Second Quarter 2026 Comments (Unaudited)
- Net revenue(1) of
$22.0 million , a record quarter for the Company, and an 11.7% increase compared to the first quarter of 2026 - Pre-provision net revenue(1) of
$10.0 million , up$6.2 million from$3.8 million for the first quarter of 2026 - Total assets under management, including
$1.2 billion of sold loans for which servicing is retained, were$2.6 billion as ofJune 30, 2026 - Net Interest Margin declined to 3.78% from 3.86% in the quarter ended
March 31, 2026 . A decline in yield on Loans and Loans Held For Sale (“Loans”) to 7.31% from 7.38% was the primary driver of this decline, however average balances of Loans increased$60.5 million in the quarter resulting in an increase in interest income on Loans of$1.1 million over the previous quarter. - Gain on loan sales of
$5.5 million on loans sold of$110.1 million , compared to gain on loan sales of$3.8 million on loans sold of$79.0 million for the first quarter of 2026 - Gain on loan sales margin(1) of 5.04% compared to 4.79% for the first quarter of 2026
U.S. Small Business Administration (“SBA”) lending and commercial banking loan originations of$132.3 million , compared to$208.1 million for the first quarter of 2026- Non-performing assets, excluding guaranteed portions(1), of
$23.3 million as ofJune 30, 2026 , representing 1.63% of total assets compared to$13.2 million as ofMarch 31, 2026 , representing 0.70% of total assets
Comments from
“First, I want to welcome GBank President/CEO and Director,
“Also, despite several near-term challenges during the quarter, the core bank remains fundamentally strong with substantive growth. We generated record revenues, maintained strong loan production, and continue to originate high-quality assets at attractive yields. While elevated nonperforming assets, retail credit card delinquencies, and net interest margin pressure impacted quarterly results, we have taken decisive actions to strengthen credit administration, optimize our balance sheet, and position the Bank for improved financial performance going forward,” continued
“Most importantly, the recently announced BVNKROLL/AXES agreement is a significant accomplishment and requires additional comment. First, within 90 days of announcing the formation of the BVNKROLL – a joint venture equally owned by BoltBetz and our affiliate BCS, owned 32.99% by GBFH, we have our first signed client contract. Second, AXES is a cloud-based all-digital casino management platform. By incorporating our complete payment solution into the AXES intelligent management system (IMS), AXES will be giving their operating customers something no legacy CMS has ever offered: a single, real-time payments process that spans the gaming floor, the digital wallet, and the financial transaction, all in one platform.This agreement validates the BVNKROLL business strategy and is the first step towards imbedding GBank into the cashless payments operations of the bricks and mortar casino industry. AXES currently serves sixty-seven gaming operators and distributors across twelve states, has a global footprint spanning over thirty countries and millions of customers. GBank, BCS and BVNKROLL could not be more enthusiastic about this agreement,” concluded
Financial Results
Income Statement
Net interest income totaled
The increase in net interest income when compared to both the first quarter of 2026 and the same quarter of 2025 was primarily volume driven, as higher interest income from growth in average loan, interest-bearing cash balances, and investments more than offset increases in interest expense resulting from higher average balances of interest-bearing deposits.
The yield on investment securities was 4.64% for the second quarter of 2026, compared to 4.39% for the first quarter of 2026 and 4.73% for the second quarter of 2025. The increase in investment yield when compared to the prior quarter was the result of the full-quarter impact of
The Company’s net interest margin for the second quarter of 2026 was 3.78%, compared to 3.86% for the first quarter of 2026 and 4.31% for the second quarter of 2025. The decrease in net interest margin during the second quarter of 2026 when compared to the previous quarter was the result of both (i) a decline in the yield on loans to 7.31% from 7.38%, and (ii) the first quarter of 2026 reflecting a one-time special dividend on restricted stock held at the
The Company recorded a provision for credit losses on loans of
Non-interest income was
Net revenue(1) totaled
Non-interest expense was
The Company’s efficiency ratio was 54.7% for the second quarter of 2026, compared to 80.8% for the first quarter of 2026 and 58.5% for the second quarter of 2025. The higher efficiency ratio for the first quarter of 2026 was due primarily to the
Income tax expense was
Net income was
(1) See Reconciliation of Non-GAAP Financial Measures
Balance Sheet
Total assets were
The investment securities portfolio increased by
Total loans, net of deferred fees and costs, were
The Company’s allowance for credit losses totaled
Deposits totaled
The Company’s ratio of loans to deposits was 86.9% as of
The Company had no short-term borrowings as of
Subordinated notes outstanding totaled
Stockholders’ equity was
The Company’s ratio of common equity to total assets was 12.07% as of
Asset Quality
The Company recorded a provision for credit loss expense for loans of
(1) See Reconciliation of Non-GAAP Financial Measures
The Company’s allowance for credit losses totaled
Net loan charge offs in the second quarter of 2026 totaled
The balance of other real estate owned increased to
Non-performing assets totaled
Our non-performing assets to total assets ratio was 4.20% as of
The Company continuously monitors its non-performing asset portfolio and believes the financial risk related to these assets is well contained. In making this assessment, it is important to consider the process we undertake when a collateralized SBA non-performing asset requires collection efforts. Historically, we have repurchased the sold portion of the government guaranteed loan to complete the foreclosure and resale of the property. This process immediately increases the non-performing asset balance on our balance sheet to include the government guaranteed portion – thus the importance of always adjusting for the government guaranteed portion of the non-performing assets as well as considering our “off balance sheet” assets consisting of the sold portion of USDA and SBA guaranteed loans of
Other Financial and Operational Highlights
SBA Lending and Commercial Banking
SBA lending and commercial loan originations totaled
We continue to see improvement in our pretax gain on sale of loans margin as the average pretax gain on sale of loans margin was 5.04% for the second quarter of 2026, compared to 4.79% for the first quarter of 2026, and 3.16% for the second quarter of 2025. This improvement in pricing quarter-over-quarter, along with the volume increase of
(1) See Reconciliation of Non-GAAP Financial Measures
Gaming and Financial Technology Operations
Our Gaming and Financial Technology businesses continue their transition from development to commercialization and scale. During the quarter,
Credit Card
Gaming-related credit card transaction volume declined to
During the quarter, we recorded an additional provision for credit losses of approximately
Despite the recent decline in sports betting-related transaction volume, we continue to believe there is a significant opportunity for gaming-focused credit products within traditional casino and distributed gaming markets. We intend to integrate both our credit and prepaid card products as funding sources within BVNKROLL and BoltBetz-supported wallet platforms, which we believe may provide additional opportunities for transaction, deposit, and fee-based revenue.
