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As filed with the Securities and Exchange Commission on August 3, 2018

Registration No. 333 -225353

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

PRE-EFFECTIVE

AMENDMENT NO. 3

TO

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

CBM BANCORP, INC.

(Exact Name of Registrant as Specified in Its Charter)

2001 East Joppa Road

Baltimore, Maryland 21234

(410) 665-7600

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

Joseph M. Solomon, President

2001 East Joppa Road

Baltimore, Maryland 21234

(410) 665-7600

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

Copies to:

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box:  ☒

If this Form is filed to register additional shares for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering:  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.  ☐

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

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PROSPECTUS

(Proposed Holding Company for Chesapeake Bank of Maryland)

Up to 3,680,000 Shares of Common Stock

(Subject to Increase to up to 4,232,000 Shares)

CBM Bancorp, Inc., a Maryland corporation, is offering shares of its common stock for sale at $10.00 per share on a best efforts basis in connection with the conversion of Banks of the Chesapeake, M.H.C. from the mutual holding company to the stock holding company form of organization. In this prospectus, we refer to CBM Bancorp, Inc. as “CBM Bancorp.” We expect the shares of CBM Bancorp common stock will be listed on the Nasdaq Capital Market under the symbol “CBMB,” upon conclusion of the offering. There is no current market for the common stock. We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012.

The shares of common stock are first being offered for sale in a subscription offering to eligible depositors and tax-qualified employee benefit plans of Chesapeake Bank of Maryland. Shares not purchased in the subscription offering may be offered for sale to the general public in a community offering, with a preference given first to residents of the communities served by Chesapeake Bank of Maryland. Any shares of common stock not purchased in the subscription or community offering may be offered for sale to the public through a syndicate of broker-dealers, referred to in this prospectus as the syndicated offering. The syndicated offering may commence before the subscription and community offerings (including any extensions) have expired. However, no shares purchased in the subscription offering or the community offering will be issued until the completion of any syndicated offering.

We may sell up to 4,232,000 shares of common stock because of demand for the shares of common stock or changes in market conditions, without resoliciting subscribers. We must sell a minimum of 2,720,000 shares to complete the offering.

The minimum purchase order is 25 shares. Generally, no individual, or individuals acting through a single qualifying account held jointly, may purchase more than 17,500 shares of common stock, and no person or entity, together with associates or persons acting in concert with such person or entity, may purchase more than 17,500 shares of common stock in all categories of the offering combined.

The subscription offering will expire at 12:00 Noon, Eastern Time, on September 7, 2018. We expect that the community offering, if held, will terminate at the same time. We may extend the expiration date of the subscription and/or community offerings without notice to you until October 22, 2018 or longer if the Federal Reserve Board approves a later date. No single extension may exceed 90 days, and the offering must be completed by September 19, 2020. Once submitted, orders are irrevocable unless the subscription and community offerings are terminated or extended, with regulatory approval, beyond October 22, 2018, or the number of shares of common stock to be sold is increased to more than 4,232,000 shares or decreased to less than 2,720,000 shares.

If the subscription and community offerings are extended past October 22, 2018, all subscribers will be notified and given the opportunity to confirm, change or cancel their orders. If you do not respond to the notice of extension, we will promptly return your funds with interest or cancel your deposit account withdrawal authorization. If the number of shares to be sold in the offering is increased to more than 4,232,000 shares or decreased to less than 2,720,000 shares, we will resolicit subscribers, and all funds delivered to us to purchase shares of common stock in the subscription and community offerings will be returned promptly with interest. Funds received in the subscription and the community offerings will be held in a segregated account at Chesapeake Bank of Maryland and will earn interest at 0.05% per annum until completion or termination of the offering.

Raymond James & Associates, Inc. will assist us in selling the shares on a best efforts basis in the subscription and community offerings, and will serve as sole manager for any syndicated offering. Raymond James & Associates, Inc. is not required to purchase any shares of common stock that are sold in the offering.

OFFERING SUMMARY

Price: $10.00 per Share

This investment involves a degree of risk, including the possible loss of principal. See “Risk Factors” beginning on page 13.

These securities are not deposits or accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. None of the Securities and Exchange Commission, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

For assistance, please contact the Stock Information Center at (888) 317-2811

The date of this prospectus is [Prospectus Date].

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RISK FACTORS

You should consider carefully the following risk factors in evaluating an investment in the shares of common stock. In addition to these risks and the other risks and uncertainties described elsewhere in this prospectus, there may be additional risks and uncertainties that are not currently known to us or that we currently deem to be immaterial that could materially and adversely affect our business, financial condition or results of operations. To the extent that any of the information in this prospectus constitutes forward-looking statements, the risk factors below are cautionary statements identifying important factors that could cause actual results to differ materially from those expressed in any forward-looking statements made by us or on our behalf. See “Forward-Looking Statements.”

Risks Related to Our Business

Because we intend to continue to increase our nonresidential real estate and commercial business loan originations, our credit risk will increase and downturns in the real estate market or local economy could adversely affect our earnings.

We intend to continue to emphasize the origination of nonresidential real estate and commercial business loans. Nonresidential real estate and commercial business loans generally have more risk than the one- to four-family residential real estate loans we originate. Because the repayment of nonresidential real estate and commercial business loans depends on the successful management and operation of the borrower’s properties or related businesses, repayment of such loans can be affected by adverse conditions in the local real estate market or economy. Nonresidential real estate and commercial loans also may involve relatively large loan balances to individual borrowers or groups of related borrowers. A downturn in the real estate market or the local economy could adversely impact the value of properties securing the loan or the revenues from the borrower’s business, thereby increasing the risk of nonperforming loans. Further, unlike residential mortgage loans or multi-family and nonresidential real estate loans, commercial business loans may be secured by collateral other than real estate, such as inventory and accounts receivable, the value of which may be more difficult to appraise and may be more susceptible to fluctuation in value at default. As our nonresidential real estate and commercial loan portfolios increase, the corresponding risks and potential for losses from these loans may also increase. Furthermore, it may be difficult to assess the future performance of newly originated commercial loans, as such loans may have delinquency or charge-off levels above our historical experience, which could adversely affect our future performance.

Future changes in interest rates may reduce our profits.

Our ability to make a profit largely depends on our net interest income, which could be negatively affected by changes in interest rates. Net interest income is the difference between:

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 significant 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. In a period of declining interest rates, the interest income we earn on our assets may decrease more rapidly than the interest we pay on our liabilities, as borrowers prepay mortgage loans, and mortgage-backed securities and callable investment securities are called, requiring us to reinvest those cash flows at lower interest rates. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Management of Market Risk.”

In addition, changes in interest rates can affect the average life of loans and mortgage-backed and related securities. An increase in interest rates results in decreased prepayments of loans and mortgage-backed and related securities reducing our ability to adjust the interest rates on our loan and securities portfolios. Increased interest rates may also reduce demand for new loans. 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 institution’s net interest margin and create financial risk for financial institutions who originate longer-term, fixed rate mortgage loans.

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

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value of our assets and ultimately affect our earnings. Since 2008 we have operated in a period of historically low market interest rates, but prevailing interest rates have begun to increase and certain financial market measures are indicating the potential for future increases.

We monitor interest rate risk through the use of a simulation model that estimates the amounts by which the fair value of our assets and liabilities (our economic value of equity or “EVE”) would change in the event of a range of assumed changes in market interest rates. As of March 31, 2018, in the event of an instantaneous 200 basis point increase in interest rates, we estimate that we would experience a 22.26% decrease in EVE. For further discussion of how changes in interest rates could impact us, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Market Risk.”

We may not be able to adequately measure and limit our credit risk, which could lead to unexpected losses.

Our business depends on our ability to successfully measure and manage credit risk. As a lender, we are exposed to the risk that the principal of, or interest on, a loan will not be repaid timely or at all or that the value of any collateral supporting a loan will be insufficient to cover our outstanding exposure. In addition, we are exposed to risks with respect to the period of time over which the loan may be repaid, risks relating to proper loan underwriting, risks resulting from changes in economic and industry conditions, and risks inherent in dealing with individual loans and borrowers. The creditworthiness of a borrower is affected by many factors including local market conditions and general economic conditions. If the overall economic climate in the U.S., generally, or our market areas, specifically, experiences material disruption, our borrowers may experience difficulties in repaying their loans, the collateral we hold may decrease in value or become illiquid, and the level of nonperforming loans, charge-offs and delinquencies could rise and require significant additional provisions for credit losses. Additional factors related to the credit quality of commercial loans include the quality of the management of the business and the borrower’s ability both to properly evaluate changes in the supply and demand characteristics affecting our market for products and services and to effectively respond to those changes. Additional factors related to the credit quality of commercial real estate loans include tenant vacancy rates and the quality of management of the property.

Our risk management practices, such as monitoring the concentration of our loans within specific industries and our credit approval, review and administrative practices may not adequately reduce credit risk, and our credit administration personnel, policies and procedures may not adequately adapt to changes in economic or any other conditions affecting customers and the quality of the loan portfolio. A failure to effectively measure and limit the credit risk associated with our loan portfolio may result in loan defaults, foreclosures and additional charge-offs, and may necessitate that we significantly increase our allowance for credit losses, each of which could adversely affect our net income. As a result, our inability to successfully manage credit risk could have an adverse effect on our business, financial condition and results of operations.

A worsening of economic conditions in our market area could reduce demand for our products and services and/or result in increases in our level of nonperforming loans, which could adversely affect our operations, financial condition and earnings.

Local economic conditions have a significant impact on the ability of our borrowers to repay loans and the value of the collateral securing loans. Almost all of our loans that we retain are to borrowers located in, or are secured by collateral located in, our market area. A deterioration in economic conditions could have the following consequences, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations:

Moreover, a significant decline in general economic conditions caused by inflation, recession, acts of terrorism, an outbreak of hostilities or other international or domestic calamities, unemployment or other factors beyond our control could further impact these local economic conditions and could further negatively affect the financial results of our banking operations. 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.

