Winchester Bancorp, Inc./MD/

Item 1A. Risk Factors.

Risks Related to our Business

Risks Related to our Lending Activities

Our portfolios of commercial real estate and multi-family real estate loans have increased in recent periods, and we intend to continue originating these types of loans. These loans involve credit risks that could adversely affect our financial condition and results of operations.

At June 30, 20256, commercial real estate and multi-family loans totaled $269.0319.2 million, or 35.76.5% of our total loan portfolio. Given their larger balances and the complexity of the underlying collateral, commercial real estate loans and multi-family real estate loans generally have more risk than the owner-occupied one- to four-family residential real estate loans we originate. Because the repayment of these loans depends on the successful management and operation of the borrowers properties, and/or related businesses with respect to commercial real estate loans, repayment of such loans can be affected by adverse conditions in the local real estate market or economy. Also, many of our commercial borrowers have more than one loan outstanding with us. Consequently, an adverse development with respect to one loan or one credit relationship can expose us to a significantly greater risk loss compared to an adverse development with respect to a one-to four-family residential real estate loan. If we foreclose on these loans, our holding period for the collateral typically is longer than for a one- to four-family residential property because there are fewer potential purchasers of the collateral. In addition, commercial real estate loans and multifamily real estate loans typically involve larger loan balances to single borrowers or groups of related borrowers compared to one- to four-family residential loans. Accordingly, charge-offs on these types of loans may be larger than those incurred with our one- to four-family residential or consumer loan portfolios.

As our commercial real estate and multi-family real estate loan portfolios increase, the corresponding risks and potential for losses from these loans may also increase, which could adversely affect our business, financial condition and results of operations.

Our construction loans involve credit risks that could adversely affect our financial condition and results of operations.

At June 30, 20256, we had $95.9116.4 million in construction loans, or 12.73.3% of our total loan portfolio, nearly all of which consisted of commercial construction loans. Construction lending involves additional risks when compared with permanent financing because funds are advanced upon the security of the project, which is of uncertain value before its completion. Because of the uncertainties in estimating construction costs, as well as the market value of the completed project and the effects of governmental regulation of real property, it can be difficult to accurately evaluate the total funds required to complete a project and the related loan-to-value ratio. These loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project and the ability of the borrower to sell or lease the property or obtain permanent take-out financing, rather than the ability of the borrower or guarantor to repay principal and interest. If the appraised value of a completed project proves to be overstated, we may have inadequate security for the repayment of the loan upon completion of construction of the project and may incur a loss. As our construction loan portfolio

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increases, the corresponding risks and potential for losses from these loans may also increase, which could adversely affect our business, financial condition and results of operations.

Our emphasis on real estate loans exposes us to lending risks.

At June 30, 20256, the overwhelming majority of our loan portfolio was secured by real estate, most of which is located in our primary lending market area of Middlesex County, Massachusetts and surrounding areas. Declines in the real estate values in our primary lending market and surrounding areas could significantly impair the value of the collateral securing our loans and our ability to sell the collateral upon foreclosure for an amount necessary to satisfy the borrowers obligations to us. This could require increasing our allowance for credit losses to address the decrease in the value of the real estate securing our loans, which could have a material adverse effect on our financial condition and results of operations.

The geographic concentration of our loan portfolio and lending activities makes us vulnerable to a downturn in our local market area.

Unlike larger financial institutions that are more geographically diversified, our profitability depends primarily on the general economic conditions in our primary market area. Local economic conditions have a significant impact on our lending, including, the ability of borrowers to repay these loans and the value of the collateral securing these loans. 

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A deterioration in economic conditions in our primary market area could result in the following consequences, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations:

demand for our products and services may decrease;

loan delinquencies, problem assets and foreclosures may increase;

collateral for loans, especially real estate, may decline in value, thereby reducing customers future borrowing power, and reducing the value of assets and collateral associated with existing loans; and/or

the net worth and liquidity of loan guarantors may decrease, thereby impairing their ability to honor commitments made to us.

Moreover, a significant decline in general economic conditions, caused by inflation, tariffs and international trade disputes, recession, acts of terrorism, an outbreak of hostilities or other international or domestic calamities, or other factors beyond our control could further impact these local economic conditions and could further negatively affect our financial performance. In addition, deflationary pressures, while possibly lowering our operating costs, could have a significant negative effect on our borrowers, especially our business borrowers, and the values of underlying collateral securing loans, which could negatively affect our financial performance.

If our allowance for credit losses is not sufficient to cover actual loan losses, our earnings could decrease.

We periodically make various assumpa determination of an allowance for credit losses based on available informations and judgments abo, including, but the collectabinot limited to, the quality of ourthe loan and lease portfolio, including the creditworthiness of our borrowers and as indicated by trends in loan risk ratings, payment performance, economic conditions, the value of the reunderlying collateral estate and other assets serving as collateral for the repayment of many of our loans. Iand the level of no accruing and criticized loans and leases. Management relies on its loan officers and credit quality reviews, its experience, and its evaluation of economic conditions, among other factors, in determining the amount of provision required for the allowance for credit losses, we review our loan. Provisions to this and our loss and delinquencyllowance result in an experiencense for the period. If, and we evaluates a result of general economic conditions. If our, previously incorrect assumptions, or the resan increase in defaults of our analyed loans or leases are incorrect, our , we determine that additional increases in the allowance for credit losses may not are necessary, additional expenses may be sufficient to cover expectedincurred.

Determining the allowance for credit losses in our loan portfolio, resulting in additions to our allowance. In addition, our emphasiherently involves a high degree of subjectivity and requires us to make significant estimates on loan growthf current credit risks and on increasing our portfolio trends, all of commercwhich may undergo material real estate and multi-family real estatchanges. We cannot be sure that we will be able to limit losses on those loans, as well as that are identified. We have in the past, any d in the future credit deterioration, could may be, require usd to increase our allowance for credit losses. At June 30, 2025, oufor allowance for credit losses was 0.55% of total loans and 187.6% of nonperforming loans. Material additions tony of several reasons. State and federal regulators, in reviewing our allowance would materially decrease our net income. 

In addiloan portfolio as part of a regulatory examination, bankmay regulators periodically reviewquest that we increase our allowance for credit losses and, as a result of such reviews, we may be. Any increases in our allowance for credit losses will required tosult in a decrease in our provision fonet income and, possibly, our credit losses or recognize further loan charge-offs. Any increase inapital, and could have an adverse effect on our financial condition and results of operations.At June 30, 2026, our allowance for credit losses or loan charge-offs awas 0.55% of total loans a resultnd 300.82% of such review or otherwise may have a manonperforming loans. Material adverse effect ondditions to our financial condition and results of operations. 

allowance would materially decrease our net income.

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Uncertainties associated with increased originations of commercial real estate, construction and multi-family loans may result in errors in judging collectability, which may lead to additional provisions for credit losses or charge-offs, which would negatively affect our operations.