Visa
Our Visa Prepaid Card program is currently in testing, with commercial launch expected during the fourth quarter of 2026. The card will be integrated with GBank's PPA infrastructure, providing account functionality and connectivity within our gaming payments ecosystem.
The card will also be integrated into BVNKROLL-supported wallet platforms, enabling customers to move funds between participating gaming operators and affiliated payment channels. We believe this product will enhance our gaming payments offering and provide additional opportunities for transaction, deposit, and fee income growth.
BVNKROLL
During the first quarter, we announced the formation of the BVNKROLL/BCS joint venture. During the second quarter, BVNKROLL further expanded its potential market reach through its agreement with AXES AI.
The AXES relationship reflects the distinction between our BoltBetz and BVNKROLL platforms. BoltBetz operates as a direct-to-operator platform through which we manage operator relationships and the patron experience. BVNKROLL functions as an infrastructure platform that enables enterprise partners to utilize our technology and banking infrastructure while maintaining ownership of operator relationships, branding, marketing, and business development activities. As additional operators are added through the AXES platform, new patron PPA accounts may be established with GBank without requiring corresponding incremental direct marketing expenditures by the Company.
BoltBetz
During the second quarter of 2026, Terrible's Gaming received approval from the
The BoltBetz deployment at Distill Taverns continues to provide meaningful data regarding patron adoption and usage patterns. Following the implementation of Version 2 platform enhancements, customer registrations increased approximately fourfold. Initial operating results indicate limited customer resistance to identity verification requirements necessary for regulatory compliance. Current efforts are focused on increasing customer registrations, visit frequency, and patron engagement as deployment continues to expand.
Earnings Call
The Company will host its second quarter 2026 earnings call on
Interested parties may register for the event using this link:
https://gbank-financial-earnings-q226.open-exchange.net/registration
About
Non-GAAP Financial Measures
Some of the financial measures included in this press release are not measures of financial performance recognized in accordance with generally accepted accounting principles in
We classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in
A reconciliation of non-GAAP financial measures to GAAP financial measures is provided at the end of this press release.
Available Information
The Company routinely posts important information for investors on its web site (under www.gbankfinancialholdings.com and, more specifically, under the News & Media tab at www.gbankfinancialholdings.com/press-releases). The Company intends to use its web site as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD (Fair Disclosure) promulgated by the
The information contained on, or that may be accessed through, the Company’s web site is not incorporated by reference into, and is not a part of, this document.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements reflect the Company’s current views with respect to future events and the Company’s financial performance. Any statements about the Company’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases, and include, but are not limited to, statements made by
For Further Information, Contact:
Executive Chairman and CEO
702-851-4200
enigro@g.bank
Condensed Consolidated Balance Sheets (Unaudited) | ||||||||||||||||||||||||||||||||||
| Quarter Year-Over-Year | ||||||||||||||||||||||||||||||||||
| ($’s in 000, except per share data) | $ Var | % Var | $ Var | % Var | ||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||
| Cash and Due From Banks | $ | 6,726 | $ | 4,960 | $ | 5,326 | $ | 4,988 | $ | 11,877 | $ | 1,766 | 35.6 | % | $ | (5,151 | ) | -43.4 | % | |||||||||||||||
| Interest-Bearing Deposits With Other Financial Institutions | 134,603 | 103,134 | 192,538 | 98,402 | 131,352 | 31,469 | 30.5 | % | 3,251 | 2.5 | % | |||||||||||||||||||||||
| Total Cash and Cash Equivalents | 141,329 | 108,094 | 197,864 | 103,390 | 143,229 | 33,235 | 30.7 | % | (1,900 | ) | -1.3 | % | ||||||||||||||||||||||
