10-K: Community Bancorp. Reports Strong 2025 Growth, Nasdaq Listing

Sentiment:

Annual Report 27 March 2026 9:03 AM

Community Bancorp./VT reported a significant increase in net income and loan growth for fiscal year 2025, alongside its common stock listing on the Nasdaq Capital Market.

Better than expectedNet income increased significantly by 32.9% year-over-year.Earnings per common share showed strong growth.Total assets, net loans, and total deposits all experienced healthy growth.Key profitability ratios like Return on Average Assets and Return on Average Equity improved substantially.Net interest income, net interest spread, and net interest margin all increased.The Bank maintained a 'well capitalized' status and all capital ratios exceeded regulatory requirements.Successful listing of common stock on the Nasdaq Capital Market.

Summary

Net income increased 32.9% to $17.0 million in 2025 from $12.8 million in 2024.
Earnings per common share rose to $3.01 in 2025 from $2.28 in 2024.
Total assets grew 3.1% to $1.29 billion at year-end 2025 from $1.25 billion at year-end 2024.
Net loans increased $36.4 million (3.9%) to $955.2 million.
Deposits increased $69.0 million (6.9%) to $1.1 billion.
Equity capital increased to $113.7 million, with book value per share at $20.36.
Common stock began trading on the Nasdaq Capital Market on February 2, 2026.
Redeemed all 15 outstanding shares of Series A Preferred Stock for $1.5 million in Q4 2025.
Credit loss expense increased 21.20% to $1.4 million in 2025 from $1.1 million in 2024.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a strong performance, marked by significant growth in key financial metrics, robust capital positions, and a strategic move to the Nasdaq, indicating positive momentum despite some market headwinds.

Positives

Net income increased by $4.2 million (32.9%) to $17.0 million in 2025.
Earnings per common share increased to $3.01 in 2025 from $2.28 in 2024.
Total assets grew by 3.1% to $1.29 billion.
Net loans increased by $36.4 million (3.9%) to $955.2 million.
Deposits increased by $69.0 million (6.9%) to $1.1 billion.
Equity capital increased to $113.7 million, with book value per share at $20.36.
Net interest income increased $6.2 million (18.0%) in 2025.
Net interest spread increased 41 basis points to 3.19% in 2025.
Net interest margin increased 40 basis points to 3.68% in 2025.
All capital ratios for the Company and its subsidiary Bank exceeded regulatory requirements, with the Bank considered 'well capitalized'.
Common stock listed on the Nasdaq Capital Market effective February 2, 2026.
Income from CFS Partners increased 46.10% due to strong equity market, managed account retention, and increased ownership share (from 33.3% to 50% effective March 1, 2025).
A recovery due to check fraud activity from 2024 resulted in a 95.09% decrease in charged-off checks year over year.
The decrease in outsourcing expense is attributable to a renegotiated contract from the Company's core processing provider.

Negatives

Borrowed funds decreased by $36.6 million, or 51.32%, from $72.6 million in 2024 to $36.0 million in 2025, indicating a reduced reliance on this funding source which can be more expensive.
Taxable investment securities portfolio decreased by 10.64% in average volume.
Average yield on federal funds sold and overnight deposits decreased 82 basis points in 2025 versus 2024, reflecting decreases in the federal funds rate.
Commercial & industrial loan portfolio decreased by $16.6 million (13.4%).
Municipal loan portfolio decreased by $5 million (7.47%).
Savings accounts decreased by $382,537 (0.3%).
Credit loss expense increased 21.20% year over year to $1.4 million.
Accumulated other comprehensive loss, though decreased, remains a loss of $(9.6) million.

