• BayFirst Financial Corp. Reports First Quarter 2024 Results; Highlighted by Strong Loan and Deposit Growth with Higher Provision for Credit Losses

    Source: Nasdaq GlobeNewswire / 25 Apr 2024 16:00:01   America/New_York

    ST. PETERSBURG, Fla., April 25, 2024 (GLOBE NEWSWIRE) -- BayFirst Financial Corp. (NASDAQ: BAFN) (“BayFirst” or the “Company”), parent company of BayFirst National Bank (the “Bank”) today reported net income of $0.8 million, or $0.11 per diluted common share, for the first quarter of 2024, compared to $1.7 million, or $0.32 per diluted common share, in the fourth quarter of 2023. Net income decreased due to two primary factors: higher provision for credit losses of $1.4 million, coupled with weaker Core SBA 7(a) loan production ($350 thousand to $5 million loan size) attributed to the continued higher interest rate environment negatively impacting loan demand.

    “BayFirst opened its twelfth banking office in the attractive Tampa Bay market during the first quarter. The South Sarasota location completes our near-term branch expansion plans,” stated Thomas G. Zernick, Chief Executive Officer. “We were successful in growing deposit balances by $22.2 million during the quarter, and by $74.4 million year-over-year. We maintain a community focused business model serving individuals, families and small businesses, with a focus on establishing strong client relationships as we grow checking and savings accounts. This model continues to build franchise value in our great community bank in Tampa Bay.”

    “Our government guaranteed lending division, CreditBench, had a good first quarter producing $130.6 million in new loans, with $98.2 million of that production coming from the SBA Bolt small loan program,” Zernick continued. “Our SBA Bolt program, which we initiated in 2022, represents loans of $150 thousand or less that carry up to an 85% government guaranty as well as a higher yield than other SBA loans. Our Core SBA 7(a) program was below our first quarter production expectations by 50%, reflecting weaker demand related to higher interest rates and lower than historical average loan size. While net charge-offs increased during the first quarter, we continue to monitor asset quality metrics, including nonperforming loans exclusive of government guaranteed loan balances, which declined from the end of last quarter. The increase in net charge-offs was due to the performance from a portfolio of unsecured consumer loans purchased in 2022, as well as higher net charge-offs from the Bank’s FlashCap, small SBA loan program, which the Bank ended during the quarter. Despite the challenging operating outlook and the ‘higher for longer’ interest rate environment that’s impacting the entire banking industry, our overall asset quality remains within acceptable levels, with our conventional commercial and industrial, owner occupied commercial real estate, and non-owner occupied commercial real estate portfolios are all performing well. The general environment to originate quality loans remains challenging from pricing, loan size, and credit perspectives.”

    First Quarter 2024 Performance Review

    • The Company’s government guaranteed loan origination platform, CreditBench, originated $130.6 million in new government guaranteed loans during the first quarter of 2024, a decrease of 9.9% from $144.9 million of loans produced in the previous quarter, and a 7.8% increase over $121.1 million of loans produced during the first quarter of 2023. Demand remains strong for the Company's Bolt loan program, an SBA 7(a) loan product designed to expeditiously provide working capital loans of $150 thousand or less to businesses throughout the country. Since the launch in 2022, the Company has originated 4,168 Bolt loans totaling $539.9 million, of which 760 Bolt loans totaling $98.2 million were originated during the quarter.
    • Loans held for investment increased by $19.1 million, or 2.1%, during the first quarter of 2024 to $934.9 million and increased $142.1 million, or 17.9%, over the past year. During the quarter, the Company originated $197.2 million of loans and sold $127.8 million of government guaranteed loan balances.
    • Deposits increased $22.2 million, or 2.3%, during the first quarter of 2024 and increased $74.4 million, or 8.0%, over the past year to $1.01 billion.
    • Balance sheet liquidity remains strong, with $60.5 million in cash balances and time deposits with other banks as of March 31, 2024. Additionally, the Company maintains significant borrowing capacity through the FHLB and Federal Reserve discount window. Approximately 84% of the Company's deposits were insured at March 31, 2024.
    • Book value and tangible book value at March 31, 2024 were $20.45 per common share, a decrease from $20.60 at December 31, 2023, driven by higher shares outstanding.
    • Net interest margin including discontinued operations decreased by 6 bps to 3.42% in the first quarter of 2024, from 3.48% in the fourth quarter of 2023, primarily due to increases in deposit costs.