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Nonperforming assets can take significant time and resources to resolve.

We currently report a low level of nonperforming assets. However, should these assets increase they may adversely affect our net income in various ways. We generally do not record interest income on other real estate owned or on nonperforming loans, thereby adversely affecting our income and increasing loan administration costs. In addition, we take collateral in foreclosures and similar proceedings, we are required to mark the related asset to the then fair market value of the collateral, which may ultimately result in a loss. An increase in the level of nonperforming assets increases our risk profile and may also impact the capital levels regulators believe are appropriate in light of the ensuing risk profile. While we seek to reduce problem assets through loan workouts, restructurings, and otherwise, decreases in the value of the underlying collateral, or in these borrowers’ performance or financial condition, whether or not due to economic and market conditions beyond our control, could have a material effect on our business, financial condition and results of operations. In addition, the resolution of nonperforming assets can require significant commitments of time from management, which may materially and adversely impact their ability to perform their other responsibilities. We may not experience future increases in the value of nonperforming assets.

A lack of liquidity could impair our ability to fund operations.

Liquidity is essential to our business, and we monitor our liquidity and manage our liquidity risk at the holding company and bank levels. We rely on our ability to generate deposits and effectively manage the repayment and maturity schedules of our loans and investment securities, respectively, to ensure that we have adequate liquidity to fund our operations. An inability to raise funds through deposits, borrowings, the sale of our investment securities, the sale of loans, and other sources could have a substantial negative effect on our liquidity. Our most important source of funds is deposits. Deposit balances can decrease when customers perceive alternative investments as providing a better risk/return tradeoff. If customers move money out of bank deposits and into other investments such as money market funds, we would lose a relatively low-cost source of funds, increasing our funding costs and reducing our net interest income and net income. We may also need to increase rates on deposits which would reduce income.

Our business strategy includes 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.

Our business strategy includes growth in assets, deposits and the scale of our operations. Achieving our growth targets will 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 bankers, the continued availability of desirable business opportunities, competition from other financial institutions in our 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. If we do not manage our growth effectively, our financial condition and operating results could be negatively affected.

Due to the high concentration of one-to four-family residential mortgage loans in our loan portfolio and the prolonged low interest rate environment, the average yield on our loan portfolio is low.

Historically, the vast majority of our loan portfolio has consisted of longer term (up to 30 years) fixed-rate one-to four-family residential real estate loans. In recent years, we have started to sell a portion of our newly originated fixed-rate one-to four-family residential real estate loans with terms of 20 years or longer, but such loans will likely continue to comprise a large percentage of our interest-earning assets. At March 31, 2018, our one-to four-family residential real estate loan portfolio total $69.6 million, or 49.31% of total loans. Traditionally, one-to four-family residential real estate loans have lower yields than nonresidential real estate or commercial business loans because one-to four-family real estate loans have less credit risk. During the prolonged low interest rate environment, the average yield on our one-to four-family residential real estate loans has decreased.

Our strategy following the offering is to grow our nonresidential real estate and commercial business loan portfolios. However, if we are unable to leverage the net proceeds of the offering with higher yielding assets, our ability to generate or increase our interest income will be compromised, which will reduce our profitability.

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

We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for the repayment of

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many of our loans. In determining the amount of the allowance for loan losses, we review our loans and our loss and delinquency experience, and we evaluate economic conditions. If our assumptions or the results of our analyses are incorrect, our allowance for loan losses may not be sufficient to cover losses inherent in our loan portfolio, resulting in additions to our allowance. In addition, our emphasis on loan growth and on increasing our portfolios of nonresidential real estate and commercial business loans, as well as any future credit deterioration, could require us to increase our allowance for loan losses in the future. At March 31, 2018, our allowance for loan losses was 0.77% of total gross loans and 137.53% of nonperforming loans. Material additions to our allowance would materially decrease our net income.

The Financial Accounting Standards Board has adopted a new accounting standard that will be effective for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years, for public business entities. As the Bank will take advantage of the extended transition period for complying with new or revised accounting standards assuming we remain an Emerging Growth Company, we may adopt the amendments in the update beginning after December 31, 2020, including interim periods within those fiscal years. This standard, referred to as Current Expected Credit Loss, or CECL, will require financial institutions to determine periodic estimates of lifetime expected credit losses on loans, and recognize the expected credit losses as allowances for loan losses. This will change the current method of providing allowances for loan losses that are probable, which would likely require us to increase our allowance for loan losses, and to greatly increase the types of data we would need to collect and review to determine the appropriate level of the allowance for loan losses.

In addition, bank regulators periodically review our allowance for loan losses and may require us to increase our provision for loan losses or recognize further loan charge-offs. Any increase in our allowance for loan losses or loan charge-offs as required by these regulatory authorities or otherwise may have a material adverse effect on our financial condition and results of operations.

Appraisals and other valuation techniques we use in evaluating and monitoring loans secured by real property, other real estate owned and repossessed personal property may not accurately describe the net value of the asset.

In considering whether to make a loan secured by real property, we generally require an appraisal of the property. However, an appraisal is only an estimate of the value of the property at the time the appraisal is made, and, as real estate values may change significantly in value in relatively short periods of time (especially in periods of heightened economic uncertainty), this estimate may not accurately describe the net value of the real property collateral after the loan is made. As a result, we may not be able to realize the full amount of any remaining indebtedness if we foreclose on and sell the relevant property. In addition, we rely on appraisals and other valuation techniques to establish the value of real estate and personal property that we acquire through foreclosure proceedings and to determine certain loan impairments. If any of these valuations are inaccurate, our consolidated financial statements may not reflect the correct value of our foreclosed real estate and personal property, and our allowance for loan losses may not reflect accurate loan impairments. This could have an adverse effect on our business, financial condition or results of operations.

Our size makes it more difficult for us to compete.

Our asset size makes it more difficult to compete with other financial institutions which are generally larger and can more easily afford to invest in the marketing and technologies needed to attract and retain customers. Because one of our primary sources of income is the net interest income we earn on our loans and investments, less the interest we pay on deposits and other sources of funds, our ability to generate the revenues needed to cover our expenses and finance such investments is limited by the size of our loan and investment portfolios. Accordingly, we are not always able to offer new products and services as quickly as our competitors. Our earnings also make it more difficult to offer competitive salaries and benefits. In addition, our customer base makes it difficult to generate meaningful non-interest income. Finally, as a smaller institution, we are disproportionately affected by the ongoing increased costs of compliance with banking and other regulations.

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

Competition in the banking and financial services industry is intense. In all of our market areas, we compete with commercial banks, savings institutions, mortgage brokerage firms, credit unions, finance companies, online lenders, mutual funds, insurance companies, brokerage and investment banking firms and unregulated or less regulated non-banking entities, operating locally and elsewhere. Many of these competitors have substantially greater resources and lending limits than we have and offer certain services that we do not or cannot provide. In addition, some of our competitors offer loans with lower interest rates on more attractive terms than loans we offer. Competition also makes it increasingly difficult and costly to

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attract and retain qualified employees. We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Our profitability depends upon our continued ability to successfully compete for business and qualified employees in our market areas. The greater resources and deposit and loan products offered by some of our competitors may limit our ability to increase our interest earning assets. For additional information see “Business of Chesapeake Bank of Maryland—Competition.”

The need to account for certain assets at estimated fair value, such as available for sale investment securities, may adversely affect our financial condition and results of operations.

We report certain assets, such as available for sale investment securities, at estimated fair value. The balance of investment securities was $6.8 million at March 31, 2018. Generally, for assets that are reported at fair value, we use quoted market prices or valuation models that utilize observable market inputs to estimate fair value. Because we carry these assets on our financial records at their estimated fair value, we may incur losses even if the subject asset presents minimal credit risk. At March 31, 2018 and December 31, 2017, accumulated other comprehensive income (loss) from available for sale investment securities was ($107,000) and ($50,000), respectively, and we did not recognize a loss on available for sale investment securities during the three months ended March 31, 2018 or the year ended December 31, 2017.

Our one- to four-family residential real estate loans expose us to increased credit risks.

At March 31, 2018, $69.6 million, or 49.31% of our gross loans held for investment, was secured by one- to four-family residential real estate. Economic recovery, including improvements in real estate values, has been inconsistent in our market areas. As a result, some of our mortgage loans and home equity lines of credit may be inadequately collateralized, which would expose us to a greater risk of loss if we seek to recover on defaulted loans by selling the real estate collateral or if borrowers who sell their homes are unable to repay their loans in full from the sale proceeds.

We typically hold in the portfolio our adjustable-rate one-to four-family residential real estate loans. Although adjustable-rate mortgage loans may reduce to an extent our vulnerability to changes in market interest rates because they periodically re-price, as interest rates increase the required payments due from the borrower also increase (subject to rate caps), increasing the potential for default by the borrower. At the same time, the ability of the borrower to repay the loan and the marketability of the underlying collateral may be adversely affected by higher interest rates.

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.

CBM Bancorp and Chesapeake Bank of Maryland are subject to extensive regulation, supervision and examination by the Federal Reserve Board and by the Office of the Comptroller of the Currency, respectively. Such regulation and supervision governs the activities in which an institution and its holding company may engage and are intended primarily for the protection of the federal deposit insurance fund and the depositors and borrowers of Chesapeake Bank of Maryland, rather than for our stockholders. 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 loan losses. These 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 accounting firm. These changes could materially impact, potentially even retroactively, how we report our financial condition and results of operations.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), enacted in 2010, significantly changed the regulation of banks and savings institutions and affects the lending, deposit, investment, trading and operating activities of financial institutions and their holding companies. The Dodd-Frank Act required various federal agencies to adopt a broad range of new implementing rules and regulations, and to prepare numerous studies and reports for Congress. The federal agencies were given significant discretion in drafting the implementing rules and regulations, some of which are not in final form. As a result, we cannot at this time predict the full extent to which the Dodd-Frank Act will impact our business, operations or financial condition. However, compliance with the Dodd-Frank Act and its implementing regulations and policies has already resulted in changes to our business and operations, as well as additional costs, and has diverted management’s time from other business activities, which have adversely affected our financial condition and results of operations.