Our recent and intended increases in the level of our commercial real estate, construction and multi-family real estate originations have required and would likely require us to lend to borrowers with which we have limited or no experience. Our commercial real estate, construction and multi-family loans have grown from $24364.9 million or 40.78.4% of the total loan portfolio at June 30, 20235 to $364.9435.5 million or 48.49.8% of the total loan portfolio at June 30, 20256. While we have not incurred any losses with regard to loans originated during this period, this portion of the loan portfolio is unseasoned and we do not have a significant payment history pattern with which to judge future collectability. Further, newly originated loans have not been subjected to unfavorable economic conditions. As a result, it may be difficult to predict the future performance of newly originated loans. These loans may have delinquency or charge-off levels above our recent historical experience, which could adversely affect our future performance. Further, commercial real estate, construction (in particular commercial construction) and multi-family real estate loans generally have larger balances and involve a greater risk than one- to four-family residential mortgage loans. Accordingly, if we make any errors in judgment in the collectability of these loans, any resulting charge-offs may be larger on a per loan basis than those incurred historically with our single-family residential mortgage loans.

The level of our commercial real estate and multi-family real estate loan portfolio may subject us to additional regulatory scrutiny.

FeThe federal bank regulatorying agencies have promulgatissued joint guidance on sound risk management practices for financial institutions with concentrations in commercial real estate lending. Under the guidance, a financialan institution that, like us, is actively involv is identified in commercial real estate lendas having should perform a risk assessment to idpotentify concentrations. A financial 

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institution may have aal concentration in commercial real estate lending if, among other factors, concentration risk if (i) total reported loans for construction, land acquisition and development, and other land represent 100% or more of tthe institutions total risk-based capital, or (ii) total reported loans secured by multi-family and non-farm non-residential properties,  and loans for construction, land acquisition and ddevelopment and other land, and loans o represent 300% or more of therwise sensitive institutions to the genertal commerciapital real ewhere the outstate market, inclunding loans tobalance of the institutions commercial real estate related entities, represent 30loan portfolio has increased 50% or more of total capital. Based during the prior 36 months. An institution these factors, weat is identified as have aing potential concentrations in multi-family and commercial real estate lending, as such loans represen is expected 320.3% of total capital of Winchester Savings Bank as of June 30, 2025. The guidance focuses on exposure to commercial real estate loans that are dependto employ heightened levels of risk management on the cash flow from thewith real estate held as collateral and that are likely to be at greater risk to conditions in the spect to its commercial real estate market (as opposed to real estate collateral held aportfolios a secondary source of repayment or in an abundance of caution). The purpose of the guidance is to guide banks nd may be required to maintain developing risk management practices and determining higher levels of capital levels commensurate with the level and nature of real estate concentrations. The guidance states that management should employ heightened risk management practices including board. As of June 30, 2026, loans secured by multi-family and management oversight and strcommercial real estategic planning, developm represent ed 320.3% of underwriting standards, risk assessment and monitoring through market analysis and stress testing. the Banks total capital While we believe we have implemented policies and procedures with respect to our commercial and multi-family real estate loan portfolio consistent with this guidance, bank regulatorswe could be require us to implement additiond to maintain higher levels of capital policieas and procedures result of our consistent with their interpretmmercial real estate and multi-family real estate lending concentration of the guidance that may, which could limit our growth, require us to raise or result tain additional costs to us or that may result in the curtailmenapital, and have an adverse effect ofn our commercial rebusiness, financial estatecondition, and mresulti-family real estate lending that would adversely as of operations. Additionally, we cannot guarantee that any risk management practices we implement will be effect ourive to prevent loan originsses relations and profitability. ng to our commercial real estate portfolio.

The foreclosure process may adversely impact our recoveries on non-performing loans

The judicial foreclosure process is protracted, which delays our ability to resolve non-performing loans through the sale of the underlying collateral. The longer timelines have been the result of many factors, including additional consumer protection initiatives related to the foreclosure process, increased documentary requirements and judicial scrutiny, and, both voluntary and mandatory programs under which lenders may consider loan modifications or other alternatives to foreclosure. These reasons and the legal and regulatory responses have impacted the foreclosure process and completion time of foreclosures for residential mortgage lenders. This may negatively impact collateral values and our ability to minimize its losses.

We are subject to environmental liability risk associated with lending activities or properties we own.

A significant portion of our loan portfolio is secured by real estate, and we could become subject to environmental liabilities with respect to one or more of these properties, or with respect to properties that we own in operating our business. During the ordinary course of business, we may foreclose on and take title to properties securing defaulted loans. In doing so, there is a risk that hazardous or toxic substances could be found on these propertiess, particularly those properties securing commercial real estate lending. If hazardous conditions or toxic substances are found on these properties, we may be liable for remediation costs, as well as for personal injury and property damage, civil fines and criminal penalties regardless of when the hazardous conditions or toxic substances first affected any particular property. Environmental laws may require us to incur substantial expenses to address liabilities and may materially reduce the affected propertys value or limit our ability to use or sell the affected property. In addition, future laws or more stringent interpretations or enforcement policies with respect to existing laws may increase our exposure to environmental liability. Our policies, which require us to perform an environmental review before initiating any foreclosure action on non-residential real property, may not be sufficient to detect

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all potential environmental hazards. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on us.

Risks Related to Market Interest Rates

Future changes in interest rates could negatively affect our operating results and asset values.

Net income is the amount by which net interest income and noninterest income exceed operating expense and the provision for credit losses. Net interest income makes up a majority of our income and is based on the difference between:

the interest income we earn on interest-earning assets, such as loans and securities; and

the interest expense we pay on interest-bearing liabilities, such as deposits and borrowings.

The rates we earn on our assets and the rates we pay on our liabilities are generally fixed for a contractual period of time. Like many savings institutions, our liabilities generally have shorter contractual maturities than our assets. This imbalance can create earnings volatility because market interest rates change over time. In a period of rising interest rates, the interest income we earn on our assets may not increase as rapidly as the interest we pay on our liabilities. Furthermore, increases in interest rates may adversely affect the ability of our borrowers to make loan repayments on adjustable-rate loans, as the interest owed on such loans would increase as interest rates increase.

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Furthermore, increases in interest rates may adversely affect our ability to originate loans.

In addition, changes in interest rates can affect the average life of loans and mortgage-backed and related securities. A decline in interest rates generally results in increased prepayments of loans and mortgage-backed and related securities as borrowers refinance their debt to reduce their borrowing costs. This creates reinvestment risk, which is the risk that we may not be able to reinvest prepayments at rates that are comparable to the rates we earned on the prepaid loans or securities. Furthermore, an inverted interest rate yield curve, where short-term interest rates (which are usually the rates at which financial institutions borrow funds) are higher than long-term interest rates (which are usually the rates at which financial institutions lend funds for fixed-rate loans) can reduce a financial institutions net interest margin and create financial risk for financial institutions that originate primarily longer-term, fixed-rate mortgage loans.