| Available For Sale, at Fair Value | 115,018 | 111,320 | 71,038 | 85,774 | 82,886 | 3,698 | 3.3 | % | 32,132 | 38.8 | % | |||||||||||||||||||||||
| Held to Maturity, at Amortized Cost | - | - | - | 38,578 | 39,515 | - | 0.0 | % | (39,515 | ) | -100.0 | % | ||||||||||||||||||||||
| Loans Held For Sale | 50,848 | 74,507 | 46,009 | 66,791 | 45,242 | (23,659 | ) | -31.8 | % | 5,606 | 12.4 | % | ||||||||||||||||||||||
| Loans, Net of Deferred Fees and Costs: | ||||||||||||||||||||||||||||||||||
| Commercial and Industrial | 80,766 | 81,623 | 80,216 | 66,226 | 59,021 | (857 | ) | -1.0 | % | 21,745 | 36.8 | % | ||||||||||||||||||||||
| 849,634 | 823,966 | 750,565 | 743,084 | 682,021 | 25,668 | 3.1 | % | 167,613 | 24.6 | % | ||||||||||||||||||||||||
| 88,216 | 91,578 | 94,576 | 97,396 | 96,526 | (3,362 | ) | -3.7 | % | (8,310 | ) | -8.6 | % | ||||||||||||||||||||||
| Construction and | 2,255 | 2,270 | 2,288 | 2,115 | 4,371 | (15 | ) | -0.7 | % | (2,116 | ) | -48.4 | % | |||||||||||||||||||||
| Multifamily | 18,836 | 18,930 | 18,950 | 18,979 | 18,987 | (94 | ) | -0.5 | % | (151 | ) | -0.8 | % | |||||||||||||||||||||
| Residential | 1,284 | 816 | 1,316 | 3,828 | 6,810 | 468 | 57.4 | % | (5,526 | ) | -81.1 | % | ||||||||||||||||||||||
| Consumer | 6,361 | 5,953 | 11,358 | 8,963 | 3,894 | 408 | 6.9 | % | 2,467 | 63.4 | % | |||||||||||||||||||||||
| Total Loans, Net of Deferred Fees and Costs | 1,047,352 | 1,025,136 | 959,269 | 940,591 | 871,630 | 22,216 | 2.2 | % | 175,722 | 20.2 | % | |||||||||||||||||||||||
| Less: Allowance for Credit Losses | (12,418 | ) | (10,755 | ) | (9,890 | ) | (10,577 | ) | (9,205 | ) | (1,663 | ) | 15.5 | % | (3,213 | ) | 34.9 | % | ||||||||||||||||
| Total Net Loans | 1,034,934 | 1,014,381 | 949,379 | 930,014 | 862,425 | 20,553 | 2.0 | % | 172,509 | 20.0 | % | |||||||||||||||||||||||
| Loan Servicing Asset | 12,270 | 11,376 | 11,140 | 10,621 | 9,736 | 894 | 7.9 | % | 2,534 | 26.0 | % | |||||||||||||||||||||||
| 5,797 | 5,513 | 5,513 | 5,513 | 5,513 | 284 | 5.2 | % | 284 | 5.2 | % | ||||||||||||||||||||||||
| All Other Assets | 71,506 | 68,621 | 78,548 | 60,697 | 43,878 | 2,885 | 4.2 | % | 27,628 | 63.0 | % | |||||||||||||||||||||||
| Total Assets | $ | 1,431,702 | $ | 1,393,812 | $ | 1,359,491 | $ | 1,301,378 | $ | 1,232,424 | $ | 37,890 | 2.7 | % | $ | 199,278 | 16.2 | % | ||||||||||||||||
| Liabilities | ||||||||||||||||||||||||||||||||||
| Non-Interest Bearing Demand | $ | 233,444 | $ | 215,063 | $ | 214,127 | $ | 227,921 | $ | 228,913 | $ | 18,381 | 8.5 | % | $ | 4,531 | 2.0 | % | ||||||||||||||||
| Interest Bearing Demand | 65,995 | 79,186 | 70,966 | 63,741 | 57,254 | (13,191 | ) | -16.7 | % | 8,741 | 15.3 | % | ||||||||||||||||||||||
| Savings and Money Market | 353,066 | 281,426 | 289,038 | 281,435 | 309,559 | 71,640 | 25.5 | % | 43,507 | 14.1 | % | |||||||||||||||||||||||
| Certificates of Deposit | 553,227 | 595,290 | 568,564 | 519,080 | 436,738 | (42,063 | ) | -7.1 | % | 116,489 | 26.7 | % | ||||||||||||||||||||||
| Total Deposits | 1,205,732 | 1,170,965 | 1,142,695 | 1,092,177 | 1,032,464 | 34,767 | 3.0 | % | 173,268 | 16.8 | % | |||||||||||||||||||||||
| Short-Term Borrowings | - | - | 371 | - | - | - | 0.0 | % | - | -100.0 | % | |||||||||||||||||||||||
| Subordinated Debt | 30,328 | 30,326 | 26,163 | 26,144 | 26,126 | 2 | 0.0 | % | 4,202 | 16.1 | % | |||||||||||||||||||||||
| Operating Lease Liability | 5,382 | 5,571 | 5,757 | 5,942 | 6,121 | (189 | ) | -3.4 | % | (739 | ) | -12.1 | % | |||||||||||||||||||||
| Other Liabilities | 17,450 | 19,328 | 18,750 | 18,922 | 15,964 | (1,878 | ) | -9.7 | % | 1,486 | 9.3 | % | ||||||||||||||||||||||
| Total Liabilities | 1,258,892 | 1,226,190 | 1,193,736 | 1,143,185 | 1,080,675 | 32,702 | 2.7 | % | 178,217 | 16.5 | % | |||||||||||||||||||||||
| Equity | ||||||||||||||||||||||||||||||||||
| Common Stock | 1 | 1 | 1 | 1 | 1 | - | 0.0 | % | - | 0.0 | % | |||||||||||||||||||||||
| 82,606 | 81,999 | 80,405 | 80,016 | 79,291 | 607 | 0.7 | % | 3,315 | 4.2 | % | ||||||||||||||||||||||||
| Retained Earnings | 92,143 | 86,681 | 85,366 | 77,970 | 73,662 | 5,462 | 6.3 | % | 18,481 | 25.1 | % | |||||||||||||||||||||||
| Accumulated Other Comprehensive (Loss) Income | (1,940 | ) | (1,059 | ) | (17 | ) | 206 | (1,205 | ) | (881 | ) | 83.2 | % | (735 | ) | 61.0 | % | |||||||||||||||||
