Winchester Bancorp (WSBK) Registration filing summary

Company overview and business model

• Operates as a community-oriented financial institution in eastern Massachusetts, focusing on individuals and small businesses through five branches in Middlesex and Essex Counties.

• Business model centers on gathering deposits and investing in residential, commercial, multi-family, and construction loans, as well as investment securities.

• Reorganizing from a mutual savings bank to a two-tier mutual holding company structure, with a new holding company and a charitable foundation.

• Strategic focus on expanding commercial real estate, construction, and multi-family lending, digital platform investments, and branch network growth.

• Plans to open one new branch per year for five years post-offering and enhance digital banking capabilities.

Financial performance and metrics

• As of September 30, 2024: total assets $872.9M, deposits $642.3M, surplus $80.2M.

• Net loss of $632K for the three months ended September 30, 2024; net income of $786K for fiscal year ended June 30, 2024; $4.2M for fiscal 2023.

• Net interest margin declined to 1.84% for the quarter ended September 30, 2024, from 2.11% a year earlier.

• Allowance for credit losses at 0.47% of total loans; non-performing loans at 0.23% of total loans.

• Loan portfolio growth driven by commercial, multi-family, and construction loans, with increased reliance on higher-cost certificates of deposit and FHLB advances.

Use of proceeds and capital allocation

• Net proceeds expected between $24.3M and $33.5M (up to $38.8M if upsized).

• At least 50% of net proceeds to be invested in Winchester Savings Bank; remainder for ESOP loan, charitable foundation, and retained for general corporate purposes.

• Proceeds may fund loan growth, branch expansion, technology investments, potential acquisitions, and share repurchases (after regulatory waiting periods).

• $400K in cash and 2% of shares to be contributed to a new charitable foundation.