As of June 30, 20256 and June 30, 20245, we had $1.3 million 844,000 and $2.31.2 million in net unrealized losses on available-for-sale investment securities, respectively. In addition, we have experienced a shift in deposits from lower-cost savings and demand accounts to higher-cost certificates of deposit. However, the rates we earn on our loans did not increase as rapidly as those paid on deposits during the years ended June 30, 20256 and June 30, 20245, as we have a significant amount of fixed-rate residential real estate loans where the interest rates did not increase commensurate with the increase in market interest rates. In addition, most of our adjustable-rate loans do not reprice immediately, such that changes in market interest rates take a period of time to affect our portfolio yields.

We monitor interest rate risk through simulation models, including estimates of the amounts by which the fair value of our assets and liabilities (our economic value of equity or EVE) and our net interest income would change in the event of a range of assumed changes in market interest rates. As of June 30, 20256, in the event of an instantaneous 200 basis point increase in interest rates, we estimate that we would experience a 22.00.1% decrease in EVE and a 14.37.9% decrease in net interest income.

Any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on our financial condition, liquidity and results of operations. Changes in the level of interest rates also may negatively affect the value of our assets and ultimately affect our earnings.

For further discussion of how changes in interest rates could impact us, see Managements Discussion and Analysis of Financial Condition and Results of Operations of Winchester Savings BankManagement of Market Risk.

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Risks Related to our Business Strategy

Our business strategy includes loan growth, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively. Growing our operations could also cause our expenses to increase faster than our revenues.

Our business strategy primarily focuses on loan growth, primarily funded by deposits. Achieving such growth may require us to attract customers that currently bank at other financial institutions in our market area. Our ability to successfully grow will depend on a variety of factors, including our ability to attract and retain experienced lenders and possibly increase our support staff, the continued availability of desirable business opportunities, the level of competition from other financial institutions in our market area, general economic conditions in our primary market area and our ability to manage our growth. Growth opportunities may not be available or we may not be able to manage our growth successfully. There can be considerable costs involved in opening branches and expanding lending capacity, and generally a period of time is required to generate the necessary revenues to offset these costs. If we do not manage our growth effectively, our financial condition and operating results could be negatively affected.

Our continued pace of growth may require us to raise additional capital in the future, but that capital may not be available when it is needed.

We are required by our banking regulatory authorities to maintain adequate levels of capital to support our operations. We may at some point need to raise additional capital to support our growth. If we raise capital through the issuance of additional shares of our common stock or other securities, it would dilute the ownership interests of stockholders and may dilute the per share book value of our common stock. New investors may also have rights, preferences and privileges senior to our current stockholders, which may adversely impact our then current stockholders. Also, the need to raise additional capital may force our management to spend more time in managerial and financing-related activities than in operational activities.

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Our ability to raise additional capital, if needed, will depend on conditions in the capital markets at that time, which are outside of our control, and on our financial performance. In addition, our ability to raise capital may be limited by our mutual holding company structure, as Winchester Bancorp, MHC is required to own a majority of our outstanding shares of common stock for as long as it is in existence. Accordingly, we may not be able to raise additional capital, if needed, with favorable terms. If we cannot raise additional capital when needed, our ability to expand our operations through internal growth and acquisitions could be materially impaired.

We depend on our management team and other key personnel to implement our business strategy and execute successful operations and we could be harmed by the loss of their services or the inability to hire additional personnel.

We depend on the services of the members of our senior management team who direct our strategy and operations. Our executive officers and lending personnel possess substantial expertise as well as extensive knowledge of our markets and key business relationships. Any one of them could be difficult to replace. Our loss of these persons, or our inability to hire additional qualified personnel, could impact our ability to implement our business strategy and could have a material adverse effect on our results of operations and our ability to compete in our markets.

Risks Related to Competitive Matters

Strong competition within our market areas may limit our growth and profitability.

CWe competition in the banking and financial services industry is intense. In our market area, we compete with commercie with community, regional, national, and global banks, savings institutions, mortgage brokerage firms, credit unions, finance companies, mutualnon-bank licensed lenders and private equity funds, insurance companie purchasing or originating loans, and securities brokerage firmsttracting deposits, and unregulated or less regulated non-banking entitiselling other customer products and services. Many of these our primary competitors have substantially greater resources and , larger established customer bases, higher lending limits than we have, extensive branch networks, numerous ATMs, and offer cgreater advertain services that we do not or cannot provide. If we must raise interest rates paid on deposits or lowising and marketing budgets. Additionally, due to their size, many competitors may be able to achieve economies of scale and, as a result, may offer interest rates charged on our loans to remain competitive, our net interest margin and profitability could be adversely affected. Competition also makes it increasingly difficult and costly to attracta broader range of products and services, as well as better pricing for those products and services than we can. Emerging technologies, such as artificial intelligence (including machine learning and retain qualgenerative artified employees. Our profitability depends upon ourcial intelligence) and quantum conmputinued abilityg, have the potential to successfullfurther intensify compete in our market area. 

Tition and accelerate disruption in the financial services industry could become even more competitive as a result of new legislative, regulatory and technological changes and continued consolidation. Also,. In recent years, non-financial services firms, such as financial technology has lowered barriers to entry and made it possible for non-bankscompanies, have begun to offer products and sservices traditionally provided by banks, such afinancial institutions. These firms automatic transfer ttempt to use technology and automatic payment systemsmobile platforms to enhance the ability of companies and individuals to borrow, save and invest money. Many of ourthese non-financial services competitors have fewer regulatory constraints and may have lower cost structures. Additionally, due to their size, many competitors may be able than we do. Our long-term success depends on our ability to achideve economies of scalelop and, as a result, may offer a broader range of product execute strategic plans and services as well as better pricing for thosinitiatives; to develop competitive products and services than we can. For additional information see Business of Winchester Savings BankMarket Area and Competition. 

Our smatechnologies; and to attract, retain and develop a highly skiller size may make it more difficult d employee workfor us to compete. 

Our smaller size may make it more difficult to compete with oce. We may not be as timely or successful in assessing ther financial institutions that ar evolving competitive larger and can more easily afford to invest in the marketing and technologiesndscape and developing or introducing needed to attractw products and retain customers. Becauseservices as our principal source of income is thcompetitors. Our business may be net interest income we earn on ogatively impacted if we, or our loans and investments afthird-party providers, do not 

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terimely deducting interest paid on deposits and other sources of funds,velop and apply emerging technologies, or if our ability to generate the revenues needed to cover our expenses and finance such investminitiatives in these areas are deficients is limited by the size of or fail. Our, or our loan and investment portfolios. Accordinglthird-party providers, inability, we are not always able to offer newor resistance to timely innovate or adapt operations, products and services as quickly as our competitors. Our lower earns to evolvings ma regulatory alsond make it more difficult to offrket environments, industry standards and consumer competitive salaries and benefits. In addipreferences could result in service disruption, our smaller customes, harm our base may make it difficult to generate meaningful noninterest income from non-tradiusiness, and adversely affect our results of operational banking activitiess and reputation. Finally, as a smaller institution, we are disproporor additional informationately affected by the continually increa see Busing costess of compliance with new bankWinchester Saving and other regulations. s BankMarket Area and Competition.