| Total Stockholders’ Equity | 172,810 | 167,622 | 165,755 | 158,193 | 151,749 | 5,188 | 3.1 | % | 21,061 | 13.9 | % | |||||||||||||||||||||||
| Total Liabilities & Stockholders’ Equity | $ | 1,431,702 | $ | 1,393,812 | $ | 1,359,491 | $ | 1,301,378 | $ | 1,232,424 | $ | 37,890 | 2.7 | % | $ | 199,278 | 16.2 | % | ||||||||||||||||
| Book Value Per Common Share | $ | 11.94 | $ | 11.58 | $ | 11.52 | $ | 11.07 | $ | 10.63 | $ | 0.36 | 3.1 | % | $ | 1.31 | 12.3 | % | ||||||||||||||||
Condensed Consolidated Income Statements (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
| ($’s in 000, except per share data) | ||||||||||||||||||||||||||||
| Interest Income | ||||||||||||||||||||||||||||
| Loans | $ | 20,093 | $ | 18,958 | $ | 20,196 | $ | 18,919 | $ | 17,659 | $ | 39,051 | $ | 34,495 | ||||||||||||||
| Deposits With Other Financial Institutions | 1,296 | 1,257 | 1,018 | 1,160 | 1,365 | 2,553 | 2,557 | |||||||||||||||||||||
| 1,326 | 1,102 | 1,404 | 1,421 | 1,414 | 2,428 | 2,695 | ||||||||||||||||||||||
| Other Interest Bearing Balances | 14 | 277 | 121 | 122 | 117 | 291 | 217 | |||||||||||||||||||||
| Total Interest Income | 22,729 | 21,594 | 22,739 | 21,622 | 20,555 | 44,323 | 39,964 | |||||||||||||||||||||
| Interest Expense | ||||||||||||||||||||||||||||
| Deposits | 9,509 | 8,893 | 8,998 | 8,339 | 7,905 | 18,402 | 15,135 | |||||||||||||||||||||
| Short-term Borrowings and Subordinated Debt | 419 | 510 | 286 | 285 | 262 | 929 | 547 | |||||||||||||||||||||
| Total Interest Expense | 9,928 | 9,403 | 9,284 | 8,624 | 8,167 | 19,331 | 15,682 | |||||||||||||||||||||
| Net Interest Income | 12,801 | 12,191 | 13,455 | 12,998 | 12,388 | 24,992 | 24,282 | |||||||||||||||||||||
| (Provision) Net Benefit for Credit Losses - Loans | (2,829 | ) | (2,323 | ) | 130 | (2,207 | ) | (1,079 | ) | (5,152 | ) | (1,789 | ) | |||||||||||||||
| Net (Provision) Benefit for Credit Losses - Unfunded Commitments | (15 | ) | 30 | 52 | (12 | ) | (13 | ) | 15 | (24 | ) | |||||||||||||||||
| Net Interest Income after Provision for Credit Losses | 9,957 | 9,898 | 13,637 | 10,779 | 11,296 | 19,855 | 22,469 | |||||||||||||||||||||
| Non-Interest Income | ||||||||||||||||||||||||||||
| Gain on Sales of Loans | 5,544 | 3,790 | 3,625 | 3,592 | 2,593 | 9,334 | 5,130 | |||||||||||||||||||||
| Loan Servicing Income | 1,248 | 998 | 963 | 762 | 750 | 2,246 | 1,453 | |||||||||||||||||||||
| Service Charges and Fees | 86 | 58 | 56 | 60 | 54 | 144 | 110 | |||||||||||||||||||||
| Net Interchange Fees | 1,823 | 2,191 | 1,806 | 2,406 | 1,535 | 4,014 | 3,538 | |||||||||||||||||||||
| Gain on Sale of | - | - | 426 | - | - | - | - | |||||||||||||||||||||
| Other Income | 448 | 417 | 387 | 357 | 452 | 865 | 616 | |||||||||||||||||||||
| Total Non-Interest Income | 9,149 | 7,454 | 7,263 | 7,177 | 5,384 | 16,603 | 10,847 | |||||||||||||||||||||
| Non-Interest Expenses | ||||||||||||||||||||||||||||
| Salaries and Employee Benefits | 6,808 | 6,750 | 6,237 | 6,589 | 6,235 | 13,558 | 12,635 | |||||||||||||||||||||
| Occupancy Expenses | 399 | 410 | 410 | 418 | 400 | 809 | 792 | |||||||||||||||||||||
| Other Expenses | 4,791 | 8,716 | 4,813 | 5,310 | 3,761 | 13,507 | 7,876 | |||||||||||||||||||||
| Total Non-Interest Expenses | 11,998 | 15,876 | 11,460 | 12,317 | 10,396 | 27,874 | 21,303 | |||||||||||||||||||||
| Income Before Provision For Income Taxes | 7,108 | 1,476 | 9,440 | 5,639 | 6,284 | 8,584 | 12,013 | |||||||||||||||||||||
| Provision For Income Taxes | (1,625 | ) | (139 | ) | (2,026 | ) | (1,282 | ) | (1,486 | ) | (1,764 | ) | (2,710 | ) | ||||||||||||||
| Net Income Before Equity Investment Loss | 5,483 | 1,337 | 7,414 | 4,357 | 4,798 | 6,820 | 9,303 | |||||||||||||||||||||
| Net Loss Attributable to | (21 | ) | (22 | ) | (18 | ) | (49 | ) | (43 | ) | (43 | ) | (78 | ) | ||||||||||||||
| Net Income | $ | 5,462 | $ | 1,315 | $ | 7,396 | $ | 4,308 | $ | 4,755 | $ | 6,777 | $ | 9,225 | ||||||||||||||
| Earnings Per Share | $ | 0.38 | $ | 0.09 | $ | 0.52 | $ | 0.30 | $ | 0.33 | $ | 0.47 | $ | 0.65 | ||||||||||||||
| Earnings Per Share (Diluted) | $ | 0.38 | $ | 0.09 | $ | 0.51 | $ | 0.30 | $ | 0.33 | $ | 0.47 | $ | 0.63 | ||||||||||||||
| Average Common Shares Outstanding | 14,470 | 14,415 | 14,360 | 14,280 | 14,274 | 14,443 | 14,265 | |||||||||||||||||||||
