NSTS Bancorp, Inc. (NSTS): Business Model Canvas [Dec-2025 Updated]

You're digging into the nuts and bolts of a classic community bank, and understanding the Business Model Canvas for NSTS Bancorp, Inc. is the fastest way to see its engine. Honestly, this isn't a high-growth tech play; it's built on stability since 1921, focusing almost entirely on local residential mortgages-that's 91.2% of their loan book as of late 2024. With a net loan portfolio of $130.4 million and revenue hitting $8.93 million in 2024, the real question is how their tight-knit customer relationships and three Illinois branches translate into sustainable net interest income. Dive below to see the nine blocks that define how NSTS Bancorp, Inc. actually makes money and manages its regulatory tightrope.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Key Partnerships

You're looking at the essential relationships NSTS Bancorp, Inc. relies on to operate and stay compliant. These aren't just names on a list; they are the gatekeepers, the market enablers, and the local anchors for North Shore Trust and Savings, the primary operating subsidiary.

Regulatory Oversight and Compliance

The relationship with the Office of the Comptroller of the Currency (OCC) is foundational. NSTS Bancorp, Inc., as the holding company for the federally-chartered North Shore Trust and Savings, is subject to comprehensive regulation and examination by the OCC. This partnership ensures the bank adheres to federal banking laws and maintains safety and soundness standards across its operations, which include attracting deposits and originating one- to four-family residential mortgage loans in its market area of Lake County, Illinois, and adjacent communities.

Government-Sponsored Enterprise (GSE) Access

NSTS Bancorp, Inc.'s investment strategy explicitly partners with the secondary mortgage market infrastructure. The investment policy permits investments in debt securities issued by U.S. agencies and Government-Sponsored Enterprises (GSEs) such as Fannie Mae and Freddie Mac. This access is crucial for managing interest rate sensitivity and complementing the bank's core lending activities. For context on the market NSTS Bancorp, Inc. participates in, Fannie Mae reported a guaranty book of business of $3.6 trillion as of June 30, 2025, with an average charged single-family guaranty fee of 48.3 basis points in the second quarter of 2025.

Here's a look at the structure of the investment securities portfolio, showing the reliance on these types of assets as of the end of the prior fiscal year, which informs the current partnership strategy:

Note: The total securities available-for-sale as of December 31, 2024, was $82,135 thousand. The sum of the listed categories exceeds 100% due to the inclusion of Municipal obligations which are often separate from agency/GSE-backed securities in reporting, but all are part of the investment strategy.

Independent Audit and Financial Assurance

The relationship with the Independent registered public accounting firm is formalized annually by stockholder ratification. For the fiscal year ending December 31, 2025, the appointment of Plante & Moran, PLLC was ratified by security holders at the Annual Meeting held on May 21, 2025. This confirms their role in providing assurance over the financial statements. At the same meeting, 3,765,451 votes were cast FOR the ratification.

Local Community Ties and Market Intermediation

NSTS Bancorp, Inc. maintains defintely deep market ties through direct engagement with local financial institutions and community support initiatives. This is evidenced by the bank's activity in selling loans to other local entities, which helps manage portfolio concentration and risk.

• Loans sold to local community banks for the year ended December 31, 2024, totaled $8.4 million.
• The total gain on sale recognized from these transactions in 2024 was $352,000.
• The bank's operational footprint includes a headquarters and main banking office in Waukegan, Illinois, plus two additional full-service branch offices in Waukegan and Lindenhurst, Illinois, and a loan production office in Chicago, Illinois.
• Historically, in connection with its January 18, 2022 conversion, NSTS Bancorp, Inc. provided $150,000 in cash and 107,959 shares of common stock to the NSTS Charitable Foundation, Inc.

The bank actively seeks opportunities to sell loans, indicating an ongoing, transactional partnership with local community banks to manage its loan production.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Key Activities

NSTS Bancorp, Inc. focuses its key activities on traditional savings institution functions, centered on deposit gathering and local lending, all under the watchful eye of federal regulators.

