NewzIntel.com

Category: Pandemic

  • MIL-OSI Security: Postal Employee Arrested For COVID Relief Fraud

    Source: United States Department of Justice (National Center for Disaster Fraud)

     Ocala, Florida – United States Attorney Roger B. Handberg announces the arrest of Marina Tusca Brooks Stewart (61, Groveland) on an indictment charging her with one count of wire fraud related to COVID relief. If convicted, Brooks Stewart faces up to 20 years in federal prison. In addition, she faces a forfeiture order of $10,000, which represents the alleged proceeds she obtained through this offense. 

    According to court documents, during the COVID pandemic, the United States Small Business Administration (SBA) offered Targeted Economic Injury Disaster Loan (EIDL) Advances that did not need to be repaid. The advances were for small businesses that were in low-income communities and received a reduction in revenue of more than 30% during an eight-week period. Between June 28 and 30, 2020, Brooks Stewart devised a scheme to defraud the SBA by electronically applying for an EIDL advance and providing false representations in her application. Afterwards, she fraudulently received a $10,000 EIDL advance.

    An indictment is merely an allegation that a defendant has committed a federal criminal offense. Every defendant is presumed innocent unless, and until, proven guilty. 

    This case is being investigated by the United States Postal Service – Office of Inspector General. It is being prosecuted by Assistant United States Attorney Hannah Nowalk.

    MIL Security OSI –

  • MIL-Evening Report: Unemployment’s up, house prices are stagnating. But is the Victorian economy doing as badly as it seems?

    Source: The Conversation (Au and NZ) – By David Hayward, Emeritus Professor of Public Policy, RMIT University

    The early 1990s in Victoria were tough. The economy was contracting severely, the population was shrinking, employment was collapsing and the unemployment rate skyrocketed to the highest in the land.

    A long-term Labor government got the blame for allowing state debt to spiral out of control. Victoria, reckoned a popular joke at the time, was “Australia’s Mexico without the sunshine”.

    Is it happening all over again?

    Some reporting in national media would suggest it is.

    The Australian Financial Review has recently run a series on the state, including a piece last week quoting business leaders saying the Victorian economy was in trouble.

    Reference was made to the latest unemployment figures as supporting evidence. Victoria’s unemployment rate has risen over the last year, and at 4.4% is now the highest in the country. Rising numbers of company failures and stagnant house prices were also cited.

    Earlier in the month, data showing a falling rate of Victorian business start-ups was highlighted, while another Financial Review article examined the decline in the number of conferences. All this was referred to as evidence of a state struggling under the weight of

    $8.6 billion in levies [imposed] in [Labor’s] 2023 budget to curb a mountain of state debt that is forecast to reach $188 billion by 2028.

    The Australian also ran a feature on Victoria echoing the same themes.

    Readers were asked, “What the hell has gone wrong with Victoria?”. Public debt and taxation figured as prominent causes of an economic catastrophe in the making. The Australian deemed the state to be

    at best, trapped in stagnation, forcing it to cover falling private investment and expenditure with ever greater public largesse. And at worst […] as the spending and debt build-up sets off the alarms, a vicious spiral is triggered […] until the whole Ponzi scheme collapses.

    But are things that bad? What does the economic data actually show?

    Some positive signs

    It is true that unemployment in Victoria is rising, and is also high compared to the rest of the country. But it has been stable for the last four months, reflecting the impact of interest rate increases over the previous couple of years.

    Also, looking back over the last 40 years, the increase has been from a very low base, and remains at an historically low level – and a long way off the highs of the 1990s.

    The number of people in the labour force is continuing to grow at a healthy clip. The participation rate is now the highest on record.

    Last month, the labour force increased in seasonally adjusted terms by 20,000, and almost all of these additional people ended up in employment.

    The growth in employment since the end of the pandemic is notable.

    Since January 2023, employment has increased by 268,000, or 8% in seasonally adjusted terms. That’s 37% of the jobs added in the whole of Australia during that time.

    Yes, the share of job growth is falling, but it is still higher than the state’s population share, and it is from an unbelievably high base (55% of all jobs created nationally in July were in Victoria).

    The Australian Financial Review acknowledged that the latest jobs data were indeed “unexpectedly strong”.

    What about business insolvencies?

    Victorian insolvencies are on the rise (up 61% in September compared to the same month last year). But so too are they across Australia, with the national number rising at a higher clip (up 70%).

    What about the number of conferences in Victoria? We simply cannot be sure whether they are up or down, because there is no consistent data base to settle the matter.

    And while Victoria may have fallen behind other states in the number of new startups per 1,000 businesses, the actual number of businesses has increased by more than 31,000, or 3%, since the beginning of the year.

    How are house prices and rents holding up?

    Yes, house prices are tumbling. In real terms, they are around 20% below their pandemic peak, at least partly caused by a bundle of new property taxes introduced in the 2023/24 state budget to help pay for pandemic-related debt.

    But with housing affordability at an all-time low courtesy of high interest rates, that is no bad thing, especially for those keen to buy their first home.

    That fall in house prices stands in contrast to a boom in rents over the same time period.

    Over the last 12 months, median rents in Victoria have increased by 13.3%, and by 4.3% over the last quarter. In the March quarter, the rental stock fell for the first time on record, perhaps supporting those who see an economy in trouble.

    But that fall amounted to barely 10,000 dwellings, or only 2.7% of the stock. Those properties had to be sold to someone, and it is likely many were sold to first time buyers who, in changing tenure, had no net effect on the rental market. A redistribution of wealth like that may be no bad thing.

    Debt is high – but so is infrastructure spending

    There is no doubt the Victorian economy has been slowing, as has the rest of the country. That is exactly the outcome sought by the Reserve Bank when it pushed up interest rates last year.

    But there is little evidence to show Victoria is following the disastrous path of the early 1990s.

    Back then, state debt grew alarmingly because of a savage recession. This time round, state debt has grown strongly, but largely to fund a construction pipeline on a scale the state has not seen before.

    Infrastructure spending is now running close to $25 billion a year, almost five times what it was a decade ago. There’s a lot of jobs in those numbers, and shortly a lot of that infrastructure will come on line, boosting the state’s economic potential.

    There is one other factor driving Victoria’s surprisingly resilient economy. Net international migration increased by 152,000 in the year to March 2024 – almost 30% of the Australian total – driven partly by the return of international students.

    Very fast, migration-driven population growth is not being matched by increased output, and the state’s household income per person is continuing its long-term decline, leading some to argue it has become a “poor state”.

    Treasurer Tim Pallas will hope that the increase stock of debt-funded infrastructure provides the productivity boost sorely needed to turn that around.

    While on several indicators Victoria’s economy is slowing, this largely reflects a national trend. Drilling down into the data shows there are signs of growth, which suggest alarm at this stage is not justified.

    David Hayward does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    – ref. Unemployment’s up, house prices are stagnating. But is the Victorian economy doing as badly as it seems? – https://theconversation.com/unemployments-up-house-prices-are-stagnating-but-is-the-victorian-economy-doing-as-badly-as-it-seems-241762

    MIL OSI Analysis – EveningReport.nz –

  • MIL-Evening Report: Being mentally flexible might influence our attitudes to vaccination, a new study shows

    Source: The Conversation (Au and NZ) – By Stephanie Gomes-Ng, Senior Lecturer in Psychology, Auckland University of Technology

    Getty Images

    Making decisions about our health is a complex and sometimes difficult process.

    On top of our own attitudes, experiences and perspectives, we are inundated with information from other people (friends, family, health professionals) and from external sources (news or social media) about what it means to be healthy.

    Sometimes, this information is consistent with what we think about our own health. At other times, it may contradict our own beliefs. And to make things even more complicated, sometimes this information is deliberate misinformation.

    How do we make sense of all this when making decisions about our health? What determines whether we hold fast to our attitudes, or change our minds?

    Most of us can probably relate to this. During the COVID-19 pandemic, we had to change many of our behaviours to slow the spread of the virus. This meant working from home, wearing a mask, staying in our “bubbles”, and eventually getting the vaccine.

    While the decision to get vaccinated was an obvious one for many people, it was not as straightforward for others. Research from the period immediately before the COVID vaccine became available in New Zealand showed a sizeable minority was unsure about or unlikely to be vaccinated.

    These people were more likely to be young, female and less educated, and were primarily concerned about unknown future side effects. Our new research suggests cognitive (mental) flexibility may also have something to do with attitudes towards vaccination.

    A flexible mind

    Past research suggests mental flexibility plays an important role in our decision-making. Imagine changing the way you do something at work, having a discussion with someone with a different opinion, or being told you should make healthier choices (such as exercising more).

    Some people navigate these situations with ease. Others find it more difficult to adapt. Mental flexibility describes this ability to adapt our attitudes, thoughts or behaviours when faced with new or changing information.

    Studies show mental flexibility influences how extreme our opinions are, how likely we are to believe misinformation or “fake news”, whether we make pro-environmental choices or engage in health-promoting behaviours (sun protection or physical exercise, for example).

    To increase vaccination coverage, governments often use education campaigns that emphasise the safety, effectiveness and importance of vaccination. However, these campaigns don’t always succeed in reducing feelings of uncertainty about vaccination.



    Read more:
    Vaccine hesitancy is one of the greatest threats to global health – and the pandemic has made it worse

    We wanted to know why, and we thought mental flexibility might play a role. To test this, we surveyed 601 New Zealanders on their opinions and experiences of vaccination.

    Some questions asked about external factors, such as how easy they thought it was to access or afford vaccines. Other questions asked about internal factors, such as personal beliefs about vaccination, perceptions of their own heath, and how important or safe they thought vaccines were.

    Overall, our participants reported few external barriers to vaccination, with 97% saying they found vaccines accessible or affordable. These percentages are promising, and may reflect the government’s continued efforts to make it easier to get a vaccine.

    In comparison, internal factors played a larger role in vaccine uncertainty or hesitancy. In particular, nearly a quarter (22%) of participants reported concerns about the health risks of vaccines. And 12% said they didn’t trust the processes or people who developed vaccines.

    Health information campaigns don’t always succeed in reducing anxiety or uncertainty.
    Getty Images

    Testing adaptive behaviour

    We also asked our participants to play a game designed to measure mental flexibility.

    This involved matching cards based on a rule – for example, match the cards with the same number of objects. The rule would randomly change during the game, meaning participants had to adapt their behaviour as the game went on.

    Interestingly, people who found it harder to adapt to the rule changes (meaning they had lower levels of mental flexibility) also reported more internal barriers to vaccination.

    For example, when we split participants into two groups based on their mental flexibility, the low-flexibility group was 18% more likely to say vaccination was inconsistent with their beliefs. They were also 14% more likely to say they didn’t trust vaccines, and 11% more likely to report concerns about the negative side effects of vaccines.

    This wasn’t the case for external factors. Mental flexibility didn’t predict whether people thought vaccines were accessible or affordable.

    Information is sometimes not enough

    These results suggest making decisions about our health – including whether or not to get vaccinated – depends on more than receiving the “right” information.

    Simply being told about the importance of vaccination may not be enough to change attitudes or behaviours. It also depends on each person’s unique cognitive style – the way they perceive and process information.

    Declining vaccination rates have been a concern worldwide, including in New Zealand, since well before the pandemic. Our findings suggest health education campaigns may be more effective if they take into account the role of cognitive flexibility.

    One technique is to change the way information is framed. For example, instead of just presenting facts about the safety or importance of vaccination, education campaigns could encourage us to question our own perspectives, or to imagine alternative realities by asking “what if?” questions.

    Research shows this type of framing can engage our deliberative thought processes (the ones that help us to think deeply and critically), increase mental flexibility, and ultimately make us more receptive to change.

    Stephanie Gomes-Ng received funding from the Ember Korowai Takitini Trust for this research. The funders had no influence over the study’s conceptualisation, design, methodology, data collection or interpretation, nor the decision to publish.

    – ref. Being mentally flexible might influence our attitudes to vaccination, a new study shows – https://theconversation.com/being-mentally-flexible-might-influence-our-attitudes-to-vaccination-a-new-study-shows-241559

    MIL OSI Analysis – EveningReport.nz –

  • MIL-OSI Asia-Pac: Union Minister Shri Rajiv Ranjan Singh set to launch Pandemic Fund Project and 21st Livestock Census Operation on 25th October 2024

    Source: Government of India

    Union Minister Shri Rajiv Ranjan Singh set to launch Pandemic Fund Project and 21st Livestock Census Operation on 25th October 2024

    One Health approach: $25 Million Pandemic Fund focuses on animal health security

    Historic 21st Livestock Census to Capture Data on Pastoralist Holdings and Gender Roles in Livestock Rearing

    Posted On: 23 OCT 2024 9:26PM by PIB Delhi

    The Union Minister of Fisheries, Animal Husbandry, and Dairying, Shri Rajiv Ranjan Singh alias Lalan Singh will launch two pivotal initiatives aimed at strengthening the animal health infrastructure in India: the Pandemic Fund Project on “Animal Health Security Strengthening in India for Pandemic Preparedness and Response” and the 21st Livestock Census operation. The launch will take place on 25th October 2024 at 10:00 AM at Hotel Leela Ambience Convention, Shahdara, New Delhi.

    The event will also be graced by the Ministers of State for Fisheries, Animal Husbandry & Dairying, Shri Prof. S.P. Singh Baghel and Shri George Kurian serving as Guests of Honour. The event will also see the participation of distinguished guests including Shri Amitabh Kant, G20 Sherpa; Prof. Dr. V K Paul, Member Health, NITI Aayog; Ms. Alka Upadhyaya, Secretary, Department of Animal Husbandry and Dairying; and Mr. Punya Salila Srivastava, Secretary, Health & Family Welfare.

    Pandemic Fund Project

    The Pandemic Fund, established under Indonesia’s G20 Presidency, aims to finance critical investments that strengthen pandemic prevention, preparedness, and response (PPR) capacities, with a focus on low- and middle-income countries. India’s $25 million proposal, approved under the Fund’s first call, focuses on animal health security—a crucial component of pandemic preparedness.

    This event will highlight the importance of integrating a One Health approach into pandemic response efforts. Five of the six recent public health emergencies declared by the World Health Organization (WHO) have had their origins in animals, further emphasizing that strengthening animal health security is key to reducing zoonotic risks and safeguarding both human and animal populations from future pandemics.

    The “Animal Health Security Strengthening in India for Pandemic Preparedness and Response” project is designed to reduce the risk of zoonotic diseases that can potentially spread from animals (both domestic and wildlife) to humans. With pandemic threats looming, this project will play a pivotal role in fortifying India’s animal health infrastructure, ensuring the nation is better prepared for future health crises. The project will be implemented in collaboration with the Asian Development Bank (ADB) as the lead implementing entity, with support from The World Bank and the Food and Agriculture Organization (FAO). The launch of the Animal Health Security Strengthening in India project under the Pandemic Fund marks a significant step in India’s commitment to One Health and pandemic preparedness.

    21st Livestock Census Operation

    The Livestock Census (LC) is a crucial exercise that has been conducted every five years since 1919, serving as the backbone for policy formulation and the implementation of various programmes in the Animal Husbandry sector. The Census involves a comprehensive door-to-door survey that captures detailed data on domesticated animals and birds across the nation. Till date 20 Livestock censuses had been conducted and the last census was held in the year 2019.

    The rollout of 21st Livestock Census, scheduled to be conducted during September-December, 2024, will be in collaboration with State/UT Animal Husbandry and Dairying. At all India level around 1 lakh field officials who are mostly veterinarians or para-veterinarians will be involved in the enumeration process. This LC will leverage mobile technology for data collection and transmission. This advancement is expected to enhance the accuracy and efficiency of data collection across all villages and urban wards in the country.

    Data on 15 species of Livestock viz. Cattle, Buffalo, Mithun, Yak, Sheep, Goat, Pig, Camel, Horse, Ponies, Mule, Donkey, Dog, Rabbit and Elephant are covered in this census. Other than Livestock, headcount of Poultry Birds viz. Fowl, Duck, Turkey, Geese, Quail, Gini Fowl, Ostrich and Emu will also be taken from each Household/ Household Enterprises/ Non-households/Institution. This LC will capture data on 219 Indigenous breeds of 16 species recognised by ICAR-National Bureau of Animal Genetic Resources (NBAGR). Notably, this will be the first census to independently capture data on livestock holdings by pastoralists and to include information on the gender of individuals primarily involved in livestock rearing.

    In addition, the event will also feature the release of important documents aimed at strengthening animal health management in India:

    1. Standard Veterinary Treatment Guidelines: A comprehensive document that outlines best practices for veterinary care, aimed at improving the overall health and productivity of livestock.
    2. Crisis Management Plan for Animal Diseases: A critical resource that provides a framework for managing and responding to outbreaks of animal diseases, ensuring rapid containment and mitigation.

    These documents will serve as vital tools for veterinarians, policymakers, and field officials, helping to ensure timely and effective responses to animal health crises and improving disease management protocols.

    The Department of Animal Husbandry & Dairying invites all stakeholders to participate in the launch of the Pandemic Fund Project and the 21st Livestock Census Operation, both of which play an essential role in enhancing India’s preparedness against health crises and in fortifying animal health security.

    ***

    AA

    (Release ID: 2067511) Visitor Counter : 49

    MIL OSI Asia Pacific News –

  • MIL-OSI: Greenway Technologies Announces Gas to Hydrogen System H-Reformer®

    Source: GlobeNewswire (MIL-OSI)

    ARLINGTON, Texas, Oct. 23, 2024 (GLOBE NEWSWIRE) — Greenway Technologies, Inc. (OTC: GWTI), (“Greenway”), is an advanced gas-to-liquids (“GTL”) and gas-to-hydrogen (“GTH”) technology development company. Greenway has developed and marketed a patented system, the G-Reformer®, that converts natural gas (methane) from various sources to a mixture of hydrogen and carbon monoxide (syngas). Continued ongoing research has developed a new version of the G-Reformer®, named the “H-Reformer®,” which converts natural gas to hydrogen and carbon dioxide. The H-Reformer® system is modular and small enough to be deployed in areas close to consumption, eliminating the cost of compressing and transporting the resultant hydrogen while separating and removing created carbon dioxide.

    Two significant changes have been made to the original G-Reformer® to make a reforming system focused on hydrogen creation rather than syngas creation. First, enhancements to the controlling software have modified the G-Reformer® to convert approximately 50% of the created carbon monoxide to carbon dioxide while also producing additional hydrogen. The H-Reformer® also includes an extension to the reforming vessel used in the G-Reformer®. This module will house the physical components needed to convert the remaining carbon monoxide to hydrogen and carbon dioxide within the reforming unit. The result is the generation of considerably more hydrogen per unit of natural gas input than the original G-Reformer® produces and high conversion of carbon monoxide to carbon dioxide. Carbon dioxide is externally separated from resultant hydrogen by commercially available processes, yielding highly pure hydrogen and liquid carbon dioxide, which will be removed, sold, or sequestered. This new reforming system is named the H-Reformer®.

    Created hydrogen will be available for use at the point of manufacture. Hydrogen compression or liquefaction costs are also eliminated for applications that do not need compressed hydrogen (e.g., electrical power generation). In cases where compressed hydrogen is required, the hydrogen can undergo the compression process at the consumption site while eliminating hydrogen transportation.

    Unlike other natural gas-to-hydrogen technologies, the Greenway reforming process does not require external heating sources, resulting in a highly efficient and lower carbon-generating process. When pipeline-quality fossil natural gas is the input, the system will make “blue hydrogen.” When renewable pipeline-quality methane is the input, the system will make “green hydrogen.” These distinctions are important for associated clean air credits, which depend on the input natural gas source and the resultant carbon’s disposition.

    The Greenway system is modular and can be scaled by adding additional H-Reformer® modules. The system produces hydrogen at an extremely low cost per unit compared to other technologies.

    Currently, Greenway is in discussions with several prospective parties interested in creating hydrogen for various potential uses.

    Notice Regarding Forward-Looking Statements:

    This news release contains “forward-looking statements,” as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this news release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, the ongoing effects of the pandemic on delays and orders regarding Greenway’s proprietary gas-to-liquids system, potential business developments and future interest in our clean fuel technologies.

    Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, general economic and political conditions, the continuation of the JV withThe University of Texas at Arlington, and the ongoing impact of the pandemic. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that the beliefs, plans, expectations and intentions contained in this news release are reasonable, there can be no assurance that such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K for the most recent fiscal year, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission.

    CONTACT:
    Robert Kevin Jones
    Greenway Technologies, Inc.
    kevin.jones@gwtechinc.com

    For more information, visit GWTI’s website: www.gwtechinc.com

    The MIL Network –

  • MIL-OSI Europe: Briefing – Croatia’s National Recovery and Resilience Plan: Latest state of play – 23-10-2024

    Source: European Parliament

    Croatia’s national recovery and resilience plan (NRRP) is an ambitious outline of reforms and investment designed to mitigate the pandemic’s socioeconomic fallout. Following the December 2023 amendment of the Croatian NRRP, to which a REPowerEU chapter was added, the plan’s worth reached €10 040.7 million (or 18.5 % of national gross domestic product (GDP) in 2019), an increase of over 59 % compared with the original (2021) version of the plan, which was worth €6 297 million in grants only. The amended plan comes with a grant allocation of €5 779.4 million and a freshly requested loan allocation of €4 254.2 million (of which more than 62 % is for the REPowerEU chapter). The grant part includes the June 2022 downward revision of Croatia’s grant allocation of €785.1 million and the country’s REPowerEU grant allocation of €269 million. In addition, Croatia has requested a €7.2 million transfer from its share of the Brexit Adjustment Reserve to its NRRP. So far, Croatia has received €4 487.3 million of Recovery and Resilience Facility (RRF) resources (44.7 % of the amended NRRP) in the form of pre financing, five grant and one loan instalment. The disbursements are above the current EU average of 41 %. The measures in the amended plan are designed to help Croatia overcome the socioeconomic ramifications of both the pandemic and the energy crisis, as well as to address the consequences of the two devastating earthquakes of 2020. The plan focuses on the green transition by devoting over 39 % of the resources to it. It also fosters the digital transformation by committing 20.1 % of the funds (excluding the REPowerEU chapter) to digital projects. In the context of the European Semester, in 2024 the Commission assessed the implementation of the Croatian plan as ‘under way’. The European Parliament continues to ensure transparency and accountability through interinstitutional dialogues on RRF implementation, and scrutiny of the Commission’s work. This briefing is one in a series covering all EU Member States. Fourth edition. The ‘NGEU delivery’ briefings are updated at key stages throughout the lifecycle of the plans.

    MIL OSI Europe News –

  • MIL-OSI Europe: JOINT MOTION FOR A RESOLUTION on the misinterpretation of UN resolution 2758 by the People’s Republic of China and its continuous military provocations around Taiwan – RC-B10-0134/2024

    Source: European Parliament

    Michael Gahler, Miriam Lexmann, Sebastião Bugalho, Rasa Juknevičienė, Danuše Nerudová
    on behalf of the PPE Group
    Yannis Maniatis, Kathleen Van Brempt, Tonino Picula
    on behalf of the S&D Group
    Joachim Stanisław Brudziński, Adam Bielan, Mariusz Kamiński, Charlie Weimers, Michał Dworczyk, Alexandr Vondra, Veronika Vrecionová, Ondřej Krutílek, Rihards Kols, Maciej Wąsik, Sebastian Tynkkynen, Alberico Gambino, Bert‑Jan Ruissen, Carlo Fidanza
    on behalf of the ECR Group
    Engin Eroglu, Petras Auštrevičius, Helmut Brandstätter, Dan Barna, Veronika Cifrová Ostrihoňová, João Cotrim De Figueiredo, Bernard Guetta, Svenja Hahn, Ľubica Karvašová, Karin Karlsbro, Moritz Körner, Nathalie Loiseau, Jan‑Christoph Oetjen, Ana Vasconcelos, Dainius Žalimas
    on behalf of the Renew Group
    Markéta Gregorová
    on behalf of the Verts/ALE Group

    European Parliament resolution on the misinterpretation of UN resolution 2758 by the People’s Republic of China and its continuous military provocations around Taiwan

    (2024/2891(RSP))

    The European Parliament,

    – having regard to its previous resolutions on the People’s Republic of China (PRC) and Taiwan,

    – having regard to its resolution of 16 September 2021 on a new EU-China strategy[1],

    – having regard to its recommendation of 21 October 2021 to the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy on EU-Taiwan political relations and cooperation[2],

    – having regard to its resolution of 7 June 2022 on the EU and the security challenges in the Indo-Pacific[3],

    – having regard to its resolution of 15 September 2022 on the situation in the Strait of Taiwan[4],

    – having regard to its resolution of 13 December 2023 on EU-Taiwan trade and investment relations[5],

    – having regard to the Strategic Compass for Security and Defence, approved by the Council on 21 March 2022,

    – having regard to the joint communication from the Commission and the High Representative of the Union for Foreign Affairs and Security Policy of 16 September 2021 entitled ‘The EU strategy for cooperation in the Indo-Pacific’ (JOIN(2021)0024),

    – having regard to the EU’s ‘One China’ policy,

    – having regard to the EU-China summit of 7 December 2023,

    – having regard to the European Council conclusions on China of 30 June 2023,

    – having regard to the visits of the Committee on Foreign Affairs of 25 to 27 July 2023 and of the Committee on International Trade of 19 to 21 December 2022 to Taiwan,

    – having regard to the statement of 1 September 2024 by the Spokesperson of the High Representative of the Union for Foreign Affairs and Security Policy on the latest dangerous actions in the South China Sea,

    – having regard to the statements by the Spokesperson of the High Representative of the Union for Foreign Affairs and Security Policy on China’s military drills around Taiwan, including the most recent statement of 14 October 2024,

    – having regard to the G7 Foreign Ministers’ statements of 18 April 2023 and of 3 August 2022 on preserving peace and stability across the Taiwan Strait,

    – having regard to the statement by the Chair of the G7 Foreign Ministers’ Meeting of 23 September 2024,

    – having regard to the joint declaration by the G7 Defence Ministers of 19 October 2024,

    – having regard to the urgency motion on Taiwan passed by the Australian Senate on 21 August 2024,

    – having regard to UN General Assembly Resolution 2758 (XXVI) of 25 October 1971,

    – having regard to the motion on UN Resolution 2758 passed by the Dutch House of Representatives on 12 September 2024,

    – having regard to the press statement by the US Department of State of 13 October 2024,

    – having regard to the UN Convention on the Law of the Sea (UNCLOS),

    – having regard to Article 7 of the UN Framework Convention on Climate Change (UNFCCC), concluded on 9 May 1992,

    – having regard to Rule 5 of the Standing Rules of Procedure of the Assembly of the International Civil Aviation Organization (ICAO),

    – having regard to Article 4 of the Constitution of the International Criminal Police Organization (Interpol),

    – having regard to Article 8 and Article 18(h) of the Constitution of the World Health Organization (WHO),

    – having regard to Rules 136(2) and (4) of its Rules of Procedure,

    A. whereas UN Resolution 2758 was passed by the UN General Assembly on 25 October 1971 and shifted the official recognition from the Republic of China (Taiwan) to the People’s Republic of China (PRC); whereas today Taiwan, while not being a member of the United Nations, maintains diplomatic relations with 11 of the 193 United Nations member states, as well as with the Holy See;

    B. whereas the EU and Taiwan are like-minded partners that share the common values of freedom, democracy, human rights and the rule of law; whereas Taiwan is a vibrant democracy, with a flourishing civil society; whereas Taiwan held peaceful and well-organised elections on 13 January 2024;

    C. whereas following the adoption of UN Resolution 2758, Taiwan lost its access to participation in multilateral forums, such as the WHO;

    D. whereas Taiwan has never been part of the PRC; whereas the Republic of China was established in 1912 and the PRC in 1949;

    E. whereas UN Resolution 2758 addresses the status of the PRC, but does not determine that the PRC enjoys sovereignty over Taiwan, nor does it make any judgement on the future inclusion of Taiwan in the UN or any other international organisation; whereas, however, the PRC continues to misinterpret UN Resolution 2758 to block Taiwan’s meaningful participation in international organisations and unilaterally change the status quo; whereas these actions highlight the PRC’s ambition to alter the existing multilateral international order and undermine international law, and can be seen as an expression of systemic rivalry;

    F. whereas the EU continues to maintain its own ‘One China’ policy, which is different from the PRC’s ‘One China’ principle; whereas the EU’s long-standing position has been to support the status quo and a peaceful resolution of differences across the Taiwan Strait, while encouraging dialogue and constructive engagement;

    G. whereas through their statement of 23 September 2024 the G7 members, among other things, underlined their support for ‘Taiwan’s meaningful participation in international organizations as a member where statehood is not a prerequisite and as an observer or guest where it is’;

    H. whereas supporting Taiwan’s participation in international organisations does not undermine the EU’s commitment to its ‘One China’ policy, which remains the political foundation of EU-China relations;

    I. whereas over the past decade the PRC has persistently tried to increase its influence over international institutions, using this to sideline Taiwan and prevent Taiwanese passport holders, including journalists, non-governmental organisation workers and political activists, from accessing international institutions; whereas the PRC exercises transnational repression by misusing extradition treaties to target Taiwanese people abroad and therefore put them at risk of arbitrary persecution and human rights abuses;

    J. whereas the statutes of most international organisations tasked to address global issues, including the WHO, the UNFCCC, Interpol and the ICAO, provide opportunities for entities such as Taiwan to participate without infringing on the rights of member states;

    K. whereas Taiwan has consistently demonstrated a peaceful and cooperative attitude globally, has significantly enhanced global developments and thus could contribute greatly to the work of various international organisations;

    L. whereas the PRC is a one-party state that is entirely controlled and ruled by the Chinese Communist Party;

    M. whereas in a speech on Taiwan’s national day of 10 October 2024, Taiwan’s President Lai Ching-te stated that the PRC has ‘no right to represent Taiwan’ and reiterated that the two sides are ‘not subordinate’ to each other; whereas the PRC has justified its recent military exercise by claiming that President Lai Ching-te is pursuing a separatist strategy;

    N. whereas on 14 October 2024 the PRC launched a large-scale military drill, named Joint Sword-2024B, that simulated a blockade of Taiwan; whereas during this exercise a record number of 153 PRC aircraft,18 warships and 17 PRC coastguard ships were detected around Taiwan;

    O. whereas during the exercises four formations of the PRC coastguard patrolled the island and briefly entered its restricted waters; whereas the very frequent deployment of the coastguard by the PRC in the Strait in what the PRC considers ‘law enforcement’ missions is putting constant pressure on the Taiwanese authorities and causing a dangerous increase in the risk of collisions, in what is one of the most concrete indications of the PRC’s intention to erode the status quo; whereas the exercises launched on 14 October 2024 were the fourth round of large-scale war games by the PRC in just over two years;

    P. whereas these activities were condemned by Taiwan as an ‘unreasonable provocation’ and are the latest in a series of war games conducted by the PRC against Taiwan; whereas these military drills came days after Lai Ching-te, Taiwan’s new president, gave a speech vowing to protect Taiwan’s sovereignty in the face of challenges from the PRC;

    Q. whereas the median line, which was set up in a decades-old tacit agreement between both sides of the Taiwan Strait, was designed to reduce the risk of conflict by keeping the military aircraft from both sides of the Strait at a safe distance and thus prevent fatal miscalculations; whereas the PRC’s People’s Liberation Army violated the median line only four times between 1954 and 2020, but now routine incursions reflect Beijing’s intent to irreversibly reset long-standing benchmarks;

    R. whereas the press statements by the High Representative of the Union for Foreign Affairs and Security Policy and the US Department of State reaffirm that peace and stability in the Taiwan Strait are of strategic importance for regional and global security and prosperity; whereas the High Representative’s statement recalls the need to preserve the status quo in the Taiwan Strait, opposes any unilateral actions that change the status quo by force or coercion and calls on all parties to exercise restraint and avoid any actions that may further escalate cross-Strait tensions;

    S. whereas on 23 May 2024 the PRC launched a military drill called Joint Sword-2024A, just days after the inauguration of Lai Ching-te as the new President of Taiwan;

    T. whereas over the past few years the PRC has held similar military drills around Taiwan; whereas these military drills have increased in intensity and have been moved closer and closer to Taiwan’s mainland; whereas during a previous drill in August 2022 the PRC also fired missiles into Japan’s exclusive economic zone;

    U. whereas on top of military pressure the PRC has long been pursuing a sophisticated strategy of targeting Taiwan with foreign information manipulation and interference (FIMI), including hybrid and cyberattacks with the goal of undermining Taiwan’s democratic society;

    V. whereas the PRC, under the leadership of Xi Jinping, has said that it will not renounce the use of force to seek unification with Taiwan;

    W. whereas the PRC’s 2005 Anti-Secession Law includes the use of non-peaceful means, triggered by ambiguous thresholds, to achieve what the PRC calls ‘unification’ with Taiwan; whereas such military action is a grave threat to the security and stability of the entire region, with potentially dire global consequences; whereas EU and US deterrence is of strategic importance to dissuade the PRC from undertaking any unilateral action against Taiwan;

    X. whereas the PRC’s increasingly aggressive behaviour, in particular in its own neighbourhood, such as the Taiwan Strait and the South China Sea, poses a risk to regional and global security; whereas since 2019 the PRC has violated the Taiwanese air defence identification zone (ADIZ) with increasing regularity; whereas the PRC has been behaving aggressively across vast areas of the Indo-Pacific and exerting varying degrees of military or economic coercion, which has led to disputes with neighbours such as Japan, India, the Philippines and Australia;

    Y. whereas the EU has condemned the dangerous actions conducted by Chinese coastguard vessels against lawful Philippine maritime operations in the South China Sea on 31 August 2024; whereas this incident is the latest in a series of actions endangering the safety of life at sea and violating the right to freedom of navigation and overflight in compliance with international law; whereas maritime security and freedom of navigation must be ensured in accordance with international law and, in particular, UNCLOS;

    Z. whereas the PRC is supporting Russia’s war of aggression against Ukraine, in particular through the export of dual-use goods to Russia and the ongoing involvement of PRC-based companies in sanctions evasion and circumvention;

    AA. whereas as a permanent member of the UN Security Council, the PRC has a responsibility to work for peace and stability in the region, and particularly in the Taiwan Strait;

    AB. whereas through its 2021 strategy for cooperation in the Indo-Pacific, the EU and its Member States increased their presence in the region, including through a higher military presence of certain Member States and the continued passage of military ships through the Taiwan Strait;

    AC. whereas Taiwan is located in a strategic position in terms of trade, notably in high-tech supply chains; whereas the Taiwan Strait is the primary route for ships travelling from China, Japan, South Korea and Taiwan towards Europe; whereas Taiwan dominates semiconductor manufacturing markets, as its producers manufacture around 50 % of the world’s semiconductor output; whereas the EU’s strategy for cooperation in the Indo-Pacific argues for increasing trade and investment cooperation with Taiwan;

    AD. whereas the EU is Taiwan’s fourth largest trading partner after the PRC, the United States and Japan; whereas in 2022 Taiwan was the EU’s 12th largest trading partner; whereas the EU is the largest source of foreign direct investment in Taiwan; whereas Taiwanese investments in the EU remain below their potential;

    AE. whereas members of the Australian Senate and of the Dutch House of Representatives have recently adopted motions concerning the distortion of UN Resolution 2758 by the PRC and called for support for Taiwan’s greater participation in multilateral organisations;

    1. Reiterates that Taiwan is a key EU partner and a like-minded democratic friend in the Indo-Pacific region; commends Taiwan and the Taiwanese people for their strong democracy and vibrant civil society, demonstrated once more by the peaceful and well-organised elections of 13 January 2024;

    2. Opposes the PRC’s constant distortion of UN Resolution 2758 and its efforts to block Taiwan’s participation in multilateral organisations; calls for the EU and its Member States to support Taiwan’s meaningful participation in relevant international organisations such as the WHO, the ICAO, Interpol and the UNFCCC; further calls on the UN Secretariat to grant Taiwanese nationals and journalists the right to access UN premises for visits, meetings and newsgathering activities;

    3. Strongly condemns the PRC’s unwarranted military exercises of 14 October 2024, its continued military provocations against Taiwan and its continued military build-up, which is changing the balance of power in the Indo-Pacific, and reiterates its firm rejection of any unilateral change to the status quo in the Taiwan Strait; lauds the restraint and disciplined reaction of the Taiwanese authorities and calls for regular exchanges between the EU and its Taiwanese counterparts on relevant security issues;

    4. Reaffirms its strong commitment to the status quo in the Taiwan Strait; underlines that any attempt to unilaterally change the status quo in the Taiwan Strait, particularly by means of force or coercion, will not be accepted and will be met with a decisive and firm reaction;

    5. Underlines that UN Resolution 2758 takes no position on Taiwan; strongly rejects and refutes the PRC’s attempts to distort history and international rules;

    6. Reiterates the EU’s commitment to its ‘One China’ policy as the political foundation of EU-China relations; recalls that the EU’s China strategy emphasises that constructive cross-strait relations are part of promoting peace and security in the whole Asia-Pacific region and that the EU supports initiatives aimed at dialogue and confidence-building;

    7. Underlines that in Taiwan it is up to the people to democratically decide how they want to live and that the status quo in the Taiwan Strait must not be unilaterally changed by the use or threat of force;

    8. Reiterates its strong condemnation of statements by Chinese President Xi Jinping that the PRC will never renounce the right to use force with respect to Taiwan; underlines that the PRC’s use of force or threats or other highly coercive measures to achieve unification is incompatible with international law; expresses grave concern over the PRC’s use of hostile disinformation to undermine trust in Taiwan’s democracy and governance; reiterates its previous calls for the EU and its Member States to cooperate with international partners in helping to sustain democracy in Taiwan, keeping it free from foreign interference and threats; underlines that only Taiwan’s democratically elected government can represent the Taiwanese people on the international stage;

    9. Condemns the PRC’s systematic grey-zone military actions, including cyber and disinformation campaigns against Taiwan, and urges the PRC to halt these activities immediately; calls, in this regard, for cooperation between the EU and Taiwan to be deepened further to enhance structural cooperation on countering disinformation and foreign interference; welcomes the posting of a liaison officer at the European Economic and Trade Office in Taiwan to coordinate joint efforts to tackle disinformation and interference as a first important step towards deeper EU-Taiwan cooperation, and calls for the EU to further deepen cooperation with Taiwan in this key area; praises the courage of the Taiwanese people and the proportionate and dignified reactions of the Taiwanese authorities and institutions in the face of intensifying Chinese threats and activities;

    10. Firmly rejects the PRC’s economic coercion against Taiwan and other countries, as well as against EU Member States, and underlines that such practices are not only illegal under World Trade Organization rules, but that they also have a devastating effect on the PRC’s reputation around the world and will lead to a further loss of trust in the PRC as a responsible actor; stresses the independent right of the EU and its Member States to develop relations with Taiwan in line with their interests and shared values of democracy and human rights without foreign interference; calls on EU and Member State missions abroad to address and provide alternatives to malign PRC business practices, especially in the Global South;

    11. Is very concerned at the adoption of the so-called guidelines for punishing ‘diehard Taiwan independence separatists’ for committing crimes of secession and the incitement of secession jointly announced by the Supreme People’s Court, the Supreme People’s Procuratorate, the ministries for public security and state security and the justice ministry in June 2024, which could lead to harsh punishments for the crime of secession, up to and including the death penalty; strongly condemns the sentencing of one Taiwanese activist to nine years in prison in September 2024 after his arrest in the PRC in 2022, as well as the constant harassment of Taiwanese people working and living in the PRC;

    12. Is seriously concerned about the situation in the East and South China Seas; recalls the importance of respecting international law, including UNCLOS and, in particular, its provisions on the obligation to settle disputes by peaceful means and on maintaining the freedom of navigation and overflight; calls on all countries that have not done so to swiftly ratify UNCLOS; calls for the EU and its Member States to step up their own maritime capacities in the region; reminds the PRC of its responsibilities, as a permanent member of the UN Security Council, to uphold international law and emphasises the obligation to resolve disputes peacefully;

    13. Reaffirms its grave concerns about China’s increasing military investments and capabilities; expresses grave concerns about the renewed Chinese and Russian commitment to further strengthen their military ties and condemns the Chinese supply of components and equipment to Moscow’s military industry; welcomes the Council decision to impose sanctions on Chinese companies for supporting Russia’s war against Ukraine; deplores the ‘no limits’ partnership between Russia and the PRC; welcomes the increasing commitment and military presence of the United States in the Indo-Pacific; reiterates its calls for a coordinated approach to deepening EU-US cooperation on security matters, including through transatlantic parliamentary dialogue;

    14. Strongly welcomes the close cooperation and alignment of Taiwan with the EU and the United States in responding to Russia’s war against Ukraine and issuing sanctions in response to this blatant violation of international law; recalls Taiwan’s help in addressing the humanitarian crisis caused by Russia’s war of aggression against Ukraine and its continuous involvement and support for the Ukrainian government and countries hosting Ukrainian refugees;

    15. Highlights that the PRC’s various actions in the field of cognitive and legal warfare are slowly undermining the status quo, as well as intensifying grey-zone activities that are intended to circumvent detection, existing laws and response thresholds; calls for the EU to establish and enforce its redlines through its toolbox of sanctions, including sectoral sanctions, against hybrid activities and cyberthreats, and to coordinate strong diplomatic and economic deterrence measures with liked-minded partners;

    16. Expresses its gratitude for Taiwan’s help and assistance during the COVID-19 pandemic;

    17. Recognises the importance of Taiwan in securing global supply chains, especially in the high-tech sector where Taiwan is the leading producer of semiconductors, and calls for the EU and its Member States to engage in closer cooperation with Taiwan;

    18. Calls on the Commission to launch, without delay, preparatory measures for negotiations on a bilateral investment agreement, or other kinds of agreement, with Taiwan; highlights the potential for cooperation on foreign direct investment screening policy and on tackling economic coercion and retaliation;

    19. Applauds the increase in freedom of navigation exercises conducted by several EU countries, including France, the Netherlands and Germany; notes that these activities are in line with international law and calls for more cooperation and coordination with regional partners in order to increase freedom of navigation operations in the region;

    20. Welcomes visits by former and current Taiwanese politicians to Europe, including the recent visit of former President Tsai Ing-wen to the European Parliament on 17 October 2024; welcomes, furthermore, continued exchanges of its Members with Taiwan and encourages further visits of official European Parliament delegations to Taiwan; additionally encourages further exchanges between the EU and Taiwan at all levels, including political meetings and people-to-people encounters;

    21. Encourages, in this light, increased economic, scientific and cultural interactions and exchanges, focusing, among other areas, on youth, academia, civil society, sports, culture and education, as well as city-to-city and region-to-region partnerships; reiterates its call on the Member States to engage in meaningful and structural technical cooperation with Taiwan’s National Fire Agency and National Police Agency and with local administrations in the field of civil protection and disaster management;

    22. Instructs its President to forward this resolution to the Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy and the governments of the People’s Republic of China and Taiwan.

     

     

    MIL OSI Europe News –

  • MIL-OSI: QCR Holdings, Inc. Announces Net Income of $27.8 Million for the Third Quarter of 2024

    Source: GlobeNewswire (MIL-OSI)

    Third Quarter 2024 Highlights

    • Net income of $27.8 million, or $1.64 per diluted share
    • Adjusted net income of $30.3 million or $1.78 per diluted share (non-GAAP) resulting in an adjusted ROAA (non-GAAP) of 1.35%
    • Significant increase in net interest income of $3.6 million from the prior quarter, or 6%
    • Net interest margin expanded by 8 basis points to 3.34% adjusted NIM (TEY) (non-GAAP)
    • Continued strong capital markets revenue of $16.3 million
    • Tangible book value (non-GAAP) per share grew $2.35, or 20% annualized
    • TCE/TA ratio (non-GAAP) improved 24 basis points to 9.24%

    MOLINE, Ill., Oct. 23, 2024 (GLOBE NEWSWIRE) — QCR Holdings, Inc. (NASDAQ: QCRH) (the “Company”) today announced quarterly net income of $27.8 million and diluted earnings per share (“EPS”) of $1.64 for the third quarter of 2024, compared to net income of $29.1 million and diluted EPS of $1.72 for the second quarter of 2024.

    Adjusted net income (non-GAAP) and adjusted diluted EPS (non-GAAP) for the third quarter of 2024 were $30.3 million and $1.78, respectively. For the second quarter of 2024, adjusted net income (non-GAAP) was $29.3 million and adjusted diluted EPS (non-GAAP) was $1.73. For the third quarter of 2023, adjusted net income (non-GAAP) was $25.4 million, and adjusted diluted EPS (non-GAAP) was $1.51.

      For the Quarter Ended  
      September 30, June 30, September 30,  
    $ in millions (except per share data) 2024 2024 2023  
    Net Income $ 27.8 $ 29.1 $ 25.1  
    Diluted EPS $ 1.64 $ 1.72 $ 1.49  
    Adjusted Net Income (non-GAAP)* $ 30.3 $ 29.3 $ 25.4  
    Adjusted Diluted EPS (non-GAAP)* $ 1.78 $ 1.73 $ 1.51  
     

    *Adjusted non-GAAP measurements of financial performance exclude non-core and/or nonrecurring income and expense items that management believes are not reflective of the anticipated future operation of the Company’s business. The Company believes these adjusted measurements provide a better comparison for analysis and may provide a better indicator of future performance. See GAAP to non-GAAP reconciliations.

    “We produced exceptional third quarter results, highlighted by our significant growth in net interest income and margin expansion. We also had another quarter of strong capital markets and wealth management revenue,” said Larry J. Helling, Chief Executive Officer. “In addition, we grew core deposits, maintained our excellent asset quality, and significantly increased our tangible book value per share.”

    Net Interest Income Grew 6% and Net Interest Margin Expanded 8 Basis Points

    Net interest income for the third quarter of 2024 totaled $59.7 million, an increase of $3.6 million from the second quarter of 2024, driven by strong growth in loans and investments combined with margin expansion. Loan yields increased and funding costs were stable. Loan discount accretion was $463 thousand during the third quarter of 2024, an increase of $195 thousand from the prior quarter.

    Net interest margin (“NIM”) was 2.90% and NIM on a tax-equivalent yield (“TEY”) basis (non-GAAP) was 3.37% for the third quarter, as compared to 2.82% and 3.27% for the prior quarter, respectively. Adjusted NIM TEY (non-GAAP) of 3.34% for the third quarter of 2024, represented an increase of 8 basis points from 3.26% for the second quarter of 2024.  

    “Our adjusted NIM, on a tax equivalent yield basis (non-GAAP), expanded by 8 basis points from the second quarter to 3.34% and exceeded the upper end of our guidance range,” said Todd A. Gipple, President and Chief Financial Officer. “We are very pleased with another quarter of NIM expansion. Looking ahead, we anticipate continued growth in net interest income and are guiding to further fourth quarter adjusted NIM TEY (non-GAAP) expansion in a range of between 2 to 7 basis points.”

    Strong Noninterest Income Including $16.3 Million of Capital Markets Revenue

    Noninterest income for the third quarter of 2024 totaled $27.2 million, a decrease from $30.9 million in the second quarter of 2024. The Company delivered $16.3 million of capital markets revenue in the quarter compared to $17.8 million in the prior quarter. Capital markets revenue was impacted by a $473 thousand loss from the execution of our third securitization during the quarter, a more modest loss than our prior guidance. Wealth management revenue was $4.5 million for the quarter, a 17% annualized increase from the second quarter. Additionally, the Company recorded $2.2 million of income from bank-owned life insurance policy proceeds in the second quarter of 2024 which did not recur during the third quarter of 2024.