| Diluted Average Common Shares Outstanding | 14,544 | 14,506 | 14,555 | 14,525 | 14,551 | 14,511 | 14,536 | |||||||||||||||||||||
Quarter-to-Date Average Balances, Rates, and Interest Income and Expense (Unaudited) | |||||||||||||||||||||||||||
| For the Three Months Ended | |||||||||||||||||||||||||||
| (Dollars in thousands) | Average | Yield/ | Average | Yield/ | Average | Yield/ | |||||||||||||||||||||
| Balance | Interest | Rate(1) | Balance | Interest | Rate(1) | Balance | Interest | Rate(1) | |||||||||||||||||||
| ASSETS: | |||||||||||||||||||||||||||
| Interest Bearing Deposits | $ | 134,527 | $ | 1,296 | 3.86 | % | $ | 132,062 | $ | 1,257 | 3.86 | % | $ | 115,974 | $ | 1,365 | 4.72 | % | |||||||||
| Taxable | 114,526 | 1,326 | 4.64 | % | 101,725 | 1,102 | 4.39 | % | 119,880 | 1,414 | 4.73 | % | |||||||||||||||
| Loans and Loans Held For Sale | 1,102,289 | 20,093 | 7.31 | % | 1,041,831 | 18,958 | 7.38 | % | 911,028 | 17,659 | 7.77 | % | |||||||||||||||
| 5,750 | 14 | 0.98 | % | 5,513 | 277 | 20.38 | % | 5,362 | 117 | 8.75 | % | ||||||||||||||||
| Total Earning Assets | 1,357,092 | 22,729 | 6.72 | % | 1,281,131 | 21,594 | 6.84 | % | 1,152,244 | 20,555 | 7.16 | % | |||||||||||||||
| Cash and Due From Banks | 6,804 | 6,108 | 6,782 | ||||||||||||||||||||||||
| Other Assets | 67,682 | 68,981 | 41,894 | ||||||||||||||||||||||||
| Total Assets | $ | 1,431,578 | $ | 1,356,220 | $ | 1,200,920 | |||||||||||||||||||||
| LIABILITIES & STOCKHOLDERS’ EQUITY | |||||||||||||||||||||||||||
| Deposits: | |||||||||||||||||||||||||||
| Interest-bearing Demand | $ | 69,922 | 498 | 2.86 | % | $ | 73,173 | 521 | 2.89 | % | $ | 60,320 | 316 | 2.10 | % | ||||||||||||
| Money Market and Savings | 339,718 | 3,113 | 3.68 | % | 275,878 | 2,545 | 3.74 | % | 303,814 | 2,929 | 3.87 | % | |||||||||||||||
| Certificates of Deposit | 579,583 | 5,898 | 4.08 | % | 569,474 | 5,828 | 4.15 | % | 413,940 | 4,660 | 4.52 | % | |||||||||||||||
| Total Interest-Bearing Deposits | 989,223 | 9,509 | 3.86 | % | 918,525 | 8,893 | 3.93 | % | 778,074 | 7,905 | 4.08 | % | |||||||||||||||
| Short-Term Borrowings | - | - | 0.00 | % | 14 | - | 0.00 | % | - | - | 0.00 | % | |||||||||||||||
| Subordinated Debt | 30,319 | 419 | 5.54 | % | 29,008 | 510 | 7.13 | % | 26,113 | 262 | 4.02 | % | |||||||||||||||
| Total Interest-Bearing Liabilities | 1,019,542 | 9,928 | 3.91 | % | 947,547 | 9,403 | 4.02 | % | 804,187 | 8,167 | 4.07 | % | |||||||||||||||
| Noninterest-bearing Deposits | 212,756 | 212,683 | 223,201 | ||||||||||||||||||||||||
| Other Liabilities | 25,914 | 25,098 | 22,404 | ||||||||||||||||||||||||
| Stockholders’ Equity | 173,366 | 170,892 | 151,128 | ||||||||||||||||||||||||
| Total Liabilities & Stockholders’ Equity | $ | 1,431,578 | $ | 1,356,220 | $ | 1,200,920 | |||||||||||||||||||||
| Net Interest Income | $ | 12,801 | $ | 12,191 | $ | 12,388 | |||||||||||||||||||||
| Total Yield on Earning Assets | 6.72 | % | 6.84 | % | 7.16 | % | |||||||||||||||||||||
| Cost on Interest-Bearing Liabilities | 3.91 | % | 4.02 | % | 4.07 | % | |||||||||||||||||||||
| Average Interest Spread | 2.81 | % | 2.82 | % | 3.08 | % | |||||||||||||||||||||
| Net Interest Margin | 3.78 | % | 3.86 | % | 4.31 | % | |||||||||||||||||||||
| (1) Ratios are annualized on an actual/actual basis | |||||||||||||||||||||||||||
Year-to-Date Average Balances, Rates, and Interest Income and Expense (Unaudited) | ||||||||||||||||||
| For the Six Months Ended | ||||||||||||||||||
| (Dollars in thousands) | Average | Yield/ | Average | Yield/ | ||||||||||||||
| Balance | Interest | Rate(1) | Balance | Interest | Rate(1) | |||||||||||||
| ASSETS: | ||||||||||||||||||
| Interest Bearing Deposits | $ | 133,262 | $ | 2,553 | 3.86 | % | $ | 109,338 | $ | 2,557 | 4.72 | % | ||||||
| Taxable | 108,161 | 2,428 | 4.53 | % | 112,591 | 2,695 | 4.83 | % | ||||||||||
| Loans and Loans Held For Sale | 1,072,227 | 39,051 | 7.34 | % | 888,982 | 34,495 | 7.82 | % | ||||||||||
| 5,632 | 291 | 10.42 | % | 5,009 | 217 | 8.74 | % | |||||||||||
| Total Earning Assets | 1,319,282 | 44,323 | 6.77 | % | 1,115,920 | 39,964 | 7.22 | % | ||||||||||
| Cash and Due From Banks | 6,497 | 6,501 | ||||||||||||||||
| Other Assets | 68,328 | 40,543 | ||||||||||||||||
| Total Assets | $ | 1,394,107 | $ | 1,162,964 | ||||||||||||||
| LIABILITIES & STOCKHOLDERS’ EQUITY | ||||||||||||||||||
| Deposits: | ||||||||||||||||||