Risks

Changes in interest rates could adversely affect net interest income, earnings, asset valuations, or margins.
Reliance on deposit-gathering for funding, with potential need for more expensive purchased deposits or borrowings if core deposits are insufficient.
Credit risk from borrower defaults, potentially leading to lost income, increased expenses, and inadequate Allowance for Credit Losses (ACL).
Prepayments of loans may reduce interest income if funds cannot be reinvested at similar or higher rates.
Geographic concentration of loans and deposits in northeastern and central Vermont, making the business vulnerable to adverse local economic conditions.
High concentration of loans secured by real estate, making the company susceptible to deterioration in real estate markets.
Systems failures, interruptions, cyberattacks, or other breaches of information security (including vendor-related) could disrupt business, harm reputation, and lead to financial losses.
Dependence on the accuracy and completeness of customer and counterparty information, which if inaccurate, could lead to financial or reputational harm.
Environmental liability associated with foreclosed properties could result in significant losses.
Pandemics, epidemics, disease outbreaks, and public health crises could disrupt business, reduce demand for services, and negatively impact asset quality, liquidity, capital, and net income.
Ability to pay dividends and service debt depends on dividends from the subsidiary bank, which are subject to regulatory and contractual limitations.
Highly regulated banking business, with potential adverse effects from changes in law and regulation, including increased costs or enforcement actions.
Decline in the fair value of the investment portfolio could adversely affect financial results and capital.
Changes in accounting standards could materially affect financial statements, potentially requiring retroactive application and restatements.
Internal controls and procedures may fail or be circumvented, leading to adverse effects on business, results of operations, and financial condition.
Detailed capital requirements could limit dividend payments and other actions.
Potential requirement to write down goodwill, negatively affecting shareholders' equity and financial results.
Investments in tax credit partnerships and other structures may not generate expected returns due to changes in tax laws or project management issues.
Low trading volume of common stock, even after Nasdaq listing, can contribute to price volatility and affect liquidity.
Common stock is subordinate to existing and future indebtedness and any future preferred stock.
Securities issued by the company are not FDIC insured.
Organizational documents may discourage third-party acquisition.
Market changes in financial service delivery (e.g., shift to online/mobile banking) may adversely affect demand for traditional services.
Substantial competition from other banks, credit unions, and non-bank financial firms, with larger competitors having greater resources.
Disintermediation of payment services could lead to loss of fee income and deposits.
New products and services, while essential, may subject the company to additional risks (delivery timetables, pricing, technology failures, regulatory compliance).
Changes in tax rates could affect future results.
Failure to attract and retain skilled personnel could harm business.
Inability to offer all financial services and products of a financial holding company, limiting competitiveness.
Risk management framework may not be effective in mitigating all risks and losses.

Future Outlook

Management expects Net Interest Income (NII) to initially trend upward in a rising rate environment due to short-term assets repricing faster than retail funding, but this benefit could be reduced if deposit rates increase more quickly due to competitive pressures. In a falling rate environment, NII is expected to trend slightly downward initially, with sustained downward pressure as funding costs reach floors and asset yields reprice lower. The prolonged inverted yield curve and increased reliance on higher-cost funding have resulted in a more liability-sensitive balance sheet.

Management Comments

Management believes that we can continue to compete effectively, in view of our local market knowledge and community ties and our understanding and responsiveness to evolving customer needs.
Management believes that, as of December 31, 2025, the Company and the Bank met all capital adequacy requirements to which they were subject.
While we believe that we have sufficient capital to withstand an economic downturn from any headwinds related to inflation or recessionary periods, should one occur, our equity capital and regulatory capital ratios could be adversely impacted, including as a result of credit losses and other adverse impacts of government monetary policy.
Management believes that the qualitative calculation adequately captures the risk in these areas, and that the reserve balance continues to be directionally consistent with the overall risk profile of the Company's loan portfolio and credit risk appetite.

Industry Context

StockSavvy.ai notes that Community Bancorp./VT operates in a highly competitive financial services landscape, facing challenges from larger banks, tax-exempt credit unions, and non-traditional lenders leveraging technology for remote service delivery. The company's strategy of emphasizing community orientation and personal relationships is a common approach for smaller regional banks to differentiate themselves. The increase in deposit balances in Q3 and Q4 due to municipal accounts collecting tax payments is a localized trend for community banks serving government entities. The shift to Nasdaq listing is a strategic move to potentially increase trading volume and visibility, aligning with broader market trends for companies seeking greater liquidity and investor access. The company's focus on expanding into more robust economic areas like Central Vermont, Chittenden County, and western New Hampshire reflects a common strategy among regional banks to seek growth beyond their traditional, sometimes slower-growth, core markets.