    “Our capital markets business delivered strong results driven by the swap fees from our low-income housing tax credit (“LIHTC”) lending program. The demand for affordable housing remains strong, which supports the sustainability of our LIHTC lending program,” added Mr. Gipple. “Our LIHTC lending pipelines, and the associated capital markets revenue remain robust. Additionally, our wealth management business continues to grow from new client additions and increased assets under management as we expand our market share.”

    During the third quarter, the Company executed a derivative strategy with a notional value of $410 million. These derivatives are designed to safeguard the Company’s regulatory capital ratios against the adverse effects of a significant decline in long-term interest rates. These derivatives are unhedged and are marked-to-market, with gains or losses recorded in noninterest income and reflected as a non-core item. For the quarter, the Company recorded a $414 thousand loss on these derivatives.

    Well Controlled Noninterest Expenses of $53.6 Million Impacted by m2 Equipment Finance Decision

    Noninterest expense for the third quarter of 2024 totaled $53.6 million, compared to $49.9 million for the second quarter and $51.1 million for the third quarter of 2023. The linked-quarter increase was primarily due to the previously announced one-time restructuring and goodwill impairment charges related to the decision to discontinue offering new loans and leases at m2 Equipment Finance, LLC (“m2”).  

    “Our core expenses, excluding m2 one-time charges, were $51.2 million, an increase of $1.3 million, and within our guidance range of $49 to $52 million,” said Mr. Gipple. The linked quarter increase in core expenses for the quarter was primarily driven by higher incentive compensation and advertising expenses. Year-to-date core noninterest expenses remain well controlled, having increased only 2% annually. Excluding the one-time charges and other non-core items, the Company’s adjusted efficiency ratio (non-GAAP) was 58.5% in the third quarter.

    Strong Core Deposit Growth

    During the third quarter of 2024, the Company generated strong deposit growth with core deposits increasing by $166.3 million, or 10.3% annualized, to $6.6 billion. “Year-to-date, core deposits have increased by $398.3 million, which is an annualized growth rate of 8.5%. This is a result of our dedication to expanding market share and building new relationships in our markets,” added Mr. Helling.

    Continued Loan Growth

    During the third quarter of 2024, the Company’s total loans and leases held for investment increased by $53.5 million to $6.7 billion. At quarter end, the Company held $165.9 million of LIHTC loans held for sale in anticipation of the Company’s next loan securitization.

    “Our year-to-date total loan growth excluding the impact of the loans securitized during the third quarter, is 10.5% annualized which was just above our guidance range. Year-to-date loan growth, net of loans securitized, was 5.8% annualized”, added Mr. Helling. “With the continued strength of our markets and healthy pipeline, we are maintaining our loan growth target for the full year 2024 of 8% to 10%, prior to the loan securitizations closed in the third quarter and planned for in the fourth quarter.”  

    Asset Quality Remains Excellent

    The Company’s nonperforming assets (“NPAs”) to total assets ratio was 0.39% on September 30, 2024, unchanged from the prior quarter. NPAs totaled $35.7 million at the end of the third quarter of 2024, a $1.2 million increase from the prior quarter.

    The Company’s total criticized loans, a leading indicator of asset quality, declined by $15.3 million on a linked-quarter basis, and the ratio of criticized loans to total loans and leases as of September 30, 2024, improved to 2.20%, as compared to 2.41% as of June 30, 2024. This marks the fourth consecutive quarter of improvement, resulting in a $50 million reduction in total criticized balances.

    The Company recorded a total provision for credit losses of $3.5 million during the quarter, representing a decline of $2.0 million from the prior quarter. The reduction in the provision for credit losses during the quarter was primarily due to overall credit quality improvements. Net charge-offs were $3.4 million during the third quarter of 2024, an increase of $1.8 million from the prior quarter. The increase in net charge offs primarily resulted from loans and leases at m2. The allowance for credit losses to total loans held for investment decreased to 1.30% from 1.33% as of the prior quarter.

    Continued Strong Capital Levels and Outstanding Tangible Book Value Expansion

    As of September 30, 2024, the Company’s tangible common equity to tangible assets ratio (“TCE”) (non-GAAP) increased to 9.24%. The improvement in TCE was driven by strong earnings and an increase in accumulated other comprehensive income (“AOCI”). The total risk-based capital ratio decreased to 13.87% and the common equity tier 1 ratio decreased to 9.79% due to sizable loan and investment growth partially offset by strong earnings. By comparison, these ratios were 9.00%, 14.21%, and 9.92%, respectively, as of June 30, 2024. The Company remains focused on growing its regulatory capital and targeting TCE (non-GAAP) in the top quartile of its peer group.

    The Company’s tangible book value per share (non-GAAP) increased significantly by $2.35, or 20% annualized, during the third quarter of 2024. AOCI increased $12.1 million during the third quarter primarily due to declining interest rates. Tangible book value per share (non-GAAP) has grown by $5.19 year-to-date, for an annualized growth rate of nearly 16%. The combination of strong earnings, a modest dividend, and improved AOCI contributed to the improvement in tangible book value per share (non-GAAP).

    Conference Call Details
    The Company will host an earnings call/webcast tomorrow, October 24, 2024, at 10:00 a.m. Central Time. Dial-in information for the call is toll-free: 888-346-9286 (international 412-317-5253). Participants should request to join the QCR Holdings, Inc. call. The event will be available for replay through October 31, 2024. The replay access information is 877-344-7529 (international 412-317-0088); access code 4892655. A webcast of the teleconference can be accessed on the Company’s News and Events page at www.qcrh.com. An archived version of the webcast will be available at the same location shortly after the live event has ended.

    About Us
    QCR Holdings, Inc., headquartered in Moline, Illinois, is a relationship-driven, multi-bank holding company serving the Quad Cities, Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield communities through its wholly owned subsidiary banks. The banks provide full-service commercial and consumer banking and trust and wealth management services. Quad City Bank & Trust Company, based in Bettendorf, Iowa, commenced operations in 1994, Cedar Rapids Bank & Trust Company, based in Cedar Rapids, Iowa, commenced operations in 2001, Community State Bank, based in Ankeny, Iowa, was acquired by the Company in 2016, Springfield First Community Bank, based in Springfield, Missouri, was acquired by the Company in 2018, and Guaranty Bank, also based in Springfield, Missouri, was acquired by the Company and merged with Springfield First Community Bank in 2022, with the combined entity operating under the Guaranty Bank name. Additionally, the Company serves the Waterloo/Cedar Falls, Iowa community through Community Bank & Trust, a division of Cedar Rapids Bank & Trust Company. The Company has 36 locations in Iowa, Missouri, Wisconsin and Illinois. As of September 30, 2024, the Company had $9.1 billion in assets, $6.8 billion in loans and $7.0 billion in deposits. For additional information, please visit the Company’s website at www.qcrh.com.

    Special Note Concerning Forward-Looking Statements. This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “bode”, “predict,” “suggest,” “project”, “appear,” “plan,” “intend,” “estimate,” ”annualize,” “may,” “will,” “would,” “could,” “should,” “likely,” “might,” “potential,” “continue,” “annualized,” “target,” “outlook,” as well as the negative forms of those words, or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.  

    A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics, acts of war or other threats thereof (including the ongoing conflict in the Middle East and the Russian invasion of Ukraine), or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the Financial Accounting Standards Board or the Public Company Accounting Oversight Board; (iv) changes in local, state and federal laws, regulations and governmental policies concerning the Company’s general business, including as a result of the upcoming 2024 presidential election or any changes in response to failures of other banks; (vi) increased competition in the financial services sector, including from non-bank competitors such as credit unions and “fintech” companies, and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) fluctuations in the value of securities held in our securities portfolio; (xiv) concentrations within our loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (xv) the concentration of large deposits from certain clients who have balances above current Federal Deposit Insurance Corporation insurance limits and may withdraw deposits to diversity their exposure; (xvi) the level of non-performing assets on our balance sheets; (xvii) interruptions involving our information technology and communications systems or third-party servicers; (xviii) breaches or failures of our information security controls or cybersecurity-related incidents, (xix) changes in the interest rates and prepayment rates of the Company’s assets, and (xx) the ability of the Company to manage the risks associated with the foregoing as well as anticipated. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

    Contact:
    Todd A. Gipple                                
    President                                
    Chief Financial Officer                        
    (309) 743-7745                                
    tgipple@qcrh.com

       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
      As of  
      September 30, June 30, March 31, December 31, September 30,
      2024 2024 2024 2023 2023  
                 
      (dollars in thousands)  
                 
    CONDENSED BALANCE SHEET            
                 
    Cash and due from banks $ 103,840   $ 92,173   $ 80,988   $ 97,123   $ 104,265    
    Federal funds sold and interest-bearing deposits   159,159     102,262     77,020     140,369     80,650    
    Securities, net of allowance for credit losses   1,146,046     1,033,199     1,031,861     1,005,528     896,394    
    Loans receivable held for sale (1)   167,047     246,124     275,344     2,594     278,893    
    Loans/leases receivable held for investment   6,661,755     6,608,262     6,372,992     6,540,822     6,327,414    
    Allowance for credit losses   (86,321 )   (87,706 )   (84,470 )   (87,200 )   (87,669 )  
    Intangibles   11,751     12,441     13,131     13,821     14,537    
    Goodwill   138,596     139,027     139,027     139,027     139,027    
    Derivatives   261,913     194,354     183,888     188,978     291,295    
    Other assets   524,779     531,855     509,768     497,832     495,251    
    Total assets $ 9,088,565   $ 8,871,991   $ 8,599,549   $ 8,538,894   $ 8,540,057    
                 
    Total deposits $ 6,984,633   $ 6,764,667   $ 6,806,775   $ 6,514,005   $ 6,494,852    
    Total borrowings   660,344     768,671     489,633     718,295     712,126    
    Derivatives   285,769     221,798     211,677     214,098     320,220    
    Other liabilities   181,199     180,536     184,122     205,900     184,476    
    Total stockholders’ equity   976,620     936,319     907,342     886,596     828,383    
    Total liabilities and stockholders’ equity $ 9,088,565   $ 8,871,991   $ 8,599,549   $ 8,538,894   $ 8,540,057    
                 
    ANALYSIS OF LOAN PORTFOLIO            
    Loan/lease mix: (2)            
    Commercial and industrial – revolving $ 387,409   $ 362,115   $ 326,129   $ 325,243   $ 299,588    
    Commercial and industrial – other   1,321,053     1,370,561     1,374,333     1,390,068     1,381,967    
    Commercial and industrial – other – LIHTC   89,028     92,637     96,276     91,710     105,601    
    Total commercial and industrial   1,797,490     1,825,313     1,796,738     1,807,021     1,787,156    
    Commercial real estate, owner occupied   622,072     633,596     621,069     607,365     610,618    
    Commercial real estate, non-owner occupied   1,103,694     1,082,457     1,055,089     1,008,892     955,552    
    Construction and land development   342,335     331,454     410,918     477,424     472,695    
    Construction and land development – LIHTC   913,841     750,894     738,609     943,101     921,359    
    Multi-family   324,090     329,239     296,245     284,721     282,541    
    Multi-family – LIHTC   973,682     1,148,244     1,007,321     711,422     874,439    
    Direct financing leases   19,241     25,808     28,089     31,164     34,401    
    1-4 family real estate   587,512     583,542     563,358     544,971     539,931    
    Consumer   144,845     143,839     130,900     127,335     127,615    
    Total loans/leases $ 6,828,802   $ 6,854,386   $ 6,648,336   $ 6,543,416   $ 6,606,307    
    Less allowance for credit losses   86,321     87,706     84,470     87,200     87,669    
    Net loans/leases $ 6,742,481   $ 6,766,680   $ 6,563,866   $ 6,456,216   $ 6,518,638    
                 
    ANALYSIS OF SECURITIES PORTFOLIO            
    Securities mix:            
    U.S. government sponsored agency securities $ 18,621   $ 20,101   $ 14,442   $ 14,973   $ 16,002    
    Municipal securities   965,810     885,046     884,469     853,645     764,017    
    Residential mortgage-backed and related securities   53,488     54,708     56,071     59,196     57,946    
    Asset backed securities   10,455     12,721     14,285     15,423     16,326    
    Other securities   39,190     38,464     40,539     41,115     43,272    
    Trading securities (3)   58,685     22,362     22,258     22,368     –    
    Total securities $ 1,146,249   $ 1,033,402   $ 1,032,064   $ 1,006,720   $ 897,563    
    Less allowance for credit losses   203     203     203     1,192     1,169    
    Net securities $ 1,146,046   $ 1,033,199   $ 1,031,861   $ 1,005,528   $ 896,394    
                 
    ANALYSIS OF DEPOSITS            
    Deposit mix:            
    Noninterest-bearing demand deposits $ 969,348   $ 956,445   $ 955,167   $ 1,038,689   $ 1,027,791    
    Interest-bearing demand deposits   4,715,087     4,644,918     4,714,555     4,338,390     4,416,725    
    Time deposits   942,847     859,593     875,491     851,950     788,692    
    Brokered deposits   357,351     303,711     261,562     284,976     261,644    
    Total deposits $ 6,984,633   $ 6,764,667   $ 6,806,775   $ 6,514,005   $ 6,494,852    
                 
    ANALYSIS OF BORROWINGS            
    Borrowings mix:            
    Term FHLB advances $ 145,383   $ 135,000   $ 135,000   $ 135,000   $ 135,000    
    Overnight FHLB advances   230,000     350,000     70,000     300,000     295,000    
    Other short-term borrowings   2,750     1,600     2,700     1,500     470    
    Subordinated notes   233,383     233,276     233,170     233,064     232,958    
    Junior subordinated debentures   48,828     48,795     48,763     48,731     48,698    
    Total borrowings $ 660,344   $ 768,671   $ 489,633   $ 718,295   $ 712,126    
                 
    (1) Loans with a fair value of $165.9 million, $243.2 million, $274.8 million and $278.0 million have been identified for securitization and are included in LHFS at September 30, 2024, June 30, 2024, March 31, 2024 and September 30, 2023, respectively.
    (2) Loan categories with significant LIHTC loan balances have been broken out separately. Total LIHTC balances within the loan/lease portfolio were $2.0 billion at September 30, 2024.   
    (3) Trading securities consisted of retained beneficial interests acquired in conjunction with Freddie Mac securitizations completed by the Company.  
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                     
          For the Quarter Ended  
          September 30, June 30, March 31, December 31, September 30,  
          2024 2024 2024 2023 2023  
                     
          (dollars in thousands, except per share data)  
                     
    INCOME STATEMENT              
    Interest income   $ 125,420   $ 119,746 $ 115,049   $ 112,248   $ 108,568    
    Interest expense     65,698     63,583   60,350     56,512     53,313    
    Net interest income     59,722     56,163   54,699     55,736     55,255    
    Provision for credit losses     3,484     5,496   2,969     5,199     3,806    
    Net interest income after provision for credit losses   $ 56,238   $ 50,667 $ 51,730   $ 50,537   $ 51,449    
                     
                     
    Trust fees     $ 3,270   $ 3,103 $ 3,199   $ 3,084   $ 2,863    
    Investment advisory and management fees     1,229     1,214   1,101     1,052     947    
    Deposit service fees     2,294     1,986   2,022     2,008     2,107    
    Gains on sales of residential real estate loans, net     385     540   382     323     476    
    Gains on sales of government guaranteed portions of loans, net     –     12   24     24     –    
    Capital markets revenue     16,290     17,758   16,457     36,956     15,596    
    Earnings on bank-owned life insurance     814     2,964   868     832     1,807    
    Debit card fees     1,575     1,571   1,466     1,561     1,584    
    Correspondent banking fees     507     510   512     465     450    
    Loan related fee income     949     962   836     845     800    
    Fair value gain (loss) on derivatives and trading securities     (886 )   51   (163 )   (582 )   (336 )  
    Other       730     218   154     1,161     299    
    Total noninterest income   $ 27,157   $ 30,889 $ 26,858   $ 47,729   $ 26,593    
                     
                     
    Salaries and employee benefits   $ 31,637   $ 31,079 $ 31,860   $ 41,059   $ 32,098    
    Occupancy and equipment expense     6,168     6,377   6,514     6,789     6,228    
    Professional and data processing fees     4,457     4,823   4,613     4,223     4,456    
    Restructuring expense     1,954     –   –     –     –    
    FDIC insurance, other insurance and regulatory fees     1,711     1,854   1,945     2,115     1,721    
    Loan/lease expense     587     151   378     834     826    
    Net cost of (income from) and gains/losses on operations of other real estate     (42 )   28   (30 )   38     3    
    Advertising and marketing     2,124     1,565   1,483     1,641     1,429    
    Communication and data connectivity     333     318   401     449     478    
    Supplies       278     259   275     333     335    
    Bank service charges     603     622   568     761     605    
    Correspondent banking expense     325     363   305     300     232    
    Intangibles amortization     690     690   690     716     691    
    Goodwill impairment     432     –   –     –     –    
    Payment card processing     785     706   646     836     733    
    Trust expense     395     379   425     413     432    
    Other       1,128     674   617     431     814    
    Total noninterest expense   $ 53,565   $ 49,888 $ 50,690   $ 60,938   $ 51,081    
                     
    Net income before income taxes   $ 29,830   $ 31,668 $ 27,898   $ 37,328   $ 26,961    
    Federal and state income tax expense     2,045     2,554   1,172     4,473     1,840    
    Net income     $ 27,785   $ 29,114 $ 26,726   $ 32,855   $ 25,121    
                     
    Basic EPS   $ 1.65   $ 1.73 $ 1.59   $ 1.96   $ 1.50    
    Diluted EPS   $ 1.64   $ 1.72 $ 1.58   $ 1.95   $ 1.49    
                     
                     
    Weighted average common shares outstanding     16,846,200     16,814,814   16,783,348     16,734,080     16,717,303    
    Weighted average common and common equivalent shares outstanding     16,982,400     16,921,854   16,910,675     16,875,952     16,847,951    
                     
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
          For the Nine Months Ended  
          September 30,   September 30,  
          2024   2023  
                 
          (dollars in thousands, except per share data)  
                 
    INCOME STATEMENT          
    Interest income   $ 360,215     $ 301,162    
    Interest expense     189,631       135,892    
    Net interest income     170,584       165,270    
    Provision for credit losses     11,949       11,340    
    Net interest income after provision for credit losses   $ 158,635     $ 153,930    
                 
                 
    Trust fees     $ 9,572     $ 8,613    
    Investment advisory and management fees     3,544       2,812    
    Deposit service fees     6,302       6,169    
    Gains on sales of residential real estate loans, net     1,307       1,288    
    Gains on sales of government guaranteed portions of loans, net     36       30    
    Capital markets revenue     50,505       55,109    
    Securities losses, net     –       (451 )  
    Earnings on bank-owned life insurance     4,646       3,352    
    Debit card fees     4,612       4,639    
    Correspondent banking fees     1,529       1,197    
    Loan related fee income     2,747       2,221    
    Fair value loss on derivatives and trading securities     (998 )     (680 )  
    Other       1,102       656    
    Total noninterest income   $ 84,904     $ 84,955    
                 
                 
    Salaries and employee benefits   $ 94,576     $ 95,560    
    Occupancy and equipment expense     19,059       18,242    
    Professional and data processing fees     13,893       12,048    
    Post-acquisition compensation, transition and integration costs     –       207    
    Restructuring expense     1,954       –    
    FDIC insurance, other insurance and regulatory fees     5,510       5,022    
    Loan/lease expense     1,116       2,034    
    Net cost of (income from) and gains/losses on operations of other real estate       (44 )     (64 )  
    Advertising and marketing     5,172       4,401    
    Communication and data connectivity     1,052       1,614    
    Supplies       812       921    
    Bank service charges     1,793       1,831    
    Correspondent banking expense     993       663    
    Intangibles amortization     2,070       2,222    
    Goodwill impairment     432       –    
    Payment card processing     2,137       1,820    
    Trust expense     1,199       983    
    Other       2,419       2,089    
    Total noninterest expense   $ 154,143     $ 149,593    
                 
    Net income before income taxes   $ 89,396     $ 89,292    
    Federal and state income tax expense     5,771       8,589    
    Net income     $ 83,625     $ 80,703    
                 
    Basic EPS   $ 4.97     $ 4.82    
    Diluted EPS   $ 4.94     $ 4.79    
                 
                 
    Weighted average common shares outstanding     16,814,787       16,731,847    
    Weighted average common and common equivalent shares outstanding   16,938,309       16,863,203    
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                       
      As of and for the Quarter Ended   For the Nine Months Ended  
      September 30, June 30, March 31, December 31, September 30,
    		   September 30, September 30,  
      2024 2024 2024 2023 2023   2024 2023  
                       
      (dollars in thousands, except per share data)  
                       
    COMMON SHARE DATA                  
    Common shares outstanding   16,861,108     16,824,985     16,807,056     16,749,254     16,731,646          
    Book value per common share (1) $ 57.92   $ 55.65   $ 53.99   $ 52.93   $ 49.51          
    Tangible book value per common share (Non-GAAP) (2) $ 49.00   $ 46.65   $ 44.93   $ 43.81   $ 40.33          
    Closing stock price $ 74.03   $ 60.00   $ 60.74   $ 58.39   $ 48.52          
    Market capitalization $ 1,248,228   $ 1,009,499   $ 1,020,861   $ 977,989   $ 811,819          
    Market price / book value   127.81 %   107.82 %   112.51 %   100.31 %   98.00 %        
    Market price / tangible book value   151.07 %   128.62 %   135.18 %   133.29 %   120.30 %        
    Earnings per common share (basic) LTM (3) $ 6.93   $ 6.78   $ 6.75   $ 6.78   $ 6.65          
    Price earnings ratio LTM (3) 10.68 x 8.85 x 9.00 x 8.61 x 7.30 x        
    TCE / TA (Non-GAAP) (4)   9.24 %   9.00 %   8.94 %   8.75 %   8.05 %        
                       
                       
    CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY          
    Beginning balance $ 936,319   $ 907,342   $ 886,596   $ 828,383   $ 822,689          
    Net income   27,785     29,114     26,726     32,855     25,121          
    Other comprehensive income (loss), net of tax   12,057     (368 )   (5,373 )   25,363     (19,415 )        
    Common stock cash dividends declared   (1,012 )   (1,008 )   (1,008 )   (1,004 )   (1,003 )        
    Other (5)   1,471     1,239     401     999     991          
    Ending balance $ 976,620   $ 936,319   $ 907,342   $ 886,596   $ 828,383          
                       
                       
    REGULATORY CAPITAL RATIOS (6):                  
    Total risk-based capital ratio   13.87 %   14.21 %   14.30 %   14.29 %   14.48 %        
    Tier 1 risk-based capital ratio   10.33 %   10.49 %   10.50 %   10.27 %   10.30 %        
    Tier 1 leverage capital ratio   10.50 %   10.40 %   10.33 %   10.03 %   9.92 %        
    Common equity tier 1 ratio   9.79 %   9.92 %   9.91 %   9.67 %   9.68 %        
                       
                       
    KEY PERFORMANCE RATIOS AND OTHER METRICS                  
    Return on average assets (annualized)   1.24 %   1.33 %   1.25 %   1.54 %   1.21 %     1.27 %   1.34 %  
    Return on average total equity (annualized)   11.55 %   12.63 %   11.83 %   15.42 %   11.99 %     12.00 %   13.18 %  
    Net interest margin   2.90 %   2.82 %   2.82 %   2.90 %   2.89 %     2.85 %   3.00 %  
    Net interest margin (TEY) (Non-GAAP)(7)   3.37 %   3.27 %   3.25 %   3.32 %   3.31 %     3.30 %   3.37 %  
    Efficiency ratio (Non-GAAP) (8)   61.65 %   57.31 %   62.15 %   58.90 %   62.41 %     60.33 %   59.78 %  
    Gross loans/leases held for investment / total assets   73.30 %   74.48 %   74.11 %   76.60 %   74.09 %     73.30 %   77.36 %  
    Gross loans/leases held for investment / total deposits   95.38 %   97.69 %   93.63 %   100.41 %   97.42 %     95.38 %   101.72 %  
    Effective tax rate   6.86 %   8.06 %   4.20 %   11.98 %   6.82 %     6.46 %   9.62 %  
    Full-time equivalent employees   976     988     986     996     987       976     987    
                       
                       
    AVERAGE BALANCES                  
    Assets $ 8,968,653   $ 8,776,002   $ 8,550,855   $ 8,535,732   $ 8,287,813     $ 8,765,913   $ 8,041,141    
    Loans/leases   6,840,527     6,779,075     6,598,614     6,483,572     6,476,512       6,739,773     6,288,343    
    Deposits   6,858,196     6,687,188     6,595,453     6,485,154     6,342,339       6,714,251     6,272,083    
    Total stockholders’ equity   962,302     921,986     903,371     852,163     837,734       929,341     816,591    
                       
                       
                       
    (1) Includes accumulated other comprehensive income (loss).            
    (2) Includes accumulated other comprehensive income (loss) and excludes intangible assets. See GAAP to Non-GAAP reconciliations.    
    (3) LTM : Last twelve months.             
    (4) TCE / TCA : tangible common equity / total tangible assets. See GAAP to non-GAAP reconciliations.         
    (5) Includes mostly common stock issued for options exercised and the employee stock purchase plan, as well as stock-based compensation.    
    (6) Ratios for the current quarter are subject to change upon final calculation for regulatory filings due after earnings release.        
    (7) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.           
    (8) See GAAP to Non-GAAP reconciliations.              
                       
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                               
                               
    ANALYSIS OF NET INTEREST INCOME AND MARGIN                        
                               
        For the Quarter Ended  
        September 30, 2024   June 30, 2024   September 30, 2023  
        Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		   Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		   Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		  
                               
        (dollars in thousands)  
                               
    Fed funds sold   $ 12,596 $ 173 5.37 %   $ 13,065 $ 183 5.54 %   $ 21,526 $ 284 5.23 %  
    Interest-bearing deposits at financial institutions   145,597   1,915 5.23 %     80,998   1,139 5.66 %     86,807   1,205 5.51 %  
    Investment securities – taxable   381,285   4,439 4.64 %     377,747   4,286 4.53 %     344,657   3,788 4.38 %  
    Investment securities – nontaxable (1)   760,645   10,744 5.65 %     704,761   9,462 5.37 %     600,693   6,974 4.64 %  
    Restricted investment securities   42,546   840 7.73 %     43,398   869 7.92 %     43,590   659 5.91 %  
    Loans (1)     6,840,527   116,854 6.80 %     6,779,075   112,719 6.69 %     6,476,512   103,428 6.34 %  
    Total earning assets (1) $ 8,183,196 $ 134,965 6.56 %   $ 7,999,044 $ 128,658 6.46 %   $ 7,573,785 $ 116,338 6.10 %  
                               
    Interest-bearing deposits $ 4,739,757 $ 42,180 3.54 %   $ 4,649,625 $ 40,924 3.54 %   $ 4,264,208 $ 33,563 3.12 %  
    Time deposits     1,164,560   13,206 4.51 %     1,091,870   12,128 4.47 %     999,488   10,003 3.97 %  
    Short-term borrowings   2,485   32 5.07 %     1,622   21 5.18 %     1,514   20 5.28 %  
    Federal Home Loan Bank advances   445,632   5,972 5.24 %     464,231   6,238 5.32 %     425,870   5,724 5.26 %  
    Subordinated debentures   233,313   3,616 6.20 %     233,207   3,582 6.14 %     232,890   3,307 5.68 %  
    Junior subordinated debentures   48,806   693 5.56 %     48,774   688 5.58 %     48,678   695 5.59 %  
    Total interest-bearing liabilities $ 6,634,553 $ 65,699 3.93 %   $ 6,489,329 $ 63,581 3.93 %   $ 5,972,648 $ 53,312 3.54 %  
                               
    Net interest income (1)   $ 69,266       $ 65,077       $ 63,026    
    Net interest margin (2)     2.90 %       2.82 %       2.89 %  
    Net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.37 %       3.27 %       3.31 %  
    Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.34 %       3.26 %       3.28 %  
                               
                               
        For the Nine Months Ended          
        September 30, 2024   September 30, 2023      
        Average Balance Interest Earned or Paid Average Yield or Cost   Average Balance Interest Earned or Paid Average Yield or Cost          
                               
        (dollars in thousands)          
                               
    Fed funds sold   $ 15,196 $ 625 5.40 %   $ 19,267 $ 741 5.14 %          
    Interest-bearing deposits at financial institutions   106,195   4,254 5.35 %     83,783   3,151 5.03 %          
    Investment securities – taxable   377,538   12,986 4.57 %     340,140   10,847 4.24 %          
    Investment securities – nontaxable (1)   717,284   29,557 5.50 %     599,070   19,892 4.43 %          
    Restricted investment securities   41,348   2,383 7.57 %     38,817   1,677 5.70 %          
    Loans (1)     6,739,773   337,244 6.68 %     6,288,343   285,136 6.06 %          
    Total earning assets (1) $ 7,997,334 $ 387,049 6.46 %   $ 7,369,420 $ 321,444 5.83 %          
                               
    Interest-bearing deposits $ 4,639,937 $ 122,207 3.52 %   $ 4,099,789 $ 84,565 2.76 %          
    Time deposits     1,121,508   37,679 4.49 %     1,020,421   27,225 3.57 %          
    Short-term borrowings   1,846   76 5.47 %     3,588   152 5.66 %          
    Federal Home Loan Bank advances   421,782   16,948 5.28 %     311,740   11,898 5.03 %          
    Subordinated debentures   233,207   10,678 6.10 %     232,784   9,922 5.68 %          
    Junior subordinated debentures   48,774   2,074 5.59 %     48,646   2,129 5.77 %          
    Total interest-bearing liabilities $ 6,467,054 $ 189,662 3.91 %   $ 5,716,968 $ 135,891 3.17 %          
                               
    Net interest income (1)   $ 197,387       $ 185,553            
    Net interest margin (2)     2.85 %       3.00 %          
    Net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.30 %       3.37 %          
    Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.28 %       3.34 %          
                               
                               
    (1) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.  
    (2) See “Select Financial Data – Subsidiaries” for a breakdown of amortization/accretion included in net interest margin for each period presented.     
    (3) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.            
                               
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
                 
      As of  
      September 30, June 30, March 31, December 31, September 30,
      2024 2024 2024 2023 2023  
                 
      (dollars in thousands, except per share data)  
                 
    ROLLFORWARD OF ALLOWANCE FOR CREDIT LOSSES ON LOANS/LEASES            
    Beginning balance $ 87,706   $ 84,470   $ 87,200   $ 87,669   $ 85,797    
    Change in ACL for transfer of loans to LHFS   (1,812 )   498     (3,377 )   266     175    
    Credit loss expense   3,828     4,343     3,736     2,519     3,260    
    Loans/leases charged off   (3,871 )   (1,751 )   (3,560 )   (3,354 )   (1,816 )  
    Recoveries on loans/leases previously charged off   470     146     471     100     253    
    Ending balance $ 86,321   $ 87,706   $ 84,470   $ 87,200   $ 87,669    
                 
                 
    NONPERFORMING ASSETS            
    Nonaccrual loans/leases $ 33,480   $ 33,546   $ 29,439   $ 32,753   $ 34,568    
    Accruing loans/leases past due 90 days or more   1,298     87     142     86     –    
    Total nonperforming loans/leases   34,778     33,633     29,581     32,839     34,568    
    Other real estate owned   369     369     784     1,347     120    
    Other repossessed assets   542     512     962     –     –    
    Total nonperforming assets $ 35,689   $ 34,514   $ 31,327   $ 34,186   $ 34,688    
                 
                 
    ASSET QUALITY RATIOS            
    Nonperforming assets / total assets   0.39 %   0.39 %   0.36 %   0.40 %   0.41 %  
    ACL for loans and leases / total loans/leases held for investment   1.30 %   1.33 %   1.33 %   1.33 %   1.39 %  
    ACL for loans and leases / nonperforming loans/leases   248.21 %   260.77 %   285.55 %   265.54 %   253.61 %  
    Net charge-offs as a % of average loans/leases   0.05 %   0.02 %   0.05 %   0.05 %   0.02 %  
                 
                 
                 
    INTERNALLY ASSIGNED RISK RATING (1) (2)            
    Special mention $ 80,121   $ 85,096   $ 111,729   $ 125,308   $ 128,052    
    Substandard (3)   70,022     80,345     70,841     70,425     72,550    
    Doubtful (3)   –     –     –     –     –    
        Total Criticized loans (4) $ 150,143   $ 165,441   $ 182,570   $ 195,733   $ 200,602    
                 
    Classified loans as a % of total loans/leases (3)   1.03 %   1.17 %   1.07 %   1.08 %   1.10 %  
    Total Criticized loans as a % of total loans/leases (4)   2.20 %   2.41 %   2.75 %   2.99 %   3.04 %  
                 
                 
                 
                 
    (1) During the first quarter of 2024, the Company revised the risk rating scale used for credit quality monitoring.  
    (2) Amounts exclude the government guaranteed portion, if any. The Company assigns internal risk ratings of Pass for the government guaranteed portion.  
    (3) Classified loans are defined as loans with internally assigned risk ratings of 10 or 11 (7 or 8 prior to January 1, 2024), regardless of performance, and include loans identified as Substandard or Doubtful.  
    (4) Total Criticized loans are defined as loans with internally assigned risk ratings of 9, 10, or 11 (6, 7, or 8 prior to January 1, 2024), regardless of performance, and include loans identified as Special Mention, Substandard, or Doubtful.  
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited)
    		  
       
                             
                             
          For the Quarter Ended For the Nine Months Ended  
          September 30,   June 30,   September 30,   September 30,   September 30,  
      SELECT FINANCIAL DATA – SUBSIDIARIES   2024   2024   2023   2024   2023  
          (dollars in thousands)  
                             
      TOTAL ASSETS                      
      Quad City Bank and Trust (1)   $ 2,552,962     $ 2,559,049     $ 2,433,084            
      m2 Equipment Finance, LLC     349,166       359,012       336,180            
      Cedar Rapids Bank and Trust     2,625,943       2,428,267       2,442,263            
      Community State Bank     1,519,585       1,531,109       1,417,250            
      Guaranty Bank     2,360,301       2,369,754       2,242,638            
                             
      TOTAL DEPOSITS                      
      Quad City Bank and Trust (1)   $ 2,205,465     $ 2,100,520     $ 1,973,989            
      Cedar Rapids Bank and Trust     1,765,964       1,721,564       1,722,905            
      Community State Bank     1,269,147       1,188,551       1,132,724            
      Guaranty Bank     1,778,453       1,791,448       1,722,861            
                             
      TOTAL LOANS & LEASES                      
      Quad City Bank and Trust (1)   $ 2,090,856     $ 2,107,605     $ 2,005,770            
      m2 Equipment Finance, LLC     353,259       363,897       341,041            
      Cedar Rapids Bank and Trust     1,743,809       1,736,438       1,750,986            
      Community State Bank     1,161,805       1,162,686       1,098,479            
      Guaranty Bank     1,832,331       1,847,658       1,751,072            
                             
      TOTAL LOANS & LEASES / TOTAL DEPOSITS                      
      Quad City Bank and Trust (1)     95 %     100 %     102 %          
      Cedar Rapids Bank and Trust     99 %     101 %     102 %          
      Community State Bank     92 %     98 %     97 %          
      Guaranty Bank     103 %     103 %     102 %          
                             
                             
      TOTAL LOANS & LEASES / TOTAL ASSETS                      
      Quad City Bank and Trust (1)     82 %     82 %     82 %          
      Cedar Rapids Bank and Trust     66 %     72 %     72 %          
      Community State Bank     76 %     76 %     78 %          
      Guaranty Bank     78 %     78 %     78 %          
                             
      ACL ON LOANS/LEASES HELD FOR INVESTMENT AS A PERCENTAGE OF LOANS/LEASES HELD FOR INVESTMENT                      
      Quad City Bank and Trust (1)     1.49 %     1.49 %     1.50 %          
      m2 Equipment Finance, LLC     4.11 %     3.86 %     3.52 %          
      Cedar Rapids Bank and Trust     1.38 %     1.44 %     1.47 %          
      Community State Bank     1.06 %     1.14 %     1.28 %          
      Guaranty Bank     1.14 %     1.16 %     1.24 %          
                             
      RETURN ON AVERAGE ASSETS                      
      Quad City Bank and Trust (1)     0.76 %     0.88 %     0.97 %     0.81 %     1.00 %  
      Cedar Rapids Bank and Trust     2.52 %     2.94 %     2.28 %     2.84 %     2.95 %  
      Community State Bank     1.46 %     1.26 %     1.38 %     1.33 %     1.43 %  
      Guaranty Bank     1.28 %     1.42 %     1.23 %     1.20 %     1.07 %  
                             
      NET INTEREST MARGIN PERCENTAGE (2)                      
      Quad City Bank and Trust (1)     3.50 %     3.39 %     3.37 %     3.40 %     3.36 %  
      Cedar Rapids Bank and Trust     3.88 %     3.75 %     3.78 %     3.80 %     3.83 %  
      Community State Bank     3.76 %     3.72 %     3.88 %     3.74 %     3.92 %  
      Guaranty Bank (3)     3.12 %     2.99 %     3.06 %     3.03 %     3.22 %  
                             
      ACQUISITION-RELATED AMORTIZATION/ACCRETION INCLUDED IN NET                  
      INTEREST MARGIN, NET                      
      Cedar Rapids Bank and Trust   $ –     $ –     $ –     $ –     $ (8 )  
      Community State Bank     (1 )     (1 )     (1 )     (3 )     69    
      Guaranty Bank     496       301       572       1,194       1,537    
      QCR Holdings, Inc. (4)     (32 )     (32 )     (32 )     (97 )     (97 )  
                             
    (1 ) Quad City Bank and Trust amounts include m2 Equipment Finance, LLC, as this entity is wholly-owned and consolidated with the Bank. m2 Equipment Finance, LLC is also presented separately for certain (applicable) measurements.  
    (2 ) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.      
    (3 ) Guaranty Bank’s net interest margin percentage includes various purchase accounting adjustments. Excluding those adjustments, net interest margin (Non-GAAP) would have been 2.94% for the quarter ended September 30, 2024, 2.86% for the quarter ended June 30, 2024 and 2.97% for the quarter ended September 30, 2023.        
    (4 ) Relates to the trust preferred securities acquired as part of the Guaranty Bank acquisition in 2017 and the Community National Bank acquisition in 2013.      
                             
     
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
     
                           
        As of
        September 30,   June 30,   March 31,   December 31,   September 30,  
    GAAP TO NON-GAAP RECONCILIATIONS   2024   2024   2024   2023   2023  
        (dollars in thousands, except per share data)
    TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO (1)                      
                           
    Stockholders’ equity (GAAP)   $ 976,620     $ 936,319     $ 907,342     $ 886,596     $ 828,383    
    Less: Intangible assets     150,347       151,468       152,158       152,848       153,564    
    Tangible common equity (non-GAAP)   $ 826,273     $ 784,851     $ 755,184     $ 733,748     $ 674,819    
                           
    Total assets (GAAP)   $ 9,088,565     $ 8,871,991     $ 8,599,549     $ 8,538,894     $ 8,540,057    
    Less: Intangible assets     150,347       151,468       152,158       152,848       153,564    
    Tangible assets (non-GAAP)   $ 8,938,218     $ 8,720,523     $ 8,447,391     $ 8,386,046     $ 8,386,493    
                           
    Tangible common equity to tangible assets ratio (non-GAAP)   9.24 %     9.00 %     8.94 %     8.75 %     8.05 %  
                           
                           
                           
    (1) This ratio is a non-GAAP financial measure. The Company’s management believes that this measurement is important to many investors in the marketplace who are interested in changes period-to-period in common equity. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to stockholders’ equity and total assets, which are the most directly comparable GAAP financial measures.  
                           
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited)
    		  
       
                                   
    GAAP TO NON-GAAP RECONCILIATIONS   For the Quarter Ended   For the Nine Months Ended  
        September 30,   June 30,   March 31,   December 31,   September 30,   September 30,   September 30,  
    ADJUSTED NET INCOME (1)   2024   2024   2024   2023   2023   2024   2023  
        (dollars in thousands, except per share data)  
                                   
    Net income (GAAP)   $ 27,785     $ 29,114     $ 26,726     $ 32,855     $ 25,121     $ 83,625     $ 80,703    
                                   
    Less non-core items (post-tax) (2):                              
    Income:                              
    Securities gains (losses), net     –       –       –       –       –       –       (356 )  
    Fair value gain (loss) on derivatives, net     (542 )     (145 )     (144 )     (460 )     (265 )     (830 )     (537 )  
    Total non-core income (non-GAAP)   $ (542 )   $ (145 )   $ (144 )   $ (460 )   $ (265 )   $ (830 )   $ (893 )  
                                   
    Expense:                              
    Goodwill impairment     432       –       –       –       –       432       –    
    Post-acquisition compensation, transition and integration costs     –       –       –       –       –       –       164    
    Restructuring expense     1,544       –       –       –       –       1,544        
    Total non-core expense (non-GAAP)   $ 1,976     $ –     $ –     $ –     $ –     $ 1,976     $ 164    
                                   
    Adjusted net income (non-GAAP) (1)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    ADJUSTED EARNINGS PER COMMON SHARE (1)                              
                                   
    Adjusted net income (non-GAAP) (from above)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    Weighted average common shares outstanding     16,846,200       16,814,814       16,783,348       16,734,080       16,717,303       16,814,787       16,731,847    
    Weighted average common and common equivalent shares outstanding     16,982,400       16,921,854       16,910,675       16,875,952       16,847,951       16,938,309       16,863,203    
                                   
    Adjusted earnings per common share (non-GAAP):                              
    Basic   $ 1.80     $ 1.74     $ 1.60     $ 1.99     $ 1.52     $ 5.14     $ 4.89    
    Diluted   $ 1.78     $ 1.73     $ 1.59     $ 1.97     $ 1.51     $ 5.10     $ 4.85    
                                   
    ADJUSTED RETURN ON AVERAGE ASSETS AND AVERAGE EQUITY (1)                              
                                   
    Adjusted net income (non-GAAP) (from above)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    Average Assets   $ 8,968,653     $ 8,776,002     $ 8,550,855     $ 8,535,732     $ 8,287,813     $ 8,765,913     $ 8,041,141    
                                   
    Adjusted return on average assets (annualized) (non-GAAP)     1.35 %     1.33 %     1.26 %     1.56 %     1.23 %     1.31 %     1.36 %  
    Adjusted return on average equity (annualized) (non-GAAP)     12.60 %     12.69 %     11.90 %     15.64 %     12.12 %     12.40 %     13.35 %  
                                   
    NET INTEREST MARGIN (TEY) (3)                              
                                   
    Net interest income (GAAP)   $ 59,722     $ 56,163     $ 54,699     $ 55,736     $ 55,255     $ 170,584     $ 165,270    
    Plus: Tax equivalent adjustment (4)     9,544       8,914       8,377       7,954       7,771       26,803       20,283    
    Net interest income – tax equivalent (Non-GAAP)   $ 69,266     $ 65,077     $ 63,076     $ 63,690     $ 63,026     $ 197,387     $ 185,553    
    Less: Acquisition accounting net accretion     463       268       363       673       539       1,094       1,501    
    Adjusted net interest income   $ 68,803     $ 64,809     $ 62,713     $ 63,017     $ 62,487     $ 196,293     $ 184,052    
                                   
    Average earning assets   $ 8,183,196     $ 7,999,044     $ 7,807,720     $ 7,631,035     $ 7,573,785     $ 7,997,334     $ 7,369,420    
                                   
    Net interest margin (GAAP)     2.90 %     2.82 %     2.82 %     2.90 %     2.89 %     2.85 %     3.00 %  
    Net interest margin (TEY) (Non-GAAP)     3.37 %     3.27 %     3.25 %     3.32 %     3.31 %     3.30 %     3.37 %  
    Adjusted net interest margin (TEY) (Non-GAAP)     3.34 %     3.26 %     3.24 %     3.29 %     3.28 %     3.28 %     3.34 %  
                                   
    EFFICIENCY RATIO (5)                              
                                   
    Noninterest expense (GAAP)   $ 53,565     $ 49,888     $ 50,690     $ 60,938     $ 51,081     $ 154,143     $ 149,593    
                                   
    Net interest income (GAAP)   $ 59,722     $ 56,163     $ 54,699     $ 55,736     $ 55,255     $ 170,584     $ 165,270    
    Noninterest income (GAAP)     27,157       30,889       26,858       47,729       26,593       84,904       84,955    
    Total income   $ 86,879     $ 87,052     $ 81,557     $ 103,465     $ 81,848     $ 255,488     $ 250,225    
                                   
    Efficiency ratio (noninterest expense/total income) (Non-GAAP)     61.65 %     57.31 %     62.15 %     58.90 %     62.41 %     60.33 %     59.78 %  
    Adjusted efficiency ratio (core noninterest expense/core total income) (Non-GAAP)     58.45 %     57.19 %     62.01 %     58.57 %     62.15 %     59.16 %     59.43 %  
                                   
                                   
                                   
                                   
    (1) Adjusted net income, adjusted earnings per common share, adjusted return on average assets and average equity are non-GAAP financial measures. The Company’s management believes that these measurements are important to investors as they exclude non-core or non-recurring income and expense items, therefore, they provide a more realistic run-rate for future periods. 
    In compliance with applicable rules of the SEC, these non-GAAP measures are reconciled to net income, which is the most directly comparable GAAP financial measure.    		  
    (2) Non-core or non-recurring items (post-tax) are calculated using an estimated effective federal tax rate of 21% with the exception of goodwill impairment which is not deductible for tax.    
    (3) Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.        
    (4) Net interest margin (TEY) is a non-GAAP financial measure. The Company’s management utilizes this measurement to take into account the tax benefit associated with certain loans and securities. It is also standard industry practice to measure net interest margin using tax-equivalent measures. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net interest income, which is the most directly comparable GAAP financial measure. In addition, the Company calculates net interest margin without the impact of acquisition accounting net accretion as this can fluctuate and it’s difficult to provide a more realistic run-rate for future periods.          
    (5) Efficiency ratio is a non-GAAP measure. The Company’s management utilizes this ratio to compare to industry peers. The ratio is used to calculate overhead as a percentage of revenue.  
    In compliance with the applicable rules of the SEC, this non-GAAP measure is reconciled to noninterest expense, net interest income and noninterest income, which are the most  directly comparable GAAP financial measures.    		  
       
       
                    

    The MIL Network –

  • MIL-OSI: Western New England Bancorp, Inc. Reports Results for Three and Nine Months Ended September 30, 2024 and Declares Quarterly Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    WESTFIELD, Mass., Oct. 23, 2024 (GLOBE NEWSWIRE) — Western New England Bancorp, Inc. (the “Company” or “WNEB”) (NasdaqGS: WNEB), the holding company for Westfield Bank (the “Bank”), announced today the unaudited results of operations for the three and nine months ended September 30, 2024. For the three months ended September 30, 2024, the Company reported net income of $1.9 million, or $0.09 per diluted share, compared to net income of $4.5 million, or $0.21 per diluted share, for the three months ended September 30, 2023. On a linked quarter basis, net income was $1.9 million, or $0.09 per diluted share, as compared to net income of $3.5 million, or $0.17 per diluted share, for the three months ended June 30, 2024. For the nine months ended September 30, 2024, net income was $8.4 million, or $0.40 per diluted share, compared to net income of $12.6 million, or $0.58 per diluted share, for the nine months ended September 30, 2023.

    The Company also announced that the Board of Directors declared a quarterly cash dividend of $0.07 per share on the Company’s common stock. The dividend will be payable on or about November 21, 2024 to shareholders of record on November 7, 2024.

