25
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS
OF
OPERATIONS
General
Auburn National Bancorporation, Inc. (the “Company”) is a bank holding
company registered with the Board of Governors
of the Federal Reserve System (the “Federal Reserve”) under the Bank Holding
Company Act of 1956, as amended (the
“BHC Act”). The Company was incorporated in Delaware in 1990, and in
1994 it succeeded its Alabama predecessor as the
bank holding company controlling AuburnBank, an Alabama state member
bank with its principal office in Auburn,
Alabama (the “Bank”). The Company and its predecessor have controlled
the Bank since 1984.
As a bank holding
company, the Company
may diversify into a broader range of financial services and other business activities than
currently
are permitted to the Bank under applicable laws and regulations.
The holding company structure also provides greater
financial and operating flexibility than is presently permitted to the
Bank.
The Bank has operated continuously since 1907 and currently conducts its business
primarily in East Alabama, including
Lee County and surrounding areas.
The Bank has been a member of the Federal Reserve System since April 1995.
The
Bank’s primary regulators are the
Federal Reserve and the Alabama Superintendent of Banks (the “Alabama
Superintendent”).
The Bank has been a member of the FHLB of Atlanta since 1991. Certain of the statements
made in this
discussion and analysis and elsewhere, including information incorporated
herein by reference to other documents, are
“forward-looking statements” as more fully described under “Special Cautionary
Notice Regarding Forward-Looking
The following discussion and analysis is intended to provide a better
understanding of various factors related to the results
of operations and financial condition of the Company and the Bank.
This discussion is intended to supplement and
highlight information contained in the accompanying unaudited condensed
consolidated financial statements and related
notes for the quarters and nine months ended September 30, 2025 and 2024,
as well as the information contained in our
annual report on Form 10-K for the year ended December 31, 2024 and our
interim reports on Form 10-Q for the quarters
ended March 31, 2025 and June 30, 2025.
Special Cautionary Notice Regarding Forward-Looking Statements
Various
of the statements made herein under the captions “Management’s
Discussion and Analysis of Financial Condition
and Results of Operations”, “Quantitative and Qualitative Disclosures about
Market Risk”, “Risk Factors” “Description of
Property” and elsewhere, are “forward-looking statements” within the meaning
and protections of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”).
Forward-looking statements include statements with respect to our beliefs,
plans, objectives, goals, expectations,
anticipations, assumptions, estimates, intentions and future performance,
and involve known and unknown risks,
uncertainties and other factors, which may be beyond our control,
and which may cause the actual results, performance,
achievements or financial condition of the Company to be materially different
from future results, performance,
achievements or financial condition expressed or implied by such forward-looking
statements.
You
should not expect us to
update any forward-looking statements.
All statements other than statements of historical fact are statements that could
be forward-looking statements.
You
can
identify these forward-looking statements through our use of words such
as “may,” “will,” “anticipate,”
“assume,”
“should,” “indicate,” “would,” “believe,” “contemplate,” “expect,”
“estimate,” “continue,” “designed,” “plan,” “point to,”
“project,” “could,” “intend,” “target,” “seek” and other
similar words and expressions of the future.
These forward-looking
statements may not be realized due to a variety of factors, including, without
limitation:
●
the effects of future economic, business and market conditions and
changes, foreign, domestic and locally,
including inflation, seasonality,
natural disasters or climate change, such as rising sea and water levels, hurricanes
and tornadoes, epidemics or pandemics including supply chain disruptions,
inventory volatility, and changes in
consumer behaviors;
●
the effects of war or other conflicts, acts of terrorism, trade restrictions,
tariffs, sanctions, the value of the U.S.
dollar against other currencies, or other events that may affect general
economic conditions, including inflation,
and consumer and business confidence; governmental monetary and fiscal policies, including taxes, federal deficit spending and the debt required to fund
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