Attracting core deposits from the general public

The bank's funding strategy relies on attracting and retaining deposits. For instance, looking at the scheduled maturities for time deposits as reported in their filings, the amount maturing in the fiscal year 2025 was reported as $13,696 (in thousands, based on context from prior periods). This highlights the ongoing activity of managing deposit retention and renewal to ensure a stable funding base.

• Manage liquidity and access cost-effective funding.
• Address significant fluctuations in deposit accounts.
• Serve banking needs of customers in the Lake County, Illinois market area.

Origination of one- to four-family residential mortgage loans

The primary lending focus remains squarely on residential mortgages within the defined market area. As of December 31, 2024, the origination activity resulted in one- to four-family residential mortgage loans comprising $119.4 million, which represented 91.2% of the total loan portfolio. This concentration shows where the bulk of the bank's asset-generating activity is directed.

The loan origination process involves accepting applications at banking offices for underwriting. The bank also originates loans as Oak Leaf Community Mortgage, powered by North Shore Trust and Savings.

Here's a quick look at the loan portfolio composition as of the end of 2024, showing the dominance of the core activity:

Managing the investment securities portfolio

Beyond direct lending, NSTS Bancorp, Inc. uses deposit funds to purchase investments. The management of the investment securities portfolio is a key activity that balances yield and liquidity needs. While the precise size of the investment portfolio as of late 2025 isn't immediately available, the availability of the Q3 2025 10-Q filing indicates ongoing reporting and management of this asset class.

The bank must manage market risk associated with these securities. The activity involves monitoring the fair value of financial instruments and adjusting the portfolio to meet strategic goals.

• Purchase investments using available funds.
• Manage market risk on the securities portfolio.
• Monitor unrealized net holding gain (loss) on securities, as reported in quarterly statements.

Maintaining strict regulatory compliance and reporting

As a federally-chartered stock savings bank, NSTS Bancorp, Inc. is subject to comprehensive regulation and examination by the Office of the Comptroller of the Currency (the "OCC"). This is a non-negotiable, continuous activity.

Reporting requirements are extensive, including filing Form 10-Q quarterly and Form 10-K annually. Furthermore, the company was managing a specific governance compliance matter with Nasdaq, having a cure period until the earlier of its 2025 annual stockholders' meeting or December 21, 2025, to regain compliance with independent director requirements following a board vacancy. As of March 27, 2025, the company had 5,247,826 shares of common stock outstanding, which is relevant for per-share reporting metrics.

The activity involves:

• Adhering to changes in laws, government regulations, or policies affecting financial institutions.
• Meeting capital requirements set by federal bank regulatory agencies.
• Managing operational risk and reporting accurately to the SEC and other bodies.

Finance: draft 13-week cash view by Friday.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Key Resources

You're looking at the foundational assets that NSTS Bancorp, Inc. uses to execute its business plan, which is centered around community banking and mortgage lending. These aren't just line items on a balance sheet; they are the engines of the operation.

Core deposit base for funding lending activities is absolutely critical. This resource represents the stable, low-cost funding that allows NSTS Bancorp, Inc. to originate loans. The Bank's primary sources of funds are deposits, which consist of checking, money market, savings, and time deposit accounts from the general public in its market area. This resource is the lifeblood for their lending focus on one- to four-family residential mortgage loans.

The scale of their lending operation is anchored by the loan book itself. As of December 31, 2024, the Net loan portfolio of $130.4 million was reported, representing about 46.8% of total assets then. This portfolio is heavily weighted toward their core product, with one- to four-family residential mortgage loans making up approximately 91.2% of that total at year-end 2024.

Physical presence remains a key tangible asset in community banking. The Physical branch network is concentrated in its service area. NSTS Bancorp, Inc. operates from its headquarters and main banking office in Waukegan, Illinois, along with two additional full-service branch offices in Waukegan and Lindenhurst, Illinois, totaling three full-service offices. They also maintain loan production offices in Chicago, Plainfield, and Aurora, Illinois, to support origination activities.

Finally, the human capital is a defining resource. The Experienced management team and 53 employees provide the expertise to navigate regulatory requirements and manage credit and operational risks. This headcount, reported as 53 total employees in recent profiles, supports the operations of the subsidiary, North Shore Trust and Savings.