    James C. Hagan, President and Chief Executive Officer, commented, “We believe our Company continues to be well positioned with strong capital and access to various liquidity sources. Our financial performance has been largely impacted by the unprecedented interest rate cycle and higher funding costs in response to the sustained increase in interest rates over the last 18-24 months. While it remains unclear whether the recent decrease in interest rates represents an end to this trend, the balance sheet is positioned to benefit from this decrease and the challenge will begin to subside as our liabilities begin to reprice lower. As we continue to manage the balance sheet in this uncertain interest rate environment, we remain focused on expense management initiatives to mitigate top line pressures and improve efficiencies over the Company’s long-term. The Company also continues to focus on our core business to grow loans and deposits as well as retention of our customers. Total deposits increased $80.5 million, or 3.8%, and total loans increased $21.7 million, or 1.1%, from year-end. Our asset quality remains strong, with nonperforming loans to total loans of 0.24% at September 30, 2024.”

    Hagan concluded, “The Company is considered to be well-capitalized as defined by the regulators and we remain disciplined in our capital management strategies. During the nine months ended September 30, 2024, we repurchased 714,282 shares of the Company’s common stock at an average price per share of $7.61. We continue to believe that buying back shares represents a prudent use of the Company’s capital and we are pleased to be able to continue to return value to shareholders through share repurchases. Although the banking environment has been challenged, our capital management strategies have been critical to sustaining growth in book value per share, which increased $0.44, or 4.0%, while tangible book value per share increased $0.43, or 4.2%, to $10.73. The management team remains focused and well positioned to serve our community and to enhance shareholder value over the long term.”

    Key Highlights:

    Loans and Deposits

    At September 30, 2024, total loans were $2.0 billion and increased $21.7 million, or 1.1%, from December 31, 2023. The increase in total loans was due to an increase in commercial real estate loans of $3.0 million, or 0.3%, an increase in residential real estate loans, including home equity loans, of $26.4 million, or 3.7%, partially offset by a decrease in commercial and industrial loans of $7.0 million, or 3.2%.

    At September 30, 2024, total deposits were $2.2 billion and increased $80.5 million, or 3.8%, from December 31, 2023. Core deposits, which the Company defines as all deposits except time deposits, decreased $8.3 million, or 0.5%, from $1.5 billion, or 71.5% of total deposits, at December 31, 2023, to $1.5 billion, or 68.5% of total deposits at September 30, 2024. Time deposits increased $88.8 million, or 14.5%, from $611.4 million at December 31, 2023 to $700.2 million at September 30, 2024. Brokered time deposits, which are included in time deposits, totaled $1.7 million at September 30, 2024 and at December 31, 2023. The loan-to-deposit ratio decreased from 94.6% at December 31, 2023 to 92.1% at September 30, 2024.

    Liquidity

    The Company’s liquidity position remains strong with solid core deposit relationships, cash, unencumbered securities, a diversified deposit base and access to diversified borrowing sources. At September 30, 2024, the Company had $1.1 billion in immediately available liquidity, compared to $615.0 million in uninsured deposits, or 27.7% of total deposits, representing a coverage ratio of 183%. Uninsured deposits of the Bank’s customers are eligible for FDIC pass-through insurance if the customer opens an IntraFi Insured Cash Sweep (“ICS”) account or a reciprocal time deposit through the Certificate of Deposit Account Registry System (“CDARS”). IntraFi allows for up to $250.0 million per customer of pass-through FDIC insurance, which would more than cover each of the Bank’s deposit customers if such customer desired to have such pass-through insurance.

    Allowance for Loan Losses and Credit Quality

    At September 30, 2024, the allowance for credit losses was $20.0 million, or 0.97% of total loans and 409.5% of nonperforming loans, compared to $20.3 million, or 1.00% of total loans and 315.6% of nonperforming loans at December 31, 2023. At September 30, 2024, nonperforming loans totaled $4.9 million, or 0.24% of total loans, compared to $6.4 million, or 0.32% of total loans, at December 31, 2023. Total delinquent loans decreased $1.7 million, or 28.3%, from $6.0 million, or 0.30% of total loans, at December 31, 2023 to $4.3 million, or 0.21% of total loans, at September 30, 2024. At September 30, 2024 and December 31, 2023, the Company did not have any other real estate owned.

    Net Interest Margin

    The net interest margin was 2.40% for the three months ended September 30, 2024 compared to 2.42% for the three months ended June 30, 2024. The net interest margin, on a tax-equivalent basis, was 2.42% for the three months ended September 30, 2024, compared to 2.44% for the three months ended June 30, 2024.

    Stock Repurchase Program

    On June 10, 2024, the Company announced the completion of its previously authorized stock repurchase plan (the “2022 Plan”) pursuant to which the Company was authorized to repurchase up to 1.1 million shares, or approximately 5% of its outstanding common stock, as of the date the 2022 Plan was adopted. On May 22, 2024, the Board of Directors authorized a new stock repurchase plan (the “2024 Plan”) under which the Company may repurchase up to 1.0 million shares, or approximately 4.6%, of the Company’s then-outstanding shares of common stock.

    During the three months ended September 30, 2024, the Company repurchased 244,441 shares of common stock under the 2024 Plan, with an average price per share of $8.18. During the nine months ended September 30, 2024, the Company repurchased 714,282 shares of common stock with an average price per share of $7.61. As of September 30, 2024, there were 692,318 shares of common stock available for repurchase under the 2024 Plan.

    The repurchase of shares under the stock repurchase program is administered through an independent broker. The shares of common stock repurchased under the 2024 Plan have been and will continue to be purchased from time to time at prevailing market prices, through open market or privately negotiated transactions, or otherwise, depending upon market conditions. There is no guarantee as to the exact number, or value, of shares that will be repurchased by the Company, and the Company may discontinue repurchases at any time that the Company’s management (“Management”) determines additional repurchases are not warranted. The timing and amount of additional share repurchases under the 2024 Plan will depend on a number of factors, including the Company’s stock price performance, ongoing capital planning considerations, general market conditions, and applicable legal requirements.

    Book Value and Tangible Book Value

    The Company’s book value per share was $11.40 at September 30, 2024 compared to $10.96 at December 31, 2023, while tangible book value per share, a non-GAAP financial measure, increased $0.43, or 4.2%, from $10.30 at December 31, 2023 to $10.73 at September 30, 2024. See pages 19-21 for the related tangible book value calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Net Income for the Three Months Ended September 30, 2024 Compared to the Three Months Ended June 30, 2024

    The Company reported net income of $1.9 million, or $0.09 per diluted share, for the three months ended September 30, 2024, compared to net income of $3.5 million, or $0.17 per diluted share, for the three months ended June 30, 2024. Net interest income increased $258,000, or 1.8%, the provision for credit losses increased $1.2 million, non-interest income decreased $693,000, or 18.1%, and non-interest expense increased $92,000, or 0.6%. Return on average assets and return on average equity were 0.29% and 3.19%, respectively, for the three months ended September 30, 2024, compared to 0.55% and 6.03%, respectively, for the three months ended June 30, 2024.

    Net Interest Income and Net Interest Margin

    On a sequential quarter basis, net interest income, our primary driver of revenues, increased $258,000, or 1.8%, to $14.7 million for the three months ended September 30, 2024, from $14.5 million for the three months ended June 30, 2024. The increase in net interest income was primarily due to an increase in interest income of $1.0 million, or 3.9%, partially offset by an increase in interest expense of $780,000, or 6.3%.

    The net interest margin was 2.40% for the three months ended September 30, 2024, compared to 2.42% for the three months ended June 30, 2024. The net interest margin, on a tax-equivalent basis, was 2.42% for the three months ended September 30, 2024, compared to 2.44% for the three months ended June 30, 2024. The decrease in the net interest margin was primarily due to an increase in the average cost of interest-bearing liabilities, which was partially offset by an increase in the average yield on interest-earning assets. During the three months ended September 30, 2024 and the three months ended June 30, 2024, the Company had a fair value hedge which contributed to an increase in the net interest margin of seven basis points. Excluding the interest income attributed to the fair value hedge, the net interest margin was 2.33% and 2.35%, for the three months ended September 30, 2024 and the three months ended June 30, 2024, respectively. The fair value hedge is scheduled to mature in October of 2024.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, was 4.54% for the three months ended September 30, 2024, compared to 4.49% for the three months ended June 30, 2024. The average loan yield, without the impact of tax-equivalent adjustments, was 4.90% for the three months ended September 30, 2024, compared to 4.85% for the three months ended June 30, 2024. During the three months ended September 30, 2024, average interest-earning assets increased $40.6 million, or 1.7% to $2.4 billion, primarily due to an increase in average loans of $21.5 million, or 1.1%, an increase in average short-term investments, consisting of cash and cash equivalents, $17.7 million, or 123.6%, and an increase in average other investments of $1.6 million, or 11.0%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, increased eight basis points from 2.16% for the three months ended June 30, 2024 to 2.24% for the three months ended September 30, 2024. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased six basis points to 0.93% for the three months ended September 30, 2024, from 0.87% for the three months ended June 30, 2024. The average cost of time deposits increased five basis points from 4.39% for the three months ended June 30, 2024 to 4.44% for the three months ended September 30, 2024. The average cost of borrowings, including subordinated debt, increased five basis points from 5.00% for the three months ended June 30, 2024 to 5.05% for the three months ended September 30, 2024. Average demand deposits, an interest-free source of funds, increased $10.4 million, or 1.9%, from $548.8 million, or 25.7% of total average deposits, for the three months ended June 30, 2024, to $559.2 million, or 25.7% of total average deposits, for the three months ended September 30, 2024.

    Provision for (Reversal of) Credit Losses

    During the three months ended September 30, 2024, the Company recorded a provision for credit losses of $941,000, compared to a reversal for credit losses of $294,000 during the three months ended June 30, 2024. The provision for credit losses includes a provision for credit losses on loans of $609,000 and a reserve on unfunded loan commitments of $332,000. The increase in the provision for credit losses on loans was due to changes in the economic environment and related adjustments to the quantitative components of the CECL methodology as well as growth in the loan portfolio. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. The increase in reserves on unfunded loan commitments was due to an increase in commercial real estate unfunded loan commitments of $33.5 million, or 20.7%, from $161.8 million at June 30, 2024 to $195.3 million at September 30, 2024. Management continues to monitor macroeconomic variables related to increasing interest rates, inflation and the concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    During the three months ended September 30, 2024, the Company recorded net charge-offs of $98,000, compared to net charge-offs of $10,000 for the three months ended June 30, 2024.

    Non-Interest Income

    On a sequential quarter basis, non-interest income decreased $693,000, or 18.1%, to $3.1 million for the three months ended September 30, 2024, from $3.8 million for the three months ended June 30, 2024. Service charges and fees on deposits were $2.3 million for the three months ended September 30, 2024 and the three months ended June 30, 2024. Income from bank-owned life insurance (“BOLI”) decreased $32,000, or 6.4%, from the three months ended June 30, 2024 to $470,000, for the three months ended September 30, 2024. During the three months ended September 30, 2024, the Company reported $74,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the three months ended June 30, 2024. During the three months ended September 30, 2024, the Company sold $20.1 million in fixed rate residential loans to the secondary market and reported income from mortgage banking activities of $246,000 and did not have comparable income during the three months ended June 30, 2024. During the three months ended September 30, 2024 and the three months ended June 30, 2024, the Company reported unrealized gains on marketable equity securities of $10,000 and $4,000, respectively. During the three months ended June 30, 2024, the Company reported a gain on non-marketable equity investments of $987,000 and did not have comparable gains or losses from non-marketable equity investments during the three months ended September 30, 2024.

    Non-Interest Expense

    For the three months ended September 30, 2024, non-interest expense increased $92,000, or 0.6%, to $14.4 million from $14.3 million for the three months ended June 30, 2024. Salaries and employee benefits increased $211,000, or 2.7%, to $8.1 million, software expenses increased $46,000, or 8.1%, data processing expense increased $23,000, or 2.7%, FDIC insurance expense increased $15,000, or 4.6%, and debit card and ATM processing fees increased $6,000, or 0.9%. During the same period, these increases were partially offset by a decrease in professional fees of $41,000, or 7.1%, a decrease in advertising expense of $68,000, or 20.1%, a decrease in occupancy expense of $1,000, or 0.1%, and a decrease in other non-interest expense of $99,000, or 7.0%.

    For the three months ended September 30, 2024, the efficiency ratio was 80.6%, compared to 78.2% for the three months ended June 30, 2024. For the three months ended September 30, 2024, the adjusted efficiency ratio, a non-GAAP financial measure, was 80.7% compared to 82.7% for the three months ended June 30, 2024. The increases in the efficiency ratio and the adjusted efficiency ratio were driven by lower revenues, defined as the sum of net interest income and non-interest income, during the three months ended September 30, 2024. See pages 19-21 for the related adjusted efficiency ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the three months ended September 30, 2024 was $618,000, or an effective tax rate of 24.5%, compared to $771,000, or an effective tax rate of 18.0%, for the three months ended June 30, 2024. The increase in the effective tax rate for the three months ended September 30, 2024 was driven by the Company’s projections of pre-tax income for the year ending December 31, 2024.

    Net Income for the Three Months Ended September 30, 2024 Compared to the Three Months Ended September 30, 2023.

    The Company reported net income of $1.9 million, or $0.09 per diluted share, for the three months ended September 30, 2024, compared to net income of $4.5 million, or $0.21 per diluted share, for the three months ended September 30, 2023. Net interest income decreased $1.7 million, or 10.1%, provision for credit losses increased $587,000, non-interest income decreased $471,000, or 13.0%, and non-interest expense increased $288,000, or 2.0%, during the same period. Return on average assets and return on average equity were 0.29% and 3.19%, respectively, for the three months ended September 30, 2024, compared to 0.70% and 7.60%, respectively, for the three months ended September 30, 2023.

    Net Interest Income and Net Interest Margin

    Net interest income decreased $1.7 million, or 10.1%, to $14.7 million, for the three months ended September 30, 2024, from $16.4 million for the three months ended September 30, 2023. The decrease in net interest income was due to an increase in interest expense of $3.6 million, or 37.8%, partially offset by an increase in interest and dividend income of $1.9 million, or 7.5%. Interest expense on deposits increased $3.5 million, or 44.9%, and interest expense on borrowings increased $133,000, or 7.3%. The increase in interest expense was a result of competitive pricing on deposits due to the continued higher interest rate environment and the unfavorable shift in the deposit mix from low cost core deposits to high cost time deposits.

    The net interest margin was 2.40% for the three months ended September 30, 2024, compared to 2.70% for the three months ended September 30, 2023. The net interest margin, on a tax-equivalent basis, was 2.42% for the three months ended September 30, 2024, compared to 2.72% for the three months ended September 30, 2023. The decrease in the net interest margin was primarily due to an increase in the average cost of interest-bearing liabilities and the unfavorable shift in the deposit mix from low cost core deposits to high cost time deposits, which was partially offset by an increase in the average yield on interest-earning assets. During the three months ended September 30, 2024 and the three months ended September 30, 2023, the Company had a fair value hedge which contributed to an increase in the net interest margin of seven basis points. Excluding the interest income from the fair value hedge, the net interest margin was 2.33% and 2.64%, for the three months ended September 30, 2024 and three months ended September 30, 2023, respectively. The fair value hedge is scheduled to mature in October of 2024.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, was 4.54% for the three months ended September 30, 2024, compared to 4.28% for the three months ended September 30, 2023. The average loan yield, without the impact of tax-equivalent adjustments, was 4.90% for the three months ended September 30, 2024, compared to 4.64% for the three months ended September 30, 2023. During the three months ended September 30, 2024, average interest-earning assets increased $38.2 million, or 1.6% to $2.4 billion, primarily due to an increase in average loans of $31.3 million, or 1.6%, an increase in average short-term investments, consisting of cash and cash equivalents, of $9.7 million, or 43.4%, an increase in average other investments of $3.7 million, or 30.8%, partially offset by a decrease in average securities of $6.5 million, or 1.8%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, increased 60 basis points from 1.64% for the three months ended September 30, 2023 to 2.24% for the three months ended September 30, 2024. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased 23 basis points to 0.93% for the three months ended September 30, 2024, from 0.70% for the three months ended September 30, 2023. The average cost of time deposits increased 98 basis points from 3.46% for the three months ended September 30, 2023 to 4.44% for the three months ended September 30, 2024. The average cost of borrowings, including subordinated debt, increased 24 basis points from 4.81% for the three months ended September 30, 2023 to 5.05% for the three months ended September 30, 2024. Average demand deposits, an interest-free source of funds, decreased $32.7 million, or 5.5%, from $591.9 million, or 27.5% of total average deposits, for the three months ended September 30, 2023, to $559.2 million, or 25.7% of total average deposits, for the three months ended September 30, 2024.

    Provision for Credit Losses

    During the three months ended September 30, 2024, the Company recorded a provision for credit losses of $941,000, compared to a provision for credit losses of $354,000, during the three months ended September 30, 2023. The increase was primarily due to an increase in the loan portfolio, specifically unfunded commercial real estate loan commitments, as well as changes in the economic environment and related adjustments to the quantitative components of the CECL methodology. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, inflation and the concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    The Company recorded net charge-offs of $98,000 for the three months ended September 30, 2024, as compared to net charge-offs of $78,000 for the three months ended September 30, 2023.

    Non-Interest Income

    Non-interest income decreased $471,000, or 13.0%, from $3.6 million for the three months ended September 30, 2023 to $3.1 million for the three months ended September 30, 2024. Service charges and fees on deposits increased $196,000, or 9.1%, and income from BOLI increased $16,000, or 3.5%, from the three months ended September 30, 2023 to the three months ended September 30, 2024. During the three months ended September 30, 2024, the Company reported $74,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the three months ended September 30, 2023. During the three months ended September 30, 2024, the Company reported income of $246,000 in mortgage banking activities due to the sale of fixed rate residential loans and did not have comparable income during the three months ended September 30, 2023. During the three months ended September 30, 2024, the Company reported $10,000 in unrealized gains of marketable equity securities and did not have comparable income during the three months ended September 30, 2023. During the three months ended September 30, 2023, the Company reported a gain on non-marketable equity investments of $238,000 and did not have comparable non-interest income during the three months ended September 30, 2024. During the three months ended September 30, 2023, non-interest income included a non-taxable gain of $778,000 on BOLI death benefits. The Company did not have comparable income during the three months ended September 30, 2024. During the three months ended September 30, 2023, the Company reported a loss on the sales of premises and equipment of $3,000 and did not have comparable expense during the three months ended September 30, 2024.

    Non-Interest Expense

    For the three months ended September 30, 2024, non-interest expense increased $288,000, or 2.0%, to $14.4 million from $14.1 million, for the three months ended September 30, 2023. Salaries and employee benefits increased $157,000, or 2.0%, to $8.1 million, debit card and ATM processing fees increased $87,000, or 15.5%, software expenses increased $83,000, or 15.7%, occupancy expense increased $58,000, or 5.0%, data processing expense increased $45,000, or 5.5%, other non-interest income increased $54,000, or 4.3%, and furniture and equipment related expenses increased $1,000, or 0.2%. These increases were partially offset by a decrease in professional fees of $103,000, or 16.0%, a decrease in advertising expense of $91,000, or 25.1%, and a decrease in FDIC insurance expense of $3,000, or 0.9%.

    For the three months ended September 30, 2024, the efficiency ratio was 80.6%, compared to 70.6% for the three months ended September 30, 2023. For the three months ended September 30, 2024, the adjusted efficiency ratio, a non-GAAP financial measure, was 80.7% compared to 74.4% for the three months ended September 30, 2023. The increases in the efficiency ratio and the non-GAAP adjusted efficiency ratio were driven by lower revenues during the three months ended September 30, 2024, compared to the three months ended September 30, 2023. See pages 19-21 for the related adjusted efficiency ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the three months ended September 30, 2024 was $618,000, or an effective tax rate of 24.5%, compared to $1.0 million, or an effective tax rate of 18.7%, for the three months ended September 30, 2023. The effective tax rate for the three months ended September 30, 2023 included $778,000 in non-taxable BOLI death benefits.

    Net Income for the Nine Months Ended September 30, 2024 Compared to the Nine Months Ended September 30, 2023

    For the nine months ended September 30, 2024, the Company reported net income of $8.4 million, or $0.40 per diluted share, compared to $12.6 million, or $0.58 per diluted share, for the nine months ended September 30, 2023. Return on average assets and return on average equity were 0.44% and 4.74% for the nine months ended September 30, 2024, respectively, compared to 0.66% and 7.19% for the nine months ended September 30, 2023, respectively.

    Net Interest Income and Net Interest Margin

    During the nine months ended September 30, 2024, net interest income decreased $7.2 million, or 13.9%, to $44.5 million, compared to $51.7 million for the nine months ended September 30, 2023. The decrease in net interest income was due to an increase in interest expense of $14.1 million, or 62.3%, partially offset by an increase in interest and dividend income of $6.9 million, or 9.3%. The $14.1 million increase in interest expense was primarily due to an increase of $12.9 million, or 72.3%, in interest expense on deposits as a result of competitive pricing and an unfavorable shift in the deposit mix from low cost core deposits to high cost time deposits.

    The net interest margin for the nine months ended September 30, 2024 was 2.46%, compared to 2.88% during the nine months ended September 30, 2023. The net interest margin, on a tax-equivalent basis, was 2.48% for the nine months ended September 30, 2024, compared to 2.90% for the nine months ended September 30, 2023. The decrease in the net interest margin was primarily due to an increase in the average cost of interest-bearing liabilities and the unfavorable shift in the deposit mix from low cost core to high cost time deposits, which was partially offset by an increase in the average yield on interest-earning assets. During the nine months ended September 30, 2024 and the nine months ended September 30, 2023, the Company had a fair value hedge which contributed to an increase in the net interest margin of seven and three basis points, respectively. Excluding the interest income from the fair value hedge, the net interest margin was 2.39% and 2.85%, for the nine months ended September 30, 2024 and the nine months ended September 30, 2023, respectively. The fair value hedge is scheduled to mature in October of 2024.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, was 4.49% for the nine months ended September 30, 2024, compared to 4.14% for the nine months ended September 30, 2023. The average loan yield, without the impact of tax-equivalent adjustments, was 4.86% for the nine months ended September 30, 2024, compared to 4.49% for the nine months ended September 30, 2023. During the nine months ended September 30, 2024, average interest-earning assets increased $14.5 million, or 0.6%, to $2.4 billion, from the same period in 2023. The increase was primarily due to an increase in average loans of $23.4 million, or 1.2%, an increase in average short-term investments, consisting of cash and cash equivalents, of $5.7 million, or 44.2%, and an increase in other interest-earning assets of $1.7 million, or 13.7%, partially offset by a decrease in average securities of $16.3 million, or 4.4%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, increased 80 basis points from 1.32% for the nine months ended September 30, 2023 to 2.12% for the nine months ended September 30, 2024. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased 24 basis points to 0.86% for the nine months ended September 30, 2024, from 0.62% for the nine months ended September 30, 2023. The average cost of time deposits increased 160 basis points from 2.72% for the nine months ended September 30, 2023 to 4.32% for the nine months ended September 30, 2024. The average cost of borrowings, including subordinated debt, increased 15 basis points from 4.84% for the nine months ended September 30, 2023 to 4.99% for the nine months ended September 30, 2024. Average demand deposits, an interest-free source of funds, decreased $52.1 million, or 8.6%, from $607.3 million, or 28.0% of total average deposits, for the nine months ended September 30, 2023, to $555.3 million, or 25.8% of total average deposits, for the nine months ended September 30, 2024.

    Provision for Credit Losses

    During the nine months ended September 30, 2024, the Company recorded a provision for credit losses of $97,000, compared to a provision for credit losses of $386,000 during the nine months ended September 30, 2023. The decrease was primarily due to changes in the loan mix as well as economic environment and related adjustments to the quantitative components of the CECL methodology. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, inflation and the concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    During the nine months ended September 30, 2024, the Company recorded net charge-offs of $41,000 compared to net charge-offs of $1.9 million for the nine months ended September 30, 2023. The charge-offs during the nine months ended September 30, 2023 were related to one commercial relationship acquired in October 2016 from Chicopee Bancorp, Inc. The Company recorded a $1.9 million charge-off on the relationship, which represented the non-accretable credit mark that was required to be grossed-up to the loan’s amortized cost basis with a corresponding increase to the allowance for credit losses under the CECL implementation.

    Non-Interest Income

    For the nine months ended September 30, 2024, non-interest income increased $1.5 million, or 17.9%, from $8.2 million during the nine months ended September 30, 2023 to $9.6 million. Service charges and fees on deposits increased $328,000, or 5.0%, and income from BOLI increased $37,000, or 2.7%.

    During the nine months ended September 30, 2024, the Company reported a gain of $987,000 on non-marketable equity investments, compared to a gain of $590,000 during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, the Company reported income of $246,000 from mortgage banking activities due to the sale of fixed rate residential real estate loans and did not have comparable income during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, the Company reported $74,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, the Company reported $22,000 in unrealized gains of marketable equity securities and did not have comparable income during the nine months ended September 30, 2023. Gains and losses from the investment portfolio vary from quarter to quarter based on market conditions, as well as the related yield curve and valuation changes. During the nine months ended September 30, 2024, the Company reported a loss on the sales of premises and equipment of $6,000 compared to $3,000 during the nine months ended September 30, 2023. During the nine months ended September 30, 2023, the Company recorded a $1.1 million final termination expense related to the defined benefit pension plan (the “DB Plan”) termination. The Company did not have comparable income or expense during the nine months ended September 30, 2024. During the nine months ended September 30, 2023, non-interest income included a non-taxable gain of $778,000 on BOLI death benefits. The Company did not have comparable income during the nine months ended September 30, 2024.

    Non-Interest Expense

    For the nine months ended September 30, 2024, non-interest expense decreased $63,000, or 0.1%, to $43.5 million, compared to $43.6 million for the nine months ended September 30, 2023. The decrease in non-interest expense was primarily due to a decrease in professional fees of $513,000, or 23.3%, a decrease in salaries and employee benefits of $218,000, or 0.9%, a decrease in advertising expense of $159,000, or 14.2%, a decrease in other non-interest expense of $120,000, or 2.9%, and a decrease in furniture and equipment related expense of $10,000, or 0.7%. These decreases were partially offset by an increase in software related expenses of $309,000, or 19.7%, an increase in debit card and ATM processing fees of $264,000, or 16.7%, an increase in data processing of $208,000, or 8.8%, an increase in FDIC insurance expense of $88,000, or 9.0%, and an increase in occupancy expense of $88,000, or 2.4%.

    For the nine months ended September 30, 2024, the efficiency ratio was 80.3%, compared to 72.7% for the nine months ended September 30, 2023. For the nine months ended September 30, 2024, the adjusted efficiency ratio, a non-GAAP financial measure, was 81.8% compared to 73.0% for the nine months ended September 30, 2023. The increases in the efficiency ratio and the non-GAAP adjusted efficiency ratio were driven by lower revenues during the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023. See pages 19-21 for the related adjusted efficiency ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the nine months ended September 30, 2024 was $2.2 million, representing an effective tax rate of 20.9%, compared to $3.4 million, representing an effective tax rate of 21.3%, for nine months ended September 30, 2023.

    Balance Sheet

    At September 30, 2024, total assets were $2.6 billion, an increase of $75.9 million, or 3.0%, from December 31, 2023. The increase in total assets was primarily due to an increase in cash and cash equivalents of $44.0 million, or 152.4%, an increase in total loans of $21.7 million, or 1.1%, and an increase in investment securities of $8.7 million, or 2.4%.

    Investments

    At September 30, 2024, the investment securities portfolio totaled $369.4 million, or 14.0% of total assets, compared to $360.7 million, or 14.1%, of total assets, at December 31, 2023. At September 30, 2024, the Company’s available-for-sale (“AFS”) securities portfolio, recorded at fair market value, increased $18.8 million, or 13.7%, from $137.1 million at December 31, 2023 to $155.9 million. The held-to-maturity (“HTM”) securities portfolio, recorded at amortized cost, decreased $10.1 million, or 4.5%, from $223.4 million at December 31, 2023 to $213.3 million at September 30, 2024.

    At September 30, 2024, the Company reported unrealized losses on the AFS securities portfolio of $24.6 million, or 13.6% of the amortized cost basis of the AFS securities portfolio, compared to unrealized losses of $29.2 million, or 17.5% of the amortized cost basis of the AFS securities at December 31, 2023. At September 30, 2024, the Company reported unrealized losses on the HTM securities portfolio of $30.7 million, or 14.4%, of the amortized cost basis of the HTM securities portfolio, compared to $35.7 million, or 16.0% of the amortized cost basis of the HTM securities portfolio at December 31, 2023.

    The securities in which the Company may invest are limited by regulation. Federally chartered savings banks have authority to invest in various types of assets, including U.S. Treasury obligations, securities of various government-sponsored enterprises, mortgage-backed securities, certain certificates of deposit of insured financial institutions, repurchase agreements, overnight and short-term loans to other banks, corporate debt instruments and marketable equity securities. The securities, with the exception of $4.6 million in corporate bonds, are issued by the United States government or government-sponsored enterprises and are therefore either explicitly or implicitly guaranteed as to the timely payment of contractual principal and interest. These positions are deemed to have no credit impairment, therefore, the disclosed unrealized losses with the securities portfolio relate primarily to changes in prevailing interest rates. In all cases, price improvement in future periods will be realized as the issuances approach maturity.

    Management regularly reviews the portfolio for securities in an unrealized loss position. At September 30, 2024 and December 31, 2023, the Company did not record any credit impairment charges on its securities portfolio and attributed the unrealized losses primarily due to fluctuations in general interest rates or changes in expected prepayments and not due to credit quality. The primary objective of the Company’s investment portfolio is to provide liquidity and to secure municipal deposit accounts while preserving the safety of principal. The Company expects to strategically redeploy available cash flows from the securities portfolio to fund loan growth and deposit outflows.

    Total Loans

    Total loans increased $21.7 million, or 1.1%, from December 31, 2023, to $2.0 billion at September 30, 2024. The increase in total loans was due to an increase in commercial real estate loans of $3.0 million, or 0.3%, an increase in residential real estate loans, including home equity loans, of $26.4 million, or 3.7%, partially offset by a decrease in commercial and industrial loans of $7.0 million, or 3.2%. During the three months ended September 30, 2024, the Company sold $20.1 million in fixed rate residential loans to the secondary market with servicing retained.

    The following table presents the summary of the loan portfolio by the major classification of the loan at the periods indicated:

      September 30, 2024   December 31, 2023
      (Dollars in thousands)
       
    Commercial real estate loans:      
    Non-owner occupied $ 878,265     $ 881,643  
    Owner-occupied   204,524       198,108  
    Total commercial real estate loans   1,082,789       1,079,751  
           
    Residential real estate loans:      
    Residential   631,649       612,315  
    Home equity   116,923       109,839  
    Total residential real estate loans   748,572       722,154  
           
    Commercial and industrial loans   210,390       217,447  
           
    Consumer loans   4,631       5,472  
    Total gross loans   2,046,382       2,024,824  
    Unamortized premiums and net deferred loans fees and costs   2,620       2,493  
    Total loans $ 2,049,002     $ 2,027,317  
                   

    Credit Quality

    Management continues to closely monitor the loan portfolio for any signs of deterioration in borrowers’ financial condition and also in light of speculation that commercial real estate values may deteriorate as the market continues to adjust to higher vacancies and interest rates. We continue to proactively take steps to mitigate risk in our loan portfolio.

    Total delinquency was $4.3 million, or 0.21% of total loans, at September 30, 2024, compared to $6.0 million, or 0.30% of total loans at December 31, 2023. At September 30, 2024, nonperforming loans totaled $4.9 million, or 0.24% of total loans, compared to $6.4 million, or 0.32% of total loans, at December 31, 2023. Total nonperforming assets totaled $4.9 million, or 0.18% of total assets, at September 30, 2024, compared to $6.4 million, or 0.25% of total assets, at December 31, 2023. At September 30, 2024 and December 31, 2023, there were no loans 90 or more days past due and still accruing interest. At September 30, 2024 and December 31, 2023, the Company did not have any other real estate owned.

    At September 30, 2024, the allowance for credit losses as a percentage of total loans was 0.97% as compared to 1.00% at December 31, 2023. At September 30, 2024, the allowance for credit losses as a percentage of nonperforming loans was 409.5% as compared to 315.6% at December 31, 2023.

    Total classified loans, defined as special mention and substandard loans, increased $3.7 million, or 9.4%, from $39.5 million, or 1.9% of total loans, at December 31, 2023 to $43.2 million, or 2.1%, of total loans at September 30, 2024. We continue to maintain diversity among property types and within our geographic footprint. More details on the diversification of the loan portfolio are available in the supplementary earnings presentation.

    Deposits

    Total deposits increased $80.5 million, or 3.8%, from $2.1 billion at December 31, 2023 to $2.2 billion at September 30, 2024. Core deposits, which the Company defines as all deposits except time deposits, decreased $8.3 million, or 0.5%, from $1.5 billion, or 71.5% of total deposits, at December 31, 2023, to $1.5 billion, or 68.5% of total deposits, at September 30, 2024. Non-interest-bearing deposits decreased $10.9 million, or 1.9%, to $568.7 million, money market accounts increased $1.5 million, or 0.2%, to $635.8 million, savings accounts decreased $8.2 million, or 4.4%, to $179.2 million and interest-bearing checking accounts increased $9.3 million, or 7.1%, to $140.3 million. Time deposits increased $88.8 million, or 14.5%, from $611.4 million at December 31, 2023 to $700.2 million at September 30, 2024. Brokered time deposits, which are included in time deposits, totaled $1.7 million at September 30, 2024 and at December 31, 2023.

    The table below is a summary of our deposit balances for the periods noted:

      September 30, 2024   June 30, 2024   December 31, 2023
      (Dollars in thousands)
    Core Deposits:          
    Demand accounts $ 568,685     $ 553,329     $ 579,595  
    Interest-bearing accounts   140,332       149,100       131,031  
    Savings accounts   179,214       186,171       187,405  
    Money market accounts   635,824       611,501       634,361  
    Total Core Deposits $ 1,524,055     $ 1,500,101     $ 1,532,392  
                           
    Time Deposits:   700,151       671,708       611,352  
    Total Deposits: $ 2,224,206     $ 2,171,809     $ 2,143,744  
                           

    During the nine months ended September 30, 2024, the Company continued to experience an unfavorable shift in deposit mix from low cost core deposits to high cost time deposits as customers continue to migrate to higher deposit rates. The Company continues to focus on the maintenance, development, and expansion of its core deposit base to meet funding requirements and liquidity needs, with an emphasis on retaining a long-term customer relationship base by competing for and retaining deposits in our local market. At September 30, 2024, the Bank’s uninsured deposits represented 27.7% of total deposits, compared to 26.8% at December 31, 2023.

    FHLB and Subordinated Debt

    At September 30, 2024, total borrowings decreased $4.1 million, or 2.6%, from $156.5 million at December 31, 2023 to $152.4 million. Short-term borrowings decreased $11.7 million, or 72.7%, to $4.4 million, compared to $16.1 million at December 31, 2023. Long-term borrowings increased $7.6 million, or 6.3%, from $120.6 million at December 31, 2023 to $128.3 million at September 30, 2024. At September 30, 2024 and December 31, 2023, borrowings also consisted of $19.7 million in fixed-to-floating rate subordinated notes.

    The Company utilized the Bank Term Funding Program (“BTFP”), which was created in March 2023 to enhance banking system liquidity by allowing institutions to pledge certain securities at par value and borrow at a rate of ten basis points over the one-year overnight index swap rate. The BTFP was available to federally insured depository institutions in the U.S., with advances having a term of up to one year with no prepayment penalties. The BTFP ceased extending new advances in March 2024. At December 31, 2023, the Company’s outstanding balance under the BTFP was $90.0 million. There were no outstanding balance under the BTFP at September 30, 2024.

    As of September 30, 2024, the Company had $452.0 million of additional borrowing capacity at the Federal Home Loan Bank, $404.9 million of additional borrowing capacity under the Federal Reserve Bank Discount Window and $25.0 million of other unsecured lines of credit with correspondent banks.

    Capital

    At September 30, 2024, shareholders’ equity was $240.7 million, or 9.1% of total assets, compared to $237.4 million, or 9.3% of total assets, at December 31, 2023. The change was primarily attributable to a decrease in accumulated other comprehensive loss of $3.4 million, cash dividends paid of $4.5 million, repurchase of shares at a cost of $5.6 million, partially offset by net income of $8.4 million. At September 30, 2024, total shares outstanding were 21,113,408.

    The Company’s regulatory capital ratios continue to be strong and in excess of regulatory minimum requirements to be considered well-capitalized as defined by regulators and internal Company targets. Total Risk-Based Capital Ratio was 14.4% at September 30, 2024 and 14.7% at December 31, 2023.  The Bank’s Tier 1 Leverage Ratio to adjusted average assets was 9.61% at September 30, 2024 and 9.62% at December 31, 2023.

    Dividends

    Although the Company has historically paid quarterly dividends on its common stock and currently intends to continue to pay such dividends, the Company’s ability to pay such dividends depends on a number of factors, including restrictions under federal laws and regulations on the Company’s ability to pay dividends, and as a result, there can be no assurance that dividends will continue to be paid in the future.

    About Western New England Bancorp, Inc.

    Western New England Bancorp, Inc. is a Massachusetts-chartered stock holding company and the parent company of Westfield Bank, CSB Colts, Inc., Elm Street Securities Corporation, WFD Securities, Inc. and WB Real Estate Holdings, LLC. Western New England Bancorp, Inc. and its subsidiaries are headquartered in Westfield, Massachusetts and operate 25 banking offices throughout western Massachusetts and northern Connecticut. To learn more, visit our website at www.westfieldbank.com.

    Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the Company’s financial condition, liquidity, results of operations, future performance, and business. Forward-looking statements may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential.”  Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition, results of operations and business that are subject to various factors which could cause actual results to differ materially from these estimates.  These factors include, but are not limited to:

    • unpredictable changes in general economic conditions, financial markets, fiscal, monetary and regulatory policies, including actual or potential stress in the banking industry;
    • the duration and scope of potential pandemics, including the emergence of new variants and the response thereto;
    • unstable political and economic conditions which could materially impact credit quality trends and the ability to generate loans and gather deposits;
    • inflation and governmental responses to inflation, including recent sustained increases and potential future increases in interest rates that reduce margins;
    • the effect on our operations of governmental legislation and regulation, including changes in accounting regulation or standards, the nature and timing of the adoption and effectiveness of new requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Basel guidelines, capital requirements and other applicable laws and regulations;
    • significant changes in accounting, tax or regulatory practices or requirements;
    • new legal obligations or liabilities or unfavorable resolutions of litigation;
    • disruptive technologies in payment systems and other services traditionally provided by banks;
    • the highly competitive industry and market area in which we operate;
    • changes in business conditions and inflation;
    • operational risks or risk management failures by us or critical third parties, including without limitation with respect to data processing, information systems, cybersecurity, technological changes, vendor issues, business interruption, and fraud risks;
    • failure or circumvention of our internal controls or procedures;
    • changes in the securities markets which affect investment management revenues;
    • increases in Federal Deposit Insurance Corporation deposit insurance premiums and assessments;
    • the soundness of other financial services institutions which may adversely affect our credit risk;
    • certain of our intangible assets may become impaired in the future;
    • new lines of business or new products and services, which may subject us to additional risks;
    • changes in key management personnel which may adversely impact our operations;
    • severe weather, natural disasters, acts of war or terrorism and other external events which could significantly impact our business; and
    • other risk factors detailed from time to time in our SEC filings.

    Although we believe that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from the results discussed in these forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake any obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent required by law.

    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Consolidated Statements of Net Income and Other Data
    (Dollars in thousands, except per share data)
    Unaudited)
     
      Three Months Ended Nine Months Ended
      September 30, June 30, March 31, December 31, September 30, September 30,
        2024     2024     2024     2023     2023     2024     2023  
    INTEREST AND DIVIDEND INCOME:              
    Loans $ 25,134   $ 24,340   $ 24,241   $ 23,939   $ 23,451   $ 73,715   $ 67,230  
    Securities   2,121     2,141     2,114     2,094     2,033     6,376     6,276  
    Other investments   189     148     136     140     166     473     418  
    Short-term investments   396     173     113     597     251     682     424  
    Total interest and dividend income   27,840     26,802     26,604     26,770     25,901     81,246     74,348  
                   
    INTEREST EXPENSE:              
    Deposits   11,165     10,335     9,293     8,773     7,704     30,793     17,876  
    Short-term borrowings   71     186     283     123     117     540     1,466  
    Long-term debt   1,622     1,557     1,428     1,444     1,444     4,607     2,513  
    Subordinated debt   254     254     254     254     253     762     760  
    Total interest expense   13,112     12,332     11,258     10,594     9,518     36,702     22,615  
                   
    Net interest and dividend income   14,728     14,470     15,346     16,176     16,383     44,544     51,733  
                   
    PROVISION FOR (REVERSAL OF) CREDIT LOSSES   941     (294 )   (550 )   486     354     97     386  
                   
    Net interest and dividend income after provision for (reversal of) credit losses   13,787     14,764     15,896     15,690     16,029     44,447     51,347  
                   
    NON-INTEREST INCOME:              
    Service charges and fees on deposits   2,341     2,341     2,219     2,283     2,145     6,901     6,573  
    Income from bank-owned life insurance   470     502     453     432     454     1,425     1,388  
    Unrealized gain (loss) on marketable equity securities   10     4     8     (1 )   –     22     –  
    Gain on sale of mortgages   246     –     –     –     –     246     –  
    Gain on non-marketable equity investments   –     987     –     –     238     987     590  
    Loss on disposal of premises and equipment   –     –     (6 )   –     (3 )   (6 )   (3 )
    Loss on defined benefit plan termination   –     –     –     –     –     –     (1,143 )
    Gain on bank-owned life insurance death benefit   –     –     –     –     778     –     778  
    Other income   74     –     –     –     –     74     –  
    Total non-interest income   3,141     3,834     2,674     2,714     3,612     9,649     8,183  
                   
    NON-INTEREST EXPENSE:              
    Salaries and employees benefits   8,112     7,901     8,244     7,739     7,955     24,257     24,475  
    Occupancy   1,217     1,218     1,363     1,198     1,159     3,798     3,710  
    Furniture and equipment   483     483     484     494     482     1,450     1,460  
    Data processing   869     846     862     788     824     2,577     2,369  
    Software   612     566     699     598     529     1,877     1,568  
    Debit/ATM card processing expense   649     643     552     559     562     1,844     1,580  
    Professional fees   540     581     569     674     643     1,690     2,203  
    FDIC insurance   338     323     410     338     341     1,071     983  
    Advertising   271     339     349     377     362     959     1,118  
    Other   1,315     1,414     1,250     2,020     1,261     3,979     4,099  
    Total non-interest expense   14,406     14,314     14,782     14,785     14,118     43,502     43,565  
                   
    INCOME BEFORE INCOME TAXES   2,522     4,284     3,788     3,619     5,523     10,594     15,965  
                   
    INCOME TAX PROVISION   618     771     827     1,108     1,033     2,216     3,408  
    NET INCOME $ 1,904   $ 3,513   $ 2,961   $ 2,511   $ 4,490   $ 8,378   $ 12,557  
                   
    Basic earnings per share $ 0.09   $ 0.17   $ 0.14   $ 0.12   $ 0.21   $ 0.40   $ 0.58  
    Weighted average shares outstanding   20,804,162     21,056,173     21,180,968     21,253,452     21,560,940     21,013,003     21,631,067  
    Diluted earnings per share $ 0.09   $ 0.17   $ 0.14   $ 0.12   $ 0.21   $ 0.40   $ 0.58  
    Weighted average diluted shares outstanding   20,933,833     21,163,762     21,271,323     21,400,664     21,680,113     21,122,208     21,681,251  
                   
    Other Data:              
    Return on average assets (1)   0.29 %   0.55 %   0.47 %   0.39 %   0.70 %   0.44 %   0.66 %
    Return on average equity (1)   3.19 %   6.03 %   5.04 %   4.31 %   7.60 %   4.74 %   7.19 %
    Efficiency ratio   80.62 %   78.20 %   82.03 %   78.27 %   70.61 %   80.27 %   72.71 %
    Adjusted efficiency ratio (2)   80.67 %   82.68 %   82.04 %   78.26 %   74.38 %   81.79 %   72.98 %
    Net interest margin   2.40 %   2.42 %   2.57 %   2.64 %   2.70 %   2.46 %   2.88 %
    Net interest margin, on a fully tax-equivalent basis   2.42 %   2.44 %   2.59 %   2.66 %   2.72 %   2.48 %   2.90 %
    (1) Annualized.          
    (2) The adjusted efficiency ratio (non-GAAP) represents the ratio of operating expenses divided by the sum of net interest and dividend income and non-interest income, excluding realized and unrealized gains and losses on securities, gain on non-marketable equity investments, loss on disposal of premises and equipment, loss on defined benefit plan termination and gain on bank-owned life insurance death benefit.
     