| Interest-bearing Demand | $ | 71,539 | 1,019 | 2.87 | % | $ | 62,992 | 672 | 2.15 | % | ||||||||
| Money Market and Savings | 307,974 | 5,658 | 3.70 | % | 284,060 | 5,340 | 3.79 | % | ||||||||||
| Certificates of Deposit | 574,556 | 11,725 | 4.12 | % | 399,899 | 9,123 | 4.60 | % | ||||||||||
| Total Interest-Bearing Deposits | 954,069 | 18,402 | 3.89 | % | 746,951 | 15,135 | 4.09 | % | ||||||||||
| Short-Term Borrowings | 7 | - | 0.00 | % | - | - | 0.00 | % | ||||||||||
| Subordinated Debt | 29,667 | 929 | 6.32 | % | 26,104 | 547 | 4.23 | % | ||||||||||
| Total Interest-Bearing Liabilities | 983,743 | 19,331 | 3.96 | % | 773,055 | 15,682 | 4.09 | % | ||||||||||
| Noninterest-bearing Deposits | 212,720 | 221,050 | ||||||||||||||||
| Other Liabilities | 25,508 | 21,278 | ||||||||||||||||
| Stockholders’ Equity | 172,136 | 147,581 | ||||||||||||||||
| Total Liabilities & Stockholders’ Equity | $ | 1,394,107 | $ | 1,162,964 | ||||||||||||||
| Net Interest Income | $ | 24,992 | $ | 24,282 | ||||||||||||||
| Total Yield on Earning Assets | 6.77 | % | 7.22 | % | ||||||||||||||
| Cost on Interest-Bearing Liabilities | 3.96 | % | 4.09 | % | ||||||||||||||
| Average Interest Spread | 2.81 | % | 3.13 | % | ||||||||||||||
| Net Interest Margin | 3.82 | % | 4.39 | % | ||||||||||||||
| (1) Ratios are annualized on an actual/actual basis | ||||||||||||||||||
Additional Financial Information (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||
| ($’s in 000, except per share data) | ||||||||||||||||||||||||||||
| Key Performance Metrics | ||||||||||||||||||||||||||||
| Return on Average Assets-Net Income (1) | 1.53 | % | 0.39 | % | 2.20 | % | 1.37 | % | 1.59 | % | 0.98 | % | 1.60 | % | ||||||||||||||
| Return on Average Stockholders’ Equity(1) | 12.64 | % | 3.12 | % | 18.03 | % | 10.89 | % | 12.62 | % | 7.94 | % | 12.61 | % | ||||||||||||||
| Efficiency Ratio | 54.66 | % | 80.81 | % | 55.31 | % | 61.05 | % | 58.50 | % | 67.01 | % | 60.64 | % | ||||||||||||||
| Net Interest Margin(1) | 3.78 | % | 3.86 | % | 4.21 | % | 4.35 | % | 4.31 | % | 3.82 | % | 4.39 | % | ||||||||||||||
| Net Revenue(1) | $ | 21,950 | $ | 19,645 | $ | 20,718 | $ | 20,175 | $ | 17,772 | $ | 41,595 | $ | 35,129 | ||||||||||||||
| Common Equity / Assets | 12.07 | % | 12.03 | % | 12.19 | % | 12.16 | % | 12.30 | % | 12.07 | % | 12.30 | % | ||||||||||||||
| Tier 1 Leverage Ratio - Bank | 13.15 | % | 13.39 | % | 13.42 | % | 13.72 | % | 13.82 | % | 13.15 | % | 13.82 | % | ||||||||||||||
| Selected Loan Metrics | ||||||||||||||||||||||||||||
| Guaranteed Portion of Loans Held for Sale | $ | 50,848 | $ | 74,507 | $ | 46,009 | $ | 66,791 | $ | 45,242 | $ | 50,848 | $ | 45,242 | ||||||||||||||
| Guaranteed Portion of Loans Held for Investment | 174,971 | 177,617 | 183,739 | 193,688 | 192,324 | 174,971 | 192,324 | |||||||||||||||||||||
| Total Guaranteed Loans | 225,819 | 252,124 | 229,748 | 260,479 | 237,566 | 225,819 | 237,566 | |||||||||||||||||||||
| Guaranteed Loans as a Percent of Total Loans(2) | 16.7 | % | 17.3 | % | 19.2 | % | 20.6 | % | 22.1 | % | 16.7 | % | 22.1 | % | ||||||||||||||
| SBA Loan Originations | $ | 131,420 | $ | 189,851 | $ | 106,744 | $ | 207,683 | $ | 132,256 | $ | 321,271 | $ | 261,607 | ||||||||||||||
| SBA Loans Sold | $ | 110,075 | $ | 79,036 | $ | 92,258 | $ | 110,820 | $ | 82,140 | $ | 189,111 | $ | 150,860 | ||||||||||||||
| Gain on Loan Sales Margin(2) | 5.04 | % | 4.79 | % | 3.93 | % | 3.24 | % | 3.16 | % | 4.94 | % | 3.40 | % | ||||||||||||||
| Asset Quality | ||||||||||||||||||||||||||||
| Total nonaccrual loans | $ | 50,206 | $ | 39,736 | $ | 32,141 | $ | 34,608 | $ | 18,227 | $ | 50,206 | $ | 18,227 | ||||||||||||||
| Loans past due 90 days and still accruing | 4,310 | - | 854 | 184 | 146 | 4,310 | 146 | |||||||||||||||||||||
| Other real estate owned | 5,663 | 4,401 | 4,401 | 2,684 | - | 5,663 | - | |||||||||||||||||||||
| Total non-performing assets | $ | 60,179 | $ | 44,137 | $ | 37,396 | $ | 37,476 | $ | 18,373 | $ | 60,179 | $ | 18,373 | ||||||||||||||
| Non-performing assets: guaranteed portion | $ | 36,876 | $ | 34,340 | $ | 28,240 | $ | 29,236 | $ | 13,792 | $ | 36,876 | $ | 13,792 | ||||||||||||||
| Non-performing assets: non-guaranteed portion | $ | 23,303 | $ | 13,188 | $ | 12,547 | $ | 10,364 | $ | 4,581 | $ | 23,303 | $ | 4,581 | ||||||||||||||
