Hanover Bancorp (HNVR) is a $2.37B-asset state commercial bank holding company. Under a liquidation lens at March 31, 2026, GAAP book equity stands at $201.4M (8.50% of assets), but that figure must be adjusted for asset recovery haircuts and the full face-value liability stack before any residual to equity can be assessed. The dominant asset is the loan portfolio: $1.99B held-for-investment (gross) against an ACL of $19.1M, producing a net carrying value of $1.97B. Under liquidation assumptions a bank loan portfolio would realistically recover 80-90 cents on the dollar in a distressed portfolio sale—not par—implying a potential loss on the loan book alone of $100-200M relative to GAAP book. The investment portfolio is $106.7M at fair value (AFS + HTM), with only $1.0M net unrealized loss, making it near-full-value recoverable. Cash and equivalents total $194.4M at 100% recovery. Goodwill of $19.2M and core deposit intangible of $0.2M are zero-value under the lens. PP&E net is $14.0M, recoverable at perhaps 50-60%. Mortgage servicing rights (carried separately as ServicingAsset $6.2M fair value) are highly sensitive to rate stress and would likely recover at a significant discount in a wind-down. Liabilities stand at $2.17B face value: deposits $2.02B, FHLB advances $59.8M, subordinated debt $59.0M (face $60M; the company issued $35M of 7.25% fixed-to-floating notes due 2036 in March 2026 and redeemed $25M of prior sub-debt, leaving the sub-debt stack slightly increased), and operating lease obligations $8.8M. The liability stack is immovable at face value. Applying conservative haircuts to assets, liquidation recovery to equity is materially negative—MFFAIS CLV/LLV/OLV all converge at $65.9M, which is consistent with the math: GAAP equity $201M minus ~$19M intangibles minus loan haircut losses of $100-200M plus modest investment/PP&E recovery produces a range where equity recovery is uncertain and potentially negative. Key deterioration since the prior filing (December 31, 2025 10-K): non-accrual loans increased $3.0M to $24.6M (1.23% of loans vs. 1.08%), ACL coverage of non-accruals declined to 78% from 87%. Subordinated debt increased $10M net (new $35M issuance, redemption of $25M). A $2.15M severance charge for the departing president hit Q1 2026. Wholesale funding reliance increased: brokered deposits now $152.2M (7.4% of total deposits). The filing does not separately XBRL-tag the ICS reciprocal deposit balance or the off-balance-sheet loan commitment notional ($137.2M) in a standalone tag; these are disclosed in MD&A only.
▼ Community Notes