    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Consolidated Balance Sheets
    (Dollars in thousands)
    (Unaudited)
     
      September 30,   June 30,   March 31,   December 31,   September 30,
        2024       2024       2024       2023       2023  
    Cash and cash equivalents $ 72,802     $ 53,458     $ 22,613     $ 28,840     $ 62,267  
    Securities available-for-sale, at fair value   155,889       135,089       138,362       137,115       130,709  
    Securities held to maturity, at amortized cost   213,266       217,632       221,242       223,370       225,020  
    Marketable equity securities, at fair value   252       233       222       196       –  
    Federal Home Loan Bank of Boston and other restricted stock – at cost   7,143       7,143       3,105       3,707       3,063  
                       
    Loans   2,049,002       2,026,226       2,025,566       2,027,317       2,014,820  
    Allowance for credit losses   (19,955 )     (19,444 )     (19,884 )     (20,267 )     (19,978 )
    Net loans   2,029,047       2,006,782       2,005,682       2,007,050       1,994,842  
                       
    Bank-owned life insurance   76,570       76,100       75,598       75,145       74,713  
    Goodwill   12,487       12,487       12,487       12,487       12,487  
    Core deposit intangible   1,531       1,625       1,719       1,813       1,906  
    Other assets   71,492       75,521       76,206       74,848       79,998  
    TOTAL ASSETS $ 2,640,479     $ 2,586,070     $ 2,557,236     $ 2,564,571     $ 2,585,005  
                       
    Total deposits $ 2,224,206     $ 2,171,809     $ 2,143,747     $ 2,143,744     $ 2,176,303  
    Short-term borrowings   4,390       6,570       11,470       16,100       8,890  
    Long-term debt   128,277       128,277       120,646       120,646       121,178  
    Subordinated debt   19,741       19,731       19,722       19,712       19,702  
    Securities pending settlement   2,513       102       –       –       2,253  
    Other liabilities   20,697       23,104       25,855       26,960       25,765  
    TOTAL LIABILITIES   2,399,824       2,349,593       2,321,440       2,327,162       2,354,091  
                       
    TOTAL SHAREHOLDERS’ EQUITY   240,655       236,477       235,796       237,409       230,914  
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 2,640,479     $ 2,586,070     $ 2,557,236     $ 2,564,571     $ 2,585,005  
                       
    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Other Data
    (Dollars in thousands, except per share data)
    (Unaudited)
                                           
      Three Months Ended
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Shares outstanding at end of period   21,113,408       21,357,849       21,627,690       21,666,807       21,927,242  
                       
    Operating results:                  
    Net interest income $ 14,728     $ 14,470     $ 15,346     $ 16,176     $ 16,383  
    Provision for (reversal of) credit losses   941       (294 )     (550 )     486       354  
    Non-interest income   3,141       3,834       2,674       2,714       3,612  
    Non-interest expense   14,406       14,314       14,782       14,785       14,118  
    Income before income provision for income taxes   2,522       4,284       3,788       3,619       5,523  
    Income tax provision   618       771       827       1,108       1,033  
    Net income   1,904       3,513       2,961       2,511       4,490  
                       
    Performance Ratios:                  
    Net interest margin   2.40 %     2.42 %     2.57 %     2.64 %     2.70 %
    Net interest margin, on a fully tax-equivalent basis   2.42 %     2.44 %     2.59 %     2.66 %     2.72 %
    Interest rate spread   1.60 %     1.66 %     1.85 %     1.96 %     2.07 %
    Interest rate spread, on a fully tax-equivalent basis   1.62 %     1.67 %     1.86 %     1.98 %     2.09 %
    Return on average assets   0.29 %     0.55 %     0.47 %     0.39 %     0.70 %
    Return on average equity   3.19 %     6.03 %     5.04 %     4.31 %     7.60 %
    Efficiency ratio (GAAP)   80.62 %     78.20 %     82.03 %     78.27 %     70.61 %
    Adjusted efficiency ratio (non-GAAP) (1)   80.67 %     82.68 %     82.04 %     78.26 %     74.38 %
                       
    Per Common Share Data:                  
    Basic earnings per share $ 0.09     $ 0.17     $ 0.14     $ 0.12     $ 0.21  
    Earnings per diluted share   0.09       0.17       0.14       0.12       0.21  
    Cash dividend declared   0.07       0.07       0.07       0.07       0.07  
    Book value per share   11.40       11.07       10.90       10.96       10.53  
    Tangible book value per share (non-GAAP) (2)   10.73       10.41       10.25       10.30       9.87  
                       
    Asset Quality:                  
    30-89 day delinquent loans $ 3,059     $ 3,270     $ 3,000     $ 4,605     $ 4,097  
    90 days or more delinquent loans   1,253       2,280       1,716       1,394       1,527  
    Total delinquent loans   4,312       5,550       4,716       5,999       5,624  
    Total delinquent loans as a percentage of total loans   0.21 %     0.27 %     0.23 %     0.30 %     0.28 %
    Nonperforming loans $ 4,873     $ 5,845     $ 5,837     $ 6,421     $ 6,290  
    Nonperforming loans as a percentage of total loans   0.24 %     0.29 %     0.29 %     0.32 %     0.31 %
    Nonperforming assets as a percentage of total assets   0.18 %     0.23 %     0.23 %     0.25 %     0.24 %
    Allowance for credit losses as a percentage of nonperforming loans   409.50 %     332.66 %     340.65 %     315.64 %     317.62 %
    Allowance for credit losses as a percentage of total loans   0.97 %     0.96 %     0.98 %     1.00 %     0.99 %
    Net loan charge-offs (recoveries) $ 98     $ 10     $ (67 )   $ 136     $ 78  
    Net loan charge-offs (recoveries) as a percentage of average loans   0.00 %     0.00 %     0.00 %     0.01 %     0.00 %

    ____________________________
    (1) The adjusted efficiency ratio (non-GAAP) represents the ratio of operating expenses divided by the sum of net interest and dividend income and non-interest income, excluding realized and unrealized gains and losses on securities, gain on non-marketable equity investments, loss on disposal of premises and equipment, loss on defined benefit plan termination and gain on bank-owned life insurance death benefit.
    (2) Tangible book value per share (non-GAAP) represents the value of the Company’s tangible assets divided by its current outstanding shares.

    The following table sets forth the information relating to our average balances and net interest income for the three months ended September 30, 2024, June 30, 2024 and September 30, 2023 and reflects the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.

      Three Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023
      Average       Average Yield/   Average       Average Yield/   Average       Average Yield/
      Balance   Interest   Cost(8)   Balance   Interest   Cost(8)   Balance   Interest   Cost(8)
      (Dollars in thousands)
    ASSETS:                                        
    Interest-earning assets                                        
    Loans(1)(2) $ 2,038,593   $ 25,253     4.93 %   $ 2,017,127   $ 24,454     4.88 %   $ 2,007,267   $ 23,568     4.66 %
    Securities(2)   354,696     2,121     2.38       354,850     2,141     2.43       361,216     2,033     2.23  
    Other investments   15,904     189     4.73       14,328     148     4.15       12,155     166     5.42  
    Short-term investments(3)   32,043     396     4.92       14,328     173     4.86       22,349     251     4.46  
    Total interest-earning assets   2,441,236     27,959     4.56       2,400,633     26,916     4.51       2,402,987     26,018     4.30  
    Total non-interest-earning assets   153,585               156,701               156,503          
    Total assets $ 2,594,821             $ 2,557,334             $ 2,559,490          
                                             
    LIABILITIES AND EQUITY:                                        
    Interest-bearing liabilities                                        
    Interest-bearing checking accounts $ 131,133     271     0.82     $ 131,449     253     0.77     $ 144,792     269     0.74  
    Savings accounts   179,844     38     0.08       185,690     51     0.11       195,020     41     0.08  
    Money market accounts   621,340     3,172     2.03       622,062     2,930     1.89       656,066     2,488     1.50  
    Time deposit accounts   688,797     7,684     4.44       650,054     7,101     4.39       563,135     4,906     3.46  
    Total interest-bearing deposits   1,621,114     11,165     2.74       1,589,255     10,335     2.62       1,559,013     7,704     1.96  
    Borrowings   153,317     1,947     5.05       160,484     1,997     5.00       149,507     1,814     4.81  
    Interest-bearing liabilities   1,774,431     13,112     2.94       1,749,739     12,332     2.83       1,708,520     9,518     2.21  
    Non-interest-bearing deposits   559,224               548,781               591,933          
    Other non-interest-bearing liabilities   23,466               24,453               24,504          
    Total non-interest-bearing liabilities   582,690               573,234               616,437          
    Total liabilities   2,357,121               2,322,973               2,324,957          
    Total equity   237,700               234,361               234,533          
    Total liabilities and equity $ 2,594,821             $ 2,557,334             $ 2,559,490          
    Less: Tax-equivalent adjustment(2)       (119 )               (114 )               (117 )      
    Net interest and dividend income     $ 14,728               $ 14,470               $ 16,383        
    Net interest rate spread(4)         1.60 %           1.66 %           2.07 %
    Net interest rate spread, on a tax-equivalent basis(5)         1.62 %           1.67 %           2.09 %
    Net interest margin(6)         2.40 %           2.42 %           2.70 %
    Net interest margin, on a tax-equivalent basis(7)         2.42 %           2.44 %           2.72 %
    Ratio of average interest-earning assets to average interest-bearing liabilities         137.58 %           137.20 %           140.65 %
                                             

    The following tables set forth the information relating to our average balances and net interest income for the nine months ended September 30, 2024 and 2023 and reflect the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.

      Nine Months Ended September 30,
      2024   2023
      Average
    Balance    		   Interest   Average Yield/
    Cost(8)    		   Average
    Balance    		   Interest   Average Yield/
    Cost(8)    		  
                                           
      (Dollars in thousands)
    ASSETS:                          
    Interest-earning assets                          
    Loans(1)(2) $ 2,025,858   $ 74,058     4.88 %   $ 2,002,485   $ 67,586     4.51 %
    Securities(2)   356,340     6,376     2.39       372,623     6,276     2.25  
    Other investments   14,248     473     4.43       12,528     418     4.46  
    Short-term investments(3)   18,634     682     4.89       12,922     424     4.39  
    Total interest-earning assets   2,415,080     81,589     4.51       2,400,558     74,704     4.16  
    Total non-interest-earning assets   154,894               154,525          
    Total assets $ 2,569,974             $ 2,555,083          
                               
    LIABILITIES AND EQUITY:                          
    Interest-bearing liabilities                          
    Interest-bearing checking accounts $ 132,708     759     0.76 %   $ 142,716     780     0.73 %
    Savings accounts   183,872     128     0.09       207,513     142     0.09  
    Money market accounts   623,216     8,689     1.86       711,173     6,813     1.28  
    Time deposit accounts   655,700     21,217     4.32       498,193     10,141     2.72  
    Total interest-bearing deposits   1,595,496     30,793     2.58       1,559,595     17,876     1.53  
    Short-term borrowings and long-term debt   158,183     5,909     4.99       130,796     4,739     4.84  
    Total interest-bearing liabilities   1,753,679     36,702     2.80       1,690,391     22,615     1.79  
    Non-interest-bearing deposits   555,253               607,338          
    Other non-interest-bearing liabilities   24,931               23,886          
    Total non-interest-bearing liabilities   580,184               631,224          
                               
    Total liabilities   2,333,863               2,321,615          
    Total equity   236,111               233,468          
    Total liabilities and equity $ 2,569,974             $ 2,555,083          
    Less: Tax-equivalent adjustment (2)       (343 )               (356 )      
    Net interest and dividend income     $ 44,544               $ 51,733        
    Net interest rate spread (4)         1.70 %           2.35 %
    Net interest rate spread, on a tax-equivalent basis (5)         1.71 %           2.37 %
    Net interest margin (6)         2.46 %           2.88 %
    Net interest margin, on a tax-equivalent basis (7)         2.48 %           2.90 %
    Ratio of average interest-earning assets to average interest-bearing liabilities       137.72 %           142.01 %

    (1) Loans, including nonaccrual loans, are net of deferred loan origination costs and unadvanced funds.
    (2) Loan and securities income are presented on a tax-equivalent basis using a tax rate of 21%. The tax-equivalent adjustment is deducted from tax-equivalent net interest and dividend income to agree to the amount reported on the consolidated statements of net income.
    (3) Short-term investments include federal funds sold.
    (4) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
    (5) Net interest rate spread, on a tax-equivalent basis, represents the difference between the tax-equivalent weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
    (6) Net interest margin represents net interest and dividend income as a percentage of average interest-earning assets.
    (7) Net interest margin, on a tax-equivalent basis, represents tax-equivalent net interest and dividend income as a percentage of average interest-earning assets.
    (8) Annualized.

    Reconciliation of Non-GAAP to GAAP Financial Measures

    The Company believes that certain non-GAAP financial measures provide information to investors that is useful in understanding its results of operations and financial condition.  Because not all companies use the same calculation, this presentation may not be comparable to other similarly titled measures calculated by other companies.  A reconciliation of these non-GAAP financial measures is provided below.

      For the quarter ended
      9/30/2024   6/30/2024   3/31/2024   12/31/2023   9/30/2023
      (Dollars in thousands)
                       
    Loan interest (no tax adjustment) $ 25,134     $ 24,340     $ 24,241     $ 23,939     $ 23,451  
    Tax-equivalent adjustment   119       114       110       113       117  
    Loan interest (tax-equivalent basis) $ 25,253     $ 24,454     $ 24,351     $ 24,052     $ 23,568  
                       
    Net interest income (no tax adjustment) $ 14,728     $ 14,470     $ 15,346     $ 16,176     $ 16,383  
    Tax equivalent adjustment   119       114       110       113       117  
    Net interest income (tax-equivalent basis) $ 14,847     $ 14,584     $ 15,456     $ 16,289     $ 16,500  
                       
    Average interest-earning assets $ 2,441,236     $ 2,400,633     $ 2,403,086     $ 2,427,112     $ 2,402,987  
    Net interest margin (no tax adjustment)   2.40 %     2.42 %     2.57 %     2.64 %     2.70 %
    Net interest margin, tax-equivalent   2.42 %     2.44 %     2.59 %     2.66 %     2.72 %
                       
    Book Value per Share (GAAP) $ 11.40     $ 11.07     $ 10.90     $ 10.96     $ 10.53  
    Non-GAAP adjustments:                  
    Goodwill   (0.59 )     (0.58 )     (0.58 )     (0.58 )     (0.57 )
    Core deposit intangible   (0.08 )     (0.08 )     (0.07 )     (0.08 )     (0.09 )
    Tangible Book Value per Share (non-GAAP) $ 10.73     $ 10.41     $ 10.25     $ 10.30     $ 9.87  
                       
      For the quarter ended
      9/30/2024   6/30/2024   3/31/2024   12/31/2023   9/30/2023
      (Dollars in thousands)
                       
    Efficiency Ratio:                  
    Non-interest Expense (GAAP) $ 14,406     $ 14,314     $ 14,782     $ 14,785     $ 14,118  
                       
    Net Interest Income (GAAP) $ 14,728     $ 14,470     $ 15,346     $ 16,176     $ 16,383  
                       
    Non-interest Income (GAAP) $ 3,141     $ 3,834     $ 2,674     $ 2,714     $ 3,612  
    Non-GAAP adjustments:                  
    Unrealized (gains) losses on marketable equity securities   (10 )     (4 )     (8 )     1       –  
    Gain on non-marketable equity investments   –       (987 )     –       –       (238 )
    Loss on disposal of premises and equipment   –       –       6       –       3  
    Gain on bank-owned life insurance death benefit   –       –       –       –       (778 )
    Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) $ 3,131     $ 2,843     $ 2,672     $ 2,715     $ 2,599  
    Total Revenue for Adjusted Efficiency Ratio (non-GAAP) $ 17,859     $ 17,313     $ 18,018     $ 18,891     $ 18,982  
                       
    Efficiency Ratio (GAAP)   80.62 %     78.20 %     82.03 %     78.27 %     70.61 %
                       
    Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP))   80.67 %     82.68 %     82.04 %     78.26 %     74.38 %
                       
      For the nine months ended
      9/30/2024   9/30/2023
      (Dollars in thousands)
           
    Loan income (no tax adjustment) $ 73,715     $ 67,230  
    Tax-equivalent adjustment   343       356  
    Loan income (tax-equivalent basis) $ 74,058     $ 67,586  
           
    Net interest income (no tax adjustment) $ 44,544     $ 51,733  
    Tax equivalent adjustment   343       356  
    Net interest income (tax-equivalent basis) $ 44,887     $ 52,089  
           
    Average interest-earning assets $ 2,415,080     $ 2,400,558  
    Net interest margin (no tax adjustment)   2.46 %     2.88 %  
    Net interest margin, tax-equivalent   2.48 %     2.90 %  
           
    Adjusted Efficiency Ratio:      
    Non-interest Expense (GAAP) $ 43,502     $ 43,565  
           
    Net Interest Income (GAAP) $ 44,544     $ 51,733  
           
    Non-interest Income (GAAP) $ 9,649     $ 8,183  
    Non-GAAP adjustments:      
    Unrealized gains on marketable equity securities   (22 )     –  
    Loss on disposal of premises and equipment, net   6       3  
    Gain on bank-owned life insurance   –       (778 )
    Gain on non-marketable equity investments   (987 )     (590 )
    Loss on defined benefit plan curtailment   –       1,143  
    Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) $ 8,646     $ 7,961  
    Total Revenue for Adjusted Efficiency Ratio (non-GAAP) $ 53,190     $ 59,694  
           
    Efficiency Ratio (GAAP)   80.27 %     72.71 %
           
    Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP))   81.79 %     72.98 %
                   

    For further information contact:
    James C. Hagan, President and CEO
    Guida R. Sajdak, Executive Vice President and CFO
    Meghan Hibner, First Vice President and Investor Relations Officer
    413-568-1911

    The MIL Network –

  • MIL-OSI United Nations: Experts of the Human Rights Committee Welcome France’s Efforts to Combat Homophobia, Raise Questions on Violence in New Caledonia and Rules Governing Identity Checks

    Source: United Nations – Geneva

    The Human Rights Committee today concluded its consideration of the sixth periodic report of France on how it implements the provisions of the International Covenant on Civil and Political Rights, with Committee Experts welcoming France’s national plan combatting hatred against lesbian, gay, bisexual, transgender and intersex persons and plans to combat homophobia, while raising questions on violence in New Caledonia and rules governing identity checks. 

    One Committee Expert said the Committee welcomed the national plan for equality and against hatred and discrimination against lesbian, gay, bisexual, transgender and intersex persons (2020-2026) and the government plan (2023-2026) to combat homophobia and discrimination based on sexual orientation and gender identity. 

    Another Expert said it appeared that the current violence in the non-self-governing territory of New Caledonia was linked to reforms of the Nouméa Accord and a lack of progress in the decolonisation process.  What was the progress made on the issue of self-determination of the non-self-governing territory of New Caledonia as well as that of French Polynesia, and the participation and consultation processes put in place with the indigenous peoples living in these territories to obtain their free and informed consent and access to independence? 

    Another Expert asked if the State party could indicate whether mandatory training on racial and ethnic discrimination and profiling was systematically offered to law enforcement officials, both in metropolitan France and in the overseas territories?  Did the State party systematically collect data to monitor the use of identity checks, both in metropolitan France and in the overseas territories?  Would the State party be prepared to implement a template for all individuals subject to an identity check?  Would it be willing to introduce a centralised record of all identity checks to have an overview of how they were used, with whom and where?

    The delegation said France supported the recognition of indigenous peoples.  New Caledonia was one of the most advanced examples of the French Government recognising the rights of indigenous peoples.  Since the Nouméa Accord, an institutional framework had been put into place allowing for shared governance between the communities, representing the customs of the Kanak people.  On 1 October, the Prime Minister announced the postponement of elections in 2025, which was unanimously agreed by Parliament.  Since 1998, France had been cooperating with the decolonisation committee and the work had been fruitful.

    The delegation said all French citizens were equal before the law. The code of ethics for the police and national gendarmerie prohibited discriminatory identity checks.  When the law authorised an identity check, the police should not rely on any physical trait, unless there were specific grounds. Any act of discrimination could be reported by someone who believed they were a victim of discriminatory profiling. There were several ways to do this, including through the various controlling and monitoring authorities and the judiciary.

    Introducing the report, Isabelle Rome, Ambassador for Human Rights of France and head of the delegation, said human rights were a priority for France.  In December 2023, the President of the Republic announced that a House of Human Rights would be created in Paris to support civil society organizations. France had strengthened its public policies on the judiciary, democracy and the law enforcement agencies since 2022, paying particular attention to conditions for the use of force, and compliance with the rules of ethics during all police operations.  Ms. Rome concluded by saying that France believed in its democratic model, in liberty, equality and fraternity, as illustrated this summer by the Olympic and Paralympic Games.

    In concluding remarks, Ms. Rome thanked the Committee for the dialogue.  France was deeply attached to the rule of law and the Committee’s recommendations would be scrupulously considered.  The country was committed to renewing dialogue with the territory of New Caledonia and its inhabitants. 

    Tania María Abdo Rocholl, Committee Chairperson, thanked the delegation for the dialogue, which had covered a wide range of subjects under the Covenant.   The Committee aimed to ensure the highest level of implementation of the Covenant in France. 

    The delegation of France was made up of representatives of the Ministry for Europe and Foreign Affairs; the Ministry of the Interior and Overseas; the Ministry of Justice; the State Council; the Interministerial delegation to the fight against racism, anti-Semitism, and hatred; the French office for the protection of refugees and stateless persons; and the Permanent Mission of France to the United Nations Office at Geneva.

    The Human Rights Committee’s one hundred and forty-second session is being held from 14 October to 7 November 2024.  All the documents relating to the Committee’s work, including reports submitted by States parties, can be found on the session’s webpage.  Meeting summary releases can be found here.  The webcast of the Committee’s public meetings can be accessed via the UN Web TV webpage.

    The Committee will next meet in public at 3 p.m. on Wednesday, 23 October, to begin its consideration of the second periodic report of Türkiye (CCPR/C/TUR/2).

    Report

    The Committee has before it the sixth periodic report of France (CCPR/C/FRA/6).

    Presentation of Report

    ISABELLE ROME, Ambassador for Human Rights of France and head of the delegation, said human rights were a priority for France.  In December 2023, the President of the Republic announced that a House of Human Rights would be created in Paris to support civil society organizations.  Launched in 2021, the Marianne initiative for human rights defenders aimed to encourage the activities of human rights defenders, both in their country of origin, and by welcoming them in France.  The fight against the death penalty was also a priority for France.  France would host the ninth World Congress against the Death Penalty in Paris in 2026.  France was also contributing to the organization of the first World Congress on Enforced Disappearances in Geneva on 15 and 16 January 2025. 

    The State’s new feminist diplomacy strategy would be published by the end of 2024.  France was proud that the Paris 2024 Olympic and Paralympic Games were the first gender-balanced games in history.  Through its diplomatic and consular network, France supported projects of democratic governance, respect for the rule of law, the fight against impunity, access to justice, and mechanisms to monitor the effective exercise of civil and political rights.  In 2019, France launched the Partnership for Information and Democracy, which was joined by 54 States from all regions, to guarantee freedom of expression.  In May 2024, the President of the French Republic and the Prime Minister of New Zealand announced the creation of a new non-governmental organization, the Christchurch Call Foundation, to coordinate the work of the Christchurch Call to eliminate terrorist and violent extremist content online. 

    France had strengthened its public policies on the judiciary, democracy and the law enforcement agencies since 2022, paying particular attention to conditions for the use of force, and compliance with the rules of ethics during all police operations.  The national law enforcement plan published in 2021 provided for an adaptation of the employment strategies of the republican security companies and the mobile gendarmerie squadrons during public demonstrations.  The right to demonstrate was guaranteed by the Constitution in France.  By getting in touch with the prefects and police units involved in public demonstrations, journalists could be added to communication channels, allowing them to receive live information and ask questions. 

    Between 2020 and 2024, the Ministry of Justice’s budget increased by 33 per cent, from €7.6 billion in 2020 to €10.1 billion in 2024. In five years, the French Ministry of Justice would have recruited as many magistrates as in the last 20 years. To combat prison overcrowding, the Ministry of Justice was implementing a proactive prison regulation policy, based on the development of alternatives to incarceration, the strengthening of early release mechanisms, and an ambitious prison real estate programme creating 15,000 net prison places.  An Interministerial Committee for Overseas Territories was set up in July 2023.  France had mobilised authorities to enable and guarantee the return to calm and security of people in New Caledonia. Emergency measures were deployed last June.  The mediation and work mission continued its work, with the aim of renewing political dialogue. 

    France had been implementing a new interministerial plan for gender equality 2023-2027, which contained 161 measures divided into four priority areas: the fight against violence against women; the global approach to women’s health; professional and economic equality; and the dissemination and transmission of a culture of equality.  The law of July 2023 aimed at strengthening women’s access to responsibilities in the public service.  It increased the mandatory quota of first-time female appointments to senior and management positions to 50 per cent.  On 8 March 2024, France became the first country in the world to enshrine the freedom to have access to voluntary termination of pregnancy in its Constitution. 

    Questions by Committee Experts

    A Committee Expert welcomed that France’s report was prepared in consultation with the National Consultative Commission on Human Rights, whose role was to monitor France’s international commitments and the implementation of recommendations issued by international and regional bodies.  In May 2024, despite the provisions of the Nouméa Accord which provided for a process of gradual transfer of power from France to New Caledonia, the National Assembly voted in favour of expanding the electorate of New Caledonia.  Thousands of Kanak demonstrators mobilised to denounce these reforms, which were allegedly passed without adequate consultation or free, prior and informed consent.  In the absence of sufficient dialogue on the part of the authorities, a violent conflict had been raging since that date. 

    The French Government had deployed considerable military resources to restore order, but at the cost of numerous allegations of excessive use of force that led to several deaths among Kanak protesters and security forces, as well as injuries.  According to information received by the Committee, at least 11 people were shot dead and 169 others were injured; 2658 demonstrators were arrested, many of whom were arbitrarily arrested and detained, dozens of them were also transferred to metropolitan France. 

    It appeared that the current violence in the non-self-governing territory of New Caledonia was linked to reforms of the Nouméa Accord and a lack of progress in the decolonisation process.  What was the progress made on the issue of self-determination of the non-self-governing territory of New Caledonia as well as that of French Polynesia, and the participation and consultation processes put in place with the indigenous peoples living in these territories to obtain their free and informed consent and access to independence?

    There had been several prominent court cases regarding the removal of headscarves in France.  In the opinion of the French State, should the Committee’s Views be followed only in the case where the Committee considered a complaint to be inadmissible or agreed with the arguments presented by the French Government? Were there intentions to lift reservations to the Covenant?  Who currently appointed the magistrates of the courts?  What was the current state of the constitutional reform initiated with a view to making the Prosecutor’s Office independent of the executive?  How could the full independence of judges and prosecutors be guaranteed?

    Since 2015, France had put in place measures to combat terrorism, which had been seen over the years to be increasingly detrimental to people’s rights and freedoms.

    Was the new legislation accompanied by sufficient guarantees against the risk of arbitrary and discriminatory implementation of these measures?  What independent and impartial expertise did public authorities have to assess the impact of new technologies on the exercise of the rights and freedoms recognised by the Covenant? 

    It was understood that mass surveillance technology was used during the Olympic and Paralympic Games.  How did the State party ensure that it did not lead to profiling that disproportionately affected racial, ethnic and religious minorities?  How did the State party ensure that continuous surveillance by algorithm-based systems did not violate the right to privacy and respected the requirements of proportionality and necessity?  For how long could the data collected in this way be kept? 

    What were the current conditions for the communication of information to the intelligence services, particularly in the area of sensitive data? What information could be transmitted and what traceability requirements were in place?  Under what conditions could information provided by the intelligence services be made available to the judicial authority and the Public Prosecutor’s Office?  What means of access was available to defendants and those accused of acts of terrorism?

    Another Expert said the Committee was informed that people of colour were subjected to identity checks by the police about 20 times more often than other citizens.  They also faced discriminatory treatment during police stops and searches, including direct fines, often without objective suspicion and without being informed of the reasons.  What could be done to ensure that the use of identity checks and fines was not left to the discretion of law enforcement agencies, and was based only on objective and individualised conditions, and not on racial origins?  Did the State party have explicit guidelines for law enforcement agencies that clearly prohibited racial profiling in police operations as well as discriminatory identity checks? 

    Could the State party indicate whether mandatory training on racial and ethnic discrimination and profiling was systematically offered to law enforcement officials, both in metropolitan France and in the overseas territories?  Did the State party systematically collect data to monitor the use of identity checks, both in metropolitan France and in the overseas territories?  Would the State party be prepared to implement a template for all individuals subject to an identity check?  Would it be willing to introduce a centralised record of all identity checks to have an overview of how they were used, with whom and where?

    The Committee had received extensive information that showed the persistent problem of systemic racial discrimination, as well as the use of negative stereotypes against minorities.  What measures had the State party taken to effectively combat all forms of hate speech and hate crimes against racial, ethnic and religious minorities? What training was provided to law enforcement officers, judges and prosecutors, and what awareness campaigns were organised to prevent and combat hate crime and hate speech?  Would France develop data collection and research in compliance with data protection rules, to effectively identify cases of racial or ethnic profiling and offences in metropolitan France and overseas?

    The Committee welcomed the national plan for equality and against hatred and discrimination against lesbian, gay, bisexual, transgender and intersex persons (2020-2026) and the government plan (2023-2026) to combat homophobia and discrimination based on sexual orientation and gender identity.  How would the State party ensure adequate resources and the active participation of civil society in the implementation of these plans?  Did these programmes sufficiently take into account minorities within minorities, such as lesbian, gay, bisexual, transgender and intersex asylum seekers? 

    The Committee was informed that some of the measures granting extensive powers to the administrative authorities, developed in the context of the state of emergency, had been granted permanent status.  What measures had the State party taken to ensure that initial emergency measures were in conformity with the Covenant in terms of necessity and proportionality?  How did the State party promote the accessibility of judicial procedures and ensure that they were effective?

    How would France ensure that anti-terrorism legislation did not disproportionately target Muslims and that actions were based on alleged criminal behaviour rather than religious practices?  How did the State party ensure that house searches and dissolution of organizations were conducted by the courts?  What was the percentage of terrorist offences in relation to criminal offences committed in the last five years?  The Committee was informed of the law establishing a new security regime, which subjected the accused to certain obligations, with a view of ensuring their reintegration.  How did France ensure that this monitoring system, which was based on the rather vague notion of “dangerousness”, was not arbitrary and did not disproportionately infringe on the rights of persons who had served their sentences?

    One Committee Expert said the Committee particularly welcomed the State party’s commitment of significant financial resources to address the needs of vulnerable groups during the health crisis of COVID-19. What was the impact of the measures described in the State party’s report, to ensure that the COVID-19 pandemic did not exacerbate inequalities, discrimination and exclusion, including among vulnerable groups?  Specifically, regarding domestic violence against women, which was said to have increased during the pandemic, what was the assessment of the effectiveness and impact of the measures taken? 

    While noting the information provided by the State party, including on the judicial review of the restrictions imposed, could the proportionality of the measures imposed to address COVID-19 be explained, including the ban on any gathering of more than 10 people imposed for a certain period? What assessment did the State party make of this experience for a better consideration of human rights in future crises?      

    Another Expert said the State party had reported on humanitarian repatriations from Syria of women and children of French nationality.  With regard to returns, according to public reports, there was still a significant number of women and children detained or held in camps and rehabilitation centres in Syria.  What was the number, the current situation, and the measures taken by the State party to ensure the full repatriation of all French women and children still in detention camps and rehabilitation centres for minors in Syria? 

    What was the estimated number of detained men and women in Syria who participated as Islamic State fighters?  Had measures been taken to ensure that due process standards were strictly respected in the trials before the Syrian national courts? According to information, in May and June 2019, 11 French nationals had been sentenced to death in Iraq for their involvement as Islamic State fighters.  Could the delegation provide an update on that information and indicate what steps the State party had taken to prevent the continued imposition of death sentences on its nationals in that country?  What other penalties had been applied to these French nationals in lieu of the death penalty?

    The Committee had requested information related to the Arms Trade Treaty, in order to know whether the State party carried out an evaluation for the granting of export licenses aimed at determining that the recipient country used the weapons included in the respective license within the framework of respect for the right to life.  Did the evaluation of an arms export take this into account?  Had any measures been taken to ensure a total ban on arms sales to countries where there was a clear risk that such weapons could be used to violate international human rights law?  Was it possible to access information on arms exports so that civil society could carry out oversight?  What measures had been taken to prevent the negative effects on the right to life of the operations of French companies abroad, especially in the province of Cabo Delgado in Mozambique? 

    A Committee Expert said the Committee was informed that there had been a rise in police violence in recent years, with multiple incidents resulting in fatal outcomes, some of them young boys.   Could more information be provided on trainings on racism for police officers?  Had improvements been made, bearing in mind previous incidents?  The Committee was informed that investigations and legal procedures of unlawful killings by law enforcement officials were not expeditious, sometimes even leading to de facto police impunity, or that sentences were not commensurate with the gravity of the crime. 

    Had there been plans to amend legal norms and review legal conditions for the use of firearms by the police and the gendarmerie, aiming to reduce the risks of disproportionate use of lethal force, and to strike a better balance with the principles of absolute necessity and strict proportionality?  What was the status of investigations of fatalities and injuries, including those related to alleged excessive use of force, which emerged during conflicts that started in May 2024 in New Caledonia? Had trainings been undertaken for those operating in France’s overseas territories? 

    The Committee welcomed the reported introduction of the new right to appeal introduced by article 803-8 of the Code of Criminal Procedure, as a step forward.  However, Experts had been informed that there were several challenges preventing its full use and benefits.  Since the right to a judicial remedy against undignified conditions of detention was introduced in 2021, what were the steps taken by the State party to disseminate it within the incarcerated population?  Was the information on the creation of a new legal tool easily reachable in all penitentiaries under the jurisdiction of the State party?  Had legal aid been introduced to those incarcerated persons who could not afford a lawyer or judicial taxes?  Were there plans to introduce wider use of alternatives to detention or a more restricted use of detention as a last resort?

    Responses by the Delegation

    The delegation said France supported the recognition of indigenous peoples.  New Caledonia was one of the most advanced examples of the French Government recognising the rights of indigenous peoples.  Since the Nouméa Accord, an institutional framework had been put into place allowing for shared governance between the communities, representing the customs of the Kanak people.  On 1 October, the Prime Minister announced the postponement of elections in 2025, which was unanimously agreed by Parliament.  Since 1998, France had been cooperating with the decolonisation committee and the work had been fruitful.

    Since 2015, the technical intelligence community had been working on a specific legal framework.  The law included respect for the private lives of citizens and had a strict principle of proportionality.  The law set forth the procedures to be respected when it came to implementing intelligence techniques, including prior authorisation by the Prime Minister.  There were restrictions on how long the data could be held.  The enhanced video surveillance was enacted in advance of the Olympics and Paralympics Games.  France chose to engage in a rigorous oversight mechanism regarding this surveillance.  This was a tool for detecting events without having to resort to facial recognition. 

    All French citizens were equal before the law.  The code of ethics for the police and national gendarmerie prohibited discriminatory identity checks.  When the law authorised an identity check, the police should not rely on any physical trait, unless there were specific grounds.  Any act of discrimination could be reported by someone who believed they were a victim of discriminatory profiling.  There were several ways to do this, including through the various controlling and monitoring authorities and the judiciary.

    At the end of the state of emergency, which followed the attacks carried out on France in 2015, the Government acknowledged the need to keep these tools in place due to the possibility of other attacks.  Four new measures had then been created.  These laws were only for preventing terrorism and were accompanied with significant guarantees for citizens.  The law of 30 July 2021 on preventing acts of terrorism gave these measures permanency.  The Constitutional Council believed this was a balanced approach that ensured achieving the goal of preventing terrorism while respecting private life.  House searches could not be instigated unless there was prior authorisation from a judge; 1,447 remedies were presented for the state of emergency.  The law of 2021 applied to people who had been sentenced to acts of terrorism. Sentences for terrorist activities represented around 0.04 per cent of all criminal activities. 

    A plan had been developed to prepare the plan on combatting lesbian, gay, bisexual, transgender and intersex hatred, involving members of civil society.  The plan contained 16 key measures, including a ten-million-euro fund by 2027 to improve the host centres for these individuals.  The goal was to have two centres per region in France.  For hate speech, the legislation provision had recently been strengthened.  In 2021, there was a vote to govern the digital space and that law had a set of provisions on combatting online hate speech to better regulate illegal behaviour. There had been significant progress made in this area, given that a bill had been introduced in the European Parliament to regulate heinous content online. 

    In France, 2020 was the year that the State had the lowest rate of femicide.  This meant that the measures set up were effective, and that the police and justice systems were able to act swiftly to combat family violence.  There were also provisions which allowed complaints to be raised. 

    Measures adopted during the pandemic were considered to be proportional.  The measures taken to address the pandemic did not overturn other measures in place. During COVID-19, the number of calls to victim support groups for violence had increased.  The accelerated measures implemented by France to support victims included electronic bracelets to ensure restraining orders were complied with.   In 2021, emergency plans were implemented to ensure people were protected.  At the end of the pandemic, the State provided hotlines 24/7 and reception centres in shopping malls.  More specialised support was also provided in courts. 

    International commitments by France to human rights did not involve a repatriation of citizens in an area where France had no control.  Authorities responded systematically to requests for repatriation made by French citizens.  Since 2019, repatriation efforts for minors had been organised.  France exported weapons to countries that wished to strengthen their armies, only with strict national oversight. 

    Force was only used when necessary in cases set forth by law and in a manner which was proportional to the threat.  A police or member of the gendarmerie would only use force if it was essential in their work, such as in cases of self-defence.  Police had additional guidelines on the use of weapons.  There should never be doubt regarding the reasons of an arrest warrant. 

    France had a law which allowed for all inmates to request guarantees for their detention conditions, ensuring they were dignified. A provision was in place which allowed individuals to benefit from jurisdictional support, in place since 2023. Template forms for this purpose were provided to all detainees upon their detention. 

    Questions by Committee Experts

    A Committee Expert said the problem with the New Caledonia information was the outcome of the projects which arose in France in 1984. The idea of postponing elections to 2025 was a positive sign as this would allow for mediation between the local and French authorities.  Over recent years, there had been a considerable strengthening of anti-terrorist measures.  However, the majority of terrorist threats were foiled by international cooperation efforts.  Were the measures justified by the threats the State faced?  How could this be transmitted between different intelligence branches?  How long was intelligence data stored and what measures were provided to keep the information secure? 

    Another Expert asked for disaggregated data on what law enforcement officials had been charged with?  Were inmates allowed to apply to a collective appeal so that others could benefit? 

    An Expert said there were laws which prohibited discrimination in identification checks; how was it ensured that this legislation was implemented?

    Another Committee Expert asked for the delegation to bear in mind the matter of redress granted to victims of violence. 

    One Expert asked for a more specific response to the measures adopted to comply with the rulings of the European courts against certain cases against France?  How did the State party ensure effective judicial control and parliamentary oversight in weapon exportation? 

    Responses by the Delegation

    The delegation said the French overseas territories met all international criteria under the law.  France had completed the decolonisation process and no longer administered non-self-governing territories.  As for French Polynesia, in 2023, France decided to speak before the General Assembly, illustrating ongoing dialogue between the State and French Polynesia. France supported the development of French Polynesia. 

    The French Government followed the individual communications procedure before the Committee.  Any communications were the subject of broad consultations among many ministries and institutions. 

    When France ended the state of emergency of 2015 to 2017, the risk of terrorism in the country was still high.  While this risk had come down, threats still persisted; 45 attacks had been foiled between 2017 and now. 

    In 2022, over 700 people brought cases to court regarding acts of violence committed by people in public authority.  Over 200 of these led to convictions. 

    The Ministry of Education and Youth was currently creating a programme to consider the new kinds of racism and anti-Semitism which had cropped up in recent years. 

    The French law enforcement force represented the population and was diverse.  Inmates could ask for specific improvements to detention conditions which impacted their dignity.  Improvements had been carried out in several penitentiaries as a result of this. Several inmates could present these complaints together.   

    Questions by Committee Experts

    A Committee Expert said since the end of the state of health emergency on 10 July 2020, the situation of exiled people in Calais had deteriorated.  The nearly 1,200 homeless men, women and children in Calais had seen their living conditions deteriorated due to the brutal “evacuations” of several large camps, and the dramatic reduction in vital services such as food distributions, and lack of access to showers and water points.  Additionally, around 100 unaccompanied minors had settled in tents in Jules Ferry Square to highlight that they had been abandoned by the State. Could the State party comment on this?

    According to information received, journalists and media organizations were reportedly facing increasing challenges in carrying out their duties, including restrictions on reporting, potential abuses of power, and other pressures that undermined press freedom.  Reporters without Borders reported that police reportedly assaulted several “clearly identifiable” journalists.  There were several cases cited to support these allegations, including journalists in New Caledonia who stated they were constantly harassed for their coverage of the riots.  Could the delegation comment on these allegations?  What measures did the State party intend to take to better protect journalists and human rights defenders in the exercise of their work? Had the perpetrators of the mentioned cases been prosecuted and what was the outcome, including convictions and reparations?

    Another Expert noted the numerous allegations of prison overcrowding in the State party and the serious health risks during the most critical period of the COVID-19 pandemic, asking what were the reasons for providing, through decree-law 2020-303, for the full continuation of pre-trial detention, which even affected minors?  What were the conditions for the application of the measure of full maintenance of pre-trial detention to children and how many children were affected by this measure? How did law no. 2021-646 of 25 May 2021 on global security preserving freedoms effectively guarantee respect for privacy, especially in the use of portable cameras by law enforcement officers and cameras installed on unmanned aerial vehicles?  Did it include the principles of proportionality and necessity? In the case of the use of surveillance devices in public demonstrations by law enforcement officers, were there safeguards or limitations to prevent their use from affecting the right to peaceful assembly and freedom of expression? 

    It was alleged that four former national secretaries of the General Confederation of Labour were being investigated for defamation and public slander following a complaint filed against them by the Directorate of the National School of Prison Administration.  Could information on this be provided?  The Committee would also like information on the processes followed against various union, political and community leaders for the crime of glorifying terrorism after the Hamas attacks of 7 October 2023.  It was reported that during the recent Olympic Games, there were many cases of systematic Islamophobia that mainly affected Muslim athletes and communities, a situation exacerbated by the security measures adopted. Could the delegation comment on this? What measures had the State party taken to combat hate speech against lesbian, gay, bisexual, transgender and intersex persons?

    One Expert said the Committee had unfortunately been informed that the situation of migrants in Calais and Grande-Synthe was still very worrying, with authorities continuing to apply the “zero point of fixation” policy, under which temporary shelters were systematically dismantled, sometimes with excessive use of force, every 48 hours.  How were migrants informed of the 48 hour rule and the possible dismantling of their temporary shelters?  Could the State consider the use of more humane and proportionate alternatives to dismantling these shelters, including increasing the capacity of reception centres?  What measures had been adopted to facilitate reporting on police abuses? 

    The Committee was concerned by reports that migrants had been detained at the French-Italian border without having obtained legal documents explaining their detention.  How did France ensure that such detentions were not arbitrary and that all migrants were informed of their procedural rights?  The Committee was also informed that the immigration law of 2 January 2024 expanded the criteria for expulsion to include minor offences, and allowed authorities to place a foreign person in administrative detention for reasons related to a potential threat to public order without justification, as well as allowing detention to be extended and reducing procedural rights.  How was it ensured that these measures were compatible with the provisions of the Covenant? 

    The Committee had received information that the State party continued to issue expulsion notices for the return of persons to countries where they were at risk of serious violations of their rights.  How did the State party ensure respect for the principle of non-refoulement in all cases of expulsion?  Regarding the internal borders of the Schengen area, in particular the issue of rapid refoulement at the border between France and Italy, the Committee noted with appreciation the State party’s follow-up to the conclusion of the Court of Justice of the European Union.  The Committee welcomed the annulment by the Council of State, in February, of certain parts of the Code on the Entry and Residence of Foreigners and the Right of Asylum. 

    However, information had been received that foreign nationals continued to be forcibly returned to Italy without having had access to a proper asylum procedure.  How did France ensure the individualised examination of all applications and effective access to asylum procedures?  Did the State intend to end the use of bone tests in law and in practice?  What was the objective of the January 2024 law to establish files to identify unaccompanied minors suspected of a criminal offence?  Who controlled these files and who kept them?  What measures had been taken to ensure adequate temporary accommodation and emergency accommodation for unaccompanied minors?

    One Committee Expert said France had adopted the third national action plan against human trafficking (2024-2027) at the beginning of 2024.  Could the evaluation of achievements from the second action plan be provided and what goals were set for the third plan?  What were the measures developed to combat trafficking?  Could victims receive compensation within the criminal procedure, or did they have to undergo civil suits for compensation?  What safeguards were in place to protect victims themselves from criminal accountability?  What methods had been developed for victims’ identification?  Had trainings been organised for prosecutors, judges and lawyers on human trafficking? 

    The Committee was concerned by numerous reports that the ban on manifestation of religious beliefs by means of clothing, headgear or other religious symbols was a source of tension in French society and was seen by some as disrespect for multiculturism, fuelling the sense of discrimination, racism, anti-Semitism, and Islamophobia.  What measures were being taken to ensure that the ban on expressing religion by means of religious clothing, headgear or symbols did not have a discriminatory effect in practice?  How was it ensured that all visible religious symbols were treated equally? What criteria was used to decide what symbol should be treated as conspicuous and thus be banned, while others were treated as discrete and allowed?  How did the State party avoid that the ban on manifestation of religious beliefs by means of clothing affected predominantly Muslim girls and women? 

    What safeguards were in place to ensure that provisions on the dissolution of association would not be broadly interpreted and end in violating the right to freedom of assembly?  There had been examples of associations, such as Uprisings of the Earth, labelled as eco-terrorists.  Could the delegation provide its views on this?  The Committee was concerned at the expansion of police powers to stop and check persons in the vicinity of protests, and the effect that this could have on the effective enjoyment of the right of peaceful assembly.  A significant number of protesters had been arrested and detained and a small percentage of the protesters arrested had been charged.  What was the position of the State party on these allegations?  How were personal dignity and respect understood by the courts?

    Another Expert said the year 2023 was marked by a succession of bans on demonstrations, particularly related to the mobilisation against the pension reform, or those carried out in support of the Palestinian people.  In October 2023, the Minister of the Interior issued a memo calling on local authorities to pre-emptively ban all demonstrations of solidarity with the Palestine people.  The ban was challenged before the Council of State, which determined that local authorities had to judge on a case-by-case basis the risks to public order and thus avoid repression by invoking public order, excessive force or arbitrary arrest.  This had had repercussions, even in the area of the right to information, which was concerning.

    Did the National Law Enforcement Scheme adopted in September 2020 mention the path of “de-escalation”, as a strategic principle for policing political manifestations in Europe, supported by the European Union?  The Committee had expressed concern about allegations of ill treatment, excessive use of force, and disproportionate use of intermediate force weapons, in particular during arrests, forced evacuations, and law enforcement operations.  A 2017 law (the Cazeneuve law) created a common framework for the use of weapons, allowing police to use armed force in five different cases.  However, the number of deaths had increased fivefold after the 2017 law, causing France to become the country in the European Union with the largest numbers of people killed or injured by shots fired by police. 

    Could the delegation explain the extent to which law enforcement agencies followed the applicable protocols in practice, with supporting statistics, and respected the principles of necessity, proportionality, precaution, non-discrimination and self-defence in the use of weapons?  What measures, in terms of training for law enforcement agencies, were envisaged?  Would the State party be willing to review the legal framework on the use of weapons and limit the use of firearms within the Security Code?  What follow-up had been given to decision 2020-131 of the Defender of Rights on general recommendations on law enforcement practices with regard to the rules of ethics? 

    According to a decision by the Ombudsman, France was the only country in Europe to use stun grenades to keep demonstrators at bay. Would grenades continue to be used despite the serious mutilations and injuries they caused?  Could the delegation provide updated information on the number of persons who had died as a result of police operations during arrests, including through the excessive use of force, and on the outcome of investigations into such deaths, sanctions imposed, and reparations provided to victims and their families?  Could statistics be provided on the number of proposals for sanctions presented by the Defender of Rights and what became of them, in particular the number of prosecutions? 

    Would the Brigades for the Repression of Motorised Violent Actions be dissolved?  The State party’s report provided information on complaints and investigations initiated concerning members of the security forces.  What measures would be taken to make the relevant statistical data more reliable, disaggregated and complete?

    Responses by the Delegation

    The delegation said the evacuations of camps in Calais which took place were done through either a legal or an administrative decision. These decisions were carried out with proper supervision and were overseen by the Government and social organizations.  Unaccompanied minors were housed in emergency shelter systems when possible and the same for adults when possible. 

    France guaranteed the right to protest and freedom of collective speech and expression of ideas.  The French State allowed journalists free circulation.  France was seeking to strike a balance because there were now many journalists without press identification who ran risks, placing themselves between protesters and law enforcement officials.  Law enforcement officers were called on to show professional behaviour at all times, including in situations where protests were violent. 

    Videos in public spaces were used to call attention to pre-determined actions; they did not have any impact on the right to protest. France supported the European plan for protecting journalists against violence.  This had allowed for additional guarantees to be provided in certain cases. 

    French authorities were mobilised to support efforts against hate speech, and there were efforts to address this phenomenon within the Ministry of Justice.  When cases were thrown out, they could be appealed before the appeals court.  Investigations into allegations of hate speech were underway. 

    The administrative police were evacuating camps, which were aimed at putting an end to illegal occupation and squatting of lands.  These operations on the ground involved parameters being established.  Regarding expulsions in Calais, 36 operations had taken place.  They were based on the same legal foundations; the anti-squat laws had been utilised to proceed with the evacuation.  Minors were always supported.  The State was aware of the situation of unaccompanied minors in Calais. Systems had been put in place to address these realities and identify the unaccompanied minors.  Work was being done with associations on the ground in Calais, including Doctors without Borders.  The shelters were only 20 minutes from Calais and allowed for daily operations and support.  This distance was far enough to protect unaccompanied minors from traffickers found in these camps. 