Risks Related to Laws and Regulations

Changes in laws and regulations and the cost of regulatory compliance with new laws and regulations may adversely affect our operations and/or increase our costs of operations.

Winchester SavThe bankings Bank is subject to extensive industry is highly regulation,ed and supervision aed under both federal and state laws and examination by regulations that are intended primarily for the Massachusetts Commissioner of Bprotection of depositors, customers, the public, the banks anding system as a whole, and/or the FDIC, as DIF, not for the protection of our shareholders and creditors. Winchester Bancorp, Inc. isMHC and the Company are subject to extensive regulation, and supervision and examination by the Federal Reserve Board. Such, and the Bank is subject to regulation and supervision governby the activities in which an insured depository institutFDIC and the Division and its holding company may engage, and are intended primarily for the protec. Compliance with applicable laws and regulation of the federal deposit insurance funds can be difficult and the depositors costly, and borrowers of Winchester Savings Bank, rather than for our stockholders. 

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 changes to laws and regulations can impose additional compliance costs.

Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on our operations, the classification of our assets, and determination of the level of our allowance for credit losses. These Banking laws and regulations, along with existing tax, accounting, securities, insurance and monetary laws, rules, standards, policies, and interpretations, control the methods by which financial institutions conduct business, implement strategic initiatives and tax compliance, and govern financial reporting and disclosures. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation, or supervisory action, may have a material impact on our operations. Further, changes in accounting standards can be both difficult to predict and involve judgment and discretion in their interpretation by us and our independent registered public accounting firm. These changes could materially impact, potentially even retroactively, how we report our business, financial condition, and results of operations. 

Non-compliance with the USA PATRIOT Act, Bank Secrecy Act, or o

Applicable laws, regulations, interpretations, enforcement policies, and accounting principles have been subject to significant changes in recent years and may be subject to significant future changes. Additionally, federal and state regulatory agencies may change ther laws and manner in which existing regulations could resu are applied. Further, changes in accounting standards can be both difficult in fines or sancto predict and involve judgment and discretions. 

The USA PATRIOT in their interpretation by us and Bank Secrecy Acts require our independent registered public accounting firm. These changes could materially impact, potentially even retroactively, how we report our financial institutions to condition and results of operations. We cannot predict the substance or effect of pending or future legislative, regulatory, or accounting develop programments, or changes to prevent the application of laws and regulations to us. Future changes may have an effect on our business, financial institutions from being used fcondition, and results of operations.

Non-compliance with the USA PATRIOT Act, Bank Secrecy Act, or moneyother laundering and terrorist aws and regulations could result in fines or sanctivitieons. If such activitie

The USA PATRIOT Act and Bank Secrecy Act, and other laws are detected,nd regulations require financial institutions are obligateto establish and maintain an effective anti-money laundering program and to filee reports susch as suspicious activity reports with the U.S. Treasurys Office of Financial Crimes Enforcement Networkand currency transaction reports, among other obligations. These rules also require financial institutions to establish procedures for identifying and verifying the identity of customers seeking to open new financial accounts. FailureWe are required to comply with these regulations could result in fines laws and other anti-money laundering requirements. Our federal and state banking regulators, the Treasury Departments Financial Crimes Enforcement Network, and other governmental agencies are authorized to impose significant civil money penalties for sanctionviolations of anti-money laundering requirements, including addition to restrictions on pursuing acquisitions or establishing new branches. The policies and procedures we have adopted that are designed to assist in compliance with these laws and regulations may not be effective in preventing violations of these laws and regulations. 

We have not been are also subject to aincreased scrutiny fines or other penaltof compliance with the regulations issued and enforced by the Treasury Departments Office of Foreign Assets Control, which is responsible for helping to ensure that U.S. entities, do nor have sufferet engage in transactions with certain prohibited parties, as defined by various Executive Orders and Acts of Congress. If our program is deemed deficient, we could business oe subject to liability, including fines, civil money penalties, and other reputagulatory actional harm, as a result of ms, which may include restrictions on our business operations, our ability to pay dividends, mergers and acquisitions and other forms of expansion, and entry into new business lines. Failure to maintain and implement adequate programs to combat money laundering activities in recent years. nd terrorist financing could also have significant reputational consequences for us. Any of these circumstances could have an adverse effect on our business, financial condition, and results of operations.

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We are subject to stringent capital requirements, which may adversely impact our return on equity, require us to raise additional capital, or limit our ability to pay dividends or repurchase shares.

Federal regulations establish minimum capital requirements for insured depository institutions, including minimum risk-based capital and leverage ratios, and define different forms ofcapital for calculating these ratios. For See Regulation and SupervisionSupervision an entity that has opted into using td Regulation of the CompanyCapital Adequacy. Banking organizations with less than $10 billion in total consolidated assets, such as the Bank, may elect to use an alternative capital framework under which they are deemed to satisfy the federal banking agencies generally applicable risk-based and leverage capital rules and the community bank apital conservation buffer, and to be deemed well capitalized for purposes of prompt corrective action, if they satisfy a CBLR requirement by maintaining a ratio of Tier 1 capital to average total consolidated assets (i.e., a leverage ratio, such o) of more than 8%. At June 30, 2026, the Bank had opted into the CBLR framework, exceeded the CBLR requirement, and was considered well capitalized.

In addition, the Company and Winchester SavBancorp, MHC currently rely on the Federal Reserves Small Bank Holdings B Company Policy Statement, which exempts a bank, holding company from the current minimum commungenerally applicable capital requirements if it has no more than $3 billion in total consolidated assets and meets other criteria, including not having a material amount of debt or equity bsecurities outstanding and registered with the SEC.

If the Bank leverage ratio rewere no longer eligible for the CBLR, or the Company and Winchester Bancorp, MHC were no longer eligible to rely on the Small Bank Holding Company Policy Statement, we may become subject to more costly, complex, or stringent capital requirement is 9%. s.

The application of these CBLR or these other capital requirements could, among other things, result in lower returns on equity, and result in regulatory actions if we are unable to comply with such requirements. See Regulation and SupervisionFederal Banking Regul

Any new or revised standards adopted in the future may require us to maintain materially more capital, with common equity as a more predominant component, or manage the configurationCapital R of our assets and liabilities to comply with formulaic capital requirements.