Comparison to Industry Standards

The Bank was recognized by the SBA as Vermont's top Section 7(a) program lender and one of Vermont's top third-party small business lenders under the SBA's Section 504 loan program, indicating strong performance in small business support compared to peers.
The Bank received an 'Outstanding' rating in its last CRA examination by the OCC during 2023, which is a top-tier rating and suggests strong community engagement and lending practices compared to industry standards.
The company's return on average assets (1.41% in 2025) and return on average equity (15.91% in 2025) are generally considered strong for a community bank, potentially outperforming many regional and national banks. For example, many larger regional banks might report ROAA in the 0.8% 1.2% range and ROAE in the 8% 12% range, suggesting CMTV is performing well.
The net interest margin of 3.68% in 2025 is competitive within the community banking sector, often exceeding the NIMs of larger, more diversified financial institutions that may face greater pressure on lending spreads.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Policy Adoption	The Company adopted a Clawback Policy to comply with Section 10D of the Exchange Act and Nasdaq Listing Rule 5608, providing for recoupment of executive compensation in the event of an accounting restatement.	NA	Enhances corporate accountability and aligns executive incentives with accurate financial reporting, potentially improving investor confidence.
Share Repurchase Authorization	The Board of Directors authorized a stock repurchase program in July 2024, allowing repurchase of up to 275,000 shares of common stock, representing approximately 5% of outstanding shares.	2024-07	Signals management's confidence in the company's value and can enhance shareholder returns by reducing share count and increasing EPS, subject to market conditions and capital needs.
Exchange Listing	The Company's common stock began trading on the Nasdaq Capital Market effective February 2, 2026, subjecting it to Nasdaq's rules for listed companies.	2026-02-02	Potentially increases liquidity, visibility, and investor access for the common stock, but also introduces new compliance requirements and costs associated with Nasdaq listing rules.
Preferred Stock Redemption	The Company redeemed all 15 outstanding shares of Series A Preferred Stock for $1.5 million in November 2025.	2025-11	Reduces preferred dividend obligations and simplifies the capital structure, potentially benefiting common shareholders.
Regulatory Status	The Company is considered a non-accelerated filer and a smaller reporting company, allowing for reduced financial and other disclosures and exemption from Section 404(b) auditor attestation.	NA	Reduces compliance burden and associated costs, but may also result in less detailed public information compared to larger filers.
Regulatory Policy Change	The FRB rescinded the 2023 CRA regulations and restored the pre-existing 1995 CRA regulations during 2025.	2025	Reverts to a familiar regulatory framework for Community Reinvestment Act compliance, potentially reducing uncertainty associated with new rules.

Legal Proceedings

There are no pending legal proceedings to which the Company or the Bank is a party or of which any of its property is the subject, other than routine litigation incidental to its banking business, none of which, in the opinion of management, is material to the Company's consolidated operations or financial condition.

Related Party Transactions

Aggregate loan transactions with directors, principal officers, their immediate families, and affiliated companies totaled $19,390,452 at December 31, 2025, down from $28,187,750 at December 31, 2024.
Total funds of related parties on deposit with the Company were $3,395,113 at December 31, 2025, down from $16,363,334 at December 31, 2024.
The Company leases office space at one of its main offices to its affiliated trust and wealth management affiliate, CFSG, on arms-length terms.
The Bank leases premises in Burlington, VT, from an entity affiliated with one of the Company's directors on arms-length terms.
The Company utilizes CFSG as an investment advisor for its 401(k) plan, paying monthly management fees of $66,568 in 2025 and $62,036 in 2024.

Stakeholder Impact

Shareholders: Positive impact from increased net income, EPS, book value per share, and the Nasdaq listing, potentially enhancing liquidity and investor visibility. Quarterly cash dividends declared. Stock repurchase program in place.
Employees: Comprehensive employee benefit package including medical, life insurance, 401K, and disability insurance for full-time employees. Management considers employee relations to be good.
Customers: Broad range of loan and deposit services, focus on long-term relationships, and responsiveness to community needs, including lowand moderate-income areas. Increased customer activity reflected in ATM and debit card expenses.
Communities: Active evaluation of banking needs in markets, including lowand moderate-income areas. Community room offered free to non-profit organizations. Investments in affordable housing limited partnerships and NMTC financing structures.
Creditors: Junior Subordinated Debentures are subordinated and junior to all senior indebtedness. The company's strong capital ratios and 'well capitalized' status for the Bank provide assurance.

Next Steps

Annual Meeting of Shareholders to be held on May 19, 2026.
Next say on pay and say on frequency votes scheduled for the 2028 Annual Meeting of shareholders.
Board will review and re-evaluate the stock repurchase program annually.
Management is reviewing ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures, effective for annual periods beginning after December 15, 2026.