    When foreigners were not eligible for asylum seeking procedures, they could then be placed under administrative detention in administrative detention centres.  These decisions were subjected to oversight by judges.  During the detention period, foreigners benefitted from health care support and legal counsel.  Voluntary returnees received financial support.  Some countries were not considered to be safe, and therefore returns were only on a voluntary basis.  Since October 2022, the Government was active in Mayotte, allowing active participation in the asylum-seeking process. 

    There were 2,100 victims of trafficking and exploitation in 2023, a six per cent increase compared to 2022.  Around 882 people had been sentenced for exploitation and trafficking.  France thanked civil society for helping contribute to the National Action Plan against Trafficking.  Training was an important part of the strategy to combat trafficking; there was a training course on human trafficking with a focus on modern slavery. Training was provided to 150 different professionals.  To care for the victims of human trafficking, several mechanisms were in place, including an early detection mechanism.

    France guaranteed the rights of citizens at the highest level, and any restrictions applied to all religions equally.  There was freedom for an individual to display religious signs, but this needed to be assessed on a case-by-case basis.  Any restriction on a religious symbol was only imposed if they were identified as a risk to the public service. 

    Freedom of expression was guaranteed in France, but this could result in some groups promoting racist and hate speech.  The law of 2021 amended the list of cases where a dissolution could take place, broadening the list of discriminatory measures which could lead to a dissolution. 

    The Public Ministry could carry out prosecutions.  Sometimes the Prosecutor could enact educational measures instead, which was used in some cases of minors.  The judges of France were required to argue for their decisions, given that there were no automatic sentences in the State.  This was also true for those found guilty of threatening public order. 

    France was one of the first countries to call for a ceasefire in Gaza.  There had been a significant increase in anti-Semitic acts since October 2023. Freedom to demonstrate was a fundamental right protected by the Constitution and protests were not subjected to authorisation.  There should be a notification to law enforcement around 15 days before to protect the safety of those participating and those living in the area.  The prohibition of protests was only carried out if it was believed they were a threat to public order, and this was done with the oversight of a judge.  Exceptionally, some protests had been prohibited due to the risk they posed to public order. 

    The use of firearms in France was regulated by the Criminal Code. This allowed a gradual response to respect necessity and proportionality to the violence and the threat.  The goal was to reduce the risk of threatening life and the integrity of people.  The police and gendarmerie were trained on how to use these weapons.  Regarding the brigades, several changes in the practices of demonstrators, including the increase in use of social media, had meant that for three years, the strategy had changed.  On average, there were two to three protests every day in Paris.  To meet this challenge, the brigades were developed and had been used to break up certain disruptive groups.  Since October 2023, the Ministry of Justice had circulated a document on combatting offences related to terrorist activities. 

    The fight against Islamophobia was a strong State policy. The strong Muslim community in France should be able to live with their beliefs peacefully to enjoy their religion. Any law which might be seen as a restriction did not target any specific population or any specific religion. 

    Questions by Committee Experts

    A Committee Expert asked if minors in Mayotte could be afforded the same protections as in metropolitan France? 

    Another Expert said hate speech online affected artists and activists in the lesbian, gay, bisexual, transgender and intersex community. What had been done to prevent this? 

    An Expert said there had been a significant increase in those killed or wounded during protests or police operations.  Were grenades and defensive bullets still used?  What happened when police used these weapons? Was there a compulsory inquiry? Was there oversight regarding each use of weapons? 

    Responses by the Delegation

    Minors were subjected to an age evaluation before they were recorded as minors.  If recorded as a minor, they should not undergo another evaluation.  The dismantling of camps was based on public legal rulings.  The individuals were informed, and efforts were made to help them find shelters or to change their immigration status.  Readmission into the Schengen space was a complex issue. 

    There was a doctrine for the use of medium weapons which allowed gradual and proportionate use.  Recent changes allowed France to address the risk of wounds with these weapons.  Law enforcement officers needed to be clearly trained on each type of weapon on a regular basis.  There was a proposal to replace grenades with non-lethal “flash-bangs”. Random visits were undertaken to police and gendarmerie stations as a form of auditing.  Efforts were made to identify the amount of time weapons were used. 

    Closing Remarks

    ISABELLE ROME, Ambassador for Human Rights of France and head of the delegation, thanked the Committee for the dialogue.  France was deeply attached to the rule of law and was a living democracy; the Committee’s recommendations would be scrupulously considered.  France would continue to progress with an open-minded spirit, in partnership with civil society and the national human rights institution.  The country was committed to renewing dialogue with the territory of New Caledonia and its inhabitants. 

    TANIA MARÍA ABDO ROCHOLL, Committee Chairperson, thanked the delegation for the dialogue, which had covered a wide range of subjects under the Covenant.  The Committee aimed to ensure the highest level of implementation of the Covenant in France. 

    __________

    CCPR.24.024E

    Produced by the United Nations Information Service in Geneva for use of the information media; not an official record.

    English and French versions of our releases are different as they are the product of two separate coverage teams that work independently.

    MIL OSI United Nations News –

  • MIL-OSI: Bel Reports Third Quarter 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    Sales and Gross Margin Percentage Above Mid-Point of Expected Ranges
    Provides Q4-24 Sales and Gross Margin Guidance

    WEST ORANGE, N.J., Oct. 23, 2024 (GLOBE NEWSWIRE) — Bel Fuse Inc. (Nasdaq: BELFA and BELFB) today announced preliminary financial results for the third quarter of 2024.

    Third Quarter 2024 Highlights

    • Net sales of $123.6 million compared to $158.7 million in Q3-23
    • Gross profit margin of 36.1%, up from 35.0% in Q3-23
    • Net earnings of $8.1 million versus $19.4 million in Q3-23
    • Adjusted EBITDA of $20.6 million (16.7% of sales) as compared to $29.9 million (18.8% of sales) in Q3-23
    • Repurchased 26,647 shares of Bel stock at an aggregate cost of $1.9 million in Q3-24

    “We were pleased that our third quarter results landed above the midpoint of guidance for both sales and gross margin,” said Daniel Bernstein, President and CEO. “Each of our three product segments performed as expected, given the current market, regulatory and seasonal factors outlined in last quarter’s disclosures and on the Q2 earnings call.

    “During the third quarter, the team focused on a variety of operational and other internal initiatives. With our announcement of the signing our definitive purchase agreement in September, we welcomed Enercon to the Bel family and are positioned to introduce new customers, end markets and geographies to our Power segment upon the closing expected later this quarter. In a project scheduled to be completed during the first quarter of 2025, our fuse manufacturing, located in China, will be consolidated into other existing Bel facilities thus reducing our footprint further. The fuse initiative is anticipated to achieve annual cost savings of approximately $1.5 million once completed. We are also pleased to announce the addition of two senior associates in newly-created positions to Bel’s corporate team. Uma Pengali has joined as Global Head of Sales and Marketing and Anubhav Gothi has joined as Bel’s Global Head of Contracts. We believe Uma and Anubhav will be instrumental contributors to Bel’s long-term success,” concluded Mr. Bernstein.

    Farouq Tuweiq, CFO, added, “We have started to see positive trends in bookings during the months of September and October across each of our product segments, which is a positive indicator as we enter 2025. These green shoots are largely in our networking and industrial markets, and in the distribution channel. Looking to the fourth quarter of 2024, we expect GAAP net sales in the range of $117 to $125 million with gross margins of approximately 34 – 36%, based on information available as of today. This guidance excludes any potential incremental contribution related to the previously-announced acquisition of Enercon, which is expected to close during the fourth quarter.

    “Overall, we are encouraged by the sequential improvement in market conditions that we are seeing and believe this will bode well for 2025. We are excited to continue our journey of growth and continuous improvement with our new team members,” concluded Mr. Tuweiq.

    Non-GAAP financial measures, such as Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA, adjust corresponding GAAP measures for provision for income taxes, interest expense, and depreciation and amortization, and also exclude, where applicable for the covered period presented in the financial statements, certain unusual or special items identified by management such as restructuring charges, gains/losses on sales of businesses and properties, acquisition related costs, and certain litigation costs. Non-GAAP adjusted net sales exclude expedite fee revenue. Please refer to the financial information included with this press release for reconciliations of GAAP financial measures to Non-GAAP financial measures and our explanation of why we present Non-GAAP financial measures.

    Conference Call
    Bel has scheduled a conference call for 8:30 a.m. ET on Thursday, October 24, 2024 to discuss these results. To participate in the conference call, investors should dial 877-407-0784, or 201-689-8560 if dialing internationally. The presentation will additionally be broadcast live over the Internet and will be available at https://ir.belfuse.com/events-and-presentations. The webcast will be available via replay for a period of at least 30 days at this same Internet address. For those unable to access the live call, a telephone replay will be available at 844-512-2921, or 412-317-6671 if dialing internationally, using access code 13749258 after 12:30 pm ET, also for 30 days.

    About Bel
    Bel (www.belfuse.com) designs, manufactures and markets a broad array of products that power, protect and connect electronic circuits. These products are primarily used in the networking, telecommunications, computing, general industrial, high-speed data transmission, military, commercial aerospace, transportation and eMobility industries. Bel’s portfolio of products also finds application in the automotive, medical, broadcasting and consumer electronics markets. Bel’s product groups include Magnetic Solutions (integrated connector modules, power transformers, power inductors and discrete components), Power Solutions and Protection (front-end, board-mount and industrial power products, module products and circuit protection), and Connectivity Solutions (expanded beam fiber optic, copper-based, RF and RJ connectors and cable assemblies). The Company operates facilities around the world.

    Company Contact:
    Farouq Tuweiq  
    Chief Financial Officer  
    ir@belf.com

    Investor Contact:
    Three Part Advisors
    Jean Marie Young, Managing Director or Steven Hooser, Partner
    631-418-4339
    jyoung@threepa.com; shooser@threepa.com

    Cautionary Language Concerning Forward-Looking Statements
    This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our guidance for the fourth quarter of 2024, and our statements regarding our expectations for future periods generally including anticipated financial performance, projections and trends for the remainder of the year and other future periods including 2025, and our statements regarding future events, performance, plans, intentions, beliefs, expectations and estimates, including statements regarding matters such as trends and expectations as to our sales, gross margin, products, product segments, customers, end markets, geographies and bookings, statements regarding our views and expectations about the impact of market trends and seasonal factors, statements about the closing of the Enercon Technologies, Ltd. (“Enercon”) acquisition including the anticipated timing thereof, and statements about the anticipated benefits and impact of the Enercon acquisition including in terms of introducing new customers, end markets and geographies to our Power segment, as well as any potential incremental contribution by Enercon post-closing to Bel’s financial results, statements regarding consolidation projects and initiatives, the expected timing of implementation and completion thereof, and the anticipated projections of cost savings to be realized thereby, statements about future contributions of new employees and the role of newly-created positions in the corporate team in contributing to Bel’s long-term success, statements regarding our expectations and beliefs regarding trends in the Company’s business and industry and the markets in which Bel operates, and about the broader economy and macroeconomic environment generally, including statements about trends in bookings and views about indicators of economic conditions including as to particular sectors or markets, improvement in market conditions, and statements about Bel’s growth and improvement, and other statements regarding the Company’s positioning, its strategies, future progress, investments, plans, targets, goals, and other focuses and initiatives, and the expected timing and potential benefits thereof. These forward-looking statements are made as of the date of this release and are based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “forecast,” “outlook,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Bel’s control. Bel’s actual results could differ materially from those stated or implied in our forward-looking statements (including without limitation any of Bel’s projections) due to a number of factors, including but not limited to, unanticipated difficulties, delays or expenditures relating to the proposed Enercon acquisition, including, without limitation, difficulties that result in the failure to realize the expected benefits and synergies within the expected time period (if at all); disruptions of Bel’s or Enercon’s current plans, operations and relationships with customers, suppliers, distributors, business partners and regulators caused by the announcement and pendency of the proposed Enercon acquisition; potential difficulties in employee retention due to the announcement and pendency of the proposed Enercon acquisition; the possibility that the proposed Enercon acquisition does not close, including, but not limited to, failure to satisfy the closing conditions; the market concerns facing our customers, and risks for the Company’s business in the event of the loss of certain substantial customers; the continuing viability of sectors that rely on our products; the effects of business and economic conditions, and challenges impacting the macroeconomic environment generally and/or our industry in particular; the effects of rising input costs, and cost changes generally, including the potential impact of inflationary pressures; difficulties associated with integrating previously acquired companies, and any difficulties that may be experienced in integrating Enercon following the closing of the Enercon acquisition; capacity and supply constraints or difficulties, including supply chain constraints or other challenges; the impact of public health crises (such as the governmental, social and economic effects of COVID or other future epidemics or pandemics); difficulties associated with the availability of labor, and the risks of any labor unrest or labor shortages; risks associated with our international operations, including our substantial manufacturing operations in China, and following the acquisition of Enercon, risks associated with operations in Israel, which may be adversely affected by political or economic instability, major hostilities or acts of terrorism in the region; risks associated with restructuring programs or other strategic initiatives, including any difficulties in implementation or realization of the expected benefits or cost savings; product development, commercialization or technological difficulties; the regulatory and trade environment including the potential effects of trade restrictions that may impact Bel, its customers and/or its suppliers; risks associated with fluctuations in foreign currency exchange rates and interest rates; uncertainties associated with legal proceedings; the market’s acceptance of the Company’s new products and competitive responses to those new products; the impact of changes to U.S. and applicable foreign legal and regulatory requirements, including tax laws, trade and tariff policies; and the risks detailed in Bel’s most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and in subsequent reports filed by Bel with the Securities and Exchange Commission, as well as other documents that may be filed by Bel from time to time with the Securities and Exchange Commission. In light of the risks and uncertainties impacting our business, there can be no assurance that any forward-looking statement will in fact prove to be correct. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Bel’s views as of the date of this press release. Bel anticipates that subsequent events and developments will cause its views to change. Bel undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Bel’s views as of any date subsequent to the date of this press release.

    Non-GAAP Financial Measures
    The Non-GAAP financial measures identified in this press release as well as in the supplementary information to this press release (Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA) are not measures of performance under accounting principles generally accepted in the United States of America (“GAAP”). These measures should not be considered a substitute for, and the reader should also consider, income from operations, net earnings, earnings per share and other measures of performance as defined by GAAP as indicators of our performance or profitability. Our non-GAAP measures may not be comparable to other similarly-titled captions of other companies due to differences in the method of calculation. We present results adjusted to exclude the effects of certain unusual or special items and their related tax impact that would otherwise be included under U.S. GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. For additional information about our use of non-GAAP financial measures in connection with our Incentive Compensation Program for 2023, please see the Executive Compensation discussion appearing in our Definitive Proxy Statement filed with the Securities and Exchange Commission on April 1, 2024.

    Website Information
    We routinely post important information for investors on our website, www.belfuse.com, in the “Investor Relations” section. We use our website as a means of disclosing material, otherwise non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, Securities and Exchange Commission (SEC) filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.

    [Financial tables follow]

               
               
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Statements of Operations
    (in thousands, except per share amounts)
    (unaudited)
               
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    Net sales $ 123,638     $ 158,682     $ 384,933     $ 499,803  
    Cost of sales   78,961       103,217       238,782       335,137  
    Gross profit   44,677       55,465       146,151       164,666  
    As a % of net sales   36.1 %     35.0 %     38.0 %     32.9 %
                                   
    Research and development costs   5,443       5,292       16,652       16,521  
    Selling, general and administrative expenses   26,700       23,717       75,785       74,149  
    As a % of net sales   21.6 %     14.9 %     19.7 %     14.8 %
    Restructuring charges   1,087       2,091       1,790       6,306  
    Gain on sale of property   –       (147 )     –       (3,819 )
    Income from operations   11,447       24,512       51,924       71,509  
    As a % of net sales   9.3 %     15.4 %     13.5 %     14.3 %
                                   
    Gain on sale of Czech Republic business   –       (135 )     –       980  
    Interest expense   (414 )     (512 )     (1,263 )     (2,402 )
    Interest income   1,480       –       3,741       –  
    Other income/expense, net   (1,325 )     (96 )     21       (286 )
    Earnings before income taxes   11,188       23,769       54,423       69,801  
                                   
    Provision for income taxes   3,108       4,321       11,663       8,006  
    Effective tax rate   27.8 %     18.2 %     21.4 %     11.5 %
    Net earnings $ 8,080     $ 19,448     $ 42,760     $ 61,795  
    As a % of net sales   6.5 %     12.3 %     11.1 %     12.4 %
                                   
    Weighted average number of shares outstanding:                              
    Class A common shares – basic and diluted   2,116       2,142       2,126       2,142  
    Class B common shares – basic and diluted   10,434       10,636       10,512       10,636  
                                   
    Net earnings per common share:                              
    Class A common shares – basic and diluted $ 0.61     $ 1.46     $ 3.23     $ 4.63  
    Class B common shares – basic and diluted $ 0.65     $ 1.54     $ 3.41     $ 4.88  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Balance Sheets
    (in thousands, unaudited)
     
      September 30, 2024     December 31, 2023  
    Assets              
    Current assets:              
    Cash and cash equivalents $ 134,266     $ 89,371  
    Held to maturity U.S. Treasury securities   29,541       37,548  
    Accounts receivable, net   75,998       84,129  
    Inventories   124,885       136,540  
    Other current assets   22,959       33,890  
    Total current assets   387,649       381,478  
    Property, plant and equipment, net   36,735       36,533  
    Right-of-use assets   22,901       20,481  
    Related-party note receivable   3,070       2,152  
    Equity method investment   10,014       10,282  
    Goodwill and other intangible assets, net   72,772       76,033  
    Other assets   51,276       44,672  
    Total assets $ 584,417     $ 571,631  
                   
    Liabilities and Stockholders’ Equity              
    Current liabilities:              
    Accounts payable $ 37,139     $ 40,441  
    Operating lease liability, current   6,451       6,350  
    Other current liabilities   53,297       63,818  
    Total current liabilities   96,887       110,609  
    Long-term debt   60,000       60,000  
    Operating lease liability, long-term   16,808       14,212  
    Other liabilities   43,360       46,252  
    Total liabilities   217,055       231,073  
    Stockholders’ equity   367,362       340,558  
    Total liabilities and stockholders’ equity $ 584,417     $ 571,631  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Condensed Consolidated Statements of Cash Flows
    (in thousands, unaudited)
         
      Nine Months Ended  
      September 30,  
      2024     2023  
                   
    Cash flows from operating activities:              
    Net earnings $ 42,760     $ 61,795  
    Adjustments to reconcile net earnings to net cash provided by operating activities:              
    Depreciation and amortization   10,759       9,962  
    Stock-based compensation   2,782       2,712  
    Amortization of deferred financing costs   27       33  
    Deferred income taxes   (5,366 )     (4,894 )
    Net unrealized losses on foreign currency revaluation   1,275       130  
    Gain on sale of property   –       (3,819 )
    Gain on sale of Czech Republic business   –       (980 )
    Other, net   628       (495 )
    Changes in operating assets and liabilities:              
    Accounts receivable, net   8,366       11,931  
    Unbilled receivables   7,482       1,590  
    Inventories   12,266       29,313  
    Accounts payable   (3,302 )     (18,674 )
    Accrued expenses   (11,849 )     4,536  
    Accrued restructuring costs   (590 )     (148 )
    Income taxes payable   4,809       2,008  
    Other operating assets/liabilities, net   (4,327 )     (13,575 )
    Net cash provided by operating activities   65,720       81,425  
                   
    Cash flows from investing activities:              
    Purchases of property, plant and equipment   (7,906 )     (9,659 )
    Purchases of held to maturity U.S. Treasury securities   (131,309 )     –  
    Proceeds from held to maturity securities   139,316       –  
    Payment for equity method investment   –       (9,975 )
    Investment in related party notes receivable   (918 )     (1,905 )
    Proceeds from sale of property, plant and equipment   236       5,403  
    Proceeds from sale of business   –       5,063  
    Net cash used in investing activities   (581 )     (11,073 )
                   
    Cash flows from financing activities:              
    Dividends paid to common stockholders   (2,487 )     (2,490 )
    Deferred financing costs   (330 )     –  
    Repayments under revolving credit line   –       (40,000 )
    Borrowings under revolving credit line   –       5,000  
    Purchases of common stock   (16,053 )     –  
    Net cash used in financing activities   (18,870 )     (37,490 )
                   
    Effect of exchange rate changes on cash and cash equivalents   (1,374 )     (2,903 )
                   
    Net increase in cash and cash equivalents   44,895       29,959  
    Cash and cash equivalents – beginning of period   89,371       70,266  
    Cash and cash equivalents – end of period $ 134,266     $ 100,225  
                   
                   
    Supplementary information:              
    Cash paid during the period for:              
    Income taxes, net of refunds received $ 15,556     $ 18,148  
    Interest payments $ 3,010     $ 3,738  
    ROU assets obtained in exchange for lease obligations $ 4,711     $ 5,887  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Product Group Highlights
    (dollars in thousands, unaudited)
     
      Sales     Gross Margin  
      Q3-24     Q3-23     % Change     Q3-24     Q3-23     Basis Point Change  
    Power Solutions and Protection $ 48,680     $ 74,862       -35.0 %     39.4 %     41.7 %     (230 )
    Connectivity Solutions   55,715       51,771       7.6 %     36.6 %     35.8 %     80  
    Magnetic Solutions   19,243       32,049       -40.0 %     27.3 %     22.0 %     530  
    Total $ 123,638     $ 158,682       -22.1 %     36.1 %     35.0 %     110  
      Sales     Gross Margin  
      YTD September 2024     YTD September 2023     % Change     YTD September 2024     YTD September 2023     Basis Point Change  
    Power Solutions and Protection $ 167,478       245,134       -31.7 %     43.2 %     37.5 %     570  
    Connectivity Solutions   167,822       160,010       4.9 %     37.3 %     35.8 %     150  
    Magnetic Solutions   49,633       94,659       -47.6 %     23.9 %     23.0 %     90  
    Total $ 384,933     $ 499,803       -23.0 %     38.0 %     32.9 %     510  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Reconciliation of GAAP Net Sales to Non-GAAP Adjusted Net Sales(2)
    Reconciliation of GAAP Net Earnings to EBITDA and Adjusted EBITDA(2)
    (in thousands, unaudited)
               
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    GAAP net sales $ 123,638     $ 158,682     $ 384,933     $ 499,803  
    Expedite fee revenue   –       1,008       57       14,425  
    Non-GAAP adjusted net sales $ 123,638     $ 157,674     $ 384,876     $ 485,378  
      Three Months Ended     Nine Months Ended  
      September 30,     September 30,  
      2024     2023     2024     2023  
                                   
    GAAP Net earnings $ 8,080     $ 19,448     $ 42,760     $ 61,795  
    Interest expense   414       512       1,263       2,402  
    Provision for income taxes   3,108       4,321       11,663       8,006  
    Depreciation and amortization   3,636       3,391       10,759       9,962  
    EBITDA $ 15,238     $ 27,672     $ 66,445     $ 82,165  
    % of net sales   12.3 %     17.4 %     17.3 %     16.4 %
                                   
    Unusual or special items:                              
    Restructuring charges   1,087       2,091       1,790       6,306  
    MPS litigation costs   –       132       –       2,903  
    Gain on sale of Czech Republic business   –       135       –       (980 )
    Gain on sale of properties   –       (147 )     –       (3,819 )
    Acquisition related costs   4,292       –       4,292       –  
    Adjusted EBITDA $ 20,617     $ 29,883     $ 72,527     $ 86,575  
    % of net sales   16.7 %     18.8 %     18.8 %     17.3 %
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
    (2) In this press release and supplemental information, we have included Non-GAAP financial measures, including Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA. We present results adjusted to exclude the effects of certain specified items and their related tax impact that would otherwise be included under GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. See the section above captioned “Non-GAAP Financial Measures” for additional information.
     
    Bel Fuse Inc.
    Supplementary Information(1)
    Reconciliation of GAAP Measures to Non-GAAP Measures(2)
    (in thousands, except per share data) (unaudited)
     
    The following tables detail the impact that certain unusual or special items had on the Company’s net earnings per common Class A and Class B basic and diluted shares (“EPS”) and the line items in which these items were included on the consolidated statements of operations.
     
        Three Months Ended September 30, 2024     Three Months Ended September 30, 2023  
    Reconciling Items   Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)     Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)  
                                                                                     
    GAAP measures   $ 11,188     $ 3,108     $ 8,080     $ 0.61     $ 0.65     $ 23,769     $ 4,321     $ 19,448     $ 1.46     $ 1.54  
    Restructuring charges     1,087       154       933       0.07       0.07       2,091       407       1,684       0.13       0.13  
    MPS litigation costs     –       –       –       –       –       132       30       102       0.01       0.01  
    Gain on sale of Czech Republic business     –       –       –       –       –       135       7       128       0.01       0.01  
    Gain on sale of properties     –       –       –       –       –       (147 )     (29 )     (118 )     (0.01 )     (0.01 )
    Acquisition related costs     4,292       987       3,305       0.25       0.27       –       –       –       –       –  
    Non-GAAP measures   $ 16,567     $ 4,249     $ 12,318     $ 0.94     $ 0.99     $ 25,980     $ 4,736     $ 21,244     $ 1.59     $ 1.68  
        Nine Months Ended September 30, 2024     Nine Months Ended September 30, 2023  
    Reconciling Items   Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)     Earnings before taxes     Provision for income taxes     Net earnings     Class A EPS(3)     Class B EPS(3)  
                                                                                     
    GAAP measures   $ 54,423     $ 11,663     $ 42,760     $ 3.23     $ 3.41     $ 69,801     $ 8,006     $ 61,795     $ 4.63     $ 4.88  
    Restructuring charges     1,790       317       1,473       0.11       0.12       6,306       1,007       5,299       0.40       0.42  
    MPS litigation costs     –       –       –       –       –       2,903       667       2,236       0.17       0.18  
    Gain on sale of Czech Republic business     –       –       –       –       –       (980 )     (49 )     (931 )     (0.07 )     (0.07 )
    Gain on sale of properties     –       –       –       –       –       (3,819 )     (763 )     (3,056 )     (0.23 )     (0.24 )
    Acquisition related costs     4,292       987       3,305       0.25       0.26       –       –       –       –       –  
    Non-GAAP measures   $ 60,505     $ 12,967     $ 47,538     $ 3.59     $ 3.80     $ 74,211     $ 8,868     $ 65,343     $ 4.89     $ 5.16  
     
    (1) The supplementary information included in this press release for 2024 is preliminary and subject to change prior to the filing of our upcoming Quarterly Report on Form 10-Q with the Securities and Exchange Commission.
    (2) In this press release and supplemental information, we have included Non-GAAP financial measures, including Non-GAAP adjusted net sales, Non-GAAP net earnings, Non-GAAP EPS, EBITDA and Adjusted EBITDA. We present results adjusted to exclude the effects of certain specified items and their related tax impact that would otherwise be included under GAAP, to aid in comparisons with other periods. We believe that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to our financial condition and results of operations. We use these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis and for budgeting and planning purposes. We also believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other similarly situated companies in our industry, many of which present similar non-GAAP financial measures to investors. We also use non-GAAP measures in determining incentive compensation. See the section above captioned “Non-GAAP Financial Measures” for additional information.
    (3) Individual amounts of earnings per share may not agree to the total due to rounding.
     

    The MIL Network –

  • MIL-OSI: Brookline Bancorp Announces Third Quarter Results

    Source: GlobeNewswire (MIL-OSI)

    Net Income of $20.1 million, EPS of $0.23

    Quarterly Dividend of $0.135

    BOSTON, Oct. 23, 2024 (GLOBE NEWSWIRE) — Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income and operating earnings after tax (non-GAAP) of $20.1 million, or $0.23 per basic and diluted share, for the third quarter of 2024, compared to net income of $16.4 million, or $0.18 per basic and diluted share, and operating earnings after tax (non-GAAP) of $17.0 million, or $0.19 per basic and diluted share, for the second quarter of 2024, and net income and operating earnings after tax (non-GAAP) of $22.7 million, or $0.26 per basic and diluted share, for the third quarter of 2023.

    “Our Company experienced improved performance in the third quarter,” commented Paul Perrault, Chairman and CEO, who continued, “As we move into the final months of 2024, we are confident our experienced bankers’ ability to continue to deliver exceptional service to our customers will be better reflected in our profitability as interest rates normalize.”

    BALANCE SHEET

    Total assets at September 30, 2024 were $11.7 billion, representing an increase of $41.4 million from $11.6 billion at June 30, 2024, and an increase of $496.2 million from September 30, 2023. At September 30, 2024, total loans and leases were $9.8 billion, representing an increase of $34.1 million from June 30, 2024, and an increase of $374.5 million from September 30, 2023.

    Total investment securities at September 30, 2024 decreased $1.0 million to $855.4 million from $856.4 million at June 30, 2024, and decreased $25.0 million from $880.4 million at September 30, 2023. Total cash and cash equivalents at September 30, 2024 increased $64.8 million to $407.9 million from $343.1 million at June 30, 2024, and increased $246.9 million from $161.0 million at September 30, 2023. As of September 30, 2024, total investment securities and total cash and cash equivalents represented 10.8 percent of total assets, compared to 10.3 percent and 9.3 percent as of June 30, 2024 and September 30, 2023, respectively.

    Total deposits at September 30, 2024 decreased $4.8 million to $8.7 billion from June 30, 2024. Despite the decrease during the quarter, customer deposits increased $103.2 million, offset by a $107.9 million decrease in brokered deposits. Total deposits increased $166.3 million from $8.6 billion at September 30, 2023, primarily driven by growth in customer deposits. The increase in customer deposits quarter to date included a $43.5 million increase in demand checking accounts.

    Total borrowed funds at September 30, 2024 increased $68.1 million to $1.5 billion from June 30, 2024, and increased $362.5 million from $1.1 billion at September 30, 2023.

    The ratio of stockholders’ equity to total assets was 10.54 percent at September 30, 2024, compared to 10.30 percent at June 30, 2024, and 10.36 percent at September 30, 2023. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 8.50 percent at September 30, 2024, as compared to 8.23 percent at June 30, 2024, and 8.16 percent at September 30, 2023. Tangible book value per common share (non-GAAP) increased $0.36 from $10.53 at June 30, 2024 to $10.89 at September 30, 2024, and increased $0.87 from $10.02 at September 30, 2023.

    NET INTEREST INCOME

    Net interest income increased $3.0 million to $83.0 million during the third quarter of 2024 from $80.0 million for the quarter ended June 30, 2024. The net interest margin increased 7 basis points to 3.07 percent for the three months ended September 30, 2024 from 3.00 percent for the three months ended June 30, 2024, primarily driven by higher yields on loans and leases partially offset by higher funding costs.

    NON-INTEREST INCOME

    Total non-interest income for the quarter ended September 30, 2024 decreased $0.1 million to $6.3 million from $6.4 million for the quarter ended June 30, 2024.

    PROVISION FOR CREDIT LOSSES

    The Company recorded a provision for credit losses of $4.8 million for the quarter ended September 30, 2024, compared to $5.6 million for the quarter ended June 30, 2024. The decrease in provision was largely driven by improving economic forecasts partially offset by an increase in specific reserves on nonperforming credits.

    Total net charge-offs for the third quarter of 2024 were $3.8 million, compared to $8.4 million in the second quarter of 2024. The $3.8 million in net charge-offs was driven by $2.6 million in equipment financing, largely within specialty vehicle. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis decreased to 16 basis points for the third quarter of 2024 from 35 basis points for the second quarter of 2024.

    The allowance for loan and lease losses represented 1.31 percent of total loans and leases at September 30, 2024, compared to 1.25 percent at June 30, 2024, and 1.27 percent at September 30, 2023.

    ASSET QUALITY

    The ratio of nonperforming loans and leases to total loans and leases was 0.73 percent at September 30, 2024, an increase from 0.62 percent at June 30, 2024. Total nonaccrual loans and leases increased $10.5 million to $71.2 million at September 30, 2024 from $60.7 million at June 30, 2024. The increase was driven by one equipment financing relationship of $9.3 million which has been reserved at 55 percent. The ratio of nonperforming assets to total assets was 0.62 percent at September 30, 2024, an increase from 0.54 percent at June 30, 2024. Total nonperforming assets increased $10.1 million to $72.8 million at September 30, 2024 from $62.7 million at June 30, 2024.

    NON-INTEREST EXPENSE

    Non-interest expense for the quarter ended September 30, 2024 decreased $1.2 million to $57.9 million from $59.2 million for the quarter ended June 30, 2024. Excluding the one time restructuring charge taken in the second quarter of $0.8 million, non-interest expense decreased $0.4 million primarily due to a reduction in advertising and marketing expense.

    PROVISION FOR INCOME TAXES

    The effective tax rate was 24.7 percent and 24.6 percent for the three and nine months ended September 30, 2024 compared to 24.4 percent for the three months ended June 30, 2024 and 21.4 percent and 20.3 percent for the three and nine months ended September 30, 2023.

    RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

    The annualized return on average assets increased to 0.70 percent during the third quarter 2024 from 0.57 percent for the second quarter of 2024.

    The annualized return on average stockholders’ equity increased to 6.63 percent during the third quarter of 2024 from 5.49 percent for the second quarter of 2024. The annualized return on average tangible stockholders’ equity increased to 8.44 percent for the third quarter of 2024 from 7.04 percent for the second quarter of 2024.

    DIVIDEND DECLARED

    The Company’s Board of Directors approved a dividend of $0.135 per share for the quarter ended September 30, 2024. The dividend will be paid on November 29, 2024 to stockholders of record on November 15, 2024.

    CONFERENCE CALL

    The Company will conduct a conference call/webcast at 1:30 PM Eastern Time on Thursday, October 24, 2024 to discuss the results for the quarter, business highlights and outlook. A copy of the Earnings Presentation is available on the Company’s website, www.brooklinebancorp.com. To listen to the call and view the Company’s Earnings Presentation, please join the call via https://events.q4inc.com/attendee/314623001. To listen to the call without access to the slides, interested parties may dial 833-470-1428 (United States) or 404-975-4839 (internationally) and ask for the Brookline Bancorp, Inc. conference call (Access Code 414186). A recorded playback of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 866-813-9403 (United States) or 929-458-6194 (internationally) and entering the passcode: 898921.

    ABOUT BROOKLINE BANCORP, INC.

    Brookline Bancorp, Inc., a bank holding company with $11.7 billion in assets and branch locations in Massachusetts, Rhode Island, and the Lower Hudson Valley of New York State, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and PCSB Bank (the “banks”). The Company provides commercial and retail banking services, cash management and investment services to customers throughout Central New England and the Lower Hudson Valley of New York State. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com and www.pcsb.com.

    FORWARD-LOOKING STATEMENTS

    Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission (“SEC”), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters, including statements regarding the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements may differ, possibly materially, from what is included in this press release due to factors and future developments that are uncertain and beyond the scope of the Company’s control. These include, but are not limited to, changes in interest rates; general economic conditions (including inflation and concerns about liquidity) on a national basis or in the local markets in which the Company operates; turbulence in the capital and debt markets; competitive pressures from other financial institutions; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in the value of securities and other assets in the Company’s investment portfolio; increases in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; decreases in deposit levels that necessitate increases in borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, and future pandemics; changes in regulation; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions and adverse economic developments; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements. Forward-looking statements involve risks and uncertainties which are difficult to predict. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the SEC. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

    BASIS OF PRESENTATION

    The Company’s consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period’s presentation.

    NON-GAAP FINANCIAL MEASURES

    The Company uses certain non-GAAP financial measures, such as operating earnings after tax, operating earnings per common share, operating return on average assets, operating return on average tangible assets, operating return on average stockholders’ equity, operating return on average tangible stockholders’ equity, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets (annualized) and return on average tangible stockholders’ equity (annualized). These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company’s GAAP to the non-GAAP measures is attached.

    INVESTOR RELATIONS:

    Contact: Carl M. Carlson
      Brookline Bancorp, Inc.
      Co-President and Chief Financial and Strategy Officer
      (617) 425-5331
      carl.carlson@brkl.com
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Selected Financial Highlights (Unaudited)
     
      At and for the Three Months Ended  
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023    		  
      (Dollars In Thousands Except per Share Data)  
    Earnings Data:                    
    Net interest income $ 83,008   $ 80,001   $ 81,588   $ 83,555   $ 84,070  
    Provision for credit losses on loans 4,832   5,607   7,423   3,851   2,947  
    Provision (credit) for credit losses on investments (172)   (39)   (44)   (76)   84  
    Non-interest income 6,348   6,396   6,284   8,027   5,508  
    Non-interest expense 57,948   59,184   61,014   59,244   57,679  
    Income before provision for income taxes 26,748   21,645   19,479   28,563   28,868  
    Net income 20,142   16,372   14,665   22,888   22,701  
                         
    Performance Ratios:                    
    Net interest margin (1) 3.07 % 3.00 % 3.06 % 3.15 % 3.18 %
    Interest-rate spread (1) 2.26 % 2.14 % 2.21 % 2.39 % 2.45 %
    Return on average assets (annualized) 0.70 % 0.57 % 0.51 % 0.81 % 0.81 %
    Return on average tangible assets (annualized) (non-GAAP) 0.72 % 0.59 % 0.53 % 0.83 % 0.83 %
    Return on average stockholders’ equity (annualized) 6.63 % 5.49 % 4.88 % 7.82 % 7.78 %
    Return on average tangible stockholders’ equity (annualized) (non-GAAP) 8.44 % 7.04 % 6.26 % 10.12 % 10.09 %
    Efficiency ratio (2) 64.85 % 68.50 % 69.44 % 64.69 % 64.39 %
                         
    Per Common Share Data:                    
    Net income — Basic $ 0.23   $ 0.18   $ 0.16   $ 0.26   $ 0.26  
    Net income — Diluted 0.23   0.18   0.16   0.26   0.26  
    Cash dividends declared 0.135   0.135   0.135   0.135   0.135  
    Book value per share (end of period) 13.81   13.48   13.43   13.48   13.03  
    Tangible book value per share (end of period) (non-GAAP) 10.89   10.53   10.47   10.50   10.02  
    Stock price (end of period) 10.09   8.35   9.96   10.91   9.11  
                         
    Balance Sheet:                    
    Total assets $ 11,676,721   $ 11,635,292   $ 11,542,731   $ 11,382,256   $ 11,180,555  
    Total loans and leases 9,755,236   9,721,137   9,655,086   9,641,589   9,380,782  
    Total deposits 8,732,271   8,737,036   8,718,653   8,548,125   8,566,013  
    Total stockholders’ equity 1,230,362   1,198,480   1,194,231   1,198,644   1,157,871  
                         
    Asset Quality:                    
    Nonperforming assets $ 72,821   $ 62,683   $ 42,489   $ 45,324   $ 51,540  
    Nonperforming assets as a percentage of total assets 0.62 % 0.54 % 0.37 % 0.40 % 0.46 %
    Allowance for loan and lease losses $ 127,316   $ 121,750   $ 120,124   $ 117,522   $ 119,081  
    Allowance for loan and lease losses as a percentage of total loans and leases 1.31 % 1.25 % 1.24 % 1.22 % 1.27 %
    Net loan and lease charge-offs $ 3,808   $ 8,387   $ 8,781   $ 7,141   $ 10,974  
    Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.16 % 0.35 % 0.36 % 0.30 % 0.47 %
                         
    Capital Ratios:                    
    Stockholders’ equity to total assets 10.54 % 10.30 % 10.35 % 10.53 % 10.36 %
    Tangible stockholders’ equity to tangible assets (non-GAAP) 8.50 % 8.23 % 8.25 % 8.39 % 8.16 %
                         
    (1) Calculated on a fully tax-equivalent basis.
    (2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Consolidated Balance Sheets (Unaudited)    		  
                         
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023    		  
    ASSETS (In Thousands Except Share Data)  
    Cash and due from banks $ 82,168   $ 60,067   $ 45,708   $ 34,514   $ 33,506  
    Short-term investments 325,721   283,017   256,178   98,513   127,495  
    Total cash and cash equivalents 407,889   343,084   301,886   133,027   161,001  
    Investment securities available-for-sale 855,391   856,439   865,798   916,601   880,412  
    Total investment securities 855,391   856,439   865,798   916,601   880,412  
    Allowance for investment security losses (186 ) (359 ) (398 ) (441 ) (517 )
    Net investment securities 855,205   856,080   865,400   916,160   879,895  
    Loans and leases held-for-sale —   —   6,717   —   —  
    Loans and leases:                    
    Commercial real estate loans 5,779,290   5,782,111   5,755,239   5,764,529   5,669,768  
    Commercial loans and leases 2,453,038   2,443,530   2,416,904   2,399,668   2,241,375  
    Consumer loans 1,522,908   1,495,496   1,482,943   1,477,392   1,469,639  
    Total loans and leases 9,755,236   9,721,137   9,655,086   9,641,589   9,380,782  
    Allowance for loan and lease losses (127,316 ) (121,750 ) (120,124 ) (117,522 ) (119,081 )
    Net loans and leases 9,627,920   9,599,387   9,534,962   9,524,067   9,261,701  
    Restricted equity securities 82,675   78,963   74,709   77,595   65,460  
    Premises and equipment, net of accumulated depreciation 86,925   88,378   89,707   89,853   90,476  
    Right-of-use asset operating leases 41,934   35,691   33,133   30,863   31,619  
    Deferred tax asset 50,827   60,032   60,484   56,952   74,491  
    Goodwill 241,222   241,222   241,222   241,222   241,222  
    Identified intangible assets, net of accumulated amortization 19,162   20,830   22,499   24,207   26,172  
    Other real estate owned and repossessed assets 1,579   1,974   1,817   1,694   299  
    Other assets 261,383   309,651   310,195   286,616   348,219  
    Total assets $ 11,676,721   $ 11,635,292   $ 11,542,731   $ 11,382,256   $ 11,180,555  
    LIABILITIES AND STOCKHOLDERS’ EQUITY                    
    Deposits:                    
    Demand checking accounts $ 1,681,858   $ 1,638,378   $ 1,629,371   $ 1,678,406   $ 1,745,137  
    NOW accounts 637,374   647,370   654,748   661,863   647,476  
    Savings accounts 1,736,989   1,735,857   1,727,893   1,669,018   1,625,804  
    Money market accounts 2,041,185   2,073,557   2,065,569   2,082,810   2,161,359  
    Certificate of deposit accounts 1,819,353   1,718,414   1,670,147   1,574,855   1,491,844  
    Brokered deposit accounts 815,512   923,460   970,925   881,173   894,393  
    Total deposits 8,732,271   8,737,036   8,718,653   8,548,125   8,566,013  
    Borrowed funds:                    
    Advances from the FHLB 1,345,003   1,265,079   1,150,153   1,223,226   899,304  
    Subordinated debentures and notes 84,293   84,258   84,223   84,188   84,152  
    Other borrowed funds 68,251   80,125   127,505   69,256   151,612  
    Total borrowed funds 1,497,547   1,429,462   1,361,881   1,376,670   1,135,068  
    Operating lease liabilities 43,266   37,102   34,235   31,998   32,807  
    Mortgagors’ escrow accounts 14,456   17,117   16,245   17,239   12,578  
    Reserve for unfunded credits 6,859   11,400   15,807   19,767   21,497  
    Accrued expenses and other liabilities 151,960   204,695   201,679   189,813   254,721  
    Total liabilities 10,446,359   10,436,812   10,348,500   10,183,612   10,022,684  
    Stockholders’ equity:                    
    Common stock, $0.01 par value; 200,000,000 shares authorized; 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, and 96,998,075 shares issued, respectively 970   970   970   970   970  
    Additional paid-in capital 901,562   904,775   903,726   902,659   901,376  
    Retained earnings 453,555   445,560   441,285   438,722   427,937  
    Accumulated other comprehensive income (38,081 ) (61,693 ) (60,841 ) (52,798 ) (81,541 )
    Treasury stock, at cost;                    
    7,015,843, 7,373,009, 7,354,399, 7,354,399 and 7,350,981 shares, respectively (87,644 ) (91,132 ) (90,909 ) (90,909 ) (90,871 )
    Total stockholders’ equity 1,230,362   1,198,480   1,194,231   1,198,644   1,157,871  
    Total liabilities and stockholders’ equity $ 11,676,721   $ 11,635,292   $ 11,542,731   $ 11,382,256   $ 11,180,555  
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Consolidated Statements of Income (Unaudited)
      Three Months Ended
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
      (In Thousands Except Share Data)
    Interest and dividend income:                  
    Loans and leases $ 149,643   $ 145,585   $ 145,265   $ 142,948   $ 136,561
    Debt securities 6,473   6,480   6,878   6,945   6,799
    Restricted equity securities 1,458   1,376   1,492   1,333   1,310
    Short-term investments 1,986   1,914   1,824   1,093   2,390
    Total interest and dividend income 159,560   155,355   155,459   152,319   147,060
    Interest expense:                  
    Deposits 59,796   59,721   56,884   54,034   49,116
    Borrowed funds 16,756   15,633   16,987   14,730   13,874
    Total interest expense 76,552   75,354   73,871   68,764   62,990
    Net interest income 83,008   80,001   81,588   83,555   84,070
    Provision for credit losses on loans 4,832   5,607   7,423   3,851   2,947
    Provision (credit) for credit losses on investments (172 ) (39 ) (44 ) (76 ) 84
    Net interest income after provision for credit losses 78,348   74,433   74,209   79,780   81,039
    Non-interest income:                  
    Deposit fees 2,353   3,001   2,897   3,064   3,024
    Loan fees 464   702   789   515   639
    Loan level derivative income, net —   106   437   778   376
    Gain on sales of loans and leases held-for-sale 415   130   —   410   225
    Other 3,116   2,457   2,161   3,260   1,244
    Total non-interest income 6,348   6,396   6,284   8,027   5,508
    Non-interest expense:                  
    Compensation and employee benefits 35,130   34,762   36,629   35,401   33,491
    Occupancy 5,343   5,551   5,769   5,127   4,983
    Equipment and data processing 6,831   6,732   7,031   7,245   6,766
    Professional services 2,143   1,745   1,900   1,442   2,368
    FDIC insurance 2,118   2,025   1,884   1,839   2,152
    Advertising and marketing 859   1,504   1,574   758   1,174
    Amortization of identified intangible assets 1,668   1,669   1,708   1,965   1,955
    Merger and restructuring expense —   823   —   —   —
    Other 3,856   4,373   4,519   5,467   4,790
    Total non-interest expense 57,948   59,184   61,014   59,244   57,679
    Income before provision for income taxes 26,748   21,645   19,479   28,563   28,868
    Provision for income taxes 6,606   5,273   4,814   5,675   6,167
    Net income $ 20,142   $ 16,372   $ 14,665   $ 22,888   $ 22,701
    Earnings per common share:                  
    Basic $ 0.23   $ 0.18   $ 0.16   $ 0.26   $ 0.26
    Diluted $ 0.23   $ 0.18   $ 0.16   $ 0.26   $ 0.26
    Weighted average common shares outstanding during the period:                  
    Basic 89,033,463   88,904,692   88,894,577   88,867,159   88,795,270
    Diluted 89,319,611   89,222,315   89,181,508   89,035,505   88,971,210
    Dividends paid per common share $ 0.135   $ 0.135   $ 0.135   $ 0.135   $ 0.135
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Consolidated Statements of Income (Unaudited)
     