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Cyber-attacks, other security breaches or systems failures could expose us to significant adverse regulatory consequences, reputational damage, civil litigation and financial loss.

We and third-party service providers who process the majority of our data regularly collect, process, transmit and store significant amounts of confidential information regarding our customers, employees and others and concerning our business, operations, plans and strategies. Information technology systems are critical to our business. We and our service providers use various technology systems to manage our customer relationships, general ledger, securities, deposits, and loans. We and our service providers have established policies and procedures to prevent or limit the impact of system failures, interruptions, and security breaches, but such events may still occur and may not be adequately addressed if they do occur. In addition, any compromise of our systems could deter customers from using our products and services.

Information security risks have generally increased in recent years because of the proliferation of new technologies, the use of the Internet and telecommunications technologies to conduct financial and other transactions and the increased sophistication and activities of perpetrators of cyber-attacks and mobile phishing. Mobile phishing, a means for identity thieves to obtain sensitive personal information through fraudulent e-mail, text or voice mail, is an emerging threat targeting the customers of popular financial entities. A failure in or breach of our operational or information security systems, or those of our third-party service providers, as a result of cyber-attacks or information security breaches or due to employee error, malfeasance or other disruptions, could adversely affect our business, result in the disclosure or misuse of confidential or proprietary information, damage our reputation, increase our operating costs or cause losses.

Physical, procedural and technological safeguards designed to protect confidential and proprietary information from mishandling, misuse or loss, do not provide absolute assurance that mishandling, misuse or loss of information will not occur, and if mishandling, misuse or loss of information does occur, that those events will be promptly detected and addressed. Similarly, when confidential or proprietary information is collected, compiled, processed, transmitted or stored by third parties on our behalf, our policies and procedures require that the third party agree to maintain the confidentiality of the information, establish and maintain policies and procedures designed to preserve the confidentiality of the information, and permit us to confirm the third party’s compliance with the terms of the agreement. As information security risks and cyber threats continue to evolve, we may be required to expend additional resources to continue to enhance information security measures and/or to investigate and remediate any information security vulnerabilities.

If our third-party service providers encounter difficulties, or if we have difficulty communicating with them, our ability to adequately process and account for transactions could be affected, and our business operations could be adversely affected. Threats to information security also exist in the processing of customer information through various other vendors and their personnel.

Although, to our knowledge, we have not experienced any of these events to date, the occurrence of any system failures, interruptions, or breaches of security could damage our reputation and result in a loss of customers and business, subject us to additional regulatory scrutiny or expose us to civil litigation and possible financial liability. Any of these events could have a material adverse effect on our financial condition and results of operations.

We have become subject to more 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.

A final capital rule, effective for us on January 1, 2015, includes new minimum risk-based capital and leverage ratios and refines the definition of what constitutes “capital” for calculating these ratios. The new minimum capital requirements are: (i) a new common equity Tier 1 capital ratio of 4.5%; (ii) a Tier 1 to risk-based assets capital ratio of 6% (increased from 4%); (iii) a total capital ratio of 8% (unchanged from prior rules); and (iv) a Tier 1 leverage ratio of 4%. The final rule also requires unrealized gains and losses on certain “available-for-sale” securities holdings to be included for calculating regulatory capital requirements unless a one-time opt-out is exercised. Chesapeake Bank of Maryland has elected to opt out of the requirement under the final rule to include certain “available-for-sale” securities holdings for calculating its regulatory capital requirements. The final rule also establishes a “capital conservation buffer” of 2.5%, and, when fully phased in, will result in the following minimum ratios: (i) a common equity Tier 1 capital ratio of 7.0%; (ii) a Tier 1 to risk-based assets capital ratio of 8.5%; and (iii) a total capital ratio of 10.5%. The new capital conservation buffer requirement is being phased in beginning in January 2016 at 0.625% of risk-weighted assets and will increase each year until fully implemented in January 2019. An institution will be subject to limitations on paying dividends, engaging in share repurchases and paying discretionary bonuses if its capital level falls below the buffer amount. These limitations will establish a maximum percentage of eligible retained income that can be utilized for such actions.

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We have analyzed the effects of these new capital requirements, and we believe that, upon completion of the offering, we will meet all of these new requirements, including the full 2.5% capital conservation buffer as if it had been fully phased in.

The application of more stringent capital requirements could, among other things, result in lower returns on equity, and may require raising additional capital in the future, and result in regulatory actions if we are unable to comply with such requirements. Furthermore, the imposition of liquidity requirements in connection with the implementation of Basel III could result in our having to lengthen the term of our funding sources, change our business models or increase our holdings of liquid assets. The implementation of changes to asset risk weightings for risk-based capital calculations, changes to items included in or deducted from regulatory capital or additional capital conservation buffers could result in management modifying its business strategy, and could limit our ability to make distributions, including paying dividends or repurchasing our shares. Specifically, Chesapeake Bank of Maryland’s ability to pay dividends to CBM Bancorp will be limited if it does not have the capital conservation buffer required by the new capital rules, which may further limit CBM Bancorp’s ability to pay dividends to stockholders. See “Supervision and Regulation—Capital Requirements.”

Non-compliance with the USA PATRIOT Act, Bank Secrecy Act, or other laws and regulations could result in fines or sanctions.

The USA PATRIOT Act and the Bank Secrecy Act require financial institutions to develop programs to prevent financial institutions from being used for money laundering and terrorist activities. If such activities are detected, financial institutions are obligated to file suspicious activity reports with the U.S. Treasury’s Office of Financial Crimes Enforcement Network. These rules require financial institutions to establish procedures for identifying and verifying the identity of customers seeking to open new financial accounts. Failure to comply with these regulations could result in fines or sanctions, including restrictions on conducting 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.

Our ability to originate and sell loans could be restricted by recently adopted federal regulations.

The Consumer Financial Protection Bureau has issued a rule intended to clarify how lenders can avoid legal liability under the Dodd-Frank Act, which holds lenders accountable for ensuring a borrower’s ability to repay a mortgage loan. Under the rule, loans that meet the “qualified mortgage” definition will be presumed to have complied with the new ability-to-repay standard. Under the rule, a “qualified mortgage” loan must not contain certain specified features, including:

Also, to qualify as a “qualified mortgage,” a loan must be made to a borrower whose total monthly debt-to-income ratio does not exceed 43%. Lenders must also verify and document the income and financial resources relied upon to qualify a borrower for the loan and underwrite the loan based on a fully amortizing payment schedule and maximum interest rate during the first five years, taking into account all applicable taxes, insurance and assessments.

The Dodd-Frank Act also requires the regulatory agencies to issue regulations that require securitizers of loans to retain “not less than 5% of the credit risk for any asset that is not a qualified residential mortgage.” The regulatory agencies have issued a final rule to implement this requirement. The final rule provides that the definition of “qualified residential mortgage” includes loans that meet the definition of “qualified mortgage” under the Consumer Financial Protection Bureau’s rule.

In addition, the Dodd-Frank Act requires the Consumer Finance Protection Bureau to adopt rules and publish forms that combine certain disclosures that consumers receive in connection with applying for and closing on certain mortgage loans loan under the Truth in Lending Act and the Real Estate Settlement Procedures Act (“TRID”). The Consumer Financial Protection Bureau has implemented a final rule to implement this requirement, and the final rule was effective in October 2015.

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We currently sell in the secondary market the majority of the one- to four-family residential real estate loans that we originate. These final rules could have a significant effect on the secondary market for loans and the types of loans we originate, and restrict or delay our ability to make loans, any of which could limit our growth or profitability.

Secondary mortgage market conditions could have a material impact on our financial condition and results of operations.

Our mortgage banking operation provides a significant portion of our non-interest income. In addition to being affected by interest rates, the secondary mortgage markets are also subject to investor demand for residential mortgage loans and increased investor yield requirements for these loans. These conditions may fluctuate or worsen in the future. As a result, a prolonged period of secondary market illiquidity may reduce our loan production volumes and could have a material adverse effect on our financial condition and results of operations.

If we are required to repurchase mortgage loans that we have previously sold, it would negatively affect our earnings.

Our mortgage banking operation involves originating residential mortgage loans for sale in the secondary market under agreements that contain representations and warranties related to, among other things, the origination and characteristics of the mortgage loans. We may be required to repurchase mortgage loans that we have sold in cases of borrower default or breaches of these representations and warranties, and we would be subject to increased risk of disputes and repurchase demands as our volume of loan sales increases. If we are required to repurchase mortgage loans or provide indemnification or other recourse, this could significantly increase our costs and thereby affect our future earnings.

Our success depends on hiring and retaining key personnel.

Our performance largely depends on the talents and efforts of highly skilled individuals. We rely on key personnel to manage and operate our business, including major revenue generating functions such as loan and deposit generation, as well as operational functions such as regulatory compliance and information technology. The loss of key staff may adversely affect our ability to maintain and manage these functions effectively, which could negatively affect our revenues. In addition, loss of key personnel could result in increased recruiting and hiring expenses, which could reduce our net income. Our continued ability to compete effectively depends on our ability to attract new employees and to retain and motivate our existing employees.

Legal and regulatory proceedings and related matters could adversely affect us.

