It's like a neighborhood Bank of America, but exclusively for specific counties in Washington state.

Think of it as a small-scale U.S. Bancorp, focused solely on specific counties in Washington.

• Deposit Products: The bank offers various accounts for holding funds, including checking, savings, money market, and certificates of deposit.
• Real Estate Loans: Timberland Bancorp provides financing for residential, multi-family, commercial real estate, and various construction projects.
• Consumer Loans: This category includes personal financing options such as home equity lines of credit, second mortgages, auto, boat, motorcycle, recreational vehicle, savings account, and unsecured loans.
• Commercial Business Loans: The bank offers lending services specifically designed to support the financial needs of businesses.

Major Customers of Timberland Bancorp (TSBK)

Timberland Bancorp, through its subsidiary Timberland Bank, provides community banking services to a broad customer base within its operational areas in Washington. As a bank, it serves numerous individuals and businesses rather than a few major corporate customers. Therefore, its customers can be categorized as follows:

• Individuals/Consumers: This category includes customers who utilize personal banking services such as money market, checking, and regular savings accounts, as well as various consumer loans including one- to four-family residential loans, home equity lines of credit, second mortgage loans, automobile loans, boat loans, motorcycle loans, recreational vehicle loans, savings account loans, and unsecured loans.
• Small and Medium-sized Businesses (SMBs): These customers leverage the bank for commercial business loans, commercial real estate loans, and deposit products to support their operations and growth.
• Real Estate Developers and Investors: This category encompasses individuals and businesses involved in real estate, utilizing loans for multi-family properties, commercial real estate, various types of construction (custom and owner/builder, speculative one- to four-family, commercial, multi-family), and land development.

Dean J. Brydon, Chief Executive Officer

Mr. Brydon has been affiliated with Timberland Bank since 1994 and has served as Chief Executive Officer since February 1, 2023. Prior to that, he served as President from January 24, 2022, to January 31, 2023, and as Chief Financial Officer from January 2000 to January 31, 2023. Mr. Brydon is a Certified Public Accountant.

Marci A. Basich, Executive VP, Chief Financial Officer & Treasurer

Ms. Basich has been affiliated with Timberland Bank since 1999. She has served as Executive Vice President and Chief Financial Officer since February 1, 2023, and as Treasurer of the Company since January 2002. She served as Treasurer of the Bank from January 2002 to January 31, 2023. Ms. Basich is a Certified Public Accountant.

Jonathan Arthur Fischer, President, Chief Operating Officer & Secretary

Mr. Fischer has been affiliated with Timberland Bank since October 1997. He has served as President since February 1, 2023, Chief Operating Officer since August 23, 2012, and as Secretary since January 24, 2022. Previously, Mr. Fischer served as Chief Risk Officer starting in October 2010, and also held roles as Compliance Officer, Community Reinvestment Act Officer, and Privacy Officer since January 2000.

Matthew J. DeBord, Executive VP, Chief Lending Officer

Mr. DeBord has been affiliated with Timberland Bank since 2012. He has served as an Executive Vice President and Chief Lending Officer since April 1, 2023. Prior to this role, Mr. DeBord was the Commercial Bank Team Leader.

Breanne D. Antich, Executive VP & Chief Technology Officer

Ms. Antich has been affiliated with Timberland Bank since 2007. She has served as an Executive Vice President since February 1, 2023, and as Chief Technology Officer since January 2022. Before these appointments, Ms. Antich served as IT Manager and Cash Management Officer.

The key risks to Timberland Bancorp's business include its significant exposure to the real estate market, particularly commercial real estate, susceptibility to fluctuations in interest rates, and the increasing threats and costs associated with cybersecurity and technological advancements.

1. Concentration in Real Estate Lending and Associated Credit Risk: Timberland Bancorp's loan portfolio has a substantial focus on real estate, including one-to four-family residential, multi-family, and commercial real estate loans, with commercial real estate making up a significant portion of its total loan portfolio. This concentration exposes the company to elevated risks related to potential defaults, foreclosures, and subsequent litigation, especially in a "high-stakes environment". A downturn in the housing market can also impact mortgage origination volumes and fees. The company's performance is highly sensitive to economic conditions within its primary Washington state markets, where various regions present distinct economic characteristics and risks.
2. Interest Rate Risk and Net Interest Margin Compression: The company faces significant market risks from fluctuations in interest rates, which directly impact its net interest margin (NIM) and overall profitability. An environment of "high-for-longer interest rates" has been noted to squeeze NIM, as increased interest expenses can outpace growth in interest income. Changes in the yield curve and the broader interest rate environment can also affect the value of its investment securities and its ability to effectively manage interest rate risk.
3. Cybersecurity Threats and Technology Investment Requirements: Timberland Bancorp, like other financial institutions, faces a growing threat landscape from cyberattacks and cybersecurity breaches. Protecting customer data and infrastructure necessitates significant and ongoing investment in cybersecurity. The increasing complexity of cyber threats, including those driven by artificial intelligence, requires substantial capital allocation for defense, automation, and distribution, which can be a costly endeavor for community banks. A breach could disrupt operations, compromise sensitive information, damage the company's reputation, and expose it to considerable liability.