Here is a quick look at the core quantitative resources as of the latest reported periods:

The Bank's lending team, which includes personnel operating as Oak Leaf Community Mortgage, is supported by this team structure. You see the commitment to the local market through the physical footprint, which is defintely a resource for attracting local deposits.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Value Propositions

Traditional savings institution stability since 1921

NSTS Bancorp, Inc., through its subsidiary North Shore Trust and Savings, offers the perceived stability of an institution established in 1921. This longevity suggests a deep-rooted presence in its market area of Lake County, Illinois, and adjacent communities.

Community-focused banking with personalized service

The value proposition centers on serving customers within a defined local footprint, operating from offices in Waukegan and Lindenhurst, Illinois, plus a loan production office in Chicago, Illinois. This local structure supports a relationship-based banking model. As of the latest available full-year data, the company's market capitalization stood at $57.19M.

• Headquarters located at 700 South Lewis Avenue, Waukegan, IL 60085.
• Operates three full-service banking offices and one loan production office.
• Focuses on serving customers in Lake County, Illinois, and adjacent communities.

Specialization in residential mortgage lending (91.2% of loans)

The core offering is highly concentrated in residential real estate financing. This specialization drives the majority of the asset base. For instance, as of December 31, 2024, the primary lending activity was heavily weighted toward this segment.

The composition of the loan portfolio as of December 31, 2024, shows this clear focus:

The total net loan portfolio as of December 31, 2024, was $130.4 million.

Local decision-making for faster loan processing

The structure implies that loan applications for one to four-family residential mortgages are processed locally, which is intended to facilitate quicker underwriting and determination of whether a loan meets their standards. This contrasts with larger, centralized lending operations. The company originates both fixed-rate and adjustable-rate mortgage (ARM) loans, with approximately 32.7% of the one to four-family residential mortgage loans maturing after December 31, 2025, being ARM loans as of December 31, 2024.

• Loan applications accepted at any banking office for processing.
• Determination of whether a loan meets underwriting standards is made locally.
• ARM loans adjust based on the Wall Street Journal Prime rate, the one-year Treasury rate, or SOFR.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Customer Relationships

You're looking at how NSTS Bancorp, Inc. keeps its customers engaged, and honestly, it's a blend of old-school community banking and necessary digital upgrades. The core relationship is built on serving a specific geographic area, primarily Lake County, Illinois, and nearby communities. This focus means relationships aren't just transactional; they're local and deeply rooted.

Personal, relationship-driven service model

The foundation of NSTS Bancorp, Inc.'s approach is personalized service, which is expected given its history as a traditional savings institution. While the company is modernizing its interfaces, the emphasis remains on direct interaction. For instance, the lending team originates loans under the Oak Leaf Community Mortgage banner, suggesting a localized, dedicated approach to their primary customer base.

The strength in lending activity, evidenced by interest income reaching $2.79 million for the quarter ending June 2025, shows these relationships are translating into business volume, even while navigating a challenging net loss of $-0.59 million for the same period. That interest income growth of 34.64% in Q2 2025 is a direct reflection of successful customer engagement in their core lending activities.

Dedicated loan officers for complex products

For more involved products, like the one- to four-family residential mortgage loans that make up 91.2% of the total loan portfolio as of December 31, 2024 (totaling $119.4 million), you see the value of experienced personnel. The structure supports this through specialized roles. Take Amy L. Avakian, the Vice President and Chief Lending Officer; she has been with North Shore Trust and Savings since 1983, serving in various lending roles before her current title, which she has held since 2019. That kind of tenure in a key role suggests deep institutional knowledge is available to guide customers through complex financing.

Here's a quick look at the operational scale supporting these relationships:

This isn't a bank that just pushes paper; they have people who have been doing this for decades.

Self-service options via online and mobile banking

To be fair, the modern banking experience demands convenience alongside the personal touch. NSTS Bancorp, Inc. is actively adapting by modernizing customer interfaces and expanding its digital footprint. This includes secure digital transaction systems, online account management, and mobile service enhancements. Customers can access services like eStatements, and the bank provides online banking services through its website, www.northshoretrust.com. This dual approach ensures accessibility for day-to-day needs while reserving high-touch service for major transactions.