We have been and may in the future become involved in legal and regulatory proceedings. We consider most of the proceedings to be in the normal course of our business or typical for the industry; however, it is inherently difficult to assess the outcome of these matters, and we may not prevail in any proceedings or litigation. There could be substantial cost and management diversion in such litigation and proceedings, and any adverse determination could have a materially adverse effect on our business, brand or image, or our financial condition and results of our operations.

Managing reputational risk is important to attracting and maintaining customers, investors and employees.

Threats to our reputation can come from many sources, including adverse sentiment about financial institutions generally, unethical practices, employee misconduct, failure to deliver minimum standards of service or quality, merger and acquisition activity, compliance deficiencies and questionable or fraudulent activities of our customers. Our policies and procedures may not be fully effective in protecting our reputation and promoting ethical conduct. Negative publicity regarding our business, employees, or customers, with or without merit, may result in the loss of customers and employees, costly litigation and increased governmental regulation, all of which could adversely affect our operating results.

Changes in management’s estimates and assumptions may have a material impact on our consolidated financial statements and our financial condition or operating results.

In preparing this prospectus as well as 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 management’s 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. Areas requiring significant estimates and assumptions by management include our evaluation of the adequacy of our allowance for loan losses, our valuation of investment securities, our valuation of deferred tax assets and our determining fair value measurements.

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Changes in our accounting policies or in accounting standards could materially affect how we report our financial condition and results of operations.

Our accounting policies are essential to understanding our financial condition and results of operations. Some of these policies require the use of estimates and assumptions that may affect the value of our assets or liabilities and financial results. Some of our accounting policies are critical because they require management to make difficult, subjective, and complex judgments about matters that are inherently uncertain, and because it is likely that materially different amounts would be reported under different conditions or using different assumptions. If such estimates or assumptions underlying our financial statements are incorrect, we may experience material losses.

From time to time, the Financial Accounting Standards Board and the Securities and Exchange Commission change the financial accounting and reporting standards or the interpretation of those standards that govern the preparation of our financial statements. These changes are beyond our control, can be difficult to predict and could materially affect how we report our financial condition and results of operations. We could also be required to apply a new or revised standard retroactively, resulting in restating prior period financial statements in material amounts.

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 properties. 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 unknown liabilities and may materially reduce the affected property’s 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 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.

We are an emerging growth company, and any decision on our part 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 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 of 2002, which would require that our independent auditors review and attest as to the effectiveness of our internal control over financial 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 will cease to be an emerging growth company upon the earliest of: (i) the first fiscal year after our annual gross revenues are $1.07 billion or more; (ii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (iii) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year. Investors may find our common stock less attractive if we choose to rely on these exemptions. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our common stock and the price of our common stock may be more volatile.

The obligations associated with being a public company will require significant resources and management attention.

As a public company, we will face increased legal, accounting, administrative and other costs and expenses that we have not incurred as a private company, particularly after we are no longer an emerging growth company. After the completion of

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this offering, we will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which requires that we file annual, quarterly and current reports with respect to our business and financial condition and proxy and other information statements, and the applicable rules and regulations implemented by the SEC, the Sarbanes-Oxley Act, the Dodd-Frank Act, the PCAOB and the Nasdaq Stock Market, each of which imposes additional reporting and other obligations on public companies. As a public company, we will be required to:

We expect these rules and regulations and changes in laws, regulations and standards relating to corporate governance and public disclosure, which have created uncertainty for public companies, to increase legal and financial compliance costs and make some activities more time consuming and costly. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Our investment in compliance with existing and evolving regulatory requirements will result in increased administrative expenses and a diversion of management’s time and attention from revenue-generating activities to compliance activities, which could have an adverse effect on our business, financial condition and results of operations. These increased costs could require us to divert a significant amount of money that we could otherwise use to expand our business and achieve our strategic objectives.

We have a continuing need for technological change, and we may not have the resources to effectively implement new technology, or we may experience operational challenges when implementing new technology.

The financial services industry is undergoing rapid technological changes with frequent introductions of new technology-driven products and services. The effective use of technology increases efficiency and enables financial institutions to reduce costs as well as service our customers better. New technology is also seen as necessary to appeal to younger customers. Our future success will depend, at least in part, upon our ability to address the needs of our customers by using technology to provide products and services that will satisfy customer demands for convenience as well as to create additional efficiencies in our operations as we continue to grow and expand our products and service offerings. We may experience operational challenges as we implement these new technology enhancements or products, which could result in us not fully realizing the anticipated benefits from such new technology or require us to incur significant costs to remedy any such challenges to a timely manner.

Many of our larger competitors have substantially greater resources to invest in technological improvements. We must also compete against online lenders who use technology to focus on segments of our business such as mortgage lending. As a result, they may be able to offer additional or superior products compared to those that we will be able to provide, which would put us at a competitive disadvantage. Accordingly, we may lose customers seeking new technology-driven products and services to the extent we are unable to provide such products and services.

We rely on third parties to provide key components of our business infrastructure, and a failure of these parties to perform for any reason could disrupt our operations.

Third parties provide key components of our business infrastructure such as data processing, internet connections, network access, core application processing, statement production and account analysis. Our business depends on the

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successful and uninterrupted functioning of our information technology and telecommunications systems and third-party servicers. The failure of these systems, or the termination of a third-party software license or service agreement on which any of these systems is based, could interrupt our operations. Because our information technology and telecommunications systems interface with and depend on third-party systems, we could experience service denials if demand for such services exceeds capacity or such third-party systems fail or experience interruptions. Replacing vendors or addressing other issues with our third-party service providers could entail significant delay and expense. If we are unable to efficiently replace ineffective service providers, or if we experience a significant, sustained or repeated, system failure or service denial, it could compromise our ability to operate effectively, damage our reputation, result in a loss of customer business, and subject us to additional regulatory scrutiny and possible financial liability, any of which could have an adverse effect on our business, financial condition and results of operations.

The Tax Cuts and Jobs Act could have an unintended impact on our business.

On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act (the “Act”) into law. The Act contains the most extensive changes to the Internal Revenue Code in over 30 years. Among other things, the Act reduces the federal corporate tax rate from a maximum of 35% to a flat 21%, doubles the standard deduction for individuals, limits the deductibility of state and local income, property and sales taxes by individuals to $10,000 per year, eliminates the deductibility of interest on home equity loans, and eliminates the deductibility of interest on new home mortgages in excess of $750,000 (down from $1.0 million previously). The Act also eliminates loss carrybacks and limits the deductibility of loss carryforwards to 80% of current-year taxable income. In addition, the Act phases out the deductibility of FDIC premiums for banks with assets in excess of $10 billion. The Act allows 100% expensing for all non-real property capital expenditures for five years but limits the deductibility of net interest expense (interest expense minus interest income) to 30% of taxable income for businesses with average annual gross receipts of more than $25 million.

While we expect to benefit from the lower federal tax rate in the future, the lower tax rate and other new limits on the recognition of tax loss carryforwards have also reduced the value of existing net operating loss carryforwards and other deferred tax assets which we were required to revalue during the 2017 fiscal year. Lower tax rates will also reduce the attractiveness of certain tax-advantaged bank investments such as municipal bonds and bank-owned life insurance. Various other provisions of the Act could have unanticipated effects on the business of Chesapeake Bank of Maryland. By reducing the tax advantages of home ownership through its limits on the deductibility of mortgage interest and property taxes and the elimination of the deductibility of interest on certain home equity loans, the Act could affect demand for housing and residential mortgages in the future. The value of the properties securing loans in our loan portfolio may be adversely impacted as a result of the changing economics of home ownership, which could require an increase in our provision for loan losses, which would reduce our profitability and could materially adversely affect our business, financial condition and results of operations. The higher standard deduction could also impact mortgage financing by reducing the number of taxpayers who itemize deductions and therefore benefit from these deductions. The lower corporate tax rates and new limits on the deductibility of net interest expense may reduce demand for loans from larger business borrowers and increase competition for lending to smaller business borrowers.

Acquisitions may disrupt our business and dilute stockholder value.

Acquiring other banks, businesses, or branches may have an adverse effect on our financial results and may involve various other risks commonly associated with acquisitions, including, among other things:

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If we are unable to successfully integrate an acquired company or branch, the anticipated benefits may not be realized fully or may take longer to realize than expected. A significant decline in asset valuations or cash flows may also cause us not to realize expected benefits

Risks Related to the Offering

The future price of the shares of common stock may be less than the $10.00 purchase price per share in the offering.

If you purchase shares of common stock in the offering, you may not be able to sell them later at or above the $10.00 purchase price. In many cases, shares of common stock issued by newly converted savings institutions or mutual holding companies have traded below the initial offering price. The aggregate purchase price of the shares of common stock sold in the offering will be based on an independent appraisal. The independent appraisal is not intended, and should not be construed, as a recommendation of any kind as to the advisability of purchasing shares of common stock. The independent appraisal is based on certain estimates, assumptions and projections, all of which are subject to change from time to time. After the shares begin trading, the trading price of our common stock will be determined by the marketplace, and may be influenced by many factors, including prevailing interest rates, the overall performance of the economy, changes in federal tax laws, new regulations, investor perceptions of CBM Bancorp and the outlook for the financial services industry in general. Price fluctuations in our common stock may be unrelated to our operating performance.

We may take other actions to meet the minimum required sales of shares if we cannot find enough purchasers to complete the offering.

If we are not able to reach the minimum the offering range, we may do any of the following: increase the maximum purchase limitations and allow all maximum purchase subscribers to increase their orders to the new maximum purchase limitations; terminate the offering and promptly return all funds; set a new offering range, notify all subscribers of the opportunity to confirm, cancel or change their orders; or take such other actions as may be permitted, to the extent such permission is required, by the Federal Reserve Board.

Our failure to effectively deploy the net proceeds may have an adverse effect on our financial performance.