At June 30, 2025, Winchester Savings Bank exceeded all applicablWe may not be able to raise additional capital at all, or on terms acceptable to us. Failure to maintain capital to meet current or future regulatory capital requirements and was considered welcould have an adverse effect on our business, financial capitalized. ondition, and results of operations.

The Federal Reserve Board may require us to commit capital resources to support Winchester Savings the Bank, and we may not have sufficient access to such capital resources.

FThe FDI Act and Federal lawReserve Board regulations requires that a a bank holding company act to serve as a source of financial and managerial strength to its subsidiary babank and to commit resources to support such susubsidiary bankies. Under the source of strength doctrine, the Federal Reserve Board may require a bank holding company to make capital injections into a troubled subsidiary bank and may c, including at times when the bank holding company may not be inclined to do so, and may charge the bank holding company with engaging in unsafe and unsound practices for failure to commit resources to such a subsidiary bank. A capitaccordingly, we could be required to provide financial assistance to the Bank if it experiences financial distress.

A capital injection may be required at a times when t when our resources are limited and we may be required to borrow the funds or raise capital to make the required capital injection. Any loan by a bank holding company may not have the resources to provide it andto its subsidiary bank is subordinate in right of payment to deposits and certain other indebtedness of such subsidiary bank. In therefore may be required to attempte event of a bank holding companys bankruptcy, the bankruptcy trustee will assume any commitment by the holding company to borrow the funds or rais a federal bank regulatory agency to maintain the capital. Thus, any borrowing of a subsidiary bank. Moreover, bankruptcy law provides that must be done by Winchester Bancorp, Inc. to make a required claims based on any such commitment will be entitled to a priority of payment over the claims of the holding companys general unsecured creditors, including the holders of any note obligations. Thus, any borrowing by a bank holding company for the purpose of making a capital injection bto a subsidiary bank may becomes more difficult and expensive anrelative to other corporate borrowings and could have an adverse effect on our business, financial condition, and results of operations. Moreover, it is possible that we will be unable to borrow funds or otherwise raise capital when we need to do so. 

We are an emerging growth company, and our decision to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors.

We are an emerging growth company, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding

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advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As an emerging growth company, we also will not be subject to Section 404(b) of the Sarbanes-Oxley Act, which would require that our independent auditors review and attest as to the effectiveness of our internal control over financial

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reporting. We have also elected to use the extended transition period to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. Accordingly, our financial statements may not be comparable to the financial statements of public companies that comply with such new or revised accounting standards.

We could remain an emerging growth company for up to five years, or until the earliest of (a) the last day of the first fiscal year in which our annual gross revenues exceed $1.235 billion, (b) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, or (c) the date on which we have issued more than $1.0 billion in non-convertible debt during the preceding three-year period.

As a result, our stockholders may not have access to certain information they may deem important, and investors may find our common stock less attractive if we choose to rely on these exemptions. This could result in a less active trading market for our common stock and the price of our common stock may be more volatile.

We qualify as a smaller reporting company, and our decision to comply only with certain reduced reporting and disclosure requirements applicable to smaller reporting companies could make our common stock less attractive to investors.

We are a smaller reporting company, and, for as long as we continue to qualify as a smaller reporting company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to smaller reporting companies, including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and two years of audited financial statements in our annual report instead of three years. As long as we are a smaller reporting company that is also not an accelerated filer, we will not be subject to Section 404(b) of the Sarbanes-Oxley Act, which requires that our independent registered public accounting firm review and attest as to the effectiveness of our internal control over financial reporting. In addition, as a non-accelerated filer, we will have longer deadlines to file our periodic reports with the Securities and Exchange Commission.

We would remain a smaller reporting company and a non-accelerated filer for so long as our voting and non-voting equity held by non-affiliates (public float) is less than $250 million or our annual revenues are less than $100 million and our public float is less than $700 million. Public float is determined each year as of the end of a companys second fiscal quarter applicable at the end of the fiscal year involved.

As a result of our smaller reporting company status and non-accelerated filer status, our stockholders may not have access to certain information they may deem important, and investors may find our common stock less attractive if we choose to rely on these exemptions. This could result in a less active trading market for our common stock and the price of our common stock may be more volatile.

Risks Related to Economic Conditions

Inflation can have an adverse impact on our business and on our customers.

IThe future of inflation risk is the risk thatand other economic factors remain uncertain, and the value of assetsFederal Reserve Board may increase or income fromdecrease invterestments will be worth less in the future as rates faster or slower than anticipated. With an increase in inflation decreases the value of money. From 2021 to 2023, there wrates, small- to medium-sized businesses may be impacted by higher costs, as a significant rise in inflation and the Federal Reserve Board raised certhey are not able to leverage economies of scale to mitigate cost pressures compared to larger businesses. Sustain benchmarked higher interest rates in an effort to combat inflation. As inflationby the Federal Reserve Board, changes to fiscal policy, increases,luding the valueexpansion of our investmeU.S. federal deficit spending and resultant securities, particularly those with longer maturitidebt issuance, could also affect market interest rates, would decrease, although this effect can be less prpush down asset prices, and weaken econounced for floating rate instrummic activity. Consequents. In addition, inflation increasely, the ability of our customers the cost of goods and services we use o repay their loans may deteriorate, and in our business operations, such as electricity and other utilitiessome cases this deterioration may occur quickly, which increasewould adversely impact our results ourf operating expensesons and financial condition. Furthermore, our customers are also affected bya prolonged period of inflation and the rising costs of goods and services used in could cause wages and otheir households and businessesr costs to increase, which could have a negative impaadversely affect on their ability to repay their loans with usur results of operations and financial condition.

Changes to trade policies and tariffs can have an adverse impact on our business and our customers.

Changes in trade policies, including the imposition of tariffs or the escalation of a trade war, could negatively impact the economic conditions in the markets we serve. Our customers may face higher costs for imported goods and materials,

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reduced export demand, and supply chain disruptions due to increased tariffs. These challenges could lead to lower revenues, reduced profitability, and potential layoffs, all of which may impair our customers ability to meet their financial obligations. Furthermore, prolonged trade tensions and economic uncertainty could lead to market volatility, declining asset values, and

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weakened consumer confidence. If our customers experience financial stress, we could see an increase in loan delinquencies and credit losses, negatively affecting our asset quality and overall financial performance. Additionally, any decline in local economic activity could reduce loan demand and deposit growth, which are critical to our long-term success. While we actively monitor economic and policy developments, we cannot predict the outcome of trade negotiations or the full impact of tariffs and trade restrictions on our business, customers, and the broader economy. Any adverse effects from tariffs or a trade war could materially and negatively impact our financial condition, results of operations, and future growth prospects.