    Results of Operations

    Net Income

    Net income was $0.8 million for the first quarter of 2024, compared to $1.7 million in the fourth quarter of 2023 and $0.7 million in the first quarter of 2023. The decrease in net income for the first quarter of 2024 from the preceding quarter was primarily the result of an increase in provision for credit losses of $1.4 million and a decrease noninterest income of $0.4 million, partially offset by a decrease in noninterest expense of $0.7 million. The increase in net income from the first quarter of 2023 was due to increases in gain on sale of government guaranteed loans of $3.7 million and other noninterest income of $1.3 million. This was partially offset by increases in provision for credit losses of $2.1 million and noninterest expense of $2.4 million.

    Net Interest Income and Net Interest Margin

    Net interest income from continuing operations was $8.7 million in the first quarter of 2024, a decrease of $0.1 million, or 1.5%, from the fourth quarter of 2023, and a decrease of $0.3 million, or 3.4%, from the first quarter of 2023. The net interest margin decreased by 6 bps to 3.42% in the first quarter of 2024, from 3.48% in the fourth quarter of 2023.

    The decrease during the first quarter of 2024 as compared to the fourth quarter of 2023 was mainly due to higher interest costs on deposits of $0.5 million and lower interest income on interest bearing deposits in banks and other of $0.2 million, partially offset by an increase in loan interest income, including fees, of $0.5 million.

    The decrease during the first quarter of 2024 as compared to the year ago quarter was mainly due to higher interest expense on deposits of $5.3 million, partially offset by an increase in interest income of $4.9 million.

    Noninterest Income

    Noninterest income from continuing operations was $14.3 million for the first quarter of 2024, which was a decrease of $0.4 million, or 2.9% from $14.7 million in the fourth quarter of 2023 and an increase of $4.9 million, or 51.0%, from $9.4 million in the first quarter of 2023. The decrease in the first quarter of 2024, as compared to the fourth quarter of 2023 was the result of a decrease in fair value gains related to held for investment government guaranteed loans of $1.4 million, partially offset by an increase in gain on sale of government guaranteed loans of $1.1 million. The increase in the first quarter of 2024, as compared to the first quarter of 2023, was the result of increases in gain on sale of government guaranteed loans of $3.7 million, and other noninterest income of $1.3 million, primarily attributable to an increase in government guaranteed loan packaging fees.

    Noninterest Expense

    Noninterest expense from continuing operations was $17.8 million in the first quarter of 2024, which was a $0.7 million, or 3.8%, decrease from $18.5 million in the fourth quarter of 2023 and a $2.4 million, or 15.3%, increase compared to $15.4 million in the first quarter of 2023. The decrease in the first quarter of 2024, as compared to the prior quarter, was primarily due to a decrease in loan production expenses of $1.0 million. The increase in the first quarter of 2024, as compared to the first quarter of 2023 was primarily due to higher compensation costs of $0.9 million and higher professional fees of $0.5 million, higher loan production expenses of $0.2 million, and higher data processing expenses of $0.2 million.

    Balance Sheet

    Assets

    Total assets increased $26.4 million, or 2.4%, during the first quarter of 2024 to $1.14 billion, mainly due to an increase of $19.1 million of loans held for investment.

    Loans

    Loans held for investment increased $19.1 million, or 2.1%, during the first quarter of 2024 and $142.1 million, or 17.9%, over the past year to $934.9 million, due to originations in both conventional community bank loans and government guaranteed loans, partially offset by government guaranteed loan sales.

    Deposits

    Deposits increased $22.2 million, or 2.3%, during the first quarter of 2024 and increased $74.4 million, or 8.0%, from March 31, 2023, ending the first quarter of 2024 at $1.01 billion. During the first quarter, there were increases in noninterest-bearing deposit account balances of $3.3 million, savings and money market deposit account balances of $18.9 million, and time deposit balances of $8.9 million, partially offset by a decrease in interest-bearing transaction account balances of $8.9 million.