We intend to invest between $12.9 million and $17.7 million of the net proceeds of the offering (or $20.4 million at the adjusted maximum of the offering range) in Chesapeake Bank of Maryland. We may use the remaining net proceeds to invest in short-term investments and for general corporate purposes, including repurchasing shares of our common stock and paying dividends. We also expect to use a portion of the net proceeds we retain to fund a loan to our employee stock ownership plan to purchase shares of common stock in the offering. Chesapeake Bank of Maryland may use the net proceeds it receives to fund new loans, expand its retail banking franchise by establishing or acquiring new branches or by acquiring other financial institutions or other financial services companies, or for other general corporate purposes. However, with the exception of funding the loan to the employee stock ownership plan, we have not allocated specific amounts of the net proceeds for any of these purposes, and we will have significant flexibility in determining the amount of the net proceeds we apply to different uses and when we apply or reinvest such proceeds. Also, certain of these uses, such as opening new branches or acquiring other financial institutions, may require the approval of the Office of the Comptroller of the Currency or the Federal Reserve Board. We have not established a timetable for investing the net proceeds, and we cannot predict how long we will require to invest the net proceeds. Our failure to reinvest these funds effectively would reduce our profitability and may adversely affect the value of our common stock.

Our return on equity will be low following the stock offering. This could negatively affect the trading price of our shares of common stock.

Net income divided by average stockholders’ equity, known as “return on equity,” is a ratio many investors use to compare the performance of financial institutions. Our return on equity will be low until we are able to leverage the additional capital we receive from the stock offering. Our return on equity also will be negatively affected by added expenses associated with our employee stock ownership plan and the stock-based benefit plans we intend to adopt, and may be negatively affected by higher minimum regulatory capital requirements. Until we can implement our business plan and increase our net interest income and non-interest income and leverage the capital raised in the stock offering, we expect our return on equity to be low compared to our peer group, which may reduce the market price of our shares of common stock.

Our stock-based benefit plans will increase our expenses and reduce our income.

We intend to adopt one or more stock-based benefit plans after the conversion, subject to stockholder approval, which will increase our annual compensation and benefit expenses related to the stock options and stock awards granted to

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participants under the proposed stock-based benefit plans. The actual amount of these stock-related compensation and benefit expenses will depend on the number of options and stock awards granted under the plans, the fair market value of our stock or options on the date of grant, the vesting period, and other factors which we cannot predict at this time. If we adopt stock-based benefit plans within 12 months following the conversion, the shares of common stock reserved for issuance pursuant to awards of restricted stock and grants of options under such plans would be limited to 4% and 10%, respectively, of the total shares of our common stock sold in the stock offering. If we adopt stock-based benefit plans more than 12 months after the completion of the conversion, we may award restricted shares of common stock or grant options in excess of these amounts, which would further increase costs.

In addition, we will recognize expense for our employee stock ownership plan when shares are committed to be released to participants’ accounts, and we will recognize expense for restricted stock awards and stock options over the vesting period of awards made to recipients. The expense in the first year following the offering for shares purchased in the offering and for our new stock-based benefit plans, assuming such plans had been implemented at the beginning of the year, has been estimated to be approximately $917,000 ($727,000 after tax) at the adjusted maximum of the offering range as set forth in the pro forma financial information under “Pro Forma Data,” assuming the $10.00 per share purchase price as fair market value. Actual expenses, however, may be higher or lower, depending on the price of our common stock. For further discussion of our proposed stock-based plans, see “Management—Benefits to be Considered Following Completion of the Conversion.”

The implementation of stock-based benefit plans may dilute your ownership interest.

We intend to adopt one or more new stock-based benefit plans following the stock offering. These plans may be funded either through open market purchases of our common stock or from the issuance of authorized but unissued shares of common stock. Our ability to repurchase shares of our common stock to fund these plans will be subject to many factors, including applicable regulatory restrictions on stock repurchases, the availability of stock in the market, the trading price of our stock, our capital levels, alternative uses for our capital and our financial performance. While our intention is to fund the new stock-based benefit plans through open market purchases, stockholders would experience a 12.29% dilution in ownership interest if newly issued shares of our common stock are used to fund stock options and shares of restricted common stock in amounts equal to 10% and 4%, respectively, of the shares sold in the offering, and all such stock options are exercised. Such dilution would also reduce earnings per share. If we adopt the plans more than 12 months following the conversion, new stock-based benefit plans would not be subject to these limitations and stockholders could experience greater dilution.

Although the implementation of new stock-based benefit plans would be subject to stockholder approval, historically, the overwhelming majority of stock-based benefit plans adopted by savings institutions and their holding companies following mutual-to-stock conversions have been approved by stockholders.

We have not determined when we will adopt one or more new stock-based benefit plans. Stock-based benefit plans adopted more than 12 months following the completion of the conversion may exceed regulatory restrictions on the size of stock-based benefit plans adopted within 12 months, which would further increase our costs.

If we adopt stock-based benefit plans more than 12 months following the completion of the conversion, then grants of shares of common stock or stock options under our proposed stock-based benefit plans may exceed 4% and 10%, respectively, of shares of common stock sold in the stock offering. Stock-based benefit plans that provide for awards in excess of these amounts would increase our costs beyond the amounts estimated in “— Our stock-based benefit plans will increase our expenses and reduce our income.” Stock-based benefit plans that provide for awards in excess of these amounts could also result in dilution to stockholders in excess of that described in “The implementation of stock-based benefit plans may dilute your ownership interest. Historically, stockholders have approved these stock-based benefit plans.” Although the implementation of stock-based benefit plans would be subject to stockholder approval, the timing of the implementation of such plans will be at the discretion of our board of directors.

Various factors may make takeover attempts more difficult to achieve.

Certain provisions of our articles of incorporation and bylaws and federal banking laws, including regulatory approval requirements, could make it more difficult for a third party to acquire control of CBM Bancorp without our board of directors’ approval. Under regulations applicable to the conversion, for a period of three years following completion of the conversion, no person may acquire beneficial ownership of more than 10% of our common stock without prior approval of the Federal Reserve Board. Under federal law, subject to certain exemptions, a person, entity or group must notify the Federal Reserve Board and receive the Federal Reserve Board’s non-objection before acquiring control of a savings and loan

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holding company. There also are provisions in our articles of incorporation and bylaws that we may use to delay or block a takeover attempt, including a provision that prohibits any person from voting more than 10% of our outstanding shares of common stock. Chesapeake Bank of Maryland’s charter will contain a similar restriction on acquisitions of 10% or more of its common stock, directly or indirectly, for five years following the conversion. Furthermore, shares of restricted stock and stock options that we may grant to employees and directors, stock ownership by our management and directors and other factors may make it more difficult for companies or persons to acquire control of CBM Bancorp without the consent of our board of directors. Taken as a whole, these statutory or regulatory provisions and provisions in our articles of incorporation and bylaws could result in our being less attractive to a potential acquirer and thus could adversely affect the market price of our common stock.

For additional information, see “Restrictions on Acquisition of CBM Bancorp, Inc.” and “Management—Benefits to be Considered Following Completion of the Conversion.”

There may be a limited trading market in our shares of common stock, which would hinder your ability to sell our common stock and may lower the market price of our common stock.

We have never issued capital stock and there is no established market for the common stock. We have applied to list the shares of CBM Bancorp common stock on the Nasdaq Capital Market following the conversion and offering. In order to have our stock listed on the Nasdaq Capital Market, we are required to have at least three broker-dealers who will make a market in our common stock. Raymond James & Associates, Inc. has advised us that it intends to make a market in our common stock following the offering, but is under no obligation to do so. The development of a public market having the desirable characteristics of depth, liquidity and orderliness depends on the existence of willing buyers and sellers, the presence of which is not within our control or that of any market maker. The number of active buyers and sellers of our common stock at any particular time may be limited, which may have an adverse effect on the price at which our common stock can be sold. Persons purchasing the common stock may not be able to sell their shares at or above the $10.00 price per share in the offering. Purchasers of our common stock should recognize that there are risks involved in their investment and that there may be a limited trading market in the common stock.

You may not revoke your decision to purchase CBM Bancorp common stock in the subscription or community offerings after you send us your order.

Funds submitted or automatic withdrawals authorized in connection with the purchase of shares of common stock in the subscription and community offerings will be held by us until the completion or termination of the conversion and offering, including any extension of the expiration date and consummation of a syndicated offering. Because completion of the conversion and offering will be subject to regulatory approvals and an update of the independent appraisal prepared by Feldman Financial Advisors, Inc., among other factors, there may be one or more delays in completing the conversion and offering. Orders submitted in the subscription and community offerings are irrevocable, and purchasers will have no access to their funds unless the offering is terminated, or extended beyond October 22, 2018, or the number of shares to be sold in the offering is increased to more than 4,232,000 shares or decreased to fewer than 2,720,000 shares.

The distribution of subscription rights could have adverse income tax consequences.

If the subscription rights granted to certain current or former depositors of Chesapeake Bank of Maryland are deemed to have an ascertainable value, receipt of such rights may be taxable in an amount equal to such value. Whether subscription rights are considered to have ascertainable value is an inherently factual determination. We have received an opinion of counsel, Jones Walker LLP, that it is more likely than not that such rights have no value; however, such opinion is not binding on the Internal Revenue Service.

Securities analysts may not initiate or continue coverage on us.

The trading market for our common stock will depend, in part, on the research and reports that securities analysts publish about us and our business. We do not have any control over these securities analysts, and they may not cover us. If one or more of these analysts cease to cover us or fail to publish regular reports on us, we could lose visibility in the financial markets, which could cause the price or trading volume of our common stock to decline. If we are covered by securities analysts and are the subject of an unfavorable report, the price of our common stock may decline.

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An investment in our common stock is not an insured deposit and is subject to risk of loss.