Risks Related to Operational Matters

Our funding sources may prove insufficient to replace deposits at maturity and support our growth. A lack of liquidity could adversely affect our financial condition and results of operations and result in regulatory limits being placed on us.

We must maintain sufficient funds to respond to the needs of depositors and borrowers. As a part of our liquidity management, we use a number of funding sources in addition to core deposit growth and repayments and maturities of loans and investments. As we grow, we are likely to depend more on these sources, which may include Federal Home Loan Bank of BostonHLBB advances, federal funds purchased and brokered certificates of deposit. While we emphasize the generation of low-cost core deposits as a source of funding, there is strong competition for such deposits in our market area. Additionally, deposit balances can decrease if customers perceive alternative investments as providing a better risk/return tradeoff. Adverse operating results or changes in industry conditions could lead to difficulty or an inability to access these additional funding sources. Our financial flexibility will be severely constrained if we are unable to maintain our access to funding or if adequate financing is not available to accommodate future growth at acceptable interest rates.

Further, if we are required to rely more heavily on more expensive funding sources to support liquidity and growth, our revenues may not increase proportionately to cover our increased costs. In this case, our operating margins and profitability would be adversely affected. Alternatively, we may need to sell a portion of our investment and/or loan portfolio to raise funds, which, depending upon market conditions, could result in us realizing a loss on the sale of such assets.

A lack of liquidity could also attract increased regulatory scrutiny and potential restraints imposed on us by regulators. Depending on the capitalization status and regulatory treatment of depository institutions, including whether an institution is subject to a supervisory prompt corrective action directive, certain additional regulatory restrictions and prohibitions may apply, including restrictions on growth, restrictions on interest rates paid on deposits, restrictions or prohibitions on payment of dividends and restrictions on the acceptance of brokered deposits.

At June 30, 20256, we had $147.058.2 million outstanding in advances from the Federal Home Loan Bank of BostonHLBB. At June 30, 20256, we had the ability to borrow $100.218.8 million in additional Federal Home Loan Bank of BostonHLBB advances. At June 30, 20256, we also had a $5.3 million line of credit with the Federal Home Loan Bank of BostonHLBB, which was not drawn at June 30, 20256. Additionally, at June 30, 20256, we had a $67102.0 million secured line of credit through the Federal Reserve Borrower in Custody (BIC)BIC program. We could significantly increase our borrowing capacity from the Federal Home Loan Bank of BostonHLBB and the Federal Reserve Bank, if we pledged additional assets as security. We anticipate that we will have sufficient funds to meet our current funding commitments. Based on our deposit retention experience and current pricing strategy, we anticipate that a significant portion of maturing time deposits will be retained.

For further information, see Managements Discussion and Analysis of Financial Condition and Results of OperationsLiquidity and Capital Resources.

We hold a relatively large level of certificates of deposit, which has and may continue to significantly increase our cost of funds.

At June 30, 20256, certificates of deposit totaled $283.21.5 million, or 41.734.8% of our total deposits. Our increased levels of certificates of deposit in recent years have resulted in a higher cost of funds than would otherwise be the case if we had a higher percentage of demand deposits and savings deposits. In addition, if our certificates of deposit do not remain with us, we may be required to access other sources of funds, including loan sales, other types of deposits, advances from the Federal Home Loan Bank of BostonHLBB and other borrowings. Depending on market conditions, we may be required to pay higher rates on such deposits or borrowings than we currently pay on our certificates of deposit. 

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The development of new products and services may impose additional costs on us and may expose us to increased operational risk. 

The introduction of new products and services can entail significant investments in time and resources, financial or otherwise, including regulatory approvals. Substantial risks and uncertainties are associated with the introduction of new products and services, including technical and control requirements that may need to be developed and implemented, rapid technological change in the industry, our ability to access technical and other information from its clients, the significant and ongoing investments required to bring new products and services to market in a timely manner at competitive prices and the preparation of marketing, sales and other materials that fully and accurately describe the product or service and its underlying risks. Our failure to manage these risks and uncertainties also exposes us to enhanced risk of operational lapses which may result in the recognition of financial statement liabilities. Regulatory and internal control requirements, capital requirements, competitive alternatives, vendor relationships and shifting market preferences may also determine if such initiatives can be brought to market in a manner that is timely and attractive to our clients. Products and services relying on internet and mobile technologies may expose us to fraud and cybersecurity risks. Failure to successfully manage these risks in the development and implementation of new products or services could have a material adverse effect on our business and reputation, as well as on its consolidated results of operations and financial condition. 

We face significant operational risks because of our reliance on technology. Our information technology systems may be subject to failure, interruption or security breaches.

Information technology systems are critical to our business. Our business requires us to collect, process, transmit and store significant amounts of confidential information regarding our customers, employees and our own business, operations, plans and business strategies. We use various technology systems to manage our customer relationships, general ledger, investments, deposits, and loans. Our computer systems, data management and internal processes, as well as those of third parties, are integral to our performance. Our operational risks include the risk of malfeasance by employees or persons outside our company, errors relating to transaction processing and technology, systems failures or interruptions, breaches of our internal control systems and compliance requirements, and business continuation and disaster recovery. There have been increasing efforts by third parties to breach data security at financial institutions. Such attacks include computer viruses, malicious or destructive code, phishing attacks, denial of service or information or other security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of confidential, proprietary and other information, damages to systems, or other material disruptions to network access or business operations. Although we take protective measures and believe that we have not experienced any of the types of data breaches described above, the security of our computer systems, software, and networks may be vulnerable to breaches, unauthorized access, misuse, computer viruses, or other malicious code and cyber-attacks that could have an impact on information security. Because the techniques used to cause security breaches change frequently, we may be unable to proactively address these techniques or to implement adequate preventative measures.

In the event of a breakdown in our internal control systems, improper operation of our systems or improper employee actions, or a breach of our security systems, including if confidential or proprietary information were to be mishandled, misused or lost, we could suffer financial loss, loss of customers and damage to our reputation, and face regulatory action or civil litigation. Any of these events could have a material adverse effect on our financial condition and results of operations. Insurance coverage may not be available for such losses, or where available, such losses may exceed insurance limits.

Our board of directors relies to a large degree on management and outside consultants in overseeing cybersecurity risk management. 

Winchester Bancorp, Inc. and Winchester Savings Bank have a standing Information Technology Steering Committee, consisting of the Chief Information Officer, the Senior Vice President of Risk and Compliance, information technology staff and staff from other departments within Winchester Savings Bank. The committee meets quarterly or more frequently if needed, and reports to the board of directors after each meeting through committee minutes. Winchester Savings Bank also engages outside consultants to support its cybersecurity efforts. The directors of Winchester Bancorp, Inc. and Winchester Savings Bank do not have significant experience in cybersecurity risk management in other business entities comparable to Winchester Savings Bank and rely on senior management and an information technology service provider for cybersecurity guidance. 