The clear emerging threat to Timberland Bancorp is the rise of digital-first banks and financial technology (fintech) companies. These entities leverage technology to offer banking services such as deposits, loans, and payment solutions with significantly lower overhead costs compared to traditional brick-and-mortar banks. This allows them to often provide more competitive interest rates, lower fees, and a superior digital user experience, attracting customers who prioritize convenience and digital access over physical branch locations. This shift erodes the competitive advantage of community banks like TSBK, which rely on a physical branch network and traditional banking models.

Timberland Bancorp (symbol: TSBK) operates within the financial services market primarily in Washington State. The addressable markets for its main products and services in this region are as follows:

• Deposits: The total deposits by customers of banks in Washington State reached $211 billion as of 2024.
• Residential Mortgage Loans (One- to Four-Family Residential): New home loans booked in Washington State totaled $36.5 billion in 2024. The median home sales price in Washington was $647,600 in July 2025. The total dollar value of closed sales for residential homes and condominiums in July 2025 was approximately $5.69 billion.
• Commercial Real Estate and Construction Loans (Multi-family, Commercial Real Estate, Construction): The commercial real estate market in Washington State generated approximately $32 billion in annual transaction volume. The Commercial Leasing industry in Washington has a market size of $4.9 billion in 2026.
• Commercial Business Loans (Commercial Business, Small Business Loans): Small business loans in Washington State amounted to $12.8 billion in 2024. The broader commercial banking industry in Washington, which includes commercial and industrial loans, is projected to have a market size of $17.7 billion in 2026.
• Consumer Loans: While a specific overall market size for consumer loans in Washington State was not identified, the commercial banking industry, which includes the issuance of consumer loans, has a market size of $17.7 billion in 2026. Payday lending, a specific segment of consumer lending, was a $135 million industry in Washington in 2024.

Timberland Bancorp (TSBK) is expected to drive future revenue growth over the next 2-3 years through several key strategies:

1. Continued Net Interest Margin (NIM) Optimization: The company has demonstrated a consistent improvement in its net interest margin, which directly contributes to its net interest income. Timberland Bancorp's net interest margin increased to 3.85% from 3.64% a year ago and has expanded for seven consecutive quarters. The focus on maintaining or further optimizing this margin is a significant revenue driver.
2. Strategic Loan Portfolio Expansion, Particularly in Commercial and Residential Lending: Timberland Bancorp is taking a disciplined approach to balance sheet expansion, prioritizing quality and returns over volume. The company aims to enhance residential lending and build stronger commercial banking relationships, as evidenced by a 3% year-over-year increase in net loans receivable in the first fiscal quarter of 2026 and a 9% year-over-year increase in net loans in fiscal year 2024.
3. Branch Network Expansion and Enhanced Market Penetration: Timberland Bancorp continues to believe in the value of physical branches for growth. The company opened a new full-service branch in University Place, near Tacoma, Washington, on January 12, 2026, specifically to deepen its presence in a dynamic market and foster stronger commercial banking relationships. This strategic expansion into new areas within its Western Washington footprint is anticipated to attract new customers and grow the business.
4. Growth and Stability of the Deposit Base: A strong and growing deposit base provides a crucial funding source for loan growth. Timberland Bancorp experienced a 5% increase in total deposits year-over-year in the first fiscal quarter of 2026, building on a 5% rise in fiscal 2025 and a 6% rise in fiscal 2024. Maintaining and growing these deposits will enable further asset expansion and revenue generation.

Share Repurchases

• On July 22, 2025, Timberland Bancorp announced a new stock repurchase program authorizing the repurchase of up to 5% of its outstanding shares, or 393,842 shares. This program superseded a previous one.
• During the quarter ended June 30, 2025, the company repurchased 34,236 shares for $1.02 million.
• Between December 2023 and March 2025, share buybacks resulted in a net decrease of approximately 220,000 shares, representing over 2.5% of the total outstanding share count.

Share Issuance

• No significant share issuances by Timberland Bancorp were identified within the last 3-5 years.

Inbound Investments

• As of September 30, 2024, Vanguard Group Inc strategically increased its holdings in Timberland Bancorp by acquiring an additional 26,337 shares, bringing its total to 448,319 shares.
• As of February 25, 2026, Timberland Bancorp had 197 institutional owners holding a total of 6,148,820 shares.
• Major institutional shareholders include BlackRock, Inc., Dimensional Fund Advisors Lp, and Vanguard Group Inc.

Outbound Investments

• No specific information about strategic outbound investments or acquisitions made by Timberland Bancorp in other companies was found for the last 3-5 years.

Capital Expenditures

• Timberland Bancorp's capital expenditures for the last 12 months were -$1.73 million.
• In 2025, capital expenditures were USD -505.0 thousand, marking a 0.2% increase year-over-year.
• The company's Property, Plant & Equipment (PPE) was valued at $24.7 million in the last twelve months ending 2025, showing a year-over-year growth of 7.2%.