      Nine Months Ended September 30,
      2024   2023
      (In Thousands Except Share Data)
    Interest and dividend income:      
    Loans and leases $            440,493   $            390,791
    Debt securities 19,831   22,703
    Restricted equity securities 4,326   4,238
    Short-term investments 5,724   7,236
    Total interest and dividend income 470,374   424,968
    Interest expense:      
    Deposits 176,401   121,631
    Borrowed funds 49,376   47,181
    Total interest expense 225,777   168,812
    Net interest income 244,597   256,156
    Provision for credit losses on loans 17,862   34,017
    Provision (credit) for credit losses on investments (255 ) 415
    Net interest income after provision for credit losses 226,990   221,724
    Non-interest income:      
    Deposit Fees 8,251   8,547
    Loan Fees 1,955   1,521
    Loan level derivative income, net 543   3,112
    Gain on investment securities, net —   1,704
    Gain on sales of loans and leases held-for-sale 545   2,171
    Other 7,734   6,852
    Total non-interest income 19,028   23,907
    Non-interest expense:      
    Compensation and employee benefits 106,521   103,494
    Occupancy 16,663   15,076
    Equipment and data processing 20,594   19,759
    Professional services 5,788   5,784
    FDIC insurance 6,027   6,005
    Advertising and marketing 3,937   3,966
    Amortization of identified intangible assets 5,045   5,875
    Merger and restructuring expense 823   7,411
    Other 12,748   12,910
    Total non-interest expense 178,146   180,280
    Income before provision for income taxes 67,872   65,351
    Provision for income taxes 16,693   13,240
    Net income $              51,179   $              52,111
    Earnings per common share:      
    Basic $                  0.58   $                  0.59
    Diluted $                  0.57   $                  0.59
    Weighted average common shares outstanding during the period:      
    Basic 88,944,569   88,016,190
    Diluted 89,241,470   88,253,361
    Dividends paid per common share $                0.405   $                0.405
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Asset Quality Analysis (Unaudited)
    		  
      At and for the Three Months Ended  
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023    		  
      (Dollars in Thousands)  
    NONPERFORMING ASSETS:                    
    Loans and leases accounted for on a nonaccrual basis:                    
    Commercial real estate mortgage $                       11,595   $             11,659   $             18,394   $                      19,608   $                       23,263  
    Multi-family mortgage 1,751   —   —   —   1,318  
    Construction —   —   —   —   2,316  
    Total commercial real estate loans 13,346   11,659   18,394   19,608   26,897  
                         
    Commercial 15,734   16,636   3,096   3,886   5,406  
    Equipment financing 37,223   27,128   13,668   14,984   13,974  
    Total commercial loans and leases 52,957   43,764   16,764   18,870   19,380  
                         
    Residential mortgage 3,862   4,495   4,563   4,292   4,249  
    Home equity 1,076   790   950   860   713  
    Other consumer 1   1   1   —   2  
    Total consumer loans 4,939   5,286   5,514   5,152   4,964  
                         
    Total nonaccrual loans and leases 71,242   60,709   40,672   43,630   51,241  
                         
    Other real estate owned 780   780   780   780   —  
    Other repossessed assets 799   1,194   1,037   914   299  
    Total nonperforming assets $                       72,821   $             62,683   $             42,489   $                      45,324   $                       51,540  
                         
    Loans and leases past due greater than 90 days and still accruing $                       16,091   $               4,994   $                  363   $                           228   $                         1,175  
                         
    Nonperforming loans and leases as a percentage of total loans and leases 0.73 % 0.62 % 0.42 % 0.45 % 0.55 %
    Nonperforming assets as a percentage of total assets 0.62 % 0.54 % 0.37 % 0.40 % 0.46 %
                         
    PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:                    
    Allowance for loan and lease losses at beginning of period $                     121,750   $           120,124   $           117,522   $                    119,081   $                     125,817  
    Charge-offs (4,183 ) (8,823 ) (5,390 ) (7,722 ) (10,978 )
    Recoveries 375   436   309   581   4  
    Net charge-offs (3,808 ) (8,387 ) (5,081 ) (7,141 ) (10,974 )
    Provision for loan and lease losses excluding unfunded commitments * 9,374   10,013   7,683   5,582   4,238  
    Allowance for loan and lease losses at end of period $                     127,316   $           121,750   $           120,124   $                    117,522   $                     119,081  
                         
    Allowance for loan and lease losses as a percentage of total loans and leases 1.31 % 1.25 % 1.24 % 1.22 % 1.27 %
                         
    NET CHARGE-OFFS:                    
    Commercial real estate loans $ —   $               3,819   $                  606   $                        1,087   $                               (3 )
    Commercial loans and leases ** 3,797   4,571   8,179   6,061   10,958  
    Consumer loans 11   (3 ) (4 ) (7 ) 19  
    Total net charge-offs $                         3,808   $               8,387   $               8,781   $                        7,141   $                       10,974  
                         
    Net loan and lease charge-offs as a percentage of average loans and leases (annualized) 0.16 % 0.35 % 0.36 % 0.30 % 0.47 %
                         
    *Provision for loan and lease losses does not include (credit) provision of $(4.5 million), $(4.4 million), $(0.3 million), $(1.7 million), and $(1.3) million for credit losses on unfunded commitments during the three months ended September 30, 2024, June 30, 2024, March 31, 2024, December 31, 2023, and September 30, 2023, respectively.
    ** The balance at March 31, 2024 includes a $3.7 million charge-off on a letter of credit which impacted the provision.
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Average Yields / Costs (Unaudited)
      Three Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023  
      Average
    Balance    		 Interest
    (1)    		 Average
    Yield/
    Cost    		   Average
    Balance    		 Interest
    (1)    		 Average
    Yield/
    Cost    		   Average
    Balance    		 Interest
    (1)    		 Average
    Yield/
    Cost    		  
      (Dollars in Thousands)
    Assets:                        
    Interest-earning assets:                        
    Investments:                        
    Debt securities (2) $      853,924 $     6,516 3.05 % $      846,469 $     6,510 3.08 % $      887,612 $     6,840 3.08 %
    Restricted equity securities (2) 75,225 1,459 7.76 % 71,696 1,375 7.67 % 67,824 1,310 7.73 %
    Short-term investments 145,838 1,986 5.44 % 143,800 1,914 5.33 % 172,483 2,390 5.54 %
    Total investments 1,074,987 9,961 3.71 % 1,061,965 9,799 3.69 % 1,127,919 10,540 3.74 %
    Loans and Leases:                        
    Commercial real estate loans (3) 5,772,456 83,412 5.65 % 5,754,901 81,565 5.61 % 5,667,373 78,750 5.44 %
    Commercial loans (3) 1,079,084 18,440 6.69 % 1,069,154 17,672 6.54 % 939,492 15,295 6.38 %
    Equipment financing (3) 1,353,649 26,884 7.94 % 1,374,217 26,255 7.64 % 1,280,033 23,331 7.29 %
    Consumer loans (3) 1,505,095 21,123 5.60 % 1,488,587 20,291 5.46 % 1,471,985 19,237 5.21 %
    Total loans and leases 9,710,284 149,859 6.17 % 9,686,859 145,783 6.02 % 9,358,883 136,613 5.84 %
    Total interest-earning assets 10,785,271 159,820 5.93 % 10,748,824 155,582 5.79 % 10,486,802 147,153 5.61 %
    Non-interest-earning assets 666,067       704,570       693,833      
    Total assets $ 11,451,338       $ 11,453,394       $ 11,180,635      
                             
    Liabilities and Stockholders’ Equity:                        
    Interest-bearing liabilities:                        
    Deposits:                        
    NOW accounts $      639,561 1,115 0.69 % $      659,351 1,111 0.68 % $      681,929 1,159 0.67 %
    Savings accounts 1,738,756 12,098 2.77 % 1,731,388 11,874 2.76 % 1,557,911 8,859 2.26 %
    Money market accounts 2,038,048 15,466 3.02 % 2,026,780 15,520 3.08 % 2,177,528 15,785 2.88 %
    Certificates of deposit 1,768,026 20,054 4.51 % 1,699,510 18,717 4.43 % 1,444,269 12,128 3.33 %
    Brokered deposit accounts 841,067 11,063 5.23 % 958,146 12,499 5.25 % 882,351 11,185 5.03 %
    Total interest-bearing deposits 7,025,458 59,796 3.39 % 7,075,175 59,721 3.39 % 6,743,988 49,116 2.89 %
    Borrowings                        
    Advances from the FHLB 1,139,049 14,366 4.94 % 1,049,609 12,894 4.86 % 954,989 11,706 4.80 %
    Subordinated debentures and notes 84,276 1,378 6.54 % 84,241 1,375 6.53 % 84,134 1,378 6.55 %
    Other borrowed funds 53,102 1,012 7.58 % 103,753 1,364 5.29 % 117,531 790 2.67 %
    Total borrowings 1,276,427 16,756 5.14 % 1,237,603 15,633 5.00 % 1,156,654 13,874 4.69 %
    Total interest-bearing liabilities 8,301,885 76,552 3.67 % 8,312,778 75,354 3.65 % 7,900,642 62,990 3.16 %
    Non-interest-bearing liabilities:                        
    Demand checking accounts 1,669,092       1,646,869       1,794,225      
    Other non-interest-bearing liabilities 264,324       300,362       318,041      
    Total liabilities 10,235,301       10,260,009       10,012,908      
    Stockholders’ equity 1,216,037       1,193,385       1,167,727      
    Total liabilities and equity $ 11,451,338       $ 11,453,394       $ 11,180,635      
    Net interest income (tax-equivalent basis) /Interest-rate spread (4)   83,268 2.26 %   80,228 2.14 %   84,163 2.45 %
    Less adjustment of tax-exempt income   260       227       93    
    Net interest income   $   83,008       $   80,001       $   84,070    
    Net interest margin (5)     3.07 %     3.00 %     3.18 %
                             
    (1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
    (2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
    (3) Loans on nonaccrual status are included in the average balances.
    (4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Average Yields / Costs (Unaudited)
      Nine Months Ended
      September 30, 2024   September 30, 2023  
      Average
    Balance    		 Interest
    (1)    		 Average
    Yield/
    Cost    		   Average
    Balance    		 Interest
    (1)    		 Average
    Yield/
    Cost    		  
      (Dollars in Thousands)
    Assets:                
    Interest-earning assets:                
    Investments:                
    Debt securities (2) $                   864,501 $   19,953 3.08 % $      971,855 $   22,905 3.14 %
    Restricted equity securities (2) 74,422 4,327 7.75 % 74,000 4,238 7.64 %
    Short-term investments 140,156 5,724 5.44 % 183,295 7,236 5.26 %
    Total investments 1,079,079 30,004 3.71 % 1,229,150 34,379 3.73 %
    Loans and Leases:                
    Commercial real estate loans (3) 5,763,065 246,026 5.61 % 5,629,600 225,999 5.29 %
    Commercial loans (3) 1,058,312 53,619 6.66 % 915,420 42,814 6.17 %
    Equipment financing (3) 1,367,380 80,034 7.80 % 1,253,512 66,901 7.12 %
    Consumer loans (3) 1,492,213 61,392 5.49 % 1,469,025 55,210 5.01 %
    Total loans and leases 9,680,970 441,071 6.07 % 9,267,557 390,924 5.62 %
    Total interest-earning assets 10,760,049 471,075 5.84 % 10,496,707 425,303 5.40 %
    Non-interest-earning assets 678,235       698,273      
    Total assets $              11,438,284       $ 11,194,980      
                     
    Liabilities and Stockholders’ Equity:                
    Interest-bearing liabilities:                
    Deposits:                
    NOW accounts $                   656,879 3,487 0.71 % $      741,951 3,129 0.56 %
    Savings accounts 1,721,518 35,324 2.74 % 1,365,541 17,290 1.69 %
    Money market accounts 2,047,011 46,940 3.06 % 2,227,404 41,914 2.52 %
    Certificates of deposit 1,697,477 55,443 4.36 % 1,394,338 29,605 2.84 %
    Brokered deposit accounts 898,455 35,207 5.23 % 798,800 29,693 4.97 %
    Total interest-bearing deposits 7,021,340 176,401 3.36 % 6,528,034 121,631 2.49 %
    Borrowings                
    Advances from the FHLB 1,117,809 41,893 4.92 % 1,135,845 40,524 4.70 %
    Subordinated debentures and notes 84,241 4,130 6.54 % 84,098 4,095 6.49 %
    Other borrowed funds 83,195 3,353 5.38 % 120,825 2,562 2.83 %
    Total borrowings 1,285,245 49,376 5.05 % 1,340,768 47,181 4.64 %
    Total interest-bearing liabilities 8,306,585 225,777 3.63 % 7,868,802 168,812 2.87 %
    Non-interest-bearing liabilities:                
    Demand checking accounts 1,646,932       1,857,429      
    Other non-interest-bearing liabilities 280,947       301,543      
    Total liabilities 10,234,464       10,027,774      
    Stockholders’ equity 1,203,820       1,167,206      
    Total liabilities and equity $              11,438,284       $ 11,194,980      
    Net interest income (tax-equivalent basis) /Interest-rate spread (4)   245,298 2.21 %   256,491 2.53 %
    Less adjustment of tax-exempt income   701       335    
    Net interest income   $ 244,597       $ 256,156    
    Net interest margin (5)     3.05 %     3.27 %
                     
    (1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
    (2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
    (3) Loans on nonaccrual status are included in the average balances.
    (4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.
    BROOKLINE BANCORP, INC. AND SUBSIDIARIES
    Non-GAAP Financial Information (Unaudited)
                  At and for the Nine Months Ended 
     September 30,
    		  
                  2024   2023  
    Reconciliation Table – Non-GAAP Financial Information           (Dollars in Thousands Except Share Data)  
                       
    Reported Pretax Income           $                      67,872   $                       65,351  
    Less:                    
    Security gains           —   1,704  
    Add:                    
    Day 1 PCSB CECL provision           —   16,744  
    Merger and restructuring expense           823   7,411  
    Operating Pretax Income             $                      68,695   $                       87,802  
    Effective tax rate             24.6 % 20.3 %
    Provision for income taxes             16,895   17,789  
    Operating earnings after tax           $                      51,800   $                       70,013  
                         
    Operating earnings per common share:                    
    Basic             $                          0.58   $                           0.80  
    Diluted             $                          0.58   $                           0.79  
                         
    Weighted average common shares outstanding during the period:                  
    Basic             88,944,569   88,016,190  
    Diluted             89,241,470   88,253,361  
                         
    Return on average assets *           0.60 % 0.62 %
    Less:                    
    Security gains (after-tax) *           — %  0.02 %
    Add:                    
    Day 1 PCSB CECL provision (after-tax) *           — % 0.16 %
    Merger and restructuring expense (after-tax) *           0.01 % 0.07 %
    Operating return on average assets *           0.61 % 0.83 %
                         
    Return on average tangible assets *           0.61 % 0.64 %
    Less:                    
    Security gains (after-tax) *           — %  0.02 %
    Add:                    
    Day 1 PCSB CECL provision (after-tax) *           — %  0.16 %
    Merger and restructuring expense (after-tax) *           0.01 % 0.07 %
    Operating return on average tangible assets *           0.62 % 0.85 %
                         
                         
    Return on average stockholders’ equity *           5.67 % 5.95 %
    Less:                    
    Security gains (after-tax) *           — %  0.16 %
    Add:                    
    Day 1 PCSB CECL provision (after-tax) *           — % 1.53 %
    Merger and restructuring expense (after-tax) *           0.07 % 0.68 %
    Operating return on average stockholders’ equity *           5.74 % 8.00 %
                         
                         
    Return on average tangible stockholders’ equity *           7.25 % 7.76 %
    Less:                    
    Security gains (after-tax) *           — %  0.20 %
    Add:                    
    Day 1 PCSB CECL provision (after-tax) *           — % 1.99 %
    Merger and restructuring expense (after-tax) *           0.09 % 0.88 %
    Operating return on average tangible stockholders’ equity *           7.34 % 10.43 %
                         
    * Ratios at and for the nine months ended are annualized.
    There was no non-operating activity for the three months ended September 30, 2024 and September 30,2023, respectively.
       
      At and for the Three Months Ended
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023    		  
      (Dollars in Thousands)
                                   
    Net income, as reported $                       20,142   $                 16,372   $                 14,665   $                      22,888   $                       22,701  
                         
    Average total assets $                11,451,338   $          11,453,394   $          11,417,185   $               11,271,941   $                11,180,635  
    Less: Average goodwill and average identified intangible assets, net 261,188   262,859   264,536   266,225   268,199  
    Average tangible assets $                11,190,150   $          11,190,535   $          11,152,649   $               11,005,716   $                10,912,436  
                         
    Return on average tangible assets (annualized) 0.72 % 0.59 % 0.53 % 0.83 % 0.83 %
                         
    Average total stockholders’ equity $                  1,216,037   $            1,193,385   $            1,201,904   $                 1,170,776   $                  1,167,727  
    Less: Average goodwill and average identified intangible assets, net 261,188   262,859   264,536   266,225   268,199  
    Average tangible stockholders’ equity $                     954,849   $               930,526   $               937,368   $                    904,551   $                     899,528  
                         
    Return on average tangible stockholders’ equity (annualized) 8.44 % 7.04 % 6.26 % 10.12 % 10.09 %
                         
    Total stockholders’ equity $                  1,230,362   $            1,198,480   $            1,194,231   $                 1,198,644   $                  1,157,871  
    Less:                    
    Goodwill 241,222   241,222   241,222   241,222   241,222  
    Identified intangible assets, net 19,162   20,830   22,499   24,207   26,172  
    Tangible stockholders’ equity $                     969,978   $               936,428   $               930,510   $                    933,215   $                     890,477  
                         
    Total assets $                11,676,721   $          11,635,292   $          11,542,731   $               11,382,256   $                11,180,555  
    Less:                    
    Goodwill 241,222   241,222   241,222   241,222   241,222  
    Identified intangible assets, net 19,162   20,830   22,499   24,207   26,172  
    Tangible assets $                11,416,337   $          11,373,240   $          11,279,010   $               11,116,827   $                10,913,161  
                         
    Tangible stockholders’ equity to tangible assets 8.50 % 8.23 % 8.25 % 8.39 % 8.16 %
                         
    Tangible stockholders’ equity $                     969,978   $               936,428   $               930,510   $                    933,215   $                     890,477  
                         
    Number of common shares issued 96,998,075   96,998,075   96,998,075   96,998,075   96,998,075  
    Less:                    
    Treasury shares 7,015,843   7,373,009   7,354,399   7,354,399   7,350,981  
    Unvested restricted shares 883,789   713,443   749,099   749,099   780,859  
    Number of common shares outstanding 89,098,443   88,911,623   88,894,577   88,894,577   88,866,235  
                         
    Tangible book value per common share $                         10.89   $                   10.53   $                   10.47   $                        10.50   $                         10.02  
                                   

    PDF available: http://ml.globenewswire.com/Resource/Download/6045e36a-2e9d-4b3a-b6a1-f895169b0f2d

    The MIL Network –

  • MIL-OSI United Nations: Experts of the Committee on the Rights of the Child Praise Ecuador’s Social Expenditure for Children, Ask about December 2024 Child Murders and Excessive Use of Force against Child Demonstrators

    Source: United Nations – Geneva

    The Committee on the Rights of the Child today concluded its consideration of the seventh periodic report of Ecuador, with Committee Experts praising the State’s social expenditure for children and adolescents, and raising questions about the murder of four children in December 2024 and excessive use of force against child demonstrators by the police.

    Mary Beloff, Committee Expert and Coordinator of the Country Taskforce for Ecuador, praised the efforts made by the country to enhance social expenditure aimed at children and adolescents.  She said it was a pleasure to hear the focus being placed on resource allocation to guarantee rights in early childhood.

    However, she said the examination was marked by the atrocious events that took place in Guayaquil in December 2024, related to the illegal detention, forced disappearance and subsequent murder of four children.  Investigating the social conditions that led to these events was an essential part of the Committee’s work.

    Velina Todorova, Committee Expert and Taskforce Member, said that in October 2019, in the context of the national strike, the personal integrity of at least 12 children was severely impacted by the public forces.  During the June 2022 strike, violence was also used against children. How was the State safeguarding the rights of children to freedom of assembly?

    Marcelo Vázquez Bermúdez, Permanent Representative of Ecuador to the United Nations Office at Geneva, presenting the report, said Ecuador had several cash transfers for social protection for children or adolescents in situations of poverty and vulnerability, including the human development bonus, the Joaquín Gallegos Lara bonus, and the lifetime pension.

    The murder of four minors in December 2024 had profoundly shocked the Government and the people of Ecuador, the delegation said. The Ecuadorian State had acted immediately following these events and had been carrying out due actions to investigate and punish the perpetrators.  Investigations had begun and 16 members of the armed forces were now in pretrial detention.

    Measures had been taken to prevent cases of excessive use of force by the police against children from reoccurring, the delegation said. Institutional guidelines had been developed to protect the rights of citizens involved in demonstrations, and an organic law regulating the legitimate use of force had been developed and disseminated.  The State party recognised that all children and adolescents had the right to protest peacefully.

    In closing remarks, Ms. Beloff said that the dialogue had provided insight on the issues faced by Ecuador and areas that needed to be focused on in public policies.  The Committee hoped that the State party would be able to achieve its goals for the benefit of all Ecuadorian children.

    Zaida Rovira, Minister of Economic and Social Inclusion of Ecuador, in concluding remarks, said that the State party was committed to taking on its challenges by increasing the budget for children, and developing robust standards and laws and an institutional system with sufficiently trained staff.  The topics discussed in the dialogue would inform the State’s future efforts for children and adolescents.

    The delegation of Ecuador consisted of representatives from the Ministry of Economic and Social Inclusion; the Ministry of Education; the Ministry of Women and Human Rights; Ecuador Grows without Child Malnutrition; the National Comprehensive Care Service for Adults Persons Deprived of Liberty and Adolescent Offenders; and the Permanent Mission of Ecuador to the United Nations Office at Geneva.

    The Committee will issue the concluding observations on the report of Ecuador at the end of its ninety-eighth session on 31 January.  Those, and other documents relating to the Committee’s work, including reports submitted by States parties, will be available on the session’s webpage.  Summaries of the public meetings of the Committee can be found here, while webcasts of the public meetings can be found here.

    The Committee will next meet in public on Thursday, 30 January at 3 p.m. to hold an informal meeting with States.

    Report

    The Committee has before it the seventh periodic report of Ecuador (CRC/C/ECU/7).

    Presentation of Report

    MARCELO VÁZQUEZ BERMÚDEZ, Permanent Representative of Ecuador to the United Nations Office at Geneva, said Ecuador was fully committed to fulfilling its international obligations under the Convention.  In May 2024, the organic law for the support and reparation for relatives of victims of femicide and violent deaths for gender reasons was adopted. Between 2023 and 2024, the Attorney General’s Office issued seven key technical instruments to strengthen the protection and care of victims, especially children, adolescents and persons affected by gender-based violence.  These instruments included guidelines on complaints and protective measures against physical, psychological, or sexual violence; guidelines to avoid revictimisation; and operational guides for the investigation of crimes such as human trafficking and the recruitment of children and adolescents for criminal purposes. 

    Through the Child Development Centres and the “growing with our children” programme, the Government provided comprehensive care to 289,000 children and adolescents in vulnerable situations in 2024.  In addition, there was close collaboration with indigenous, Afro-descendant, and Montubio communities and children on the move.  There were also several cash transfers for social protection for children or adolescents in situations of poverty and vulnerability, namely the human development bonus, the Joaquín Gallegos Lara bonus, and the lifetime pension.

    One of the most outstanding achievements was the creation of the Technical Secretariat for the “Ecuador grows without child malnutrition” policy and the implementation of its strategy, as well as the intersectoral strategic plan for the prevention and reduction of chronic child malnutrition.  These allowed effective collaboration between various government entities, focusing on the prevention and reduction of chronic malnutrition in children under two years of age.  Due to the implementation of the strategy, by 2024, the indicator on prevalence of chronic malnutrition in children under two years of age was reduced to 19.3 per cent, from the previous level of 24.8 per cent.  The programme was expected to achieve the goal of reducing the malnutrition rate to less than 15 per cent. 

    As an important component of the strategy, there was a cash transfer called the “1,000 days voucher”, which consisted of a fixed transfer and payments conditional on the commitment to attend prenatal check-ups and early registration of the birth in the Civil Registry.  Furthermore, all beneficiaries of the “1,000 days bonus” had the right to receive weekly family counselling services from specialised educators of the Ministry of Economic and Social Inclusion.

    ZAIDA ROVIRA, Minister of Economic and Social Inclusion of Ecuador, said Ecuador guaranteed access to quality vaccines approved by the World Health Organization, ensuring that every child received the appropriate vaccine to prevent diseases. As of August 2024, 95 out of every 100 Ecuadorian children had completed their vaccination schedule.  Between 2020 and 2023, maternal mortality was almost halved. The suicide prevention manual had been issued, which focused on the construction of support networks, from 10 years of age onwards.  Around 2,724 people had been trained in using the manual for the early identification of suicidal ideation, and 21 community support networks had been established for the prevention of suicide. 

    The Ministry of Labour, in collaboration with the International Labour Organization and the United Nations Economic Commission for Latin America and the Caribbean, had implemented a tool called the child labour risk identification model, which made it possible to identify the territories most prone to child labour and estimate the impact of various associated factors.  More than 1,000 labour inspections took place between January 2023 and July 2024.  In addition, 217 dialogue tables had been held with key actors, such as decentralised autonomous governments and civil society organizations, to design local intervention strategies. 

    Digital literacy campaigns had been carried out to educate the population on the safe and effective use of information technologies; 919 digital points had been opened nationwide.  Between 2023 and 2024, more than 9,000 visas were issued for children and adolescents seeking refuge, with particular focus on the Venezuelan population.  Between 2023 and 2024, Ecuadorian Consulates had handled 10,668 cases of children and adolescents in vulnerable conditions abroad, managing to resolve the majority of these cases. 

    The National Service for the comprehensive care of adults deprived of liberty and adolescent offenders, through the horizon of change work plan, had strengthened the comprehensive development of socio-educational measures by strengthening care for more than 739 adolescents in conflict with the law.  In addition, awareness-raising talks and trainings were carried out in educational units, reaching more than 7,000 adolescents.  Ms. Rovira hoped the exchange with the Committee members would help the country delve deeper into progress made and provide clarity on any issues. 

    Questions by Committee Experts

    MARY BELOFF, Committee Expert and Taskforce Coordinator, said the Committee was aware that the national context in which the dialogue was taking place was complex in many ways, especially since the declaration of an internal armed conflict.  The examination being carried out by the Committee was inevitably marked by the atrocious events that took place in Guayaquil in December 2024, related to the illegal detention, forced disappearance and subsequent murder of four children: Saúl Arboleda (15 years old); the brothers Josué Arroyo (14 years old) and Ismael Arroyo (15 years old); and Steven Medina (11 years old).  Investigating the social conditions that led to these events was an essential part of the work of the Committee in order to contribute to ensure that similar events never happened again in the country.

    There were more than 50 norms and standards to do with the rights of the child and adolescents which required legislative amendments.  What was the timeline for this?  Where did the difficulties lie in this regard?  The Committee praised the efforts made by the country to enhance social expenditure aimed at children and adolescents.  However, there had been a regressive trend after the pandemic in this respect.  How did the State plan to draw up a budget which considered the specific needs of children and adolescents in the country?  If a crisis were to occur again, how would expenditure on child-related matters be protected?  What were the State’s plans to ensure there was a coordination body at the national and local levels in order to facilitate missing data?  How was the State planning to extend its scope to cover the entire population, particularly those at the greatest risk of social disadvantage?

    Ecuador faced a situation described as one of structural discrimination, which had a direct link to poverty.  This affected indigenous populations, Afro-indigenous populations, and children in State custody.  What were the comprehensive policies which the State was planning to establish to put an end to structural discrimination?    How was the monitoring of centres where children were deprived of their liberty carried out, particularly during the state of emergency? How was it ensured that legislation relating to child labour was enforced?  The Committee was aware of the number of instruments relating to child participation.  However, it was indicated that children’s voices were not really being heard.  How was Ecuador going to include the voices of children and adolescents, particularly when it pertained to their rights? 

    VELINA TODOROVA, Committee Expert and Taskforce Member, said in October 2019, in the context of the national strike, the personal integrity of at least 12 children was severely impacted by the public forces.  Children suffered from injuries, as well as what could be as considered acts of torture. During the June 2022 strike, violence was also used against children, which was serious and unjustifiable.  How was the State safeguarding the rights of children to freedom of assembly?  Could the Committee be informed of investigations, prosecutions and reparations relating to these events?  Over the past few years, there had been acts of cruelty towards children by the Ecuadorian State.  Ecuador was in a state of deep regression of children’s rights, which the Committee had expressed concern about in 2016.  There were many reasons for this, and the State had failed to address the root causes. 

    The Committee understood that children in Ecuador did not feel safe in their families, neighbourhoods, and schools due to the increase presence of gangs in schools.  Many children had witnessed violent acts by gangs, including shootings.  Was this a real concern for the Government?  There had been a shocking increase in the number of deaths of children by 640 per cent, between 2019 and 2023, as well as enforced disappearances and acts of torture.  The Committee was informed that children in marginalised communities were most affected by security operations.  What progress had been made in investigations into these events?  How could the Government guarantee that perpetrators would face justice and convictions?   

    Another worrying trend was the use of children and adolescents by organised crime groups.  Boys as young as eight years old were recruited, as well as indigenous children and those from remote communities.  There were also many reports of illiteracy in these areas. Could the delegation explain the actions by the State to approve legislation trying children as adults in certain cases, such as murder?  In 2023, the forced recruitment of children and adolescents in the context of armed conflict was criminalised in Ecuador, which was highly commendable.  However, to date there had been no convictions under this crime.  What was the Government doing to address the human rights of children? 

    Every second child in Ecuador between 0 and five years of age suffered violence at home.  Did high profile politicians or celebrities in Ecuador ever condemn this kind of violence publicly?  Would the Government implement a programme for respectful parenting? What were the plans for the proper implementation of the law on femicide?  What measures had been taken to implement an early warning system on femicide?  How many children reported violence to the Public Defenders Service?  The levels of sexual abuse were a disgrace for Ecuador; girls were often victims of rape within their close circles of trust, including fathers, brothers and teachers.  Many cases were not reported and there was a high degree of impunity. Why was there such a high level of impunity for perpetrators?  Could this be attributed to the lack of trained prosecutors?  How were victims interviewed with the view to avoid harmful repetitive interviews? 

    One of the greatest issues in Ecuador was teenage pregnancy.  Six girls under 14 became mothers every day.  Although abortion was decriminalised, it was understood that the legal restrictions on abortion violated the rights of pregnant women. How did the State guarantee that rape victims could access safe abortions without obstacles?  What measures had been adopted to guarantee the non-criminalisation of doctors who performed abortions? 

    Responses by the Delegation

    The delegation said when it came the murder of the four minors, this case had profoundly shocked the Government and the people of Ecuador.  The Ecuadorian State had acted immediately following these events and had been carrying out due actions to investigate and punish the perpetrators. These events took place in December 2024, when the disappearance of the minors was reported.  The competent authorities then took all necessary actions to locate the children.  Investigations had begun and 16 members of the armed forces were now in pretrial detention.  All actions were being undertaken to ensure that the perpetrators were punished for this serious crime.

    Ecuador was a country with limited resources but it had focused on addressing childhood issues. There had been a delay concerning the Code of Children and Adolescents, which would end the scattered pieces of legislation that were a cause for concern.  The early childhood law was before the Assembly, as was the law on malnutrition.  Chronic malnutrition was high in Ecuador, and this had been a key focus of the State since 2018.  Many ministries were involved in this process and a system allowed information to be received from all ministries, allowing work to be honed into the vulnerable territories and ascertain where the greatest vulnerability level lay. Chronic malnutrition had been reduced by four points, which showed that the strategies were working.  The strategy focused on ages 0 to two, as well as pregnant mothers, and it was hoped this could be extended to other ages. 

    “Ecuador grows without malnutrition” was the pilot project being rolled out to address one of the main problems of the enjoyment of the rights of children and adolescents in the country.  Follow-up was carried out on each of the households for all families living in poverty and extreme vulnerability.  It was ensured that all care services for children and adolescents had a budget for the entire year.  Each of the State’s services had been and would be monitored continually to ensure their efficiency with funds. 

    More than 20,000 new families had been included in the “human development voucher” cash programme. In Ecuador there were money transfers for children who had no parents due to violent deaths.  They received support from several Government ministries to provide them with priority, comprehensive reparations.  The Ombudsman law ensured anyone could defend their rights without discrimination.  Ecuador had conducted around 1,000 annual inspections for child labour.  These were conducted on the ground and online to ensure a nationwide reach. 

    Ecuador had received an award for best practices because of work being done with the youth. The programme “horizon of change” aimed to be a worldwide reference point by 2035.  Currently, the programme was working with high-level methodologies, including a therapeutic system used with the youth.  The State was also investing heavily in occupational vocational activities, including through a programme which covered topics, including baking and juvenile fashion, among other areas. 

    In centres with young offenders, there was a whole staff of psychologists and medical professionals on hand.  The State was also working to bolster the self-esteem of young offenders through art and culture.  A life skills programme aimed to teach young offenders how to handle depression and anxiety, and work in this area had also been carried out in schools. 

    There were approximately 40,000 children and adolescents who were not in the education system.  The Government had identified them and was encouraging them to go back to school. School dropout had dropped between 2021 and 2023.  Children within the educational system had the right to participation.  There was a participation model which placed children and adolescents closer to the centre on issues which related to them.  A campaign had been drafted to reduce racial discrimination, and another to address violence in the education system. The shared responsibility of families was promoted throughout the education system, and child rearing skills programmes were offered, including on communication skills, emotional sympathy, learning support, preventing sexual violence, and teenage pregnancy, among others.  Over one million families benefited from these sessions in 2024. 

    Teen pregnancy was an issue of concern in the country, particularly the health of the baby due to malnutrition.  The teen fertility rate had decreased.  There were many communications strategies which addressed the issue of teen pregnancy. There was a law in force for abortion in cases of violence.  Pregnancy in the case of rape could be terminated up to 12 weeks. 

    Questions by Committee Experts

    VELINA TODOROVA, Committee Expert and Taskforce Member, asked if the malnutrition of the baby was really the key issue when it came to teen pregnancy?  Could examples of the messaging to pregnant girls be provided? Had it been considered that boys or men who were responsible for the pregnancy also needed to receive messages? The Committee had received many reports that the phenomenon of child marriage existed, and was underrated by the Government.  Information had been received that around 30,000 girls lived in early unions, particularly in Amazon communities.  There was an increase in early unions between girls 12 and 14 years old.  Many of these adolescent girls remained in these unions until they were 18 and then they married.  Did the delegation not consider this a trend which needed the attention of the Government? 

    Had the State ever considered the reason for the high number of missing girls?  Was it likely that some of these girls were sold by parents or were involved in prostitution?  One form of using children in prostitution was the so-called “prepaid” with contact being made discreetly and in advance.  What were the policies of the Government regarding this issue? 

    MARY BELOFF, Committee Expert and Taskforce Coordinator, said it was a pleasure to hear the focus being placed on resource allocation to guarantee rights in early childhood. This trend was promising, and it was hoped it would be consolidated in coming years.  What would the budgetary allocation be for the new Code of Children and Adolescents?  Were there any plans to increase the investment per capita amongst children? What was the State planning to do to reach out to all vulnerable populations to grapple with the issue of recruitment proactively?

    A Committee Expert said between January and November 2024, there had been nine complaints of enforced disappearance, 80 complaints of torture, and 145 complaints of excessive use of force.  It would appear the poorest neighbourhoods were the most impacted.  What was the State doing to prevent this pattern?  Afro-Ecuadorians, migrants and trans children were groups which faced discrimination.  There were two cases before the court on trans children.  What was the State doing to address this issue of discrimination? 

    Another Expert asked if the consent form was used in cases of all children in terms of abortion?  Could a minor give their consent for abortion? Were parents informed if their child requested an abortion?  Was there any special support put in place for young girls to ascertain if the pregnancy was the result of a rape?  What was being done to protect the young girls in this context?

    An Expert asked if a young girl who was over the age of 14 who was pregnant due to rape was required to bring the pregnancy to term? 

    VELINA TODOROVA, Committee Expert and Taskforce Member, asked about the inclusiveness of policies for children with disabilities in the areas of care and education?  Did Ecuador implement a policy of inclusive education and community-based care for children who could not stay with their families? What was the difference between comprehensive child development services and specialised comprehensive rehabilitation centres of the Ministry of Health? 

    ZARA RATOU, Committee Expert and Taskforce Member, said in the case of children deprived of a family environment, the technical standard was part of the strategy for the deinstitutionalisation of children and promoted their reintegration into the family environment.  What progress had been made in terms of ending institutionalisation and the adoption of a strategy and action plan for the deinstitutionalisation of children and adolescents to take into account judicial proceedings?  Was there information on the effective implementation of the technical standard of family support, family custody, and foster care?  Had a framework been set up by the Government to guarantee extended coverage for children?  What measures had been taken to facilitate the rehabilitation and social reintegration of children?  What measures had been taken to strengthen the capacity of professionals working with families and children, including judges, law enforcement, and social workers to ensure alternative care solutions?

    What measures had been taken by the Government to speed up the national adoption process, including by increasing the number of family judges and ensuring that properly trained professionals worked in foster care centres? Could information be provided on the implementation and results of the application of the technical standard of family support, family custody, and foster care placement to expedite the adoption process?

    What steps was the Government taking to adopt a comprehensive strategy to ensure equal access to essential health services for children living in marginalised situations?  How did the State maintain and strengthen measures to achieve universal immunisation coverage, such as the 2023 national immunisation campaign for a polio-free, measles-free, and rubella-free Ecuador?  What measures had the Government implemented to maintain and strengthen Ecuador’s national strategy to ensure that children grow up free of child malnutrition?  What was the Government doing to improve prevention strategies on anaemia, diarrhoea, and respiratory diseases?  What support was given to breastfeeding campaigns?  What measures was the Government taking to provide appropriate support to mothers through counselling structures in hospitals and the implementation of the baby-friendly hospitals initiative throughout the country? 

    According to the information received, the suicide rate had increased from 1.7 per cent in 2018 to 7.2 per cent in 2022.  Could information be provided on the adoption and implementation of the national mental health policy and the national suicide prevention strategy?  Ms. Ratou commended the Government for the efforts of the intersectoral policy for the prevention of pregnancy among girls and adolescents, which had achieved remarkable results in 2019-2022.  However,

    could more information on the implementation of the policy for the prevention of pregnancies be provided?  How was the Government providing children and adolescents with accurate and objective information on the prevention of substance abuse, such as tobacco and alcohol?

    What steps had been taken to improve the follow-up treatment of HIV/AIDS-infected mothers and their children?  Were there revised and harmonised laws and policies on HIV/AIDS to ensure access to confidential HIV testing services?  What measures had been taken to provide counselling to adolescents without the need for parental consent?  Was there specific data on government strategies to protect intersex children?  What steps were being taken to fully guarantee the rights of inter-sex children?

    MARY BELOFF, Committee Expert and Taskforce Coordinator, asked if any mechanism had been implemented to allow children who were not registered to benefit from cash transfers?  What strategy could be used to reach these children who lived in remote areas?  What was the State’s responsibility in terms of the oil and mining industry and its impact on the environment, which could violate the rights of children and adolescents? What mechanisms were there for oversight and sanctioning?  What were the mitigation measures used to address the environmental impacts felt by the country?  Was there any policy on this issue?  How often were the most affected communities consulted? 

    BENYAM MEZMUR, Committee Expert and Taskforce Member, acknowledged the efforts made by the State party despite the challenges.  Significant resources went to the education of children between the ages of five and 17. How would early childhood education be addressed?  What had been the impact of interventions to address school dropout?  Had there been improvements to the water and sanitation systems in schools?  The intersectoral policy for the prevention of pregnancy in girls and adolescents was positively noted.  Why were all complaints not transferred to the Ombudsman’s office?  What was the criteria to establish which complaints were transferred?  The State should be congratulated on progress in learning outcomes since the COVID-19 pandemic.  What was the Government doing to move beyond this? 

    Some school bus drivers were recognised as committing sexual violence against children.  How was the State addressing this?  There were concerns about access to justice for asylum seeking migrants and children.  How would this be addressed?  There were also concerns around the regularisation process in the State party. To what extent were temporary residents’ visas being issued to individuals?  How would the Government address shortcomings faced by migrant children, particularly those from Venezuela?  To what extent were efforts to combat xenophobic speech against migrant and refugee children effective?  Could information be provided on children in street situations, including violence faced at the hands of law officials?  There were concerns around the lack of resources for monitoring of rehabilitation centres, where children were deprived of their liberty.  What was the State party doing to address this challenge?  Would 14 be maintained as the criminal age of responsibility?   

    Responses by the Delegation

    The delegation said over 37,000 members of the armed forces and 57,000 police officers were trained on the principles of human rights, and manuals, protocols, and training modules had been developed on protecting the rights of children and adolescents.  There were internal investigation units that could issue sanctions against police officers and armed forces personnel who committed human rights violations.  The Attorney-General also conducted investigations of such cases and could pursue criminal proceedings.

    An inter-sectoral prevention policy was in place to reduce incidences of teenage pregnancy. Personalised school curricula and virtual learning platforms had been developed for girls who fell pregnant. The State had sexual and reproductive health education programmes, manuals on adolescent health, and over 1,000 health centres providing reproductive health care for adolescents. The Ministry of Health was working to properly implement the law on the voluntary termination of pregnancy and had trained over 5,000 public health workers on the law.

    The State party was working to use online tools to identify and prevent cases of gender-based violence.  There was a national plan in place to prevent violence against children and a safe schools project.  The State sought to guarantee clear paths of redress for victims of ill treatment. More than 33,000 teachers had been trained in early detection of incidences of violence.

    The bill on the rights of boys, girls, and adolescents, which sought to establish a governing body on the rights of children and adolescents, was being debated in the National Assembly.  The budget for children and adolescents had significantly increased in recent years. For example, from 2021 to 2025, the budget for early childhood education had increased by more than 20 per cent. In 2024, there was a 1.5 per cent reduction in the poverty rate from 2023, from 26 to 24.5 per cent.  The State party had implemented various actions, including cash transfers and vouchers, to reduce the poverty rate.

    State law guaranteed comprehensive care for all children with HIV, who were entitled to free treatment.  Programmes promoting screening for HIV and child prophylaxis had helped to reduce mother-to-child transmission. 

    The State party also aimed to improve the availability and quality of mental health care clinics across the country. The organic law on mental health established processes for diagnosis, rehabilitation, and reintegration into the community.

    Ecuador had established support groups for mothers that encouraged breastfeeding.  The breastfeeding rate had recently increased from 51 to 53 per cent. Over 3,000 breastfeeding-friendly areas had been certified by the State.  A book on baby nutrition had been produced and breast milk banks had been set up.

    Ecuador had a national immunisation project that was based on World Health Organization guidelines.  Eighteen vaccinations were provided to children and adults by public health care clinics.  The rate of children who were vaccinated before the age of one had increased to 91 per cent.  Vaccinations were voluntary and free of charge.  Interventions in remote provinces had been carried out to promote vaccination.  In the second half of 2025, the State party would start to provide cellular vaccinations against various diseases.

    One of the pillars of the State’s strategy to tackle malnutrition was to improve access to safe water supplies. The national Government was supporting decentralised governments to bolster the development of water filtration. The prevalence of acute diarrhoea and respiratory infections in children under two had decreased in recent years.

    Alternative care modalities, including institutional and foster care, had been established to provide care to children who were victims of violence.  A national guardianship programme was also in place to bolster family ties and reduce institutionalisation.  Over 19 million United States dollars had been invested in the protection system in 2024.  The State party focused on deinstitutionalisation and family integration.  Placement in foster homes was a measure of last resort. An independent committee was monitoring the implementation of child protection policies.  There were two specialised units working to care for child victims of trafficking and reinsert them into family environments.

    Ecuador had regulated the adoption process and was working to reduce delays in the process.  Registration of adoptive families was now done online. An entry interview was conducted and families were assessed, then they underwent a four-week training course. Adoption units monitored the situation in adoptive families for two years after children were adopted.

    Ecuador recognised the right of children and adolescents to live in a safe environment.  The State’s second nationally determined contribution under the Paris Agreement for 2026 to 2035 was approved yesterday.  It highlighted indigenous knowledge as key to combatting climate change, and aimed to ensure social protection for children, encouraging them to engage in climate action. A roundtable on the protection of environmental human rights defenders had been set up and was drafting a public policy on their protection.  Standards on free, prior and informed consent had been developed and were considered in court cases relating to development projects.

    The Constitution, the Organic Law on Disability, and the Code on Children and Adolescents promoted the rights of children with disabilities.  Over 1,400 caregivers participated in a support network for children with disabilities.  Subsidies, vouchers, and pensions were provided to families caring for persons with disabilities to lighten the economic burden.  Around 34 million United States dollars was allocated to this annually.  In 2023 and 2024, there were over 38,000 students with disabilities in the regular school system, while around 3,000 were enrolled in special schools.  A public policy was in place to prevent violence against children with disabilities.  Around 1,300 civil servants had been trained to improve care for children with disabilities.  The State party sought to broaden programmes for children with disabilities in remote areas and ensure that they could fully enjoy their rights.

    Questions by Committee Experts

    MARY BELOFF, Committee Expert and Taskforce Coordinator, asked whether the worsening security situation in the country would affect public opinion regarding proposed legislation on the rights of children and adolescents.  The various reforms of the social protection sector were very welcome.  Why was there such a high number of persons behind bars?  What measures were in place to provide alternatives to detention for adolescents?

    VELINA TODOROVA, Committee Expert and Taskforce Member, asked why no information had been provided on cases of the use of force by State officials against children in 2017 and 2022?  A commission had been established to investigate allegations of sexual abuse against children by members of the Catholic Church in 2017, which identified several cases of cover-ups of such abuse.  Did the State party plan to establish a Truth Commission related to this issue?  How were teachers, parents, and children prepared to support children with disabilities in inclusive education?  What was meant by the concept of “care by agreement”?

    BENYAM MEZMUR, Committee Expert and Taskforce Member, cited concerns regarding the potential abuse of children’s rights in the implementation of the state of emergency.  How would the State party prevent this?  Were there plans to develop distinct legislation addressing the recruitment of children by non-State armed groups?  There had reportedly been a decline in vaccination coverage recently; why was this?

    ZARA RATOU, Committee Expert and Taskforce Member, asked whether cellular vaccines, which could have undesired effects on children, would be administered to them.

    Other Committee Experts asked questions on strategies to address high rates of child murders and suicides; measures to protect children from structural violence and organised crime; plans for full vaccination against the pneumococcal virus and polio; the coverage of the sexual and reproductive health education programme; measures to protect children in the Galapagos islands from abuse; plans to restore speciality to the juvenile justice system; why children vaccinated in the public sector did not receive the same vaccines as in the private sector; when the State party would update the national vaccination schedule; measures to ensure all births were registered; whether pregnant girls’ parents needed to consent to abortions; whether the national preventive mechanism provided specialised oversight of the detention of children; and inquiries into human rights violations occurring in international intercountry adoptions.

    Responses by the Delegation

    The delegation said thousands of institutions were providing inclusive education for children with disabilities, and over 126,000 teachers had received training on providing inclusive education.  A new national curriculum had been developed to encourage inclusive education, and there were also models of education tailored to the needs of children with various disabilities.  A programme had been developed to support children whose education had been delayed and there were policies in place to promote reinsertion for children who had dropped out of school.  Around one per cent of educational institutions were in a state of disrepair. The State party was investing more funds in refurbishing schools.  A voluntary early childhood education system had been developed, and 18,000 children were enrolled in the system. 

