Lake Shore Bancorp, Inc. /MD/ Debt Disclosure
Note 8 - Borrowings
At December 31, 2025 and 2024, the Company had written agreements with the FHLBNY, which allow it to borrow up to the maximum lending values designated by the type of collateral pledged. As of December 31, 2025 and 2024, our maximum lending value was $88.0 million and $26.7 million, respectively, and was collateralized by a pledge of certain fixed-rate residential, one- to four-family loans.
At December 31, 2025 and December 31, 2024, the Company had no short-term borrowings from the FHLBNY.
At December 31, 2025, the Company had paid off all long-term debt outstanding under the written agreement with the FHLBNY. At December 31, 2024, the Company had long-term debt outstanding under the written agreement with the FHLBNY of $10.3 million. All of the advances outstanding at December 31, 2024, were term borrowings with initial terms of 1 to 5 years at fixed rates of interest ranging from 1.70% to 5.20%, with a weighted average interest rate of 3.73%.
Long-term debt from the FHLBNY and related contractual maturities consisted of the following:
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At December 31, 2025 |
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At December 31, 2024 |
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Maturity |
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Amount |
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Weighted Average |
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Amount |
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Weighted Average |
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(Dollars in thousands) |
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In one year |
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$ |
— |
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— |
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% |
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$ |
8,250 |
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3.79 |
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% |
In two years |
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— |
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— |
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% |
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1,000 |
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3.49 |
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% |
In three years |
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— |
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— |
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% |
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1,000 |
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3.49 |
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% |
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$ |
— |
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— |
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% |
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$ |
10,250 |
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3.73 |
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% |
The Company has a written agreement with the FRB discount window for overnight borrowings which is collateralized by a pledge of securities, and allows it to borrow up to the value of the securities pledged. At December 31, 2025 and December 31, 2024, there were no securities pledged to the FRB. Additionally, the Company has uncollateralized intraday credit with the FRB that allows for certain transactions to not be rejected for which there are insufficient funds in its Federal Reserve Master Account during normal hours of operation.
The Company has also established an unsecured line of credit with a correspondent bank for $20.0 million at December 31, 2025 and December 31, 2024. At December 31, 2025 and 2024, there were no borrowings on this line.
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.