| Non-performing assets to total assets | 4.20 | % | 3.17 | % | 2.75 | % | 2.88 | % | 1.49 | % | 4.20 | % | 1.49 | % | ||||||||||||||
| Non-performing assets, excluding guaranteed, to total assets(2) | 1.63 | % | 0.70 | % | 0.67 | % | 0.63 | % | 0.37 | % | 1.63 | % | 0.37 | % | ||||||||||||||
| Net charge-offs | $ | 1,167 | $ | 1,457 | $ | 557 | $ | 836 | $ | 870 | $ | 2,624 | $ | 1,698 | ||||||||||||||
| Loans past due 30-89 days and accruing | $ | 4,937 | $ | 6,255 | $ | 9,843 | $ | 3,595 | $ | 8,182 | $ | 4,937 | $ | 8,182 | ||||||||||||||
| Loans past due 30-89 days and accruing: guaranteed portion | $ | 2,491 | $ | 2,474 | $ | 4,574 | $ | 2,351 | $ | 5,650 | $ | 2,491 | $ | 5,650 | ||||||||||||||
| Loans past due 30-89 days and accruing: non-guaranteed portion | $ | 2,445 | $ | 3,781 | $ | 5,269 | $ | 1,244 | $ | 2,532 | $ | 2,445 | $ | 2,532 | ||||||||||||||
| Allowance for credit losses (ACL) | $ | 12,418 | $ | 10,755 | $ | 9,890 | $ | 10,577 | $ | 9,205 | $ | 12,418 | $ | 9,205 | ||||||||||||||
| Nonaccrual loans | $ | 50,206 | $ | 39,736 | $ | 32,141 | $ | 34,608 | $ | 18,227 | $ | 50,206 | $ | 18,227 | ||||||||||||||
| ACL to nonaccrual loans | 25 | % | 27 | % | 31 | % | 31 | % | 51 | % | 25 | % | 51 | % | ||||||||||||||
| ACL to nonaccrual loans, excluding guaranteed(2) | 70 | % | 122 | % | 136 | % | 141 | % | 208 | % | 70 | % | 208 | % | ||||||||||||||
| ACL to loans | 1.19 | % | 1.05 | % | 1.03 | % | 1.12 | % | 1.06 | % | 1.19 | % | 1.06 | % | ||||||||||||||
| ACL to loans, excluding guaranteed(2) | 1.42 | % | 1.27 | % | 1.28 | % | 1.42 | % | 1.36 | % | 1.42 | % | 1.36 | % | ||||||||||||||
| Book Value | ||||||||||||||||||||||||||||
| Stockholders’ Equity | $ | 172,810 | $ | 167,622 | $ | 165,755 | $ | 158,193 | $ | 151,749 | $ | 172,810 | $ | 151,749 | ||||||||||||||
| Common shares outstanding | 14,470 | 14,470 | 14,385 | 14,288 | 14,274 | 14,470 | 14,274 | |||||||||||||||||||||
| Book value per common share | $ | 11.94 | $ | 11.58 | $ | 11.52 | $ | 11.07 | $ | 10.63 | $ | 11.94 | $ | 10.63 | ||||||||||||||
| Full-Time Equivalent Employees | 189 | 189 | 184 | 187 | 188 | 189 | 188 | |||||||||||||||||||||
| (1) Ratios are annualized on an actual/actual basis | ||||||||||||||||||||||||||||
| (2) See Reconciliation of Non-GAAP Financial Measures | ||||||||||||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures (Unaudited) | ||||||||||||||||||||||||||||
| Three Months Ended | For the Six Months Ended | |||||||||||||||||||||||||||
| ($'s in 000, except per share data) | ||||||||||||||||||||||||||||
| Pre-Provision Net Revenue(1) | ||||||||||||||||||||||||||||
| Net Interest Income | $ | 12,801 | $ | 12,191 | $ | 13,455 | $ | 12,998 | $ | 12,388 | $ | 24,992 | $ | 24,282 | ||||||||||||||
| Non-Interest Income | 9,149 | 7,454 | 7,263 | 7,177 | 5,384 | 16,603 | 10,847 | |||||||||||||||||||||
| Net Revenue | $ | 21,950 | $ | 19,645 | $ | 20,718 | $ | 20,175 | $ | 17,772 | $ | 41,595 | $ | 35,129 | ||||||||||||||
| Non-Interest Expense | 11,998 | 15,876 | 11,460 | 12,317 | 10,396 | 27,874 | 21,303 | |||||||||||||||||||||
| Pre-Provision Net Revenue | $ | 9,952 | $ | 3,769 | $ | 9,258 | $ | 7,858 | $ | 7,376 | $ | 13,721 | $ | 13,826 | ||||||||||||||
| Less: | ||||||||||||||||||||||||||||
| (Provision) Net Benefit for Credit Losses | (2,844 | ) | (2,293 | ) | 182 | (2,219 | ) | (1,092 | ) | (5,137 | ) | (1,813 | ) | |||||||||||||||
| Provision For Income Taxes | (1,625 | ) | (139 | ) | (2,026 | ) | (1,282 | ) | (1,486 | ) | (1,764 | ) | (2,710 | ) | ||||||||||||||
| Net Loss Attributable to | (21 | ) | (22 | ) | (18 | ) | (49 | ) | (43 | ) | (43 | ) | (78 | ) | ||||||||||||||
| Net Income | $ | 5,462 | $ | 1,315 | $ | 7,396 | $ | 4,308 | $ | 4,755 | $ | 6,777 | $ | 9,225 | ||||||||||||||
| Adjusted Diluted Earnings Per Share Excluding Unusual Items(2) | ||||||||||||||||||||||||||||
| Net Income | $ | 5,462 | $ | 1,315 | $ | 7,396 | $ | 4,308 | $ | 4,755 | $ | 6,777 | $ | 9,225 | ||||||||||||||
| Unusual Items: | ||||||||||||||||||||||||||||
| Form S-1 and Uplift Costs | - | - | - | 30 | 290 | - | 1,049 | |||||||||||||||||||||
| Severance Expenses | - | - | 257 | 1,001 | - | - | - | |||||||||||||||||||||
| Credit Card Fraud Losses | 52 | 4,213 | - | - | - | 4,265 | ||||||||||||||||||||||
| Costs Incurred Related to Discontinued Credit Card Marketing Campaign | - | - | 416 | 1,692 | - | - | - | |||||||||||||||||||||