Your investment in our common stock will not be a bank deposit and will not be insured or guaranteed by the FDIC or any other government agency. Your investment will be subject to investment risk, and you must be capable of affording the loss of your entire investment.

You may not receive dividends on our common stock.

Holders of our common stock are only entitled to receive such dividends as our board of directors may declare out of funds legally available for such payments. The declaration and payment of future cash dividends will be subject to, among other things, regulatory restrictions, our then current and projected consolidated operating results, financial condition, tax considerations, future growth plans, general economic conditions, and other factors our board of directors deems relevant. At this time, no determination has been made with respect to the payment of future dividends on our common stock.

Our articles of incorporation contain provisions which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our articles of incorporation provide that, unless we consent in writing to the selection of an alternative forum, any state or federal court located within the State of Maryland, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants, shall be the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders with respect to our Company, our directors, our officers or our other employees. This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that the stockholder believes is favorable for disputes with us or our directors, officers or other employees and may discourage meritorious claims from being asserted against us and our directors, officers and other employees. Alternatively, if a court were to find this provision inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations.

We believe this provision makes it less likely that we will be forced to incur the expense of defending duplicative actions in multiple forums and less likely that plaintiffs’ attorneys will be able to employ such litigation to coerce us into otherwise unjustified settlements. We also believe the risk of a court declining to enforce this provision is remote, as the General Assembly of Maryland has specifically authorized the adoption of this type of provision.

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SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following tables set forth selected consolidated historical financial and other data of Banks of the Chesapeake, M.H.C. and its subsidiary as of and for the periods indicated. The following is only a summary and you should read it in conjunction with the business and financial information regarding Banks of the Chesapeake, M.H.C. contained elsewhere in this prospectus. The information at March 31, 2018, and for the three months ended March 31, 2018 and 2017, is not audited but, in the opinion of management, includes all adjustments necessary for fair presentation. All adjustments are normal and recurring. The results of operations for the three months ended March 31, 2018 are not necessarily indicative of the results that may be expected for the entire year. The information at December 31, 2017 and 2016, and for the years ended December 31, 2017 and 2016, is derived in part from the audited consolidated financial statements that appear in this prospectus.

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RECENT DEVELOPMENTS

The following tables set forth selected consolidated historical financial and other data of Banks of the Chesapeake, M.H.C. and its subsidiary as of and for the periods indicated. The following is only a summary and you should read it in conjunction with the business and financial information regarding Banks of the Chesapeake, M.H.C. contained elsewhere in this prospectus. The information at June 30, 2018, and for the three and six months ended June 30, 2018 and 2017, is not audited but, in the opinion of management, includes all adjustments necessary for fair presentation. All adjustments are normal and recurring. The results of operations for the three and six months ended June 30, 2018 are not necessarily indicative of the results that may be expected for the entire year. The information at December 31, 2017 is derived in part from the audited consolidated financial statements that appear in this prospectus.

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Comparison of Financial Condition at June 30, 2018 and December 31, 2017

Total Assets. Total assets increased $6.3 million, or 3.54%, to $184.2 million at June 30, 2018 from $177.9 million at December 31, 2017. The increase in total assets was primarily due to growth in cash and cash equivalents funded by growth in deposits, as discussed in more detail below.

Cash and Cash Equivalents. Cash and cash equivalents increased $7.0 million, or 58.33%, to $19.0 million at June 30, 2018 from $12.0 million at December 31, 2017. The increase was primarily the result of an increase in deposits.

Time Deposits in Other Banks. Time deposits in other banks increased by $248,000, or 4.96%, to $5.2 million at June 30, 2018 from $5.0 million at December 31, 2017. This increase was due to investing in time deposits in other banks offset by maturities of time deposits in other banks.

Investment Securities. Investment securities increased $539,000, or 5.28%, to $10.8 million at June 30, 2018 from $10.2 million at December 31, 2017. The increase was due to purchases of $1.0 million offset by maturities, calls, and principal repayments of $341,000. At June 30, 2018 our available for sale portion of the securities portfolio, at fair value, was $7.8 million and our held to maturity portion of the securities portfolio, at amortized cost, was $3.0 million.

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Net Loans. Net loans increased slightly to $139.1 million at June 30, 2018 from $139.0 million at December 31, 2017 which was the result of lower than expected loan originations during the six months ended June 30, 2018. One-to four-family residential real estate loans increased $574,000 or 0.85%, to $67.8 million at June 30, 2018 from $67.2 million at December 31, 2017, nonresidential loans increased $604,000, or 1.23%, to $49.6 million at June 30, 2018 from $49.0 million at December 31, 2017, commercial loans increased $875,000, or 19.02%, to $5.5 million at June 30, 2018 from $4.6 million at December 31, 2017, home equity loans and lines of credit decreased $755,000, or 7.95%, to $8.8 million at June 30, 2018 from $9.5 million at December 31, 2017 and construction and land development loans decreased $1.1 million, or 11.83%, to $8.2 million at June 30, 2018 from $9.3 million at December 31, 2017.

Bank-owned Life Insurance. We invest in bank-owned life insurance (“BOLI”) to provide us with a funding source for our benefit plan obligations. Bank-owned life insurance also generally provides us noninterest income that is non-taxable. Federal regulations generally limit our investment in bank-owned life insurance to 25% of our Tier 1 capital plus our allowance for loan losses at the time of investment. This investment is accounted for using the cash surrender value method and is recorded at the amount that can be realized under the insurance policies at the balance sheet date. At June 30, 2018 and December 31, 2017, the aggregate cash surrender value of these policies was $4.5 million and $5.4, million respectively. The decrease in the cash surrender value was attributable to the benefits received upon the death of a retired director insured with BOLI.

Deposits. Deposits increased $5.3 million, or 3.42%, to $160.1 million at June 30, 2018 from $154.8 million at December 31, 2017. Our non-interest bearing demand deposits increased $2.8 million, or 16.97%, to $19.3 million at June 30, 2018 from $16.5 million at December, 31, 2017. Our interest-bearing demand deposits increased $402,000, or 1.60%, to $25.6 million at June 30, 2018 from $25.2 million at December 31, 2017, our savings deposits increased $1.4 million, or 5.69%, to $26.0 million at June 30, 2018 from $24.6 million at December 31, 2017. Our certificates of deposit increased $1.3 million, or 1.73%, to $76.3 million at June 30, 2018 from $75.0 million at December 31, 2017 and our money market deposits decreased $649,000, or 4.81%, to $12.9 million at June 30, 2018 from $13.5 million at December 31, 2017.

Total Equity. Total equity increased by $415,000, or 1.92%, to $22.0 million at June 30, 2018 from $21.6 million at December 31, 2017 due to earnings of $473,000 for the six months ended June 30, 2018, partially offset by increases in unrealized losses on available for sale securities, net of tax, of $58,000 during the six months ended June 30, 2018.

Comparison of Operating Results for the Three Months Ended June 30, 2018 and June 30, 2017

General. Net income was $217,000 for the three months ended June 30, 2018 compared to $86,000 for the three months ended June 30, 2017. The increase was due to an increase in net interest income after provision of $299,000, or 24.92%, to $1.5 million for the three months ended June 30, 2018 from $1.2 million for the three months ended June 30, 2017. The increase was offset by an increase in non-interest expense of $101,000, or 7.77%, to $1.4 million for the three months ended June 30, 2018 from $1.3 million for the three months ended June 30, 2017.

Interest Income. Interest and dividend income increased $85,000, or 5.00%, to $1.8 million for the three months ended June 30, 2018 from $1.7 million for the three months ended June 30, 2017. The increase in interest income was due primarily to the increase in average interest-earning assets for the three months ended June 30, 2018 compared to the average interest-earning assets for the three months ended June 30, 2017.

Interest income on loans increased $36,000, or 2.25%, and remained constant at $1.6 million for the three months ended June 30, 2018 and for three months ended June 30, 2017. Our average balance of loans decreased $1.9 million, or 1.35%, to $138.7 million for the three months ended June 30, 2018 from $140.6 million for the three months ended June 30, 2017. Our average yield on loans increased 16 basis points to 4.76% for the three months ended June 30, 2018 from 4.60% for the three months ended June 30, 2017, as lower-yielding loans have been repaid or refinanced and replaced with higher-yielding loans.

Interest and dividends on federal funds sold, interest-bearing deposits in other banks, time deposits in other banks, and investments increased $49,000, or 44.14%, to $160,000 for the three months ended June 30, 2018 from $111,000 for the three months ended June 30, 2017. The average balances on federal funds sold, interest-bearing

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deposits in other banks, time deposits in other banks and investments increased $6.3 million, or 24.23%, to $32.3 million for the three months ended June 30, 2018 from $26.0 million for the three months ended June 30, 2017. The average rate we earned on federal funds sold, interest-bearing deposits in other banks, time deposits in other banks and investments increased 28 basis points to 1.99% for the three months ended June 30, 2018 from 1.71% for the three months ended June 30, 2017 primarily due to our interest-bearing deposits in other banks repricing due to federal funds rate increases.

Interest Expense. Interest expense increased $36,000, or 18.65%, to $229,000 for the three months ended June 30, 2018 from $193,000 for the three months ended June 30, 2017. Our average balance of interest-bearing liabilities increased $714,000, or 0.52%, to $139.1 million for the three months ended June 30, 2018 from $138.4 million for the three months ended June 30, 2017. Our average yield on interest-bearing deposits increased 10 basis points to 0.66% for the three months ended June 30, 2018 from 0.56% for the three months ended June 30, 2017 primarily due to an increase in the average rate paid on certificates of deposit.