We rely on thirdWe rely on third-party vendors, which could expose us to additional cybersecurity risks.

Third-party vendors provide key components of our business infrastructure, including certain data processing and information services. Accordingly, our operations are exposed to risk that these vendors will not perform in accordance with

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our contractual agreements with them, or we also could be adversely affected if such an agreement is not renewed by the third-party vendor or is renewed on terms less favorable to us. If our third-party providers encounter difficulties, or if we have difficulty communicating with those service providers, our ability to adequately process and account for transactions could be affected, and our business operations could be adversely affected, which could have a material adverse effect on our financial condition and results of operations. Threats to information security also exist in the processing of customer information through various other vendors and their personnel. To our knowledge, the services and programs provided to us by third parties have not experienced any material security breaches. However, the existence of cyber-attacks or security breaches at third parties with access to our data, such as vendors, may not be disclosed to us in a timely manner.

We may be subject to risks and losses resulting from fraudulent activities that could adversely impact our financial performance and results of operations.

As a bank, we are susceptible to fraudulent activity that may be committed against us or our clients, which may result in financial losses or increased costs to us or our clients, disclosure or misuse of our information or our client information, misappropriation of assets, privacy breaches against our clients, litigation or damage to our reputation. We are most subject to fraud and compliance risk in connection with the origination of loans, ACH transactions, wire transactions, ATM transactions, checking transactions, and debit cards that we have issued to our customers and through our online banking portals.

We maintain a system of internal controls and insurance coverage to mitigate against such risks, including data processing system failures and errors, and customer fraud. If our internal controls fail to prevent or detect any such occurrence, or if any resulting loss is not insured or exceeds applicable insurance limits, it could have a material adverse effect on our business, financial condition and results of operations.

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We maintainhad a defined pension benefit plan for the benefit of a portion of our employees. We may de that was termine to terminate this planated effective February 1, 2026. We could incur an expense in connection with the termination, which could negatively affect our income duringin the year of the terupcominationg year.

We maintain a defined pension benefit plan for the benefit of employees of Winchester Savings the Bank who were employees prior to November 1, 2022. This plan was frozen effective October 31, 2024. We mayhave choose n and applied to terminate thise plan. The cost to terminate the plan is primarily dependent on the value of the plans assets and applicable interest rates at the time of such terminationn is finalized. We cannot estimate the actual costs associated with potential termination from the plan until the date of the termination, but if these costs were material, it would negatively impact future earnings in the year of termination.

Risks Related to Accounting Matters

Changes in accounting standards could affect reported earnings. 

The bodies responsible for establishing accounting standards, including the Financial Accounting Standards Board, the SecuritieOur financial statements and Exchange Commission and other regulatory bodies, periodically change the financial accounting and reporting guidance that governs the preparation of our financial statements. These changes can be hard to predict and can materially impact how we record and report our financial condition and results of operations. In some cases, we re based in part on estimates and assumptions, which, if wrong, could be required to apply new or revised guidance retroactively. 

Changes in managements estimates and assumptions may have a material impact on our consolidated financial statements and our financial condition or operating results. cause unexpected losses in the future.

In preparing periodic reports we are required to file under the Securities Exchange Act of 1934, including our consolidated financial statements, our management is and will be required under applicable rules and regulations to make estimates and assumptions as of a specified date. These estimates and assumptions are based on managements best estimates and experience as of that date and are subject to substantial risk and uncertainty. Materially different results may occur as circumstances change and additional information becomes known. The most significant area requiring significant estimates and assumptions by management include our evaluation of the adequacy of our allowance for credit losses.

Other Risks Related to Our Business 

Legal and regulatory proceedChanges in accountings  stand related matterards could adversely affect us. 

We have been and may in treported earnings.

The future become involved in legal and regulatory proceedbodies responsible for establishing accountings. We consider most of the procee standards, includings to be in the norm the Financial course of our business or typical forAccounting Standards Board, the industry; however, it is difficult to assess Securities and Exchange Commission and othe 

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or regutcome of these matters, and we may not prevail inlatory bodies, periodically change the financial accounting any proceedd reportings or litigation. There could be substant guidance that governs the preparation of our financial costs and managstatement diversion in such litigation and proceedings, and any adverse determination could have as. These changes can be hard to predict and can materially adverse effeimpact on our business,how we reputation, brcord and or image, orreport our financial condition and results of our operations.

Societal responses to climate changIn some cases, we could adversebe required to apply affect our business and performance, including indirectly through impacts on onew or revised guidance retroactively.

Other Risks Related to Our customers. 

Concerns over the long-term impacts of climate change have led aBusiness 

Legal and regulatory proceedings and will continue to lead to governmental efforts around the worrelated matters could to mitigate those impactadversely affect us. Consumers and businesses also

We have been and may changein their future behavior as acome involved in legal and result of these concerngulatory proceedings. We and our customers will nconsider most of the proceedings to respond to new laws and regulations as well as consumer andbe in the normal course of our business preferences resulting from climate change concerns. We and our customers may face cost increaor typical for the industry; however, it is difficult to asses, asset value reductions and operating process changes. The impact on our customs the outcome of these matters will likely vary depending on their specific attributes,, and we may not prevail including reliance on or role in carbon intensive activities. Among the impacts to us cou any proceedings or litigation. There could be a drop in demand for our products and services, particularly in certain sectors. In addition, we could face reductsubstantial costs and management diversions in creditworthiness such litigation the part of some customers or in the value of assets securand proceeding loans. Our efforts to take these risks into acs, and any adverse determination count in making lending and other decisions, including by increasingld have a materially adverse effect on our business with climate-friendly companies, may not be effective in protecting us from the negative impact of new laws a, reputation, brand or image, or our financial condition and regulationsults or changes in consumef our or business behaviorperations.

We are a community bank and our ability to maintain our reputation is critical to the success of our business, and the failure to do so may materially adversely affect our performance.

We are a community bank, and our reputation is one of the most valuable components of our business. A key component of our business strategy is to rely on our reputation for customer service and knowledge of local markets to expand our presence by capturing new business opportunities from existing and prospective customers in our market area and contiguous areas. As such, we strive to conduct our business in a manner that enhances our reputation. This is done, in part, by recruiting, hiring and retaining employees or by retaining, appointing or electing directors who share our core values of being an integral part of the communities we serve, delivering superior service to our customers and caring about our customers and employees. If our reputation is negatively affected by the actions of our employees or directors, by our inability to conduct our operations in a manner that is appealing to current or prospective customers, or otherwise, our business and, therefore, our operating results may be materially adversely affected.

Severe weather, natural disasters and other external events could significantly affect our operations and results.

Severe weather or natural disasters, such as tornados, drought and other adverse external events, could have a significant effect on our ability to conduct business. Such events could affect the stability of our deposit base, impair the ability of borrowers to repay outstanding loans, impair the value of collateral securing loans, cause significant property damage, result in loss of revenue and/or cause us to incur additional expenses. Accordingly, the occurrence of any such

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severe weather or natural disaster event could have a material adverse effect on our business, which, in turn, could adversely affect our financial condition and results of operations.