Key Dates

Date	Description
1851	Community National Bank organized as Peoples Bank.
1865	Peoples Bank reorganized as National Bank of Derby Line.
1975	National Bank of Derby Line acquired Island Pond National Bank and changed name to Community National Bank.
2007-10-31	Indenture dated for Junior Subordinated Debentures.
2007-10-31	Amended and Restated Declaration of Trust dated for CMTV Statutory Trust I.
2007-12-15	Junior Subordinated Debentures first became redeemable.
2007-12-31	Company completed acquisition of LyndonBank.
2007-12-31	Company issued 25 shares of fixed-to-floating rate non-cumulative perpetual preferred stock.
2008-12-15	Amended and Restated Deferred Compensation Plan for Directors filed.
2010-07-12	Amended Code of Ethics for Senior Financial Officers and Principal Executive Officer filed.
2011-07-21	Depository institutions allowed to pay interest on demand deposits.
2013	Say on executive pay and say on frequency votes first applicable for annual meeting.
2015-01-01	Company required to comply with Basel III capital rules.
2015-03-13	Amended and Restated Officer Incentive Plan filed.
2015-Q1	One-time opportunity for covered banking organizations to opt out of AOCI treatment for Common Equity Tier 1 capital.
2017	2017 Tax Act passed, affecting deferred tax assets revaluation.
2018	Company purchased 20 shares of common stock in ACBI.
2018	SEC amended reporting and disclosure rules, classifying Company as non-accelerated filer and smaller reporting company.
2019	Opening of loan production office in Lebanon, New Hampshire.
2020-07-15	Amended and Restated By-laws of Community Bancorp. amended and restated.
2020-12-31	Company no longer required to obtain external auditor attestation on internal control over financial reporting under Section 404(b) of SOX.
2021	Federal bank regulatory agencies issued final rule requiring banks to notify certain entities of computer-security incidents.
2021-09-07	Amended and Restated Change in Control Agreement between Louise M. Bonvechio and the Company and the Bank filed.
2021-09-07	Change in Control Agreement between Christopher L. Caldwell and the Company and the Bank filed.
2022-03	Federal Adjustable Interest Rate (LIBOR) Act enacted.
2023	Federal banking agencies issued a final rule amending CRA regulations, with a mandatory compliance date of January 1, 2026 (later rescinded).
2023	Bank's last CRA examination completed by OCC, received 'Outstanding' rating.
2023-01-01	Effective date for adoption of CECL accounting standard.
2023-03	FRB established temporary BTFP borrowing facility.
2023-06-30	LIBOR Replacement Date for Junior Subordinated Debentures.
2024	Company established an LLC to facilitate purchase of federal NMTCs.
2024-07	Board of Directors authorized repurchase of up to 275,000 shares of common stock, expiring July 2029.
2024-12-15	Preferred stock dividend rate decreased to 8.00% for the last quarter of 2024.
2024-12-31	Fiscal year ended.
2025-01-01	Preferred stock dividend rate decreased to 7.50% for the first quarter of 2025.
2025-03-01	Company's share of CFS Partners net income increased from 33.3% to 50%.
2025-Q1	BTFP loans matured and were repaid.
2025-06-30	Aggregate market value of voting stock held by non-affiliates was $90,019,415.
2025-07-31	CFS Partners redeemed Guaranty Bancorp Inc.'s membership interest, increasing Company's ownership to 50%.
2025-11	Company redeemed remaining 15 shares of preferred stock at par ($1,500,000).
2025-12-17	Board declared a cash dividend of $0.25 per share payable February 1, 2026.
2025-12-31	Fiscal year ended.
2026-01-01	Mandatory compliance date for 2023 CRA regulations (later rescinded).
2026-01-15	Record date for $0.25 cash dividend payable February 1, 2026.
2026-02-01	Cash dividend of $0.25 per share payable.
2026-02-02	Common stock began trading on the Nasdaq Capital Market under symbol CMTV.
2026-03-18	5,580,648 shares outstanding of common stock.
2026-03-18	Board declared a cash dividend of $0.25 per share payable May 1, 2026.
2026-03-27	Report date of the 10-K filing.
2026-04-15	Record date for $0.25 cash dividend payable May 1, 2026.
2026-05-01	Cash dividend of $0.25 per share payable.
2026-05-19	Annual Meeting of Shareholders to be held.
2026-12-15	Effective date for ASU No. 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures.
2028	Next say on pay and say on frequency votes scheduled.
2029-07	Stock repurchase authorization expires.
2030	Operating leases for bank premises expire in various years through 2030.
2037-12-15	Junior Subordinated Debentures mature.

Recommendation

strong buy

The company demonstrates robust financial health with significant year-over-year growth in net income, EPS, assets, loans, and deposits. The improved net interest margin and spread indicate effective interest rate management. The Nasdaq listing is a material positive development for liquidity and investor access. While credit loss expense increased, the overall credit quality metrics remain manageable, and the company's capital position is strong, exceeding regulatory requirements. The stock repurchase program further signals management's confidence and commitment to shareholder value.

Keywords

Community Bancorp, CMTV, Banking, Financial Services, Vermont, New Hampshire, SEC Filing, 10-K, Annual Report, Net Income, Loan Growth, Deposit Growth, Equity Capital, Nasdaq Listing, Credit Risk, Interest Rate Risk, Cybersecurity, Regulatory Compliance, Community National Bank, Financial Performance, Bank Holding Company, Wealth Management, Trust Services, Commercial Real Estate, Residential Real Estate, Municipal Lending, Consumer Lending, Capital Adequacy, Dividend, Stock Repurchase

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