Net Interest Income. Net interest income increased $49,000, or 3.27%, to $1.6 million for the three months ended June 30, 2018 from $1.5 million for the three months ended June 30, 2017, primarily as the result of a higher balance of net interest-earning assets, which represents total interest-earning assets, less total interest-bearing liabilities, and to a lesser extent, a higher net interest rate spread and net interest margin. Our average net interest-earning assets increased by $3.7 million, or 13.12%, to $31.9 million for the three months ended June 30, 2018 from $28.2 million for the three months ended June 30, 2017, due primarily to our growth in federal funds sold, interest-bearing deposits in other banks, time deposits in other banks and investments described above. Our net interest rate spread decreased by one basis point to 3.58% for the three months ended June 30, 2018 from 3.59% for the three months ended June 30, 2017 and our net interest margin increased by two basis points to 3.70% for the three months ended June 30, 2018 from 3.68% for the three months ended June 30, 2017.

Provisions for Loan Losses. Provisions for loan losses are charged to operations to establish an allowance for loan losses at a level necessary to absorb known and inherent losses in our loan portfolio that are both probable and reasonably estimable at the date of the financial statements. In evaluating the level of the allowance for loan losses, management analyzes several qualitative loan portfolio risk factors, including, but not limited to, management’s ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and non-accrual loans, existing risk characteristics of specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses. The allowance for loan losses is assessed on a quarterly basis and provisions are made for loan losses as required in order to maintain the allowance.

Provision for loan losses decreased by $250,000, or 76.92%, to $75,000 for the three months ended June 30, 2018 from a provision for loan losses for the three months ended June 30, 2017 of $325,000. The Company recorded net charge-offs of $50,000 and $0 for the three months ended June 30, 2018 and 2017, respectively. Non-performing loans totaled $673,000 at June 30, 2018 compared to $2.1 million at June 30, 2017. The decrease of $1.4 million in non-performing loans was the result of a decrease of $1.6 million in non-performing construction and land development loans offset by an increase of $212,000 in non-performing one-to four-family loans. The Company’s non-performing loans to total loans decreased to 0.48% at June 30, 2018 from 1.48% at June 30, 2017. The Company reported a higher provision during the three months ended June 30, 2017 due to higher levels of non-performing and impaired loans at June 30, 2017. The Company has provided for losses that are probable and reasonably estimable at June 30, 2018.

Non-interest Income. Non-interest income decreased by $29,000, or 16.67%, to $145,000 for the three months ended June 30, 2018 from $174,000 for the three months ended June 30, 2017. The decrease was primarily due to decreases of $13,000 and $12,000 in the cash surrender value of bank-owned life insurance and gain on sale of loans, respectively.

Non-interest Expense. Non-interest expense increased by $101,000, or 7.77%, to $1.4 million for the three months ended June 30, 2018 from $1.3 million for the three months ended June 30, 2017. Salaries, director fees and employee benefits increased $68,000, or 9.33%, to $797,000 for the three months ended June 30, 2018 from $729,000 for the three months ended June 30, 2017 due to our investment in our employee base, including the senior management team and our sales and relationship management personnel, to help support our continued growth strategy. Professional fees increased

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$14,000, or 20.59%, to $82,000 for the three months ended June 30, 2018 from $68,000 for the three months ended June 30, 2017 primarily due to increased consulting fees relating to information technology system enhancements. Marketing expenses increased $13,000, or 52.00%, to $38,000 for the three months ended June 30, 2018 compared to $25,000 for the three months ended June 30, 2017 primarily due to marketing outlays to generate organic growth and investments in new products and services. We recorded a loss of $14,000 on the sale of foreclosed real estate for the three months ended June 30, 2017. We did not sell any foreclosed real estate during the three months ended June 30, 2018.

Income Tax Expense. Income tax expense increased by $38,000 to $73,000 for the three months ended June 30, 2018 from $35,000 for the three months ended June 30, 2017. The effective tax rate was 25.17% and 28.93% for the three months ended June 30, 2018 and 2017, respectively. The increase in tax expense was the result of an increase in income before income taxes of $169,000 to $290,000 for the three months ended June 30, 2018 from $121,000 for the three months ended June 30, 2017 offset by a decrease in the tax rate as the result of the passage of the Tax Cuts and Job Act (the “Act”) that was signed into law on December 22, 2017. The Act amended the Internal Revenue Code to reduce income tax rates and modify policies, credits and deductions for individuals and businesses. For businesses, the Act reduces the federal corporate tax rate from a maximum 35% to a flat 21% tax rate.

Comparison of Operating Results for the Six Months Ended June 30, 2018 and June 30, 2017

General. Net income was $473,000 for the six months ended June 30, 2018 compared to $265,000 for the six months ended June 30, 2017. The increase was due primarily to an increase in net interest income of $160,000, or 5.33%, to $3.2 million for the six months ended June 30, 2018 from $3.0 million for the six months ended June 30, 2017 and a decrease in the provision for loan losses of $225,000, or 60.00%, to $150,000 for the six months ended June 30, 2018 from $375,000 for the six months ended June 30, 2017. The increase was offset by an increase in non-interest expense of $157,000, or 6.28%, to $2.7 million for the six months ended June 30, 2018 from $2.5 million for the six months ended June 30, 2017.

Interest Income. Interest and dividend income increased $224,000, or 6.59%, to $3.6 million for the six months ended June 30, 2018 from $3.4 million for the six months ended June 30, 2017. The increase in interest income was due primarily to the increase in average interest-earning assets for the six months ended June 30, 2018 compared to the average interest earnings assets for the six months ended June 30, 2017.

Interest income on loans increased $151,000, or 4.87%, to $3.3 million for the quarter ended June 30, 2018 from $3.1 million for the quarter ended June 30, 2017. The increase was primarily due to an increase in the average balance of our loans as well as an increase in the average yield on our loans. Our average balance of loans increased $3.0 million, or 2.20%, to $139.1 million for the six months ended June 30, 2018 from $136.1 million for the six months ended June 30, 2017. Our average yield on loans increased 11 basis points to 4.77% for the six months ended June 30, 2018 from 4.66% for the six months ended June 30, 2017, as lower-yielding loans have been repaid or refinanced and replaced with higher-yielding loans.

Interest and dividends on federal funds sold, interest-bearing deposits in other banks, time deposits in other banks, and investments increased $73,000, or 33.03%, to $294,000 for the six months ended June 30, 2018 from $221,000 for the six months ended June 30, 2017. The average balances on federal funds sold, interest-bearing deposits in other banks, time deposits in other banks and investments increased $3.5 million, or 12.64%, to $31.2 million for the six months ended June 30, 2018 from $27.7 million for the six months ended June 30, 2017. The average rate we earned on federal funds sold, interest-bearing deposits in other banks, time deposits in other banks and investments increased 29 basis points to 1.90% for the six months ended June 30, 2018 from 1.61% for the six months ended June 30, 2017 primarily due to our interest-bearing deposits in other banks repricing due to federal funds rate increases.

Interest Expense. Interest expense increased $64,000, or 16.89%, to $443,000 for the six months ended June 30, 2018 from $379,000 for the six months ended June 30, 2017. Our average balance of interest-bearing liabilities increased $2.8 million, or 2.05%, to $139.4 million for the six months ended June 30, 2018 from $136.6 million for the six months ended June 30, 2017. Our average yield on interest-bearing deposits increased eight basis points to 0.64% for the six months ended June 30, 2018 from 0.56% for the six months ended June 30, 2017 primarily due to an increase in the average rate paid on certificates of deposit.

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Net Interest Income. Net interest income increased $160,000, or 5.33%, to $3.2 million for the six months ended June 30, 2018 from $3.0 million for the six months ended June 30, 2017, primarily as the result of a higher balance of net interest-earning assets, which represents total interest-earning assets, less total interest-bearing liabilities and, to a lesser extent, a higher net interest rate spread and net interest margin. Our average net interest-earning assets increased by $4.2 million, or 15.73%, to $30.9 million for the six months ended June 30, 2018 from $26.7 million for the six months ended June 30, 2017. Our net interest rate spread increased by three basis points to 3.61% for the six months ended June 30, 2018 from 3.58% for the six months ended June 30, 2017 and our net interest margin increased by five basis points to 3.72% for the six months ended June 30, 2018 from 3.67% for the six months ended June 30, 2017.

Provisions for Loan Losses. Provisions for loan losses are charged to operations to establish and allowance for loan losses at a level necessary to absorb known and inherent losses in our loan portfolio that are both probable and reasonably estimable at the date of the financial statements. In evaluating the level of the allowance for loan losses, management analyzes several qualitative loan portfolio risk factors, including, but not limited to, management’s ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and non-accrual loans, existing risk characteristics of specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses. The allowance for loan losses is assessed on a quarterly basis and provisions are made for loan losses as required in order to maintain the allowance.

Provision for loan losses decreased by $225,000, or 60.00%, to $150,000 for the six months June 30, 2018 from a provision for loan losses for the six months ended June 30, 2017 of $375,000. The Company recorded net charge-offs of $72,000 and $0 for six months ended June 30, 2018 and 2017, respectively. Non-performing loans totaled $673,000 at June 30, 2018 compared to $2.1 million at June 30, 2017. The decrease of $1.4 million in non-performing loans was the result of a decrease of $1.6 million in non-performing construction and land development loans offset by an increase of $212,000 in non-performing one-to four-family loans. The Company’s non-performing loans to total loans decreased to 0.48% at June 30, 2018 from 1.48% at June 30, 2017. The Company reported a higher provision during the six months ended June 30, 2017 due to higher levels of non-performing and impaired loans at June 30, 2017. The Company has provided for losses that are probable and reasonably estimable at June 30, 2018.

Non-interest Income. Non-interest income decreased by $10,000, or 3.27%, to $296,000 for the six months ended June 30, 2018 from $306,000 for the six months ended June 30, 2017. The decrease was primarily due to decreases of $7,000 and $22,000 in service fees on deposit accounts and cash surrender value of bank-owned life insurance, respectively, offset by an increase of $25,000 in gain on sale of loans.

