(2)	Nature of Operations

Greene County Bancorp, Inc.’s primary business is the ownership and operation of its subsidiaries, The Bank of Greene County and Greene Risk Management, Inc. The Bank of Greene County has 17 full-service offices and an operations center and lending center located in its market area within the Hudson Valley and Capital District Regions of New York State. The Bank of Greene County is primarily engaged in the business of attracting deposits from the general public in The Bank of Greene County’s market area, and investing such deposits, together with other sources of funds, in loans and investment securities. Greene Risk Management, Inc. is a pooled captive insurance company, which provides additional insurance coverage for the Company and its subsidiaries related to the operations of the Company for which insurance may not be economically feasible. The Bank of Greene County also owns and operates two subsidiaries, Greene County Commercial Bank and Greene Property Holdings, Ltd. Greene County Commercial Bank’s primary business is to attract deposits from, and provide banking services to, local municipalities. Greene Property Holdings, Ltd. was formed as a New York corporation that has elected under the Internal Revenue Code to be a real estate investment trust, which holds mortgages and notes which were originated through and serviced by The Bank of Greene County.

During calendar year 2020, the world began and continues to respond to the pandemic. COVID-19 has caused business shutdowns or slowdowns, limitations on commercial activity, increased unemployment and commercial property vacancy rates, reduced profitability and ability for borrowers to make mortgage or other lending commitments. The overall economic and financial market instability has impacted households, individuals and businesses. The Company continues to closely monitor the impact of the pandemic on our business and results of operations. The Company recognizes and appreciates the staff who continue to assist retail customers, municipalities and businesses in the communities in which the Company operates as the country and world continue to work through the pandemic. Management believes it is still well positioned to withstand the continued financial impact from this health crisis as it stands by and works hand in hand with local businesses, individuals and households to be stronger than ever.

Depending upon the duration of the COVID-19 pandemic and the adequacy of strategies put in place by local and federal governments, borrowers may not have the ability to repay their debts which may ultimately result in losses to the Company. The fiscal stimulus and relief programs appear to have delayed any materially adverse financial impact to the Company. Once these stimulus programs have been discontinued, the Company’s may experience deterioration in the credit portfolio and loan losses may materialize. The risk of credit losses will be contingent upon efficacy of vaccines including distribution and customers and businesses ability to return to pre-pandemic routines. Economic uncertainty remains high and volatility may continue. Management continues to closely monitor credit relationships, particularly those on payment deferral or adversely classified discussed in more detail below.