    All complaints of sexual violence occurring in schools needed to be reported to the police. Health services provided psychological care to child victims.  Schools were required to report complaints of abuse of students by bus drivers, which prosecutors duly investigated.  Data on violence in schools was collected to inform public protection policies and to provide specialised care to students.  A plan of action to prevent gender-based violence against children with disabilities in the education system was being implemented.

    Ecuador had growing rates of violence and terrorist crimes, which were an affront to the State’s sovereignty.  Given this situation, the Government declared a state of emergency in 2024.  All states of emergency were reviewed by the Constitutional Court, which had found them to be lawful.  All policies administered under states of emergency respected the rights of children and adolescents and promoted peace and human rights.

    The Constitution banned discrimination based on migration status.  The organic law on people on the move and other legislation ensured the rights of all migrant children in Ecuador and the provision of comprehensive care to them.  A specialised policy had been developed on caring for and regularising the status of unaccompanied minors.  Between 2021 and 2025, more than 4,900 children and adolescents were granted international protection by Ecuador.  Single parent migrant families had access to free legal representation.  There was an awareness raising campaign in place aiming to prevent discrimination against migrants on the northern border.  Guides had been developed that promoted the inclusion of migrant children in society and the education system.  All foreign persons had the same access to education and healthcare as Ecuadorian nationals.

    Ecuador had stepped up efforts to combat trafficking in persons.  It had produced guidance booklets against these crimes and was implementing preventive checks at border points.  The State party had managed to prevent over 3,000 irregular exits by children in recent years.  Training had been provided to border officials on detecting victims of trafficking, and an interactive map had been developed that displayed patterns in criminal activity.  Funding in the response to trafficking had been boosted in recent years.

    The police had a unit that was investigating illegal intercountry adoptions and taking measures to prevent such adoptions.  A protocol for the searching for the origins of adoptees had been developed.

    Measures had been taken to prevent cases of excessive use of force by the police against children from reoccurring.  Institutional guidelines had been developed to protect the rights of citizens involved in demonstrations, and an organic law regulating the legitimate use of force had been developed and disseminated.  The State party recognised that all children and adolescents had the right to protest peacefully.

    The State party was raising awareness of the importance of juvenile justice.  Measures imposed on adolescents aimed to ensure that they could rehabilitate and return to society.  These measures could be applied on adolescents for a minimum period of one year and a maximum of eight, depending on the severity of the crime. There were custodial and non-custodial socio-educational measures.  Units for social reintegration had bedrooms instead of cells, recreational areas, canteens, and educational workshops.  Around 430 adolescents were housed in these units, around half of whom had committed rape. The “good citizenship” programme was addressing the issue of adolescent rape.  No young persons had passed away in these centres in 2024.

    Parents did not need to give permission for girls to seek abortions.  Babies needed to be registered within 45 days of birth.  The cellular vaccine that the State would use had been scientifically tested and found to be safe for children aged six months and over.

    Concluding Remarks 

    MARY BELOFF, Committee Expert and Taskforce Coordinator, thanked the delegation for its efforts to answer the Committee’s questions.  The dialogue had provided insight on the issues faced by Ecuador and areas that needed to be focused on in public policies.  Ecuador had expressed its commitment to implementing the Convention.  The Committee hoped that the State party would be able to achieve its goals for the benefit of all children.

    ZAIDA ROVIRA, Minister of Economic and Social Inclusion of Ecuador, said that the dialogue had been sincere and candid.  The delegation had provided information on the implementation of the Convention through public policies, plans, and programmes aimed at protecting the rights of children and adolescents.  It had submitted official, verified information that it hoped had dispelled the Committee’s concerns.  It called for the Committee’s support to build a system for the protection of all children and adolescents.  It hoped to make its policies a reality in a short space of time.

    The State party had a debt to children and adolescents in the country.  It was committed to taking on its challenges by increasing the budget for children, developing robust standards and laws and an institutional system with sufficiently trained staff, and promoting cooperation with civil society.  The topics discussed in the dialogue would inform the State’s future efforts for children and adolescents.

     

    Produced by the United Nations Information Service in Geneva for use of the media; 
    not an official record. English and French versions of our releases are different as they are the product of two separate coverage teams that work independently.

     

    CRC25.008E

    MIL OSI United Nations News –

  • MIL-OSI USA: Lummis, Kelly Introduce Bipartisan, Bicameral Commercial Driver’s License Reforms  

    US Senate News:

    Source: United States Senator for Wyoming Cynthia Lummis
    WASHINGTON, D.C. – U.S. Senators Cynthia Lummis (R-WY) and Mark Kelly (D-AZ) introduced the Licensing Individual Commercial Exam-takers Now Safely and Efficiently (LICENSE) Act to help ease supply chain challenges by increasing the number of truck drivers in the U.S. The bill builds on waivers the Federal Motor Carrier Safety Administration (FMCSA) implemented during the COVID-19 pandemic.
    “Wyoming relies on America’s truck drivers to deliver goods to folks and small businesses throughout our rural state,” said Lummis. “Streamlining commercial driver’s licensing and cutting this burdensome red tape will ensure the people in the Cowboy State can rely on deliveries so they get the resources they need. I’m proud to work with Senator Kelly to reform the licensing process for America’s truckers.”
    “Arizona’s economy relies on the commercial drivers who work hard to keep goods moving across the nation,” said Kelly. “I’m glad to work with my colleague Senator Lummis to cut red tape, support the trucking industry, and ensure the federal government is doing everything it can to strengthen our economy and lower costs for families in Arizona.” 
    “When the Federal Motor Carrier Safety Administration (FMCSA) provided flexibility on several regulatory requirements during the COVID-19 public health emergency, drivers and motor carriers gained new operational efficiencies without compromising safety,” said American Trucking Associations Senior Vice President of Regulatory & Safety Policy Dan Horvath.  “The LICENSE Act leverages the lessons learned during the pandemic and makes permanent two commonsense waivers that were reissued numerous times since 2020 to reduce administrative burdens for Americans pursuing rewarding careers in the trucking industry. The incorporation of these waivers into law by enactment of the LICENSE Act will provide certainty to the trucking industry and strengthen our supply chain by permanently removing these unnecessary bureaucratic barriers.  This represents an important step toward making it more efficient and simpler for drivers to obtain their CDLs while keeping our roadways safe.”
    “During the past several years that these waivers have been in effect, they have proven that they strike the appropriate balance between maintaining high safety standards while making it easier for aspiring truck drivers to obtain their CDLs.  That’s why DOT reissued them multiple times throughout the pandemic.  Now it is time to provide certainty to the trucking industry by making these effective waivers permanent,” said Wyoming Trucking Association President & CEO Kevin Hawley.  “The LICENSE Act would make a commonsense change to streamline the arduous process for obtaining a CDL, removing unnecessary burdens on our drivers and supply chain.  We commend Senator Lummis for once again standing up for truckers, helping more people to obtain good-paying jobs, and growing Wyoming’s economy.”
    “The LICENSE Act streamlines the CDL testing process by allowing states to test applicants regardless of their residency or training location,” said Ryan Streblow, President and CEO of the National Tank Truck Carriers. “This efficiency is a commonsense solution that aims to address tank truck workforce shortages and strengthen our supply chain.”
    “CVTA members are pleased to see swift reintroduction of the LICENSE Act,” said Danny Bradford, Chairman of the Commercial Vehicle Training Association (CVTA). “This bill reduces bureaucratic barriers that delay new drivers from receiving their Commercial Driver’s License (CDL). We urge Congress to quickly pass this bill as part of an agenda to unleash record growth in the U.S. economy.”
    The LICENSE Act will:
    Expand CDL Testing: State and third-party examiners would be authorized to administer both the CDL skills and knowledge tests, speeding up the licensing process without compromising safety.
    Provide Flexible Supervision for CLP Holders: Licensed drivers accompanying commercial learner’s permit (CLP) holders could move to the sleeper berth of the truck, recognizing that many CLP holders have already passed their road tests and are waiting on their official CDL.
    Streamline Testing Across States: States would be allowed to administer driving skills tests to applicants from other states, making it easier for future truckers to complete testing close to home.
    The LICENSE Act is endorsed by: 
    The Agricultural & Food Transporters Conference (AFTC), the American Trucking Associations (ATA), the Automobile Carriers Conference (ACC), the Commercial Vehicle Training Association (CVTA), the Government Freight Conference (GFC), the Intermodal Motor Carriers Conference (IMCC), the Moving and Storage Conference (MSC), the National Tank Truck Carriers (NTTC), and the Truckload Carriers Association (TCA)
    To read the bill, click here.

    MIL OSI USA News –

  • MIL-OSI Security: Savage Woman Pleads Guilty for Her Role in $250 Million Feeding Our Future Fraud Scheme

    Source: Office of United States Attorneys

    MINNEAPOLIS – A Savage woman pleaded guilty for her role in the fraud scheme that exploited a federally funded child nutrition program during the COVID-19 pandemic, announced Acting U.S. Attorney Lisa D. Kirkpatrick.

    According to court documents, Ayan Farah Abukar, 43, and her co-defendants participated in a massive scheme to defraud the Federal Child Nutrition Program by obtaining, misappropriating, and laundering millions of dollars in program funds that were intended as reimbursements for the cost of serving meals to children. The defendants exploited changes in the program intended to ensure underserved children received adequate nutrition during the COVID-19 pandemic. Rather than feed children, the defendants enriched themselves by fraudulently misappropriating millions of dollars in Federal Child Nutrition Program funds.

    According to court documents, Abukarwas the founder and executive director of Action for East African People, a non-profit which she enrolled in the Federal Child Nutrition Program under the sponsorship of Feeding Our Future and Sponsor A. Between October 2020 through 2022, Abukar falsely claimed to be serving as many as 5,000 children a day at her various sites in Bloomington, Minneapolis, Savage, and St. Paul. In total, Abukar fraudulently received approximately $5.7 million in fraudulent Federal Child Nutrition Program funds. As part of the scheme to defraud, Abukar also paid more than $330,000 in kickbacks to a Feeding Our Future employee. Abukar spent millions on real estate, including a 37-acre commercial property in Lakeville and spent hundreds of thousands of dollars to purchase an aircraft in Nairobi, Kenya.

    Abukar pleaded guilty today in U.S District Court before Chief Judge Schiltz to one count of conspiracy to commit wire fraud. A sentencing hearing will be scheduled at a later date.

    The case is the result of an investigation by the FBI, IRS – Criminal Investigations, and the U.S. Postal Inspection Service.

    Assistant U.S. Attorneys for the District of Minnesota Joseph H. Thompson, Harry M. Jacobs, Matthew S. Ebert, and Daniel W. Bobier are prosecuting the case. Assistant U.S. Attorney Craig Baune is handling the seizure and forfeiture of assets.

    MIL Security OSI –

  • MIL-OSI Security: Feeding our Future Defendant Sentenced to 17 Years in Prison For His Role in $250 Million Fraud Scheme

    Source: Office of United States Attorneys

    MINNEAPOLIS – A Bloomington man has been sentenced to 210 months in prison followed by three years of supervised release for his role in a $250 million fraud scheme that exploited a federally funded child nutrition program during the COVID-19 pandemic, announced Acting U.S. Attorney Lisa D. Kirkpatrick. The defendant was also ordered to pay restitution in the amount of $47,920,514.

    “The defendant committed a brazen fraud that shamelessly stole taxpayer money intended to feed children during a global pandemic. He lined his pockets, here and abroad, with millions,” said Acting U.S. Attorney Kirkpatrick. “As the Court found, he doubled down on his crimes by obstructing justice. This significant sentence should serve as a clear warning to anyone who would seek to exploit and defraud government programs. You will be held accountable.”

    As proven at trial, Mukhtar Mohamed Shariff, 34, and his co-defendants devised and carried out a multi-million fraud scheme to defraud the Federal Child Nutrition Program. As the chief executive officer of Afrique Hospitality Group, Shariff obtained, misappropriated, and laundered millions of dollars in program funds that were intended as reimbursements for the cost of serving meals to children. Their scheme was accomplished by exploiting changes in the nutrition program intended to ensure underserved children received adequate nutrition during the COVID-19 pandemic. Shariff and his co-defendants created and submitted fraudulent meal count sheets purporting to document the number of children and meals served at each site and false invoices purporting to document the purchase of food to be served to children at the sites. The conspirators also submitted fake attendance rosters purporting to list the names and ages of the children receiving meals at the sites each day. These rosters were fabricated and created using fake names. 

    The Federal Child Nutrition Program, administered by the U.S. Department of Agriculture (USDA), is a federally funded program designed to provide free meals to children in need. The USDA’s Food and Nutrition Service administers the program throughout the nation by distributing federal funds to state governments. In Minnesota, the Minnesota Department of Education (MDE) administers and oversees the Federal Child Nutrition Program. Meals funded by the Federal Child Nutrition Program are served by “sites.” Each site participating in the program must be sponsored by an authorized sponsoring organization. Sponsors must submit an application to MDE for each site. Sponsors are also responsible for monitoring each of their sites and preparing reimbursement claims for their sites. The USDA then provides MDE federal reimbursement funds on a per-meal basis. MDE provides those funds to the sponsoring agency who, in turn, pays the reimbursements to the sites under its sponsorship. The sponsoring agency retains 10 to 15 percent of the funds as an administrative fee.

    During the COVID-19 pandemic, the USDA waived some of the standard requirements for participation in the Federal Child Nutrition Program. Among other things, the USDA allowed for-profit restaurants to participate in the program, and it allowed for off-site food distribution to children outside of educational programs.

    Following a seven-week trial in U.S. District Court before Judge Nancy E. Brasel in June 2024, Shariff was convicted of one count of conspiracy to commit wire fraud, one count of wire fraud, one count of conspiracy to commit money laundering, and one count of money laundering. In handing down the sentence today, Judge Brasel commented that Shariff’s conduct showed a “staggering lack of respect for the law,” and that taxpayers were “outraged by the brazenness of the crime.”

    The case is the result of an investigation by the FBI, IRS – Criminal Investigations, and the U.S. Postal Inspection Service. 

    Assistant U.S. Attorneys for the District of Minnesota Joseph H. Thompson, Harry M. Jacobs, Matthew S. Ebert, and Daniel W. Bobier prosecuted the case. Assistant U.S. Attorney Craig Baune is handling the seizure and forfeiture of assets.

    MIL Security OSI –

  • MIL-OSI USA: Commissioner Kristin Johnson’s Keynote Address at the University of Chicago Law School: Charting the Future of Financial Regulation

    Source: US Commodity Futures Trading Commission

    Good afternoon. Thank you to Dean Miles, Professor Birdthistle and the broader University of Chicago Law School for the kind invitation to join you for today’s event. We can often learn a great deal about the future by looking at the past. About 4,000 years ago (c. 2000 B.C.E.), Phoenician sailors developed charts and observations of the Sun and stars. Early mariners’ compasses were inaccurate or inconsistent because they lacked an understanding of magnetic variation. Later, the astrolabe, sextant, chip log, gyroscopic compass, radar, and GPS replaced earlier, primitive tools.
    In remarks earlier this week at a blockchain event at the World Economic Forum in Davos, I explored rapidly advancing technologies—an area that has long been a central focus of my contributions as a lawyer in private practice, in-house counsel, an academic, and most recently, a financial market regulator at the CFTC.[1] Today, on the eve of the Commodity Futures Trading Commission’s (CFTC) 50th Anniversary, we stand, once again on the frontier—a frontier of technological development in markets—including increasingly advanced computing, predictive analytical models, and algorithmic trading, and digital trading, clearing and settlement.
    During the most recent past administration, the Securities Exchange Commission Divisions of Trading and Markets and of Investment Management announced rule amendments to shorten the standard settlement cycle for most broker-dealer transactions from two business days after the trade date (“T+2”) to one business day after the trade date (“T+1”)[2] marking faster, more efficient, less costly trading ushered in, in part, by digitization of trading market infrastructure. Many of our largest market participants have partnered with technology firms to migrate exceptional volumes of data including orders, quotes, trades, cancellations and settlement data to cloud-based storage.
    Executive Orders this week on AI and digital assets or cryptocurrency indicate the new administration’s intent to focus on these new technologies. As we prepare to hear from the new administration regarding solutions to address the intricacies of balancing responsible innovation with the critical goals of ensuring market integrity, market stability, and protection of vulnerable market participants, let’s keep top-of-mind the lessons of the past and the benefits of well-honed regulatory tools which aid us in navigating the sea of technological innovation set forth before us.
    Today, we will consider the two specific technologies at the center of the new administration’s Executive Orders issued yesterday—AI and crypto.
    Artificial Intelligence in Financial Markets
    Financial markets regulation is often defined by two salient questions—what should we regulate and, if we regulate, what should be the scope of regulation. Knowing that crypto technologies are a focus of my remarks, some of you might demand that we tailor these questions and simply focus on the legal standard for distinguishing among regulated products, namely securities and commodities, citing the debate surrounding the legal standard articulated by the Supreme Court of the United States in SCOTUS’s now (in)famous 1946 decision S.E.C. vs Howey,[3] explaining that investment contracts that involve an investment of money in a common enterprise with an expectation of profits to be derived from the efforts of others.
    Leaving this question aside for a moment and focusing on the macro issue, I would note an underlying premise of these two fundamental questions. It is presumed that regulators understand both the products and the markets that are the subject of regulation—that we are clear on the benefits as well as the risks and limitations posed by products, processes, and market structures introduced in our markets. In other words, we are well-informed and deeply engaged in discussions regarding the attributes of what we regulate. I would also share that, for me, this understanding informs “how” I think about regulation.
    The Ever-Expanding Universe of AI Use Cases
    AI has long served financial services firms. For decades, firms have integrated standard algorithms and earlier forms of machine learning in both external client-facing applications as well as internal operations.[4] Developers tout the potential for more nascent uses of AI to enhance critical risk management tools, “inform[ing] trading strategies by identifying patterns, optimizing execution, managing portfolio workflows, and assessing risk-return tradeoffs.”[5] According to proponents, deep learning through neural networks holds promise to simulate the multi-layered, complex decision-making capabilities of the human brain.
    Several years ago, the CFTC identified a number of AI use cases in our regulated markets:

    Trading (including market intelligence, robo-advisory, sentiment analysis, algorithmic trading, smart routing, and transactions)
    Risk Management (including margin and capital requirements, trade monitoring, fraud detection)
    Risk Assessments and Hedging
    Resource Optimization (including energy and computer power)
    RegTech – Applications that enhance or improve compliance and oversight activities (including surveillance, reporting)
    Compliance (including identity and customer validation, anti-money laundering, regulatory reporting)
    Books and Records (including automated trade histories from voice or text)
    Data Processing and Analytics
    Cybersecurity and Resilience
    Customer Service.[6]

    The ever-expanding universe of AI use cases impacts investment, trading, surveillance and compliance, fraud detection, cyber security and supervision and enforcement across the derivatives and broader financial markets. In discussing AI’s application across financial markets, a Treasury report released last month stated “some financial firms have been experimenting with Generative AI tools—to explore the capabilities of AI in enhancing existing processes.”[7]
    “Robo-advisors offer personalized investment advisory services, while AI-driven insights improve forecasting and trading process automation.”[8] The Treasury Department’s recent report on Artificial Intelligence in Financial Services also notes that “financial firms are increasingly using AI—and particularly experimenting with Generative AI—internal business operations, including but not limited to risk management, regulatory compliance, treasury management, fraud detection, and back-office functions.”[9]
    Risks and Challenges Remain
    Attendant risks associated with the increase in use of AI, however, deserves equal attention, particularly for regulators tasked with safeguarding the integrity and stability of financial markets and the global economy. In testimony before Congress and academic work prior to my service at the Commission, I have encouraged regulators and market participants to also consider the following risks fraud and market manipulation, bias and discrimination, and privacy and data protection risks.[10]
    As the Financial Stability Board recently explained, “many of the potential risks of AI may seem new, but when you look beneath the surface, they are strikingly similar to traditional financial risks. Risks that we are familiar with. We already have frameworks to assess concentration risk, third party dependence and interconnectedness. This is good news. But potential new forms of interconnectedness in the financial system may emerge.”[11]
    To that end, it will be imperative for regulators to understand, track, and be poised to address emerging cybersecurity, third-party, concentration, and human capital risks.

    Cybersecurity

    Few would disagree that cybersecurity attacks and related disruptions pose one of the most pernicious and persistent threats to global financial markets.  In a timely and critical report on cybersecurity and AI, Treasury notes that “complex and persistent cyber threats continue to grow, and some experts from financial institutions believe the availability of advanced AI tools such as Generative AI will, at least initially, give threat actors an upper hand.”[12] Following a recent attack that disrupted clearing and settlement in derivatives markets in January of 2023, the Commission adopted a proposed rule enhancing operational resilience for swap dealers. In parallel to this rule, the Market Risk Advisory Committee that I sponsor, encouraged the Commission to consider comprehensive reform and consider the need for parallel reforms for our derivatives clearing organizations. While our principles-based approach to regulation enables dynamic application of existing rules, we must be ever vigilant to ensure that regulation is keeping pace and fit-for-purpose. I am looking forward to advancing these initiatives.

    Third-Party Risk Management

    Financial market regulators have, for several years, noted the challenges of relying on third parties for critical services. While regulated entities may have robust tools to monitor their own activities, our market participants increasingly partner with and rely upon third parties for critical services. Third party critical service providers may not have the comprehensive compliance processes and procedures the regulated entities have. The cascading impact of disruption may impact the many financial institutions that rely on the same critical third-party service providers, potentially engendering systemic risk concerns.[13]

    Concentration Risk

    The increasing reliance on third party service providers and the limited number of critical third-party service providers creates concentration risk. While the largest financial services firms in the world may have less exposure to these threats, smaller and medium sized firms without the technical expertise to develop high-cost technologies may need to rely on third parties and may also adapt these technologies in ways not anticipated by original developers, creating additional frictions.
    At the CFTC, we have been engaged in a longstanding dialogue with our market participants and our colleagues at other federal regulatory agencies to analyze and work to address these concerns—and we plan to continue the conversation.
    Last year, our staff released a request for comment, soliciting data regarding our market participants’ increasing use of AI.[14] We have not been alone in this work. The U.S. Department of Treasury similarly issued a request for information.[15] I worked with staff at the CFTC and staff at Treasury prior to and following these RFIs. The important results of these forms of engagement have only scratched the surface, given that “[o]ne of the most significant learnings from the comment responses is the reported ubiquity of AI usage—in particular traditional AI such as algorithms or machine learning—in virtually every function of financial firms, ranging from compliance management, internal operations, underwriting, customer service, treasury management, and product development and marketing.”[16]
    A Roadmap for the Future
    I have advanced, and will continue to advance, several policy initiatives over the course of my time at the Commission.
    Collaboration is Key

    Continued Dialogue

    There is still much work to be done. Continuing conversations with interested stakeholders across the board is the only way to ensure that we are learning in real time and incorporating that knowledge into sensible actions, both within the regulatory sphere and in the private sector.
    This dialogue “create[s] a framework that simultaneously serves two goals. The first is protecting the integrity of the trading markets so that they fairly serve the interests of participants and the larger public. The second is welcoming and encouraging the development and application of the newest technologies with responsible guardrails. In this way, we can ensure that these technologies help assure that the United States financial markets remain leaders in financial innovation in the years ahead.”[17]

    Interagency coordination

    In the December Treasury report, a brief discussion of the existing and proposed frameworks related to the use of AI in financial services is more than two pages long.[18] And that is just the first layer before adding state laws on AI, which can differ from each other and from federal frameworks, and finally, international standards.
    Of course, each regulator has its own specific mission and mandate. However, regulators must work together to harmonize regulation.[19]
    The Financial Stability Oversight Council echoes this recommendation in its annual report: “The Council supports interagency development of expertise to analyze and monitor potential systemic risks associated with the use of AI in the financial services sector, as well as further inter-agency discussions on developments in AI and associated financial stability risks.”[20]
    FSOC also recognizes the need for collaboration on a global scale. “The U.S. financial system is part of a global network and could potentially be vulnerable to shocks that originate abroad. The Council supports continued engagement with international counterparts on the risks and benefits of AI in financial services.”[21]
    Enhanced Resources for An Enhanced Mission

    Resources Must Keep Pace with Demand

    The CFTC is small but mighty, and continues to punch above its weight on all matters that come before it. In 2015 amidst the Dodd-Frank regulatory mandates, the CFTC had completed a greater percentage of its Dodd-Frank rules than other domestic financial regulatory agencies despite its smaller staff.[22] The same has been true in the past few years, as the Commission has taken on an increased role in addressing digital assets, while continuing its existing work, without any increase in budget.
    As the CFTC oversees increasingly complex markets, and must identify threats from increasingly sophisticated bad actors, it must have the resources to continue to do so effectively. I feel it important to reiterate that “the Commission would benefit from increased resources dedicated to enabling several of the Divisions within the Commission to prepare for and meet the challenges of regulating innovative trading, clearing, and settlement technologies, among other changes to operational infrastructure that merits consideration.”[23]

    An AI Fraud Task Force to Tackle Fraud Full Force

    I have expressly called for the CFTC Division of Enforcement to create an AI Fraud Task Force. While there may be divergent opinions on the benefits and risks engendered by AI, preventing bad actors from using AI to commit fraud against consumers and potentially market participants should be common ground. “Policing derivatives markets is one of the cornerstones of the CFTC’s mission. We must adapt our surveillance technologies and enforcement penalties to keep pace with the rapidly evolving innovation that characterizes global financial markets.”[24]
    A Future Framework for Digital Asset Markets 
    A second Executive Order released yesterday established a Presidential Working Group on Digital Asset Markets within the National Economic Council and appointed a Special Advisor for AI and Crypto to serve as Chairman of the PWG.
    Meaningful regulation in any market begins with identifying and developing standards to address certain risk management concerns. Many of the risks in the digital asset markets are well known.Learning from the lessons of the past few years, I am hopeful that any action to establish digital asset regulation include needed clarity regarding the application of rules and protections that safeguard the integrity of our markets. These regulations often also serve the organizations that implement them well.
    Digital asset market regulation should incorporate the same governance principles that have long governed our markets. Evidence of recent crises in digital asset markets underscore the benefits of strong corporate governance, rules governing conflicts of interest, and separation of customer property to preserve customer assets as part of a broader default management, recovery, and resilience strategy.

    Segregation of Customer Assets

    Our markets are built on trust. Any market that we supervise should have measures in place to protect the trust and confidence of customers and counterparties. Such recovery, resilience, and default risk management approaches should be applicable across markets that engender similar risks. 
    At the core these default-focused efforts create protections that preserve customer assets in the event of a liquidity or solvency crisis. The measures also guard against the commingling of customer funds witnessed in the 2022 crypto crises.[25] 
    The Commodity Exchange Act (CEA) expressly requires separation of customer funds in certain contexts. Section 4d(a)(2) of the CEA requires each FCM to segregate from its own assets all money, securities, and other property deposited by futures customers to margin, secure, or guarantee futures contracts and options on futures contracts traded on designated contract markets.[26] As the PGW takes up the mantle, preservation of customer capital must be a central and key issue. 

    Governance

    Basic corporate governance and internal controls should form part of the health and welfare of any market participant subject to the Commission’s supervision. Among other obligations, our regulations uniformly call for registered entities to have boards of directors, including independent directors, risk management committees, and executive officers that include chief compliance and risk officers who possess the requisite skills and expertise.[27]
    We continuously refine and update our governance standards as our markets evolve. In 2023, the Commission unanimously (please confirm) approved a final rule requiring derivatives clearing organizations (DCOs) to establish and consult with one or more risk management committees (RMCs) comprised of clearing members and customers of clearing members on matters that could materially affect the risk profile of the DCO. Section 5b(c)(2) of the CEA establishes core principles with which a DCO must comply in order to be registered and to maintain registration as a DCO (DCO Core Principles),1 and part 39 of the Commission’s regulations implement the DCO Core Principles. DCO Core Principle O requires a DCO to establish governance arrangements that are transparent, fulfill public interest requirements, and permit the consideration of the views of owners and participants.2 Regulation § 39.24 implements this aspect of Core Principle O by providing minimum requirements regarding the substance and form of a DCO’s governance arrangements.
    In the earlier referenced 2023 final risk governance rule, the Commission adopted minimum requirements for RMC composition and rotation, and required DCOs to establish and enforce fitness standards for RMC members. The Commission adopted requirements for DCOs to maintain written policies and procedures governing the RMC consultation process and the role of RMC members. Finally, the Commission adopted requirements for DCOs to establish one or more market participant risk advisory working groups (RWGs) that must convene at least twice per year, and adopt written policies and procedures related to the formation and role of the RWG.

    Compliance with AML/KYC laws and regulations

    Our experience regulating financial markets has demonstrated that strong AML/KYC regulations protects not only market integrity and stability, but also national security interests. These regulations are foundational and define the scope of who is permitted to actively engage our markets and, in many instances, the broader financial services and banking sector of our economy.
    Concluding with A Word Collaboration
    One of the greatest strengths of our government and, more specifically, the federal agencies that supervise many of the largest global financial market participants in the world is the intellectual leadership that our market regulators demonstrate. Our financial market regulations enhance efficiency, reduce the costs of raising capital, attract global investments, and serve as a model for regulation around the world. Our successful regulation is due, in large part, to our engagement with markets and the global regulatory community.
    As I noted in keynote remarks last year at NYU’s AI Convening, it is imperative for government and regulators to demonstrate a deep and abiding commitment to developing well-informed, research-based, data-driven regulatory solutions that are well-tailored, fit-for-purpose interventions. This requires a multi-stakeholder, public-private partnership that may include for advancing technologies developers, market participants, academics, government and industry researchers, diverse regulators across the financial markets, and public interest organizations.[28]
    Last year, in response to a staff advisory on the use of AI in CFTC-regulated markets,[29] I noted that “[w]orking in partnership with market participants, we are able to enhance our ability to accomplish our mission of ensuring market stability and market integrity. .”[30]
    I started this week in Davos, Switzerland, where I shared remarks at a conference about blockchain and AI, and about how the World Economic Forum Annual Meeting theme of “Collaboration for the Intelligent Age” is relevant to my work at the CFTC on these topics. World leaders in government, business, and civil society are still there, discussing the most pressing issues facing our global markets and broader societies, and trying to solve problems on a global scale. Nowhere is that more salient than in the United States, as we are close out the first week of a new executive administration.
    When we reflect on the future of finance, we must think back to the lessons learned as markets navigated sustained periods of extreme distress. Collaboration has served as one of the most important tools in our toolkit.
    The creation of the Financial Stability Oversight Council has proved a valuable source for convening the heads of financial market regulators across our government can carefully identifying and addressing anticipated systemic risk concerns. In addition to collaboration across market and prudential regulators, efforts by the SEC and CFTC to navigate implementation of the Dodd-Frank Act rules offers a second example of successful collaboration among market regulators. The discussions regarding regulation of AI, crypto, and other novel and emerging technologies should benefit from similar collaboration across regulators authority and across the aisle.
    Navigating difficult conditions requires focus, discipline, leadership and a steady hand at the helm. In recent years, our markets have navigated the onset of a global pandemic, geopolitical conflicts, sustained inflation.
    I am committed to working together to achieve this goal. As we enter this new year and new administration, collaboration will be as important as ever to achieve the benefits of scale and take advantage of all that innovation has to offer financial markets.
    Simply stated, and echoing this year’s World Economic Forum theme at Davos, we must find a path to collaboration in an intelligent age.

    [3] 328 U.S. 293 (1946).

    [5] Treasury December Report at 15.

    [7] Treasury December Report at 14.

    [8] Treasury December Report at 15.

    [9] Treasury December Report at 16.

    [13] Treasury December Report at 25.

    [16] See Treasury December Report.

    [18] Treasury December Report at 30.

    [19] “While many financial firms operating in the financial services sector are subject to laws and regulations that are technology-agnostic and can apply to AI technologies, respondents noted different regulatory standards among financial firms for the same activities.” Treasury December Report at 28.

    [25] See 1, 17 C.F.R. Pt. 1 (segregation of futures customer funds); 17 C.F.R. Pt. 22 (segregation of swaps customer funds); 17 C.F.R. Pt. 30 (segregation of foreign futures customer funds).

    [26] 7 U.S.C. § 6d(a)(2).

    MIL OSI USA News –

  • MIL-OSI Security: Kapolei Woman Indicted for Scheme to Defraud Unemployment Insurance and Pandemic Unemployment Assistance Programs

    Source: Office of United States Attorneys

    HONOLULU, Hawaii – Acting United States Attorney Kenneth M. Sorenson announced that on January 23, 2025, a federal grand jury returned a twelve-count indictment against Phoebe Trinh, also known as Phuong Trinh Ngoc Vo, 31, of Kapolei, Hawaii, charging Trinh with nine counts of wire fraud and three counts of aggravated identity theft in connection with fraudulent claims for unemployment insurance and pandemic unemployment assistance.

    The charges in the indictment pertain to both the unemployment insurance and Pandemic Unemployment Assistance (PUA) programs. In 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act created the PUA program to provide emergency unemployment payments to certain workers whose livelihoods were impacted by the COVID-19 pandemic, but who were ineligible for traditional state unemployment insurance benefits.

    The indictment alleges that Trinh submitted a false claim for unemployment insurance benefits to the Hawaii Department of Industrial and Labor Relations (DLIR) using its website, and that she repeatedly falsely certified under penalty of law that she was unemployed and not receiving income, despite knowing that her certifications were false, in order to receive benefit payments that she was not entitled to receive.

    The indictment further alleges that Trinh also submitted a claim to the Hawaii DLIR for PUA benefits on behalf of another individual, using that individual’s personal identifiable information, including name and social security number, without that individual’s knowledge and consent, in order to obtain  additional benefit payments to which she was not entitled. Trinh then allegedly repeatedly certified to Hawaii DLIR that the individual remained eligible for PUA benefit payments in order to receive the payments, without the individual’s knowledge and consent. The indictment alleges that Trinh directed Hawaii DLIR to transmit the benefit payments that were intended for the individual to her own bank account.

    According to the indictment, Trinh fraudulently obtained at least approximately $36,265 in unemployment insurance and PUA unemployment benefits to which she was not entitled.

    Each of the wire fraud counts carries a maximum penalty of 20 years in prison and a fine of up to $250,000. Each of the aggravated identity theft counts carries a sentence of two years in prison. An indictment is merely an accusation, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

    On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.

    Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) at 866-720-5721 or online at http://www.justice.gov/DisasterComplaintForm.

    This case is being investigated by the U.S. Department of Labor Office of Inspector General. It is being prosecuted by Assistant U.S. Attorney Gregg Paris Yates.

    MIL Security OSI –

  • MIL-OSI United Kingdom: Statement on the approval of the accounts at the Audit and Governance Committee on Wednesday 22 January

    Source: St Albans City and District

    Publication date:

    Councillor Paul de Kort, Leader of St Albans City and District Council, said:

    I am pleased that the Council’s Statements of Accounts for three previous financial years have been approved by the Audit Committee.

    This brings to an end what has been a frustrating period for us and dozens of other local authorities across the country.

    We have complied with all laws and regulations governing our financial activities and there is nothing untoward in the accounts, which have been open to public inspection.

    Unfortunately, the delays in auditing the accounts – which were out of our control – have led to some unfair criticism and speculation that can now be put to rest.

    We will move forward, look to the future and concentrate on finalising our accounts for the last financial year, 2023/24, with the way clear for them to be audited in a timely fashion.

    Jonathan Flowers, the independent Chair of the Council’s Audit and Governance Committee, said: 

    As the Council’s external auditor BDO’s report explains, delays to the auditing of local authority accounts have been a national problem due to factors which councils have been powerless to prevent.

    These range from significant staff shortages among BDO and other auditors, who have had difficulty in recruiting and retaining staff, to the adverse impact upon their work of the Covid-19 pandemic.

    The Government recognised councils were experiencing lengthy delays through no fault of their own and introduced legislation last year which allowed them to clear the backlog and start afresh.

    Auditors are now required to issue a disclaimed opinion on accounts which the backlog pressures mean they have been unable to check.

    More than 300 disclaimed opinions have been made by auditors for local authority accounts across the country. It offers no opinion rather than an approval or a non-approval and attaches no blame. 

    It is a mechanism the Government is using to reset the local audit assurance process and allow for a fresh start.

    This means that the Audit and Governance Committee have had to look to other sources of assurance in relation to our accounts such as the work of our internal audit service.

    We look forward to putting the backlog behind us, though it will be some time before any of the affected councils can get fully approved accounts because of the overhang from this issue.

    Cllr de Kort added: 

    A disclaimed opinion is what BDO have made for our accounts for the financial years, 2021/22 and 2022/23.

    For the financial year 2020/21, they have issued a modified opinion. The audit commenced for that financial year but was not completed.

    Some issues were identified during the audit but were not resolved within the time constraints. 

    These are of a technical nature, such as the method used to value land and buildings, and we don’t necessarily accept the points BDO have raised. It is a matter of judgement, and we will simply agree to disagree. 

    The important thing is that we can now put these frustrating delays behind us and with the Committee having approved the accounts, we can move on to complete our accounts for 2023/24 with the help of our new auditors, KPMG.

    Notes:

    BDO’s Audit Completion Report – Extract from the Executive Summary:

    Circumstances that affect the form and content of the auditor’s report

    There has been a deterioration in the timeliness of local audit in recent years leading to a persistent and significant backlog of audit opinions. 

    Across England, the backlog of outstanding audit opinions stood at 771 at 31 December 2023 and is estimated to increase to around 1,000 later this year. 

    In February 2024, the Department for Levelling Up, Housing and Communities published ‘Local audit delays: Joint statement on update to proposals to clear the backlog and embed timely audit’. 

    This joint statement confirmed that: “The issues facing local audit are widely recognised as multi-faceted and complex with no single cause or solution”. 

    The factors contributing to the delay in issuing an audit opinion on the financial statements of St Albans City & District Council for the year ended 31 March 2021 include, but are not limited to:

    § increased regulator expectations on auditors

    § difficulties in attracting, developing and retaining staff to perform local audit work 

    § the impact of the Covid-19 pandemic 

    Over the last year, organisations involved in the regulation and oversight of local body financial reporting and audit have been working collectively to agree a proposed solution to clear the outstanding historical audit opinions and ensure that delays do not return.

    MIL OSI United Kingdom –

  • MIL-OSI: Marquette National Corporation Increases Quarterly Dividend 10.7 Percent and Announces a Common Stock Repurchase Program

    Source: GlobeNewswire (MIL-OSI)

    CHICAGO, Jan. 24, 2025 (GLOBE NEWSWIRE) — Marquette National Corporation (OTCQX: MNAT) today announced that its Board of Directors declared a cash dividend of $0.31 per share, an increase of 10.7% from the previous quarter dividend rate. The dividend will be payable on April 1, 2025 to shareholders of record on March 14, 2025. As of December 31, 2024, Marquette had 4,367,477 shares issued and outstanding.

    The Company also announced that its Board of Directors authorized the repurchase of up to $1,000,000 of its outstanding common stock at prevailing market prices through open market or negotiated transactions. The repurchase program is authorized to last through December 31, 2025.

    Marquette National Corporation is a diversified bank holding company with total assets of $2.2 billion. The Company’s banking subsidiary, Marquette Bank, is a full-service, community bank that serves the financial needs of communities in Chicagoland, offering an extensive line of financial solutions, including retail banking, real estate lending, trust, insurance, investments, wealth management and business banking to consumers and commercial customers. Marquette Bank has 20 branches located in: Chicago, Bolingbrook, Bridgeview, Evergreen Park, Hickory Hills, Lemont, New Lenox, Oak Forest, Oak Lawn, Orland Park, Summit and Tinley Park, Illinois. For more information visit: https://emarquettebank.com

    Special Note Concerning Forward-Looking Statements
    This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local, state, national and international economies (including the effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics, acts of war or other threats thereof (including the ongoing Israeli-Palestinian conflict and the Russian invasion of Ukraine), or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the Financial Accounting Standards Board or the Public Company Accounting Oversight Board; (iv) changes in local, state and federal laws, regulations and governmental policies concerning the Company’s general business as a result of the upcoming 2024 presidential election or any changes in response to failures of other banks; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of the significant rate increases by the Federal Reserve since 2022); (vi) increased competition in the financial services sector (including from non-bank competitors such as credit unions and “fintech” companies) and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) the loss of key executives or employees; (ix) changes in consumer spending; (x) unexpected outcomes of existing or new litigation involving the Company; (xi) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xii) fluctuations in the value of securities held in our securities portfolio; (xiii) concentrations within our loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (xiv) the concentration of large deposits from certain clients who have balances above current Federal Deposit Insurance Corporation insurance limits and may withdraw deposits to diversity their exposure; (xv) the level of non-performing assets on our balance sheets; (xvi) interruptions involving our information technology and communications systems or third-party servicers; (xvii) breaches or failures of our information security controls or cybersecurity-related incidents, and (xviii) the ability of the Company to manage the risks associated with the foregoing as well as anticipated.. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

    The MIL Network –

  • MIL-OSI: Silicon Motion Confirms Quarterly Dividend

    Source: GlobeNewswire (MIL-OSI)

    TAIPEI, Taiwan and MILPITAS, Calif., Jan. 24, 2025 (GLOBE NEWSWIRE) — Silicon Motion Technology Corporation (NasdaqGS: SIMO)(“Silicon Motion” or the “Company”), a global leader in designing and marketing NAND flash controllers for solid state storage devices, confirms today its quarterly cash dividend.

    On October 28, 2024, the Board of Directors of the Company declared payment of an annual dividend of US$2.00 per ADS1, equivalent to US$0.50 per ordinary share, which will be paid in four quarterly installments of $0.50 per ADS, equivalent to US$0.125 per ordinary share.  According to the previously announced record and payment dates, the next quarterly installment will be paid on February 27, 2025 to all shareholders of record on February 13, 2025. Our depository bank’s DR Books will be closed for issuance and cancellation on February 13, 2025.

    The declaration and payment of future cash dividends are subject to the Board’s continuing determination that the payment of dividends is in the best interests of the Company’s shareholders and are in compliance with all laws and agreements of the Company applicable to the declaration and payment of cash dividends.

    ABOUT SILICON MOTION:

    We are the global leader in supplying NAND flash controllers for solid state storage devices.  We supply more SSD controllers than any other company in the world for servers, PCs and other client devices and are the leading merchant supplier of eMMC and UFS embedded storage controllers used in smartphones, IoT devices and other applications.  We also supply customized high-performance hyperscale data center and specialized industrial and automotive SSD solutions.  Our customers include most of the NAND flash vendors, storage device module makers and leading OEMs.  For further information on Silicon Motion, visit us at http://www.siliconmotion.com.

    FORWARD-LOOKING STATEMENTS:

    This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” or the negative of these terms or other comparable terminology. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. These statements involve risks and uncertainties, and actual market trends or our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward-looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to the unpredictable volume and timing of customer orders, which are not fixed by contract but vary on a purchase order basis; the loss of one or more key customers or the significant reduction, postponement, rescheduling or cancellation of orders from one or more customers; general economic conditions or conditions in the semiconductor or consumer electronics markets; the impact of inflation on our business and customer’s businesses and any effect this has on economic activity in the markets in which we operate; the functionalities and performance of our information technology (“IT”) systems, which are subject to cybersecurity threats and which support our critical operational activities, and any breaches of our IT systems or those of our customers, suppliers, partners and providers of third-party licensed technology; the effects on our business and our customer’s business taking into account the ongoing U.S.-China tariffs and trade disputes; the uncertainties associated with any future global or regional pandemic; the continuing tensions between Taiwan and China including enhanced military activities; decreases in the overall average selling prices of our products; changes in the relative sales mix of our products; changes in our cost of finished goods; supply chain disruptions that have affected us and our industry as well as other industries on a global basis; the payment, or non-payment, of cash dividends in the future at the discretion of our board of directors and any announced planned increases in such dividends; changes in our cost of finished goods; the availability, pricing, and timeliness of delivery of other components and raw materials used in the products we sell given the current raw material supply shortages being experienced in our industry; our customers’ sales outlook, purchasing patterns, and inventory adjustments based on consumer demands and general economic conditions; any potential impairment charges that may be incurred related to businesses previously acquired or divested in the future; our ability to successfully develop, introduce, and sell new or enhanced products in a timely manner; and the timing of new product announcements or introductions by us or by our competitors. For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time to time with the U.S. Securities and Exchange Commission, including our Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission on April 30, 2024. Other than as required under the securities laws, we do not intend, and do not undertake any obligation to, update or revise any forward-looking statements, which apply only as of the date of this press release.

    1 One ADS is equivalent to four ordinary shares.

    The MIL Network –

  • MIL-OSI Global: The technology that runs Congress lags so far behind the modern world that its flag-tracking system just caught up to 2017-era Pizza Hut

    Source: The Conversation – USA – By Lorelei Kelly, Research Lead, Modernizing Congress, McCourt School of Public Policy, Georgetown University

    Tracking one of these items to your door has been possible since 2017 – tracking the other is all new. FTiare/iStock / Getty Images Plus

    On a typical day, you can’t turn on the news without hearing someone say that Congress is broken. The implication is that this dereliction explains why the institution is inert and unresponsive to the American people.

    There’s one element often missing from that discussion: Congress is confounding in large part because its members can’t hear the American people, or even each other. I mean that literally. Congressional staff serve in thousands of district offices across the nation, and their communications technology doesn’t match that of most businesses and even many homes.

    Members’ district offices only got connected to secure Wi-Fi internet service in 2023. Discussions among members and congressional staff were at times cut short at 40 minutes because some government workers were relying on the free version of Zoom, according to congressional testimony in March 2024.

    Congressional testimony discusses meetings being cut off at 40 minutes.

    The information systems Congress uses have existed largely unchanged for decades, while the world has experienced an information revolution, integrating smartphones and the internet into people’s daily personal and professional lives. The technologies that have transformed modern life and political campaigning are not yet available to improve the ability of members of Congress to govern once they win office.

    Slow to adapt

    Like many institutions, Congress resists change; only the COVID-19 pandemic pushed it to allow online hearings and bill introductions. Before 2020, whiteboards, sticky notes and interns with clipboards dominated the halls of Congress.

    Electronic signatures arrived on Capitol Hill in 2021 – more than two decades after Congress passed the ESIGN Act to allow electronic signatures and records in commerce.

    The nation spends about US$10 million a year on technology innovation in the House of Representatives – the institution that declares war and pays all the federal government’s bills. That’s just 1% of the amount theater fans have spent to see ‶Hamilton“ on Broadway since 2015.

    It seems the story of American democracy is attractive to the public, but investing in making it work is less so for Congress itself.

    The chief administrative office in Congress, a nonlegislative staff that helps run the operations of Congress, decides what types of technology can be used by members. These internal rules exist to protect Congress and national security, but that caution can also inhibit new ways to use technology to better serve the public.

    Finding a happy medium between innovation and caution can result in a livelier public discourse.

    The pandemic compelled Congress to allow witnesses to testify before committees by videoconference.
    Stefani Reynolds-Pool/Getty Images

    A modernization effort

    Congress has been working to modernize itself, including experimenting with new ways to hear local voices in their districts, including gathering constituent feedback in a standardized way that can be easily processed by computers.

    The House Natural Resources Committee was also an early adopter of technology for collaborative lawmaking. In 2020, members and committee staff used a platform called Madison to collaboratively write and edit proposed environmental justice legislation with communities across the country that had been affected by pollution.