| - | - | (426 | ) | - | - | - | - | |||||||||||||||||||||
| Tax Effect of Unusual Expenses (a) | (12 | ) | (963 | ) | (55 | ) | (605 | ) | (64 | ) | (975 | ) | (233 | ) | ||||||||||||||
| Net Income Excluding Unusual Items | $ | 5,502 | $ | 4,565 | $ | 7,588 | $ | 6,426 | $ | 4,981 | $ | 10,067 | $ | 10,041 | ||||||||||||||
| Weighted average diluted shares outstanding | 14,544 | 14,506 | 14,555 | 14,525 | 14,551 | 14,511 | 14,536 | |||||||||||||||||||||
| Diluted Earnings Per Share | $ | 0.38 | $ | 0.09 | $ | 0.51 | $ | 0.30 | $ | 0.33 | $ | 0.47 | $ | 0.63 | ||||||||||||||
| Adjusted Diluted Earnings Per Share Excluding Unusual Expenses | $ | 0.38 | $ | 0.31 | $ | 0.52 | $ | 0.44 | $ | 0.34 | $ | 0.69 | $ | 0.69 | ||||||||||||||
| Gain on Loan Sales Margin(1) | ||||||||||||||||||||||||||||
| Gain on Sale of Loans | $ | 5,544 | $ | 3,790 | $ | 3,625 | $ | 3,592 | $ | 2,593 | $ | 9,334 | $ | 5,130 | ||||||||||||||
| Loans Sold | 110,075 | 79,036 | 92,258 | 110,820 | 82,140 | 189,111 | 150,860 | |||||||||||||||||||||
| Gain on Loan Sales Margin | 5.04 | % | 4.79 | % | 3.93 | % | 3.24 | % | 3.16 | % | 4.94 | % | 3.40 | % | ||||||||||||||
| Guaranteed Loans as a Percent of Loans(3) | ||||||||||||||||||||||||||||
| SBA and USDA Guaranteed Loans | $ | 174,971 | $ | 177,617 | $ | 183,739 | $ | 193,688 | $ | 192,324 | $ | 174,971 | $ | 192,324 | ||||||||||||||
| Loans, Net of Deferred Fees and Costs | 1,047,352 | 1,025,136 | 959,269 | 940,591 | 871,630 | 1,047,352 | 871,630 | |||||||||||||||||||||
| Guaranteed Loans as a % of Loans | 16.7 | % | 17.3 | % | 19.2 | % | 20.6 | % | 22.1 | % | 16.7 | % | 22.1 | % | ||||||||||||||
| Non-performing assets, excluding guaranteed, to total assets(3) | ||||||||||||||||||||||||||||
| Non-performing assets | $ | 60,179 | $ | 44,137 | $ | 37,396 | $ | 37,476 | $ | 18,373 | $ | 60,179 | $ | 18,373 | ||||||||||||||
| Less: SBA and USDA guaranteed portions of non-performing assets | 36,876 | 34,340 | 28,240 | 29,236 | 13,792 | 36,876 | 13,792 | |||||||||||||||||||||
| Non-performing assets, excluding guaranteed portions | 23,303 | 9,797 | 9,156 | 8,240 | 4,581 | 23,303 | 4,581 | |||||||||||||||||||||
| Total assets | 1,431,702 | 1,393,812 | 1,359,491 | 1,301,378 | 1,232,424 | 1,431,702 | 1,232,424 | |||||||||||||||||||||
| Non-performing assets, excluding guaranteed, to total assets | 1.63 | % | 0.70 | % | 0.67 | % | 0.63 | % | 0.37 | % | 1.63 | % | 0.37 | % | ||||||||||||||
| Allowance for credit losses (ACL) to nonaccrual loans, excluding guaranteed(3) | ||||||||||||||||||||||||||||
| Nonaccrual loans | $ | 50,206 | $ | 39,736 | $ | 32,141 | $ | 34,608 | $ | 18,227 | $ | 50,206 | $ | 18,227 | ||||||||||||||
| Less: SBA and USDA guaranteed portions of nonaccrual loans | 32,481 | 30,949 | 24,849 | 27,112 | 13,792 | 32,481 | 13,792 | |||||||||||||||||||||
| Nonaccrual loans, excluding guaranteed portions | 17,725 | 8,787 | 7,292 | 7,496 | 4,435 | 17,725 | 4,435 | |||||||||||||||||||||
| ACL to nonaccrual loans, excluding guaranteed | 70 | % | 122 | % | 136 | % | 141 | % | 208 | % | 70 | % | 208 | % | ||||||||||||||
| ACL to loans, excluding guaranteed(3) | ||||||||||||||||||||||||||||
| Loans, net of deferred fees and costs | $ | 1,047,352 | $ | 1,025,136 | $ | 959,269 | $ | 940,591 | $ | 871,630 | $ | 1,047,352 | $ | 871,630 | ||||||||||||||
| Less: SBA and USDA guaranteed portions of loans | 174,971 | 177,617 | 183,739 | 193,688 | 192,324 | 174,971 | 192,324 | |||||||||||||||||||||
| Loans, excluding guaranteed | 872,381 | 847,519 | 775,530 | 746,903 | 679,306 | 872,381 | 679,306 | |||||||||||||||||||||
| ACL to loans, excluding guaranteed | 1.42 | % | 1.27 | % | 1.28 | % | 1.42 | % | 1.36 | % | 1.42 | % | 1.36 | % | ||||||||||||||
| Non-GAAP Financial Measures Footnotes | ||||||||||||||||||||||||||||
| (1) We utilize this non-GAAP measurement to present trends in income generation of the Company. | ||||||||||||||||||||||||||||
| (2) We utilize this non-GAAP measurement to present the core earnings and core ratios of the Company by excluding certain significant one-time expenses. | ||||||||||||||||||||||||||||
| (3) We utilize these non-GAAP measurements to provide useful metrics regarding the at-risk assets of the Company. | ||||||||||||||||||||||||||||
| (a) Estimated tax impact calculated using each respective period's effective tax rate. | ||||||||||||||||||||||||||||