The digital push is a necessary evolution for a company established way back in 1921. You can expect to use these digital tools for routine tasks, such as:

• Accessing eStatements.
• Managing online bill pay.
• Reviewing account balances.
• Initiating secure digital transactions.

Long-standing, multi-generational customer loyalty

The institution's history as North Shore Building and Loan, established in 1921, is a major factor in customer retention. When a bank has been around for over a century in the same community, loyalty often passes down through families. This long-standing presence in Waukegan, Lindenhurst, and surrounding areas fosters trust that digital-only banks simply can't replicate quickly. The company's strategy is explicitly about balancing these traditional strengths with digital offerings to maintain relevance across generations of customers.

The physical footprint supports this continuity, with operations centered around its headquarters and main banking office in Waukegan, IL, plus two additional full-service branches in Waukegan and Lindenhurst, and a loan production office in Chicago, IL. You see this commitment in the lobby hours, which include Saturday appointments, showing a willingness to meet customers where they are.

Finance: draft 13-week cash view by Friday.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Channels

The Channels block for NSTS Bancorp, Inc. centers on a hybrid approach, balancing its traditional, localized physical presence in Lake County, Illinois, with necessary digital access points for modern banking activities.

The physical distribution network is concentrated, reflecting the institution's focus on its core market area. As of the latest available reports, NSTS Bancorp, Inc. operates through its primary physical locations:

• Three full-service branch offices within Lake County, Illinois.
• One dedicated loan production office situated in Chicago, Illinois.

The physical footprint includes the headquarters and main banking office in Waukegan, Illinois, alongside two additional full-service branches in Waukegan and Lindenhurst, Illinois. The Chicago loan production office supports lending activity outside the immediate branch network in a more densely populated area.

The scale of the business being channeled through these points can be seen in the balance sheet. As of December 31, 2024, the net loan portfolio totaled $130.4 million. This portfolio, which is the primary asset generated from customer relationships, flows through these established channels.

Digital channels are critical for transaction efficiency and accessibility, supporting the relationship banking model. NSTS Bancorp, Inc. provides these services to meet contemporary customer expectations:

• Online banking platforms for desktop access.
• Mobile banking platforms for on-the-go account management.
• Access to an ATM network for cash transactions.

The bank also supports digital services like eStatements and Online Bill Pay through these platforms. The integration of mobile wallets is also part of the current digital offering. For customers, the primary physical interaction points offer specific operating hours; for example, lobby hours generally run Monday through Friday from 9:00 a.m. - 5:00 p.m., with Saturday appointments available from 9:00 a.m. - 12:00 p.m. Drive-up hours extend slightly earlier and later, running Monday through Friday from 8:00 a.m. - 5:00 p.m., and Saturday from 8:00 a.m. - 1:00 p.m. This structure defines how customers physically access services, complementing the 24/7 digital access.

Finance: update the loan portfolio size from the Q3 2025 10-Q to reflect the current asset base by next Tuesday.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Customer Segments

NSTS Bancorp, Inc. serves a defined geographic area with specific financial product needs.

Individuals and families in Lake County, Illinois and adjacent communities

• Geographic focus: Lake County, Illinois and adjacent communities.
• Physical presence includes headquarters and main banking office in Waukegan, Illinois, and two additional full-service branch offices in Waukegan and Lindenhurst, Illinois.
• The institution operates with approximately $282.7 million in assets as of March 31, 2025.

Homebuyers and homeowners seeking residential mortgages

This segment drives the majority of the lending activity, as the primary business is originating one- to four-family residential mortgage loans. The lending team operates under the name Oak Leaf Community Mortgage, powered by North Shore Trust and Savings.

Local small businesses requiring commercial real estate and term loans

Commercial lending is a smaller, but present, component of the loan book, focusing on real estate collateral.

The commercial real estate loans include 14 loans secured by investor properties and two loans secured by retail frontage. There were unfunded commitments of $4.8 million related to construction loans as of December 31, 2024.

Retail customers utilizing deposit products (checking, savings, CDs)

The institution's principal activity involves attracting deposits from the general public to fund its loan portfolio.

• Offers interest-bearing and noninterest-bearing checking accounts.
• Offers money market accounts.
• Offers savings accounts.
• Offers time deposit accounts (CDs).