    Asset Quality

    The Company recorded a provision for credit losses in the first quarter of $4.1 million, compared to a $2.7 million provision for the fourth quarter of 2023 and $1.9 million during the first quarter of 2023.

    The ratio of ACL to total loans held for investment at amortized cost was 1.62% at March 31, 2024, 1.64% as of December 31, 2023, and 1.69% as of March 31, 2023. The ratio of ACL to total loans held for investment at amortized cost, excluding government guaranteed loans, was 2.06% at March 31, 2024, 2.03% as of December 31, 2023, and 2.10% as of March 31, 2023.

    Net charge-offs for the first quarter of 2024 were $3.7 million, a $1.1 million increase from $2.6 million for the fourth quarter of 2023 and a $1.8 million increase compared to $1.9 million in the first quarter of 2023. Annualized net charge-offs as a percentage of average loans held for investment at amortized cost were 1.71% for the first quarter of 2024, up from 1.27% in the fourth quarter of 2023 and 1.05% in the first quarter of 2023. Net charge-offs for the first quarter of 2024 were elevated by higher net charge-offs from the Bank’s FlashCap, small SBA loan program, which the Bank ended during the quarter, as well as $0.8 million of net charge-offs from a purchased portfolio of unsecured consumer loans. The Company stopped purchasing these consumer loans at the end of 2022 and the portfolio balances decreased from $17.0 million to $14.3 million during the quarter. Nonperforming assets to total assets was 0.97% as of March 31, 2024, compared to 0.92% as of December 31, 2023, and 0.55% as of March 31, 2023. Nonperforming assets, excluding government guaranteed loans, to total assets was 0.70% as of March 31, 2024, compared to 0.74% as of December 31, 2023, and 0.20% as of March 31, 2023.

    Management made changes to improve asset quality performance of the Bank’s CreditBench working capital lending program. Beginning in January 2024, the FlashCap loan product offering was discontinued due to higher-than-expected credit losses. FlashCap provided working capital loans in the amounts of $150 thousand to $350 thousand. While the Bank’s Bolt small working capital loan program (up to $150 thousand loan size) has performed well, management also made a decision to suspend lending to a small number of certain industries which present higher risk or have performed below expectations. Furthermore, additional credit enhancements were made to the Bolt underwriting parameters to improve future performance.

    Capital

    The Bank’s Tier 1 leverage ratio was 9.12% as of March 31, 2024, compared to 9.38% as of December 31, 2023, and 10.18% at March 31, 2023. The CET 1 and Tier 1 capital ratio to risk-weighted assets were 11.04% as of March 31, 2024, compared to 11.77% as of December 31, 2023, and 12.87% as of March 31, 2023. The total capital to risk-weighted assets ratio was 12.29% as of March 31, 2024, compared to 13.03% as of December 31, 2023, and 14.12% as of March 31, 2023.

    Liquidity

    The Bank has liquidity well in excess of internal minimums and the expectations of our bank regulators. The Bank’s overall liquidity position remains strong and stable. The on-balance sheet liquidity ratio at March 31, 2024 was 9.22%, as compared to 9.33% at December 31, 2023. The Bank retained additional liquidity after bank failures generated uncertainty for all banks in early 2023. The Bank has robust liquidity resources. These resources include secured borrowings available from the Federal Home Loan Bank, the Federal Reserve, and lines of credit with other financial institutions. As of March 31, 2024, the Bank had $15.0 million of borrowings from the FHLB and no borrowings from the FRB or other financial institutions. This compares to $10.0 million of borrowings from the FHLB and no borrowings from the FRB or other financial institutions at December 31, 2023.

    Recent Events

    Second Quarter Common Stock Dividend. On April 23, 2024, BayFirst’s Board of Directors declared a second quarter 2024 cash dividend of $0.08 per common share. The dividend will be payable June 15, 2024 to common shareholders of record as of June 1, 2024. The Company has continuously paid quarterly common stock cash dividends since 2016.

    Conference Call

    BayFirst’s management team will host a conference call on Friday, April 26, 2024 at 9:00 a.m. ET to discuss its first quarter results. Interested investors may listen to the call live under the Investor Relations tab at www.bayfirstfinancial.com. Investment professionals are invited to dial (800) 549-8228 to participate in the call using Conference ID 78074. A replay of the call will be available for one year at www.bayfirstfinancial.com.

