  | 306 |  |  | 1,077 |  |  | 775
Total |  |  | 243 |  |  | 701 |  |  | 1,022 |  |  | 1,822 |  |  | 1,514
Accruing loans past due 90 days or more: |  |  | — |  |  | — |  |  | — |  |  | — |  |  | —
Total |  |  | — |  |  | — |  |  | — |  |  | — |  |  | —
Restructured loans on non-accrual status: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage loans: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Single-family |  |  | 721 |  |  | 722 |  |  | 974 |  |  | 980 |  |  | 5,102
Total |  |  | 721 |  |  | 722 |  |  | 974 |  |  | 980 |  |  | 5,102
Total non-performing loans (3) |  |  | 964 |  |  | 1,423 |  |  | 1,996 |  |  | 2,802 |  |  | 6,616
Real estate owned, net |  |  | — |  |  | — |  |  | — |  |  | — |  |  | —
Total non-performing assets |  | $ | 964 |  | $ | 1,423 |  | $ | 1,996 |  | $ | 2,802 |  | $ | 6,616

(3) The non-performing loans balances are net of individually evaluated or collectively evaluated allowances, specifically attached to the individual loans.
Page 14 of 14