If our deposits grow too large, we may lose the benefits of excess deposit insurance provided by the Depositors Insurance FundMA DIF.

Winchester Savings The Banks deposits are insured in full beyond federal deposit insurance coverage limits by the Depositors Insurance Fund, or theMA DIF, a private excess deposit insurer created under Massachusetts law. We believe providing deposit insurance in excess of FDIC insurance limits gives us a competitive advantage for individual, corporate and municipal depositors having deposit balances. However, the MA DIF may require member institutions that pose greater than normal loss exposure risk to the MA DIF to take certain risk-mitigating measures or withdraw from the MA DIF. In such an event, an institution may be required to reduce its level of excess deposits, pay for the reinsurance of excess deposits, make an additional capital contribution to the MA DIF, provide collateral or take other risk-mitigating measures that the MA DIF may require, which may include entering into reciprocal deposit programs with other financial institutions or reciprocal deposit services. Any of the above measures may reduce our overall level of deposits and increase our reliance on other, more expensive or less stable sources for funding, including FHLB advances, which would reduce net income.

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Our articles of incorporation provide that, subject to limited exceptions, state and federal courts in Maryland are the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders ability to obtain a favorable judicial forum for disputes with us or our directors, officers, and other employees.

TheOur articles of incorporation of Winchester Bancorp, Inc. pprovide that, unless Winchester Bancorp, Inc.the Company consents in writing, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of Winchester Bancorp, Inc.the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of Winchester Bancorp, Inc.the Company to Winchester Bancorp, Inc.the Company or its stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Maryland General Corporation Law, or (iv) any action asserting a claim governed by the internal affairs doctrine will be conducted in a state or federal court located within Maryland, in all cases subject to the courts having personal jurisdiction over the indispensable parties named as defendants. This exclusive forum provision does not apply to claims arising under the federal securities laws. This exclusive forum provision may limit a stockholders ability to bring a claim in a judicial forum it finds favorable for disputes with Winchester Bancorp, Inc.the Company and its directors, officers, and other employees, or may cause a stockholder to incur additional expense by having to bring a claim in a judicial forum that is distant from where the stockholder resides, or both. In addition, if a court were to find this exclusive forum provision to be inapplicable or unenforceable in a particular action, we may incur additional costs associated with resolving the action in another jurisdiction, which could have a material adverse effect on our financial condition and results of operations.

Various factors may make takeover attempts more difficult to achieve.

Stock banks or their holding companies, as well as individuals, may not acquire control of a company organized in the mutual holding company structure, such as Winchester Bancorp, Incthe Company. As a result, the only entities that may acquire control of a mutual holding company are other mutual savings institutions or mutual holding companies. Accordingly, it is very unlikely that Winchester Bancorp, Inc.the Company would be subject to any takeover attempt by activist stockholders or other financial institutions.

Under applicable regulations, for a period of three years following completion of the reorganization, no person may acquire beneficial ownership of more than 10% of our common stock without prior approval of the Federal Reserve Board and the Massachusetts Commissioner of Banks. Under federal law, subject to certain exemptions, a person, entity or group must notify the Federal Reserve Board before acquiring control of a bank holding company. Also, a bank holding company must obtain the prior approval of the Federal Reserve Board before, among other things, acquiring direct or indirect ownership or control of more than 5% of any class of voting shares of any bank, including Winchester Savings the Bank.

There also are provisions in our articles of incorporation that may be used to delay or block a takeover attempt, including a provision that prohibits any person from voting more than 10% of the shares of common stock outstanding. Furthermore, shares of restricted stock and stock options that we may grant to employees and directors, stock ownership by our management and directors, employment and change in control agreements that we have entered into with our executive officers and other factors may make it more difficult for companies or persons to acquire control of Winchester Bancorp, Inc.the Company without the consent of our board of directors. Taken as a whole, these statutory provisions and provisions in our articles of incorporation could result in our being less attractive to a potential acquirer and thus could adversely affect the market price of our common stock.

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Risks Related to Our Organizational Structure

Our stockholders own a minority of Winchester Bancorp, Inc.s cour common stock and will not be able to exercise voting control over most matters put to a vote of stockholders.

Public stockholders own a minority of the outstanding shares of Winchester Bancorp, Inc.s cour common stock. As a result, stockholders other than Winchester Bancorp, MHC will not be able to exercise voting control over most matters put to a vote of stockholders. Winchester Bancorp, MHC owns a majority of Winchester Bancorp, Inc.s common stock and, through its board of trustees, exercises voting control over most matters put to a vote of stockholders. Winchester Bancorp, MHC may take actmay take action that the public stockholders believe to be contrary to their interests. For example, Winchester Bancorp, MHC may exercise its voting control to defeat a stockholder nominee for election to the board of directors of Winchester Bancorp, Incthe Company.

In addition, stockholders will not be able to force a merger or second-step conversion transaction without the consent of Winchester Bancorp, MHC since such a transaction requires the approval of the holders of a majority of the outstanding voting stock of Winchester Bancorp, Inc.the Company, which can only be achieved if Winchester Bancorp, MHC votes to approve such transactions. Some stockholders may desire a sale or merger transaction, since stockholders typically receive a premium for their shares, or a second-step conversion transaction, since, on a fully converted basis, most full stock institutions tend to trade at higher multiples than mutual holding companies. Stockholders could, however, prevent a second-step conversion or

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the implementation of equity incentive plans because under current regulations and policies, such matters also require the separate approval of the stockholders other than Winchester Bancorp, MHC.

If we declare dividends on our common stock, Winchester Bancorp, MHC will be prohibited from waiving the receipt of dividends.

Winchester Bancorp, Inc.s Our board of directors will have the authority to declare dividends on our common stock, subject to statutory and regulatory requirements. If Winchester Bancorp, Inc. payswe pay dividends to itsour stockholders, itwe also will be required to pay dividends to Winchester Bancorp, MHC, unless Winchester Bancorp, MHC is permitted by the Federal Reserve Board to waive the receipt of dividends. The Federal Reserve Boards current position is to not permit a bank holding company to waive dividends declared by its subsidiary. In addition, Massachusetts banking regulations prohibit Winchester Bancorp, MHC from waiving dividends declared and paid by Winchester Bancorp, Inc. us unless the Massachusetts Commissioner of Banks does not object to the waiver and provided the waiver is not detrimental to the safe and sound operation of Winchester Savings the Bank. Accordingly, because dividends will be required to be paid to Winchester Bancorp, MHC along with all other stockholders, the amount of dividends available for all other stockholders will be less than if Winchester Bancorp, MHC were permitted to waive the receipt of dividends.