    House leaders are also looking at what is called deliberative technology, which uses specially designed websites to facilitate digital participation by pairing collective human intelligence with artificial intelligence. People post their ideas online and respond to others’ posts. Then the systems can screen and summarize posts so users better understand each other’s perspectives.

    These systems can even handle massive group discussions involving large numbers of people who hold a wide range of positions on a vast set of issues and interests. In general, these technologies make it easier for people to find consensus and have their voices heard by policymakers in ways the policymakers can understand and respond to.

    Governments in Finland, the U.K., Canada and Brazil are already piloting deliberative technologies. In Finland, roughly one-third of young people between 12 and 17 participate in setting budget priorities for the city of Helsinki.

    In May 2024, 45 U.S.-based nonprofit organizations signed a letter to Congress asking that deliberative technology platforms be included in the approved tools for civic engagement.

    In the meantime, Congress is looking at ways to use artificial intelligence as part of a more integrated digital strategy based on lessons from other democratic legislatures.

    A panel discussion of various ideas for modernizing how Congress hears from the American people.

    Finding benefits

    Modernization efforts have opened connections within Congress and with the public. For example, hearings held by video conference during the pandemic enabled witnesses to share expertise with Congress from a distance and open up a process that is notoriously unrepresentative. I was home in rural New Mexico during the pandemic and know three people who remotely testified on tribal education, methane pollution and environmental harms from abandoned oil wells.

    New House Rules passed on Jan. 3, 2025, encourage the use of artificial intelligence in day-to-day operations and allow for remote witness testimony.

    Other efforts that are new to Congress but long established in business and personal settings include the ability to track changes in legislation and a scheduling feature that reduces overlaps in meetings. Members are regularly scheduled to be two places at once.

    Another effort in development is an internal digital staff directory that replaces expensive directories compiled by private companies assembling contact information for congressional staff.

    The road ahead

    In 2022, what is now called ”member-directed spending“ returned to Congress with some digital improvements. Formerly known as “earmarks,” this is the practice of allowing members of Congress to handpick specific projects in their home districts to receive federal money. Earmarks were abolished in 2011 amid concerns of abuse and opposition by fiscal hardliners. Their 2022 return and rebranding introduced publicly available project lists, ethics rules and a search engine to track the spending as efforts to provide public transparency about earmarks.

    Additional reforms could make the federal government even more responsive to the American people.

    Some recent improvements are already familiar. Just as customers can follow their pizza delivery from the oven to the doorstep, Congress in late 2024 created a flag-tracking app that has dramatically improved a program that allows constituents to receive a flag that has flown over the U.S. Capitol. Before, different procedures in the House and Senate caused time-consuming snags in this delivery system.

    At last, the world’s most powerful legislature caught up with Pizza Hut, which rolled out this technology in 2017 to track customers’ pizzas from the store to the delivery driver to their front door.

    Lorelei Kelly has received funding from Democracy Fund and the Hewlett Foundation for her research on modernization in the US Congress.

    – ref. The technology that runs Congress lags so far behind the modern world that its flag-tracking system just caught up to 2017-era Pizza Hut – https://theconversation.com/the-technology-that-runs-congress-lags-so-far-behind-the-modern-world-that-its-flag-tracking-system-just-caught-up-to-2017-era-pizza-hut-245931

    MIL OSI – Global Reports –

  • MIL-OSI Global: Donald Trump is firing out presidential pardons and warnings of retribution. What happens next?

    Source: The Conversation – UK – By Adam Quinn, Associate Professor in American and International Politics, University of Birmingham

    Donald Trump has now pardoned or commuted the sentences of around 1,500 January 6 protesters, including those who were convicted of crimes against police officers relating to the riot at the US Capitol.

    But use of the presidential pardon in the last few days was not restricted to the incoming president. On his last day in office, outgoing president Joe Biden signed a number of pre-emptive pardons in an effort, he suggested, to shield people from possible “retribution” at Trump’s hands.

    This included not just members of the House committee that investigated the Capitol riot, but also Anthony Fauci, former chief medical advisor to the president during the COVID pandemic, and Gen. Mark Milley, who retired in 2023 after four years as the nation’s most senior military officer, and whom Trump has previously suggested would have been executed for treason in a previous era.

    In December, Biden granted his son Hunter a sweeping pardon, and he extended the same to several other relatives in the final minutes of his presidency. In an accompanying statement he said: “Even when individuals have done nothing wrong — and in fact have done the right thing — and will ultimately be exonerated, the mere fact of being investigated or prosecuted can irreparably damage reputations and finances.”

    Such pardons may be greeted with ambivalence by some recipients. One person who received a pardon was Adam Schiff, now a US Senator and previously a House member who both served on the Jan 6 committee and was lead prosecutor in Trump’s first impeachment. He had previously declared he did not want such a pardon because, first, it was unnecessary since he had done nothing wrong, and, second, it set a bad precedent. We may find out in the months and years ahead whether he was right on either count.

    So how did we get here?

    A year ago, Trump faced a daunting obstacle course of criminal cases. Among them, he faced trial in New York for falsifying business records. Federal prosecutors had indicted him for trying to steal the 2020 election, and for illegally holding onto classified documents after his presidency ended. He also faced state-level election subversion charges in Georgia.

    By the time of his inauguration, however, his legal problems had been almost entirely resolved. He was convicted on the New York charges, but his punishment, an unconditional discharge, is a slap on the wrist. The greatest symbol of Trump’s victory over legal threats, however, is the shelving of the two federal cases against him. Both cases have now been dismissed at the request of the Justice Department because its policy prevents a criminal case against a sitting president. Even if this were not the case, as head of the executive branch Trump would have authority to order them dropped.



    Read more:
    Nixon’s official acts against his enemies list led to a bipartisan impeachment effort

    Trump enters a second term freer of personal legal jeopardy than he has been in years. He is convinced that the cases against him represented a weaponisation of the criminal justice system by his political opponents. Now restored to the highest office, there are widespread fears that he may wield federal power to retaliate against those he believes have wronged him.

    In the run-up to the election he spoke often about “retribution” against “the enemy within”. An NPR investigation of Trump’s rallies and social media posts since 2022 found more than 100 instances of his explicitly or implicitly threatening to “investigate, prosecute, jail or otherwise punish his perceived opponents”.

    He has repeated that he “would have every right” to go after those he believes have waged “lawfare” against him over the last several years.

    If he does decide to try, it is less likely than during his first term that top officials will block or dissuade him. Trump’s current nominee for attorney general, former Florida attorney general Pam Bondi, was part of his defence team during his 2020 impeachment, then an active supporter of his campaign to overturn the 2020 election. During her Senate confirmation hearing she refused to say that she would defy pressure from Trump, but she did say that “politics will not play a part” in deciding who to investigate. Few will have felt completely reassured.

    Even more concerningly, Christopher Wray, director of the FBI, the leading national criminal investigative agency, has resigned before the usual duration of his tenure, after Trump declared he intended to replace him with Kash Patel. Patel, more than any other senior Trump nominee, has spent his career at the heart of the post-2016 Maga movement. He held junior roles late in the first Trump administration, but in the years since he has advocated using criminal and civil prosecution to root out “conspirators” among journalists and government officials.

    Patel even published a book containing a list of “Members of the Executive Branch Deep State” (including both Democrats and Republican appointees), seen by some as an “enemies list”. This is an appointment that some believe suggests restraint is unlikely.



    Read more:
    Trump’s election interference case may be closed, but it still matters for America’s future

    The January 6 rioters and plotters were among the first beneficiaries of the transfer of power. While campaigning Trump had portrayed them as martyrs to his cause and pledged pardons. He made good on that promise on day one by pardoning or commuting sentences. He also ordered the Justice Department to dismiss all pending indictments.

    It remains to be seen what approach the new president will take toward those who have worked prominently against him. He had previously said that some who served on the Congressional committee investigating the attack on the Capitol ““should go to jail”, often singling out former Republican Congresswoman Liz Cheney, who also received a pre-emptive pardon from Biden. Trump has also suggested that Biden should have issued a pardon for himself.

    It is doubtful that targeted investigations could ultimately produce criminal convictions without some plausible case. For the time being at least, US courts and the jury system retain sufficient independence that blatantly groundless and malicious prosecutions would struggle to get that far against targets with the resources to defend themselves.

    But as previous federal probes have illustrated – such as those into the Clintons – even an investigation that ultimately stops short of bringing charges against its top targets can last years, impose significant legal expenses on those embroiled in it, and inflict stress and distraction.

    The aim of this kind of action may be to instil a climate of anticipatory fear in which outspoken criticism in the future seems, to most, more trouble than it is worth. The US is not there yet. But it is closer to such a state than it has been in any of our lifetimes.

    Adam Quinn has previously received research funding from the Economic and Social Research Council (ESRC) and the Charles Koch Foundation (CKF)

    – ref. Donald Trump is firing out presidential pardons and warnings of retribution. What happens next? – https://theconversation.com/donald-trump-is-firing-out-presidential-pardons-and-warnings-of-retribution-what-happens-next-247646

    MIL OSI – Global Reports –

  • MIL-OSI Global: Netflix’s La Palma’s ‘megatsunami’ has been debunked

    Source: The Conversation – UK – By Hannah Little, Lecturer in Communication and Media, University of Liverpool

    In the Netflix series La Palma, a Norwegian family goes on holiday to the Canary Islands when a young researcher discovers alarming signs of an imminent volcanic eruption. Cumbre Vieja is an active volcano on La Palma, which last erupted in 2021. The series culminates in a “megatsunami” capable of engulfing Europe and reaching as far as the west coast of the US.

    It’s a truly terrifying prospect.

    Disaster stories are hugely popular and La Palma is just the latest hit in the growing genre. In his book Disaster Mon Amour, the film critic David Thomson identifies the filmmakers’ goal of creating “a spectacle of devastation with cozy human interest”. But stories like La Palma can have real world impact.

    The series presents itself as being based on a real hypothesis, which is communicated by newscasters and a scientist in the title sequence of each episode. The tsunami expert Simon Day, whose research inspired the show, is also thanked in the closing credits. However, La Palma does nothing to capture the more up to date and reassuring science.

    Looking for something good? Cut through the noise with a carefully curated selection of the latest releases, live events and exhibitions, straight to your inbox every fortnight, on Fridays. Sign up here.

    While volcanic events can trigger tsunamis, as experts in volcanoes and the communication of disaster, we can assure you that the eruption and subsequent rapid collapse of the island depicted in the series isn’t a plausible scenario that scientists are concerned about.

    What should be taken more seriously are localised tsunamis. Such “megatsunami” scenarios have been debunked in recent years you’ll be happy to hear.

    There have been more than 17 eruptions in the Canary Islands since the 1400s, none resulting in a “megatsunami” across the Atlantic.

    Stories have the power to communicate information about environmental risk for audiences. Following the release of the film, some have dug up the megatsunami hypothesis, raising it back into the public awareness.

    The idea of a “megatsunami”, triggered in the way it is in La Palma, first arose in a 2001 paper by the academic the series thanks in its credits, Simon Day and the geophysicist Steven Ward based on one extreme hypothetical scenario. This theory has since been proven false by subsequent studies that show that a Canary Islands eruption and collapse might reach the US with a maximum wave height similar to a storm surge at one to two metres , not the 25-metre waves depicted in La Palma. Newer research has also called into question the scale of the landslide used in the original study which would cause such a tsunami.

    Since the initial work, we understand a lot more about how large landslides and tsunamis occur, and the computer models used to test tsunami scenarios have improved. Research on the underwater landslide deposits has shown that these collapses occur in multiple, smaller steps, not one massive slide into the ocean. Such a large tsunami would leave telltale deposits in North and South America – but they are nowhere to be found.

    The importance of understanding the risk relating to real volcanoes was encapsulated during the 2021 eruption of Cumbre Vieja. As the eruption progressed, volcanologists received messages from concerned and frightened people fearing a megatsunami, which prompted the US Geological Survey to respond outlining why the hypothesis doesn’t carry. This was even before a major Netflix drama had recounted such an imaginary event.

    Volcanogenic tsunamis of all sizes are a real threat around the world and hazards experts want to know what our risks are so we can prepare and protect our communities. This becomes difficult when facts are diluted or distorted by stories like La Palma’s. Volcanologists with limited resources during an eruption end up spending more time debunking information rather than talking to the press about the potential dangers.

    During the 2021 eruption, the people of La Palma suffered greatly and continue to struggle with claiming compensation and rebuilding their homes or accessing their properties. Tourist numbers dropped to a third of pre-pandemic levels after 2021’s volcanic eruption.

    Misinformation about eruptions and their risks can add to the stress of those inhabiting or visiting volcanic islands, not only concerned about their own safety, but the security of an economy that relies heavily on tourism. With the right information, we can empower communities to prepare themselves and to act fast when the time comes.

    A lot of people watch Netflix, but not many people read scientific papers on volcanology. Given this, it might be that the responsibility of getting the science right and accurately representing risk should lie with the people with a captive audience. There is an opportunity to work with scientists to help spread the right information alongside promotion for future stories about such disasters.

    Simon Day was approached for comment but hadn’t responded by the time this article was published.

    Katy Chamberlain received funding to work on the 2021 La Palma eruption from the Natural Environment Research Council (NERC) Urgency grant number: NE/ W007673/1

    Hannah Little and Janine Krippner do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.

    – ref. Netflix’s La Palma’s ‘megatsunami’ has been debunked – https://theconversation.com/netflixs-la-palmas-megatsunami-has-been-debunked-246916

    MIL OSI – Global Reports –

  • MIL-OSI Video: The Global Economic Outlook | World Economic Forum Annual Meeting 2025

    Source: World Economic Forum (video statements)

    Nearly five years since the COVID-19 pandemic upended the global economy, growth is slow but stable, inflation has gradually declined in advanced economies and trade trends have turned positive. Despite this, there remain challenges such as high public debt burdens, ongoing geo-economic tensions and the potential impact of industrial policies on smaller countries.

    Given this landscape, what are the plausible scenarios for the global economy in 2025?

    Speakers: Faisal Alibrahim, Kristalina Georgieva, Laurence D. Fink, Sara Eisen, Christine Lagarde, Tharman Shanmugaratnam

    The 55th Annual Meeting of the World Economic Forum will provide a crucial space to focus on the fundamental principles driving trust, including transparency, consistency and accountability.

    This Annual Meeting will welcome over 100 governments, all major international organizations, 1000 Forum’s Partners, as well as civil society leaders, experts, youth representatives, social entrepreneurs, and news outlets.

    The World Economic Forum is the International Organization for Public-Private Cooperation. The Forum engages the foremost political, business, cultural and other leaders of society to shape global, regional and industry agendas. We believe that progress happens by bringing together people from all walks of life who have the drive and the influence to make positive change.

    World Economic Forum Website ► http://www.weforum.org/
    Facebook ► https://www.facebook.com/worldeconomicforum/
    YouTube ► https://www.youtube.com/wef
    Instagram ► https://www.instagram.com/worldeconomicforum/
    X ► https://twitter.com/wef
    LinkedIn ► https://www.linkedin.com/company/world-economic-forum
    TikTok ► https://www.tiktok.com/@worldeconomicforum
    Flipboard ► https://flipboard.com/@WEF

    #Davos2025 #WorldEconomicForum #wef25

    https://www.youtube.com/watch?v=k7rBsMrx094

    MIL OSI Video –

  • MIL-OSI: Stronghold Digital Mining Announces CFO Transition

    Source: GlobeNewswire (MIL-OSI)

    NEW YORK, Oct. 25, 2024 (GLOBE NEWSWIRE) — Stronghold Digital Mining, Inc. (the “Company”) today announced that Chief Financial Officer Matthew Smith will resign from his position, effective November 15, 2024, after the Company files its Quarterly Report on Form 10-Q for the third quarter of 2024. Mr. Smith will also step down from the Company’s Board of Directors at that time. Mr. Smith’s resignation was not due to any disagreement with the Company on any matter relating to the Company’s operations, policies or practices, including accounting principles and practices.

    Following his departure, the Company intends to retain Mr. Smith as a consultant to assist with the transition of his responsibilities for a period of time. Currently, the Company does not intend to fill the vacancy on the Board that will be created following the effective date of Mr. Smith’s resignation. The Company thanks Mr. Smith for his contributions over the past three years.

    About Stronghold Digital Mining, Inc.
    Stronghold is a vertically integrated Bitcoin mining company with an emphasis on environmentally beneficial operations. Stronghold houses its miners at its wholly owned and operated Scrubgrass Plant and Panther Creek Plant, both of which are low-cost, environmentally beneficial coal refuse power generation facilities in Pennsylvania.

    Forward Looking Statements of Stronghold:
    Certain statements contained in this press release, including guidance, constitute “forward-looking statements.” within the meaning of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements because they contain words such as “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Forward-looking statements and the business prospects of Stronghold are subject to a number of risks and uncertainties that may cause Stronghold’s actual results in future periods to differ materially from the forward-looking statements, including with respect to its potential carbon capture initiative and with respect to completing a strategic review process or entering into a transaction. These risks and uncertainties include, among other things: the hybrid nature of our business model, which is highly dependent on the price of Bitcoin; our dependence on the level of demand and financial performance of the crypto asset industry; our ability to manage growth, business, financial results and results of operations; uncertainty regarding our evolving business model; our ability to retain management and key personnel and the integration of new management; our ability to raise capital to fund business growth; our ability to maintain sufficient liquidity to fund operations, growth and acquisitions; our substantial indebtedness and its effect on our results of operations and our financial condition; uncertainty regarding the outcomes of any investigations or proceedings; our ability to enter into purchase agreements, acquisitions and financing transactions; public health crises, epidemics, and pandemics such as the coronavirus pandemic; our ability to procure crypto asset mining equipment from foreign-based suppliers; our ability to maintain our relationships with our third-party brokers and our dependence on their performance; our ability to procure crypto asset mining equipment including to upgrade our current fleet; developments and changes in laws and regulations, including increased regulation of the crypto asset industry through legislative action and revised rules and standards applied by The Financial Crimes Enforcement Network under the authority of the U.S. Bank Secrecy Act and the Investment Company Act; the future acceptance and/or widespread use of, and demand for, Bitcoin and other crypto assets; our ability to respond to price fluctuations and rapidly changing technology; our ability to operate our coal refuse power generation facilities as planned; our ability to remain listed on a stock exchange and maintain an active trading market; our ability to avail ourselves of tax credits for the clean-up of coal refuse piles; legislative or regulatory changes, and liability under, or any future inability to comply with, existing or future energy regulations or requirements; our ability to replicate and scale the carbon capture project; our ability to manage costs related to the carbon capture project; and our ability to monetize our carbon capture project, including through the private market; our ability to qualify for, obtain, monetize or otherwise benefit from the Puro registry and Section 45Q tax credits, our ability to timely complete a strategic review process and our ability to consummate a transaction in connection with such process, in part or at all, our ability to qualify for demand response programs, our ability to qualify as PJM “In Network” load, our ability to prepare our sites for and execute on GPU computing initiatives and our ability to expand the power capacity at our sites. More information on these risks and other potential factors that could affect our financial results are included in our filings with the SEC, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our Annual Report on Form 10-K filed on March 8, 2024, and in our subsequently filed Quarterly Reports on Form 10-Q. Any forward-looking statement or guidance speaks only as of the date as of which such statement is made, and, except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements or guidance, whether because of new information, future events, or otherwise.

    Contacts:

    Stronghold Digital Mining, Inc.
    Investor Contact:
    Matt Glover or Alec Wilson
    Gateway Group, Inc.
    SDIG@gateway-grp.com
    1-949-574-3860

    Media Contact:
    contact@strongholddigitalmining.com

    The MIL Network –

  • MIL-OSI USA: Senator Murray Applauds Historic Presidential Apology to Tribes for Federal Indian Boarding School Era, Affirms Commitment to Tribal Nations

    US Senate News:

    Source: United States Senator for Washington State Patty Murray

    Seattle, WA – Today, U.S. Senator Patty Murray (D-WA), Chair of the Senate Appropriations Committee, issued the following statement in response to President Joe Biden’s historic and formal Presidential apology for the Federal Indian Boarding School era.

    “To have the President of the United States formally acknowledge the harms of our past and issue a direct apology to Tribal nations is powerfully important. It’s long past time for our government to fully come to terms with the horrific legacy of Indian boarding schools, which were designed to systematically strip away Native language, religion, and heritage—in brutal and traumatic ways. The next step is to pass our bipartisan bill to establish a Truth and Healing Commission so that we can help Native families and communities in Washington state and across the country heal from this painful chapter in our nation’s history.

    “Importantly, I am proud to have partnered with the Biden-Harris administration to deliver historic investments in our Tribal communities. As a voice for Washington state’s Tribes in the Senate, I will continue to fight to live up to our commitments to our Tribal partners with action and real, meaningful investments.”

    The bipartisan Truth and Healing Commission on Indian Boarding School Policies in the United States Act (S.1723), cosponsored by Senator Murray, would establish a formal commission to investigate, document, and acknowledge the injustices of the federal government’s Indian boarding school policies. These policies include the ordered termination of Native cultures, religions, and languages; the removal and kidnapping of Native children; forced assimilation; and egregious human rights violations. The commission would also develop recommendations for how Congress could provide aid to Native families and communities and provide a forum for victims to speak about their personal experiences.

    For over 150 years, the federal government ran boarding schools that forcibly removed generations of Native children from their homes to boarding schools often far away. Native children at these schools endured physical, emotional, and sexual abuse, and, as detailed in the Federal Indian Boarding School Investigative Report by the Department of the Interior (DOI), at least 973 children died in these schools. The federally-run Indian boarding school system was designed to assimilate Native Americans by destroying Native culture, language, and identity through harsh militaristic and assimilationist methods. There were 15 Indian boarding schools in the State of Washington. In April of 2023, as part of her “Road to Healing” tour, U.S. Secretary of the Interior Deb Haaland met with Native survivors of the federal Indian boarding school system and their descendants in Tulalip.

    Murray has been a strong advocate for Tribes in the United States Senate. Over the years, Murray has secured hard-won updates to the Violence Against Women Act to better protect Native women and fought to deliver the largest-ever federal investment in Tribes in the American Rescue Plan to support Tribal communities as they confronted the health and economic impacts of the pandemic.

    As Appropriations Chair, Murray protected funding for the Indian Health Service (IHS) despite tough budget caps and fought for a $61.4 million increase in Fiscal Year 2024 to ensure IHS can hire more providers to meet increased patient demand. Importantly, Murray secured advance appropriations for IHS for the upcoming fiscal year to provide more certainty and limit disruptions so the agency can better plan and provide continuity of care for Tribes. Murray has also been a strong advocate of the Indian Housing Block Grant (IHBG) program. The IHBG is the largest source of federal resources for housing for Tribal communities—providing flexible funding for the construction for new affordable housing, rental assistance, housing improvements and rehabilitation, and other supportive housing-related services. Murray has fought to increase funding for the IHBG program every year, and in Fiscal Year 2024, as Appropriations Chair, she was able to secure a record $1.111 billion for the program—a $324 million increase over Fiscal Year 2023—in the Transportation and Housing and Urban Development spending bill signed into law in March of 2023. Across government spending, Murray has always fought to prioritize the needs of Washington state Tribal communities.

    MIL OSI USA News –

  • MIL-OSI USA News: Remarks by President  Biden on the Biden-⁠ Harris Administration’s Record of Delivering for Tribal Communities, Including Keeping His Promise to Make this Historic Visit to Indian Country | Laveen Village,  AZ

    Source: The White House

    Gila Crossing Community School
    Laveen Village, Arizona

    10:44 A.M. MST

    PRESIDENT BIDEN:  I’m Joe Biden.  I’m Jill Biden’s husband  (Laughter.)

    Gov, thank you for that introduction and to the Gila Indian River Community — the — Gila — yeah, Gila — nothing wrong with me — (laughter) — Gila River Indian Community for welcoming me today. 

    You know — (applause) — I say this with all sincerity, this, to me, is one the most consequential things I’ve ever had an opportunity to do in my whole career and as president of the United States.  It’s an honor — a genuine honor to be in this special place on this special day. 

    Thank you to Senator Mark Kelly, a great friend, who also is married to an incredible woman who is my friend. 

    Please have a seat, by the way.  (Laughter.)

    And Congressman Greg Stanton.  I saw Greg when I came in.  He’s over there somewhere.  Greg, thank you.

    And I’m putting these glasses on because I’m having trouble seeing this. 

    And all the elected leaders and the Tribal community leaders for being here. 

    You know, I can’t tell you what a special thanks I have for Deb Haaland, my Interior secretary.  I was determined — (applause) — I was determined — I made a commitment when I became president to have an administration that looked like America.  Except you’re America, and there’s — never has been — never has been a Native American, an Indigenous person who was on — in the Cabinet or in a — in the secretary’s job or any consequential job in a presidential administration.

    She’s the first — but it’s clearly not the last — Native American Cabinet secretary ever.  (Applause.)  And her historic and dedicated leadership is strengthening the relationship between the Tribal Nations and the federal government — is unlike ever happened before. 

    That’s why we’re here today. 

    You know, when I got to the Senate, I was only 29 years old.  I had to wait 17 days to be eligible.  And I had — after I got elected, w- — while I waiting, my wife and daughter were killed and my two boys were badly injured.

    And a guy that came to my assistance was a guy named Danny Inouye.  And the first thing he taught me — not a joke — was, “Joe, it is not ‘Indians.’  It’s ‘Indian Nations’ — Indian N-” — (applause) — No, I — he was serious, deadly earnest about it.

    It’s been 10 years since a sitting president — president came and visited Indian Country.  That’s simply much too long.

    And that’s why I am here today not only to fulfil my promise to be a president that — first president to visit Indian Country but, more importantly, to right a wrong, to chart a new path toward a better future for us all.

    I am also here because, as I said, my wife Jill has been here 10 times in Indian Country, literally.  The first lady sends her love and said, “Joe, make sure you come home.”  (Laughter.)  Because every time she goes — she spent a lot of time in, excuse me for saying this, the Navajo Nation.  I’m worried — (applause) — every time she goes, I’m worried she’s not coming home.  (Laughter.)

    I watched that beautiful performance just now, and it moved me deeply.  It’s a reminder of everything Native people enjoy and employ: sacred traditions, culture passed down over thousands of — thousands of years.  (Applause.)  

    Long before there was a United States, Native communities flourished on these lands.  They practiced democratic government before we ever heard of it, developed advanced agriculture, contributed to science, art, and culture.  (Applause.)

    But eventually, the United States was established and began expanding, entering treaties with sovereign Tribal Nations.  But as time moved on, respect for s- — for Tribal sovereignty evaporated, was shattered, pushing Native people off their homelands, denying — denying their humanity and their rights, targeting children to cut their connection to their ancestors and their inheritance and their heritage. 

    At first, in the 19- — 1800s, the effort was voluntary, asking Tribes to sell their children — to send their children away to vocational schools.  But then — then the federal government mandated — mandated the removal of children from their families and Tribes, launching what’s called the Federal Indian Boarding School era — era.  Over a 150-year span — 150 years — from the early 1800s to 1870 — to 1970.  One of the most horrific chapters in American history.  We should be ashamed.  A chapter that most Americans don’t know about.  The vast majority don’t even know about it. 

    I was — I was at my hotel today.  I told the pe- — the hotel staff, as we were leaving.  They said, “Where are you going?”  I told them.  They said, “What are you doing?”  I told them.  They said they’re Natives here.  They said, “I never knew that.  I never knew that.”  Think of how many people don’t know.

    As president, I believe it’s imper- — important that we do know — know generations of Native children stolen, taken away to places they didn’t know with people they never met who spoke a language they had never heard.  Native communities silenced.  Their children’s laughter and play were gone. 

    Children would arrive at schools.  Their clothes taken off.  Their hair that they were told was sacred was chopped off.  Their names literally erased and replaced by a number or an English name. 

    One survivor later recounted her days when taken away.  She said, quote, “My mother standing on that sidewalk as we loaded into a green bus.  I can see the image of my mom burned into my mind and my heart where she was crying.”

    Another survivor described what it was like at the boarding school, and I quote, “When I would talk in my Tribal language, I would get hit.  I lost my tongue.  They beat me every day.”

    Children abused — emotionally, physically, and sexually abused.  Forced into hard labor.  Some put up for adoption without the consent of their birth parents.  Some left for dead in unmarked graves. 

    And for those who did return home, they were wounded in body and in spirit — trauma and shame passed down through generations. 

    The policy continued even after the Civil Rights Act, which got me involved in politics as a young man.  Even after the Civil Rights Act was passed in 1964, it continued. 

    All told, hundreds and hundreds of Federal Indian Boarding Schools across the country.  Tens of thousands of Native children entered the system.  Nearly 1,000 documented Native child deaths, though the real number is likely to be much, much higher; lost generations, culture, and language; lost trust. 

    It’s horribly, horribly wrong.  It’s a sin on our soul.

    I’d like to ask, with your permission, for a moment of silence as we remember those lost and the generations living with that trauma. 

    (A moment of silence is observed.)

    After 150 years, the United States government eventually stopped the program, but the federal government has never — never — formally apologized for what happened until today. 

    I formally apologize — (applause) — as president of the United States of America, for what we did.  I formally apologize.  And it’s long overdue.

    At the Tribal school — at a Tribal school in Arizona, a community full of tradition and culture, and joined by survivors and descendants to do just that: apologize, apologize, apolo- — rewrite the history book correctly.  (Applause.)

    I have a solemn responsibility to be the first president to formally apologize to the Native peoples — Native Americans, Native Hawaiians, Native Alaskans — and [at] Federal Indian Boarding Schools. 

    It’s long, long, long overdue.  Quite frankly, there’s no excuse that this apology took 50 years to make. 

    The Federal Indian Boarding School policy and the pain it has caused will always be a significant mark of shame, a blot on American history. 

    For too long, this all happened with virtually no public attention, not written about in our history books —

    AUDIENCE MEMBER:  Yeah, what about the people in Gaza?

    THE PRESIDENT:  — not taught in our schools.

    AUDIENCE MEMBER:  What about the people in Palestine, huh?

    (Cross-talk.)

    AUDIENCE:  Booo —

    AUDIENCE MEMBER:  (Inaudible.)

    THE PRESIDENT:  Let her talk.  Let her talk.

    AUDIENCE MEMBER:  (Inaudible) empty promise for our people.  How can you apologize for a genocide while committing a genocide in Palestine?

    Free Palestine!  Free Palestine!

    AUDIENCE MEMBER:  Get out of here!

    AUDIENCE MEMBER:  Free Palestine!

    THE PRESIDENT:  No, no.  Let — let her go.  There’s a lot of innocent people being killed. 

    AUDIENCE MEMBER:  (Inaudible.)

    THE PRESIDENT:  There’s a lot of innocent people being killed, and it has to stop.

    For those — (applause) — for those who went through this period, it was too painful to speak of.  For our nation, it was too shameful to acknowledge.  But just because history is silent doesn’t mean it didn’t take place.  It did take place.  (Applause.)

    While darkness can hide much, it erases nothing.  It erases nothing.  Some injustices are heinous, horrific, and grievous.  They can’t be buried, no matter how hard people try. 

    As I’ve said throughout my presidency, we must know the good, the bad, the truth of who we are as a nation.  That’s what great nations do.  We’re a great nation.  We’re the greatest of nations.  We do not erase history; we make history.  We learn from history, and we remember so we can heal as a nation.  It takes remembering.

    This formal apology is the culmination of decades of work by so many courageous people, many of whom are here today: survivors and descendants, allies and advocates — like the nation’s Native American Boarding School Healing Coalition and other — (applause) —

    All of you who are part of that, stand up.  Stand up.  (Applause.)  As my grandfather would say, you’re doing God’s work.

    And other courageous leaders who spent decades shining a light on this dark chapter.  And leaders like Secretary Haaland, whose grandparents were children at one of those boarding schools. 

    U.S. Interior Department, the same department that long ago oversaw Federal Indian Boarding Schools — guess what? — the extensive work on the — breaking ground, it’s happened with her.  It’s appropriate that she is bringing an end to what that very agency did.  (Applause.)  Groundbreaking report documenting what happened. 

    We owe it to all of you across Indian Country.  The truth — the truth must be told.  And the truth must be heard all across America. 

    But this official apolocy [apology] is only one step toward and forward from the shadows of failed policies of the past.  That’s why I’ve committed to working with Indigenous communities across the country to write a new and better chapter of our — in our history, to honor the solemn promise the United States made to Tribal Nations, to fulfill our federal trust and treaty obligations.  It’s long, long, long overdue.  (Applause.)

    And I say this with all sincerity, from day one, my administration, Jill and I, Kamala and Secretary Haaland, our entire administration have worked to include Indigenous voices in all we do.  Along with Secretary Haaland, I’ve appointed Native Americans to lead across the federal government.

    I signed a groundbreaking executive order to give Tribes the — more autonomy to make your own decisions — (applause) — requiring federal agencies to streamline grant appro- — grant appropriations and applications, to comanage federal programs, to eliminate heavy-handed reporting requirements.  It’s about representing your autonomy.  And, I might add, it’s a hell of a lot more efficient when you do it too.  (Applause.)

    Folks, I’m proud to have reestablished the White House Council on Native American Affairs — (applause); relaunched the White House Tribal Na- — Tribal Nations Summit — (applause); and taken historic steps to improve Tribal consultation.  (Applause.) 

    With the historic laws I’ve signed, we’re making some of the most significant investments in Native communities ever — ever in American history. 

    It’s part of my Invest in America agenda, and it’s helping all Americans from every state and every Tribe, and that’s good for all America. 

    Helping Native communities get through the pandemic with vaccine shots in arms and checks in pockets. 

    I’m proud this helped cut child poverty in Native communities by more than one third.  (Applause.) 

    I’m proud our economy — our economic plan has created 200,000 jobs for Native Americans, record-low [un]employment in Native communities. 

    With the strong support from Secretary Haaland and all of you, we’re finally modernizing Tribal infrastructure, for God’s sake — (applause) — building new roads, new bridges; delivering clean water, affordable high-speed broadband in every Native community; and so much more. 

    Folks, we’re just getting started.  We’re making historic climate investments in clean energy, conservation, and clean water [for] Native communities, including co-stewardships of our land and waters. 

    We just des- — designated the first National Marine Sancrutary — Sanctuary proposed by Indigenous communities, which is off the coast of California.  We just got that done.  (Applause.)  And I have restored and designated multiple national monuments to honor Tribal Nations, including the Ancestral Footprints of the Grand Canyon, right here in Arizona, where I had the honor of visiting.  (Applause.)  It was breathtaking.  It was breathtaking.

    I secured the first-ever advanced funding for Indian Health Services — (applause) — so Tribal hospitals can plan ahead, order supplies, hire doctors and know that the money will be there.  (Applause.)  

    We’re also preserving ancestral Tribal homelands, restoring salmon and other native fish, recognizing the value of Indigenous knowledge and languages, especially those damaged in the boarding school era. 

    In fact, my administration was proud to defend the Indian Child Welfare Act — (applause) — an act that was passed in 1970 [1978] in no small part to remedy the harms of 150 years of taking Native children away from their families. 

    But you all know, that act was challenged just a few years ago in the summer of 2023.  Those who opposed us challenged — challenged on the grounds that Native families should not have priority over everyone else in adopting Native children.  Well, I took that all the way to the Supreme Court and we won.  We won.  (Applause.)

    We also extended mental health programs through the Bureau of Indian Education so young people have the tools to end cycles of generational trauma. 

    As an educator, this is something Jill cares deeply about, my wife, just as she’s traveled across Native communities to increase access to health care and so much more, including helping open the first cancer cure [care] center in Navajo Nation.  (Applause.)

    And more to do — a lot more to do.

    And, by the way, the infrastructure bill is over a trillion dollars.  It’s not a decade.  I mean, it’s not a quarter.  It’s going to be there for a decade.  Much, much more to come, and you got to get your fair share.   

    By [re]authorizing the Violence Against Women Act — an Act I took great pains in writing 30 years ago, we also — (applause) — we also reasirmed [reaffirmed] Tribal sovereignty and expanded Tribal jurisdiction in cases where outside predators [perpetrators] harm members of your Nation. 

    And as we mark Native Americans History Month in November — this November, we recognize the contributions of Indigenous people in — to American history.  You — you are the first Americans.  I might add, you’re among the most patriotic Americans.  (Applause.)  Well, that’s a fact.  The whole of America should know, all Americans should know Indigenous people volunteer to serve in the United States military five times more than any other single group.  (Applause.)  Five times.  Five.  Five.  Five.  (Applause.)  Many having paid the ultimate sacrifice in every war since our founding. 

    To all of you, thank you — thank you for serving in so many ways — as first responders, artists, entrepreneurs, educators, doctors, scientists, and so much more — sharing your culture and your knowledge for the good of future generations, believing in possibilities — the possibility to usher in a new era to a nation-to-nation relationship grounded in dignity and respect.  It matters. 

    My dad used to have an expression.  He’d say, “Joey, everyone — everyone — is entitled to be treated with dignity.  Everyone.”  “Everyone is enti-” — he meant it.  (Applause.)

    Well, let me close with this.  It’s about restoring your dignity.

    I know no apology can or will make up for what was lost during the darkness of the Federal Boarding School policy.  But today, we’re finally moving forward into the light. 

    As president of the United States, I’ve had the honor to bestow our nation’s most prestigious medals to distinguished people and organizations all across America.  That includes Native Americans who survived the boarding school era. 

    Early in my term, I bestowed the Medal of Freedom — our highest civilian honor — on a man my grandfather, who was an Irish immigrant and was not treated very well because he was an Irish Catholic in the coal-mine era in Scranton — but he went on to be an all-American football player at Santa Clara.  And every time they’d talk about all-Americans, he’d say, “Joey, the greatest athlete in American history is Jim Thorpe.”  (Applause.)  Oh, I’m seri- — I knew a lot about Jim Thorpe before some of you probably even knew.  (Laughter.)

    As a child, Jim was taken from his home but went on to become one of the greatest athletes ever, ever, ever in all of American history. 

    And earlier this week, I bestowed two other revere- — revered medals — the National Medals of Arts and the National Medal of the Humanities — to 39 extraordinary Americans and organizations, including Roseta Wrol [Rosita Worl], an Alaskan Native.  (Applause.) 

    More than 80 years ago, she was a six-year-old when she was taken to a federal boarding school.  She spent three years without her family, her family not knowing if she’d ever come home.  Nine years old, she was one of those who did come home. 

    Over the next seven decades, she became a leading anthropologist and advocate, building a new era of understanding.  Her story, from being taken from her home as child to standing in the Oval Office receiving one of the nation’s most consequential medals, is a story of the truth, the power of healing. 

    When Roseta [Rosita] sees young people signing tradi- — singing traditional songs, just like we heard today, she says, and I quote, “We will hear the voices of our ancestors, and we are now hearing it through our children.”

    For too long, this nation sought to silence the voices of generations of Native children, but now your voices are being heard.    

    That’s the America that we should be.  That’s the America we can all be proud of.  That’s who we are.  For God’s sake, let’s make sure we reach out and embrace, because you make us stronger.  You are America.

    God bless you all.  And may God protect our troops. 

    Thank you.  (Applause.)

    11:07 A.M. MST

    MIL OSI USA News –

  • MIL-OSI Economics: UK non-food online penetration set to improve for first time since COVID-19 pandemic, says GlobalData

    Source: GlobalData

    UK non-food online penetration set to improve for first time since COVID-19 pandemic, says GlobalData

    Posted in Retail

    The UK non-food online market is set to grow by 2.9% to reach £106m in 2024, with online penetration forecast to climb to 39%, marking an improvement for the first time since the COVID-19 pandemic, according to GlobalData, a leading data and analytics company. GlobalData anticipates the non-food online market growth will outpace the total retail market, which is expected to increase by 2.1% in 2024.

    Tash Van Boxel, Retail Analyst at GlobalData, comments: “Retailers must diversify online capabilities to take advantage of increased online demand. Enhancing online services will be essential, such as implementing AI powered tools to strengthen apps and websites and improving fulfilment services. Not doing so will expose retailers to fluctuations in footfall, impacting offline demand. A strong online proposition can help retailers convert online browsers to purchase through services such as Click & Collect.”

    As online growth is set to continue, retailers must ensure that delivery services provide good value for money and high efficiency. 85% of frequent online shoppers* would switch away from their favourite online retailer if they could find faster delivery for the same item elsewhere, according to GlobalData’s September 2024 Consumer Views survey**. A further 60% of frequent online shoppers stated that the delivery experience impacts whether they shop at the retailer again.

    Van Boxel continues: “Online shoppers value the delivery experience and will switch away to competitors if the experience goes sour. Prioritising cost-effective delivery methods is crucial for retailers to retain customers, ensuring shoppers have options, such as next-day delivery and nominated-day delivery at reasonable prices. Retailers must also be cautious about which couriers they partner with, as shoppers will look elsewhere if the only available courier has proved to be unreliable in the past.”

    Social media will play a vital role in the growth of the non-food online market, as consumers increasingly shop directly through social media platforms. 49.0% of UK consumers use Instagram, and 30.9% use TikTok, according to GlobalData’s October 2024 survey. Usage is highest among Gen Z consumers, with 88% using Instagram and 74% using TikTok.

    Van Boxel concludes: “Social media is growing as a retail channel, but given the variation in usage among the generations, retailers need to cater their content on each platform to reach their target audience. As younger consumers utilise Instagram and TikTok more than their older counterparts, retailers must tailor content to this demographic. For example, collaborations with content creators are more likely to resonate with younger consumers who are more trusting of social media reviews than sponsored posts announcing new product launches, which may capture all age groups. Personalising marketing campaigns and content will be key to growing retailers’ customer bases and bolstering online traffic.”

    *A frequent shopper is defined as a consumer who shops online every few days or once a week

    **GlobalData’s October 2024 and September 2024 monthly surveys were conducted with 2,000 respondents

    MIL OSI Economics –

  • MIL-Evening Report: UN experts ‘alarmed’ by Kanaky New Caledonia deaths as Pacific fact-finding mission readies

    By Stefan Armbruster of BenarNews

    France has been criticised for the “alarming” death toll in New Caledonia during recent protests and its “cold shower” approach to decolonisation by experts of the UN Human Rights Committee.

    The UN committee met this week in Geneva for France’s five-yearly human rights review with a focus on its Pacific territory, after peaceful protests over electoral changes turned violent leaving 13 people dead since May.

    French delegates at the hearing defended the country’s actions and rejected the jurisdiction of the UN decolonisation process, saying the country “no longer has any international obligations”.

    A delayed fact-finding mission of Pacific Islands Forum leaders is due to arrive in New Caledonia this weekend to assess the situation on behalf of the region’s peak regional inter-governmental body.

    Almost 7000 security personnel with armoured vehicles have been deployed from France to New Caledonia to quell further unrest.

    “The means used and the intensity of their response and the gravity of the violence reported, as well as the amount of dead and wounded, are particularly alarming,” said committee member Jose Santo Pais, assistant Prosecutor-General of the Portuguese Constitutional Court.

    “There have been numerous allegations regarding an excessive use of force and that would have led to numerous deaths among the Kanak people and law enforcement,” the committee’s vice-chair said on Wednesday.

    Months of protests
    Violence erupted after months of protests over a unilateral attempt by President Emmanuel Macron to “unfreeze” the territory’s electoral roll. Indigenous Kanaks feared the move would dilute their voting power and any chance of success at another independence referendum.

    Eleven Kanaks and two French police have died. The committee heard 169 people were wounded and 2658 arrested in the past five months.

    New Caledonia’s economy is in ruins with hundreds of businesses destroyed, tens-of-thousands left jobless and the local government seeking 4 billion euros (US$4.33 billion) in recovery funds from France.

    France’s reputation has been left battered as an out-of-touch colonial power since the deadly violence erupted.

    Santos Pais questioned France’s commitment to the UN Declaration on Indigenous People and the “sufficient dialogue” required under the Nouméa Accord, a peace agreement signed in 1998 to politically empower Kanak people, that enabled the decolonisation process.

    “It would seem that current violence in the territory is linked to the lack of progress in decolonisation,” said Santos Pais.

    Last week, the new French Prime Minister announced controversial electoral changes that sparked the protests had been abandoned. Local elections, due to be held this year, will now take place at the end of 2025.

    Pacific mission
    Tomorrow, Tonga’s prime minister Hu’akavameiliku Siaosi Sovaleni will lead a Pacific “observational” mission to New Caledonia of fellow leaders from Cook Islands, Fiji and Solomon Islands Minister for Foreign Affairs, together known as the “Troika-Plus”.

    The PIF leaders’ three-day visit to the capital Nouméa will see them meet with local political parties, youth and community groups, private sector and public service providers.

    “Our thoughts have always been with the people of New Caledonia since the unrest earlier this year, and we continue to offer our support,” Sovaleni said in a statement on Friday.

    The UN committee is a treaty body composed of 18 experts that regularly reviews compliance by 173 member states with their human rights obligations and is separate from the Human Rights Council, a political body composed of states.

    Serbian committee member Tijana Surlan asked France for an update on investigations into injuries and fatalities “related to alleged excessive use of force” in New Caledonia. She asked if police firearms use would be reviewed “to strike a better balance with the principles of absolute necessity and strict proportionality.”

    France’s delegation responded saying it was “committed to renewing dialogue” in New Caledonia and to striking a balance between the right to demonstrate and protecting people and property with the “principle of proportionality.”

    Alleged intimidation by French authorities of at least five journalists covering the unrest in New Caledonia was highlighted by committee member Kobauyah Tchamdja Kapatcha from Togo. France responded saying it guarantees freedom of the press.

    French Ambassador for Human Rights Isabelle Rome addresses the UN Human Rights Committee meeting in Geneva, pictured on 23 October 2024. Image: UNTV

    France rejects ‘obligations’
    The French delegation led by Ambassador for Human Rights Isabelle Rome added it “no longer administers a non-self-governing territory.”

    France “no longer has any international obligations in this regard linked to its membership in the United Nations”, she told the committee on Thursday.

    New Caledonia voted by modest majorities to remain part of France in referendums held in 2018 and 2020 under a UN-mandated decolonisation process. Three referendums were part of the Nouméa Accord to increase Kanaks’ political power following deadly violence in the 1980s.

    A contentious final referendum in 2021 was overwhelmingly in favor of continuing with the status quo. Supporters of independence rejected its legitimacy due to a very low turnout — it was boycotted by Kanak political parties — and because it was held during a serious phase of the covid-19 pandemic, which restricted campaigning.

    “France, through the referendum of September [2021], has therefore completed the process of decolonisation of its former colonies,” ambassador Rome said. She added that New Caledonia was one of the most advanced examples of the French government recognising indigenous rights, with a shared governance framework.

    Another of its Pacific territories — French Polynesia — was re-inscribed on the UN decolonisation list in 2013 but France refuses to recognise its jurisdiction.

    No change in policy
    After a decade, France began attending General Assembly Decolonisation Committee meetings in 2023 to “promote dialogue” and that it was not a “change in [policy] direction”, Rome said.

    “There is no process between the French state and the Polynesian territory that reserves a role for the United Nations,” she added.

    Santos Pais responded saying, “what a cold shower”.

    “The General Assembly will certainly have a completely different view from the one that was presented to us,” he said.

    Earlier this month pro-independence French Polynesian President Moetai Brotherson told the UN Decolonisation Committee’s annual meeting in New York that “after a decade of silence” France must be “guided” to participate in “dialogue.”

    The Human Rights Committee is due to meet again next month to adopt its findings on France.

    Copyright ©2015-2024, BenarNews. Republished with the permission of BenarNews.

    MIL OSI Analysis – EveningReport.nz –