Non-interest Expense. Non-interest expense increased by $157,000, or 6.28%, to $2.7 million for the six months ended June 30, 2018 from $2.5 million for the six months ended June 30, 2017. Salaries, director fees and employee benefits increased $105,000, or 7.00%, to $1.6 million for the six months ended June 30, 2018 from $1.5 million for the six months ended June 30, 2017 due to our investment in our employee base, including the senior management team and our sales and relationship management personnel, to help support our continued growth strategy. Professional fees increased $38,000, or 31.40%, to $159,000 for the six months ended June 30, 2018 from $121,000 for the six months ended June 30, 2017 primarily due to increased consulting fees relating to information technology system enhancements. Marketing expenses increased $15,000, or 25.42%, to $74,000 for the six months ended June 30, 2018 compared to $59,000 for the six months ended June 30, 2017 primarily due to marketing outlays to generate organic growth and investments in new products and services. We recorded a loss of $14,000 on the sale of foreclosed real estate for the six months ended June 30, 2017. We did not sell any foreclosed real estate during the six months ended June 30, 2018.

Income Tax Expense. Income tax expense increased by $10,000, to $153,000 for the six months ended June 30, 2018 from $143,000 for the six months ended June 30, 2017. The effective tax rate was 24.44% and 35.05% for the six months ended June 30, 2018 and 2017, respectively. The increase in tax expense was the result of an increase in income before income taxes of $218,000, or 53.43% to $626,000 for the six months ended June 30, 2018 from $408,000 for the six months ended June 30, 2017 offset by a decrease in the tax rate as the result of the passage of the Tax Cuts and Jobs Act (the “Act”) which was signed into law on December 22, 2017. The Act amended the Internal Revenue Code to reduce income tax rates and modify policies, credits and deductions for individuals and businesses. For businesses, the Act reduces the federal corporate tax rate from a maximum 35% to a flat 21% tax rate.

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FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect,” “will,” “would,” “should,” “could” or “may,” and words of similar meaning. These forward-looking statements include, but are not limited to:

These forward-looking statements are based on current beliefs and expectations of our management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

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Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. See “Risk Factors” beginning on page 13. Except as required by applicable law or regulation, we do not undertake, and we specifically disclaim any obligation, to release publicly the results of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.

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HOW WE INTEND TO USE THE PROCEEDS FROM THE OFFERING

Although we cannot determine what the actual net proceeds from the sale of the shares of common stock in the offering will be until the offering is completed, we anticipate that the net proceeds will be between $25.9 million and $35.4 million, or $40.9 million if the offering range is increased by 15%.

We intend to distribute the net proceeds as follows:

Payments for shares of common stock made through withdrawals from existing deposit accounts will not result in the receipt of new funds for investment but will result in a reduction of Chesapeake Bank of Maryland’s deposits. The net proceeds may vary because total expenses relating to the offering may be more or less than our estimates. For example, our expenses would increase if all shares were not sold in the subscription and community offerings and a portion of the shares were sold in a syndicated offering.

CBM Bancorp may use the proceeds it retains from the offering:

See “Our Dividend Policy” for a discussion of our expected dividend policy following the completion of the conversion. Under current federal regulations, we may not repurchase shares of our common stock during the first year following the completion of the conversion, except when extraordinary circumstances exist and with prior regulatory approval, or except to fund the granting of restricted stock awards (which would require notification to the Federal Reserve Board) or tax qualified employee stock benefit plans.

Chesapeake Bank of Maryland may use the net proceeds it receives from the offering:

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Initially, a substantial portion of the net proceeds will be invested in short-term investments, investment-grade debt obligations and mortgage-backed securities. We have not determined specific amounts of the net proceeds that would be used for the purposes described above. The use of the proceeds outlined above may change based on many factors, including, but not limited to, changes in interest rates, equity markets, laws and regulations affecting the financial services industry, the attractiveness of potential acquisitions to expand our operations, and overall market conditions. The use of the proceeds may also change depending on our ability to receive regulatory approval to establish new branches or acquire other financial institutions.

We expect our return on equity to be low until we are able to reinvest effectively the additional capital raised in the offering. Until we can increase our net interest income and non-interest income, we expect our return on equity to be below the industry average, which may negatively affect the value of our common stock. See “Risk Factors—Risks Related to the Offering—Our failure to effectively deploy the net proceeds may have an adverse effect on our financial performance.”

OUR DIVIDEND POLICY

Following completion of the stock offering, our board of directors will have the authority to declare dividends on our shares of common stock, subject to our capital requirements, our financial condition and results of operations, tax considerations, statutory and regulatory limitations, and general economic conditions. However, no decision has been made with respect to the amount, if any, and timing of any dividend payments. We cannot assure you that we will pay dividends in the future, or that any such dividends will not be reduced or eliminated in the future.

CBM Bancorp will not be permitted to pay dividends on its common stock if its stockholders’ equity would be reduced below the amount of the liquidation account established by CBM Bancorp in connection with the conversion. The source of dividends will depend on the net proceeds retained by CBM Bancorp and earnings thereon, and dividends from Chesapeake Bank of Maryland. In addition, CBM Bancorp will be subject to state law limitations and federal bank regulatory policy on the payment of dividends. Maryland law generally limits dividends if the corporation would not be able to pay its debts in the usual course of business after giving effect to the dividend or if the corporation’s total assets would be less than the corporation’s total liabilities plus the amount needed to satisfy the preferential rights upon dissolution of stockholders whose preferential rights on dissolution are superior to those receiving the distribution.

After the completion of the conversion, Chesapeake Bank of Maryland will not be permitted to pay dividends on its capital stock to CBM Bancorp, its sole stockholder, if Chesapeake Bank of Maryland’s stockholder’s equity would be reduced below the amount of the liquidation account established in connection with the conversion. In addition, Chesapeake Bank of Maryland will not be permitted to make a capital distribution if, after making such distribution, it would be undercapitalized. Chesapeake Bank of Maryland must file an application with the Federal Reserve Board for approval of a capital distribution if the total capital distributions for the applicable calendar year exceed the sum of Chesapeake Bank of Maryland’s net income for that year to date plus its retained net income for the preceding two years, or Chesapeake Bank of Maryland would not be at least adequately capitalized following the distribution.

Any payment of dividends by Chesapeake Bank of Maryland to CBM Bancorp that would be deemed to be drawn from Chesapeake Bank of Maryland’s bad debt reserves established prior to 1988, if any, would require a payment of taxes at the then-current tax rate by Chesapeake Bank of Maryland on the amount of earnings deemed to be removed from the pre-1988 bad debt reserves for such distribution. Chesapeake Bank of Maryland does not intend to make any distribution that would create such a federal tax liability. See “The Conversion and Offering—Liquidation Rights.” For further information concerning additional federal law and regulations regarding the ability of Chesapeake Bank of Maryland to make capital distributions, including the payment of dividends to CBM Bancorp, see “Taxation—Federal Taxation.”

We will file a consolidated federal tax return with Chesapeake Bank of Maryland. Accordingly, it is anticipated that any cash distributions made by us to our stockholders would be treated as cash dividends and not as a non-taxable return of capital for federal tax purposes. Additionally, during the three-year period following the conversion, we will not be permitted to make any capital distribution to stockholders that would be treated by recipients as a tax-free return of capital for federal income tax purposes.

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MARKET FOR THE COMMON STOCK

We have not previously issued common stock and there is no established trading market for the common stock. We have applied for approval to list the shares of common stock of CBM Bancorp on the Nasdaq Capital Market under the symbol “CBMB” upon completion of the conversion. To list our stock on the Nasdaq Capital Market, we are required to have at least three broker-dealers who will make a market in our common stock. Raymond James & Associates, Inc. has advised us that it intends to make a market in our common stock following the offering, but is under no obligation to do so. We cannot assure you that an active trading market will develop for the common stock.

The development of an active trading market depends on the existence of willing buyers and sellers, the presence of which is not within our control, or that of any market maker. The number of active buyers and sellers of the shares of common stock at any particular time may be limited. In addition, our public “float,” which is the total number of our outstanding shares less the shares held by our employee stock ownership plan and our directors and executive officers, is likely to be quite limited. As a result, it is unlikely that an active trading market for our common stock will develop or that, if it develops, it will continue. Under such circumstances, you could have difficulty selling your shares of common stock on short notice, and, therefore, you should not view the shares of common stock as a short-term investment. Furthermore, we cannot assure you that, if you purchase shares of common stock, you will be able to sell them at or above $10.00 per share. Purchasers of common stock in this stock offering should have long-term investment intent and horizon and should recognize that there may be a limited trading market in the common stock. A limited trading market may make it difficult to sell the common stock after the stock offering and may have an adverse impact on the price at which the common stock can be sold.

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HISTORICAL AND PRO FORMA REGULATORY CAPITAL COMPLIANCE

At March 31, 2018, Chesapeake Bank of Maryland exceeded all of the applicable regulatory capital requirements and was considered “well capitalized.” The table below sets forth the historical equity capital and regulatory capital of Chesapeake Bank of Maryland at March 31, 2018, and the pro forma equity capital and regulatory capital of Chesapeake Bank of Maryland, after giving effect to the sale of shares of common stock at $10.00 per share. The table also compares historical and pro forma capital levels to those required to be considered “well capitalized.” The table assumes the receipt by Chesapeake Bank of Maryland of 50% of the net offering proceeds. See “How We Intend to Use the Proceeds from the Offering.”

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CAPITALIZATION

The following table presents the historical consolidated capitalization of Banks of the Chesapeake, M.H.C. at March 31, 2018 and the pro forma consolidated capitalization of CBM Bancorp after giving effect to the conversion and offering based upon the assumptions set forth in the “Pro Forma Data” section.