The institution maintains loan production offices in Chicago, Aurora, and Plainfield, Illinois, which may serve as origination points for customers outside the immediate branch area.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Cost Structure

You're looking at the core outflows for NSTS Bancorp, Inc., which, as a smaller regional bank, has a cost profile heavily influenced by interest paid to depositors and the overhead of maintaining a physical and regulatory presence. Honestly, for a company like NSTS Bancorp, Inc., the cost of funds-what you pay for deposits-is usually the single biggest variable cost.

We can map out the key cost drivers based on the latest available annual figures, primarily from the 2024 fiscal year reporting, as granular 2025 expense breakdowns across all requested categories aren't fully itemized in the immediate data. For instance, the Total Noninterest Expense for the third quarter of 2025 was reported at $2,495K (in thousands).

Here's a breakdown of the major cost components you asked about, using the most recent annual data points we have to populate the structure:

Personnel costs are a significant fixed component, tied directly to the 53 employees NSTS Bancorp, Inc. reports having. Remember, NSTS Bancorp, Inc. pays North Shore Trust and Savings for the time devoted by its support staff, meaning some personnel costs are indirect or allocated.

The cost structure is also defined by the physical footprint and the necessary technology to support its operations as a federally-chartered bank. The occupancy expense, which covers branch overhead, was $800,000 in the latest annual reporting column available.

Regulatory and compliance costs are a non-negotiable expense for a federally-chartered institution. While a specific dollar amount for NSTS Bancorp, Inc.'s 2025 compliance spend isn't itemized here, industry context suggests that banks with assets under $100 million might allocate around 8.7% of their non-interest expenses to compliance duties.

You should monitor these key cost areas closely:

• Interest expense on deposits is highly sensitive to rate changes.
• Personnel costs are relatively fixed given the 53 headcount.
• Technology spend is embedded in noninterest expense line items.
• Regulatory burden increases due to guidance on cybersecurity.

Finance: draft 13-week cash view by Friday.

NSTS Bancorp, Inc. (NSTS) - Canvas Business Model: Revenue Streams

You're looking at the core ways NSTS Bancorp, Inc. brings money in, which is pretty standard for a community bank focused on lending in Lake County, Illinois. The primary drivers are interest earned on the assets they hold and fees for services rendered.

The Total 2024 revenue was $8.93 million, representing a significant jump of 82.49% compared to the prior year's total revenue of $4.89 million. This growth suggests a material shift in their earning asset base or interest rate environment impact during 2024.

Net Interest Income from loan and investment portfolios remains the bedrock. For the full year 2024, the reported Net Interest Income reached $7.3 million, up from $7.1 million in 2023. To give you a clearer picture of the components driving this, here are the figures for the nine months ended September 30, 2024 (in thousands):

The lending portfolio is key here. As of December 31, 2024, the net loan portfolio totaled $130.4 million, making up 46.8% of total assets. The bulk of this lending is concentrated in one area.

• One- to four-family residential mortgage loans accounted for $119.4 million, or 91.2% of the total loan portfolio as of December 31, 2024.
• Commercial real estate loans were $4.2 million, or 3.2% of the total loan portfolio at that same date.
• Consumer loans represented a small fraction at $282,000, or 0.2%.

Non-interest income from service charges and fees, along with other non-interest sources, helps diversify the revenue base. This is crucial because it's less sensitive to interest rate swings. The company also generates revenue from loan origination and servicing fees, often bundled into the interest income line or recognized upon sale.

For the nine months ended September 30, 2024, Total Noninterest Income was $1,236 thousand. Here's a breakdown of those non-interest sources:

• Gain on sale of mortgage loans: $695 thousand.
• Service charges on deposits: $192 thousand.
• Increase in cash surrender value of BOLI (Bank Owned Life Insurance): $162 thousand.
• Rental income on office building: $48 thousand.

Remember, the gain on the sale of mortgage loans is directly tied to their primary lending activity-origination-but it's recognized as a fee/non-interest event when those loans are sold into the secondary market. That $695 thousand gain over nine months shows how important that secondary market execution is to their overall top line.