    About BayFirst Financial Corp.

    BayFirst Financial Corp. is a registered bank holding company based in St. Petersburg, Florida which commenced operations on September 1, 2000. Its primary source of income is derived from its wholly owned subsidiary, BayFirst National Bank, a national banking association which commenced business operations on February 12, 1999. The Bank currently operates twelve full-service banking offices throughout the Tampa Bay-Sarasota region and offers a broad range of commercial and consumer banking services to businesses and individuals. The Bank was the 2nd SBA 7(a) lender by number of units originated and 5th largest by dollar volume nationwide through the second quarter ended March 31, 2024, of SBA's 2024 fiscal year. Additionally, it was the number one SBA 7(a) lender in dollar volume in the 5 county Tampa Bay market for the SBA's 2023 fiscal year. As of March 31, 2024, BayFirst Financial Corp. had $1.14 billion in total assets.

    Forward-Looking Statements

    In addition to the historical information contained herein, this presentation includes "forward-looking statements" within the meaning of such term in the Private Securities Litigation Reform Act of 1995. These statements are subject to many risks and uncertainties, including, but not limited to, the effects of health crises, global military hostilities, or climate change, including their effects on the economic environment, our customers and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with them; the ability of the Company to implement its strategy and expand its banking operations; changes in interest rates and other general economic, business and political conditions, including changes in the financial markets; changes in business plans as circumstances warrant; risks related to mergers and acquisitions; changes in benchmark interest rates used to price loans and deposits, changes in tax laws, regulations and guidance; and other risks detailed from time to time in filings made by the Company with the SEC, including, but not limited to those “Risk Factors” described in our most recent Form 10-K and Form 10-Q. Readers should note that the forward-looking statements included herein are not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking statements.

    BAYFIRST FINANCIAL CORP.
    SELECTED FINANCIAL DATA (Unaudited)
     
     At or for the three months ended
    (Dollars in thousands, except for share data)3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
    Balance sheet data:         
    Average loans held for investment at amortized cost$        855,040   $        825,196   $        789,167   $        781,744   $        718,094  
    Average total assets         1,126,315            1,108,550            1,088,517            1,064,068            969,489  
    Average common shareholders’ equity         85,385            82,574            81,067            80,310            78,835  
    Total loans held for investment         934,868            915,726            878,447            836,704            792,777  
    Total loans held for investment, excl gov’t gtd loan balances         712,073            698,106            687,141            638,148            596,505  
    Allowance for credit losses         13,906            13,497            13,365            12,598            12,208  
    Total assets         1,144,194            1,117,766            1,133,979            1,087,399            1,069,839  
    Common shareholders’ equity         84,578            84,656            82,725            81,460            80,734  
    Share data:          
    Basic earnings per common share$        0.11   $        0.32   $        0.42   $        0.29   $        0.13  
    Diluted earnings per common share         0.11            0.32            0.41            0.29            0.13  
    Dividends per common share         0.08            0.08            0.08            0.08            0.08  
    Book value per common share         20.45            20.60            20.12            19.85            19.70  
    Tangible book value per common share (1)         20.45            20.60            20.12            19.85            19.70  
    Performance and capital ratios:         
    Return on average assets(2)         0.29 %          0.60 %          0.71 %          0.52 %          0.30 %
    Return on average common equity(2)         2.06 %          6.37 %          8.46 %          5.86 %          2.69 %
    Net interest margin(2)         3.42 %          3.48 %          3.36 %          4.18 %          4.17 %
    Dividend payout ratio         74.91 %          25.03 %          19.15 %          27.89 %          61.48 %
    Asset quality ratios:         
    Net charge-offs$        3,652   $        2,612   $        2,234   $        2,253   $        1,887  
    Net charge-offs/avg loans held for investment at amortized cost(2)         1.71 %          1.27 %          1.13 %          1.15 %          1.05 %
    Nonperforming loans(3)$        9,877   $        9,688   $        9,518   $        8,478   $        5,890  
    Nonperforming loans (excluding gov't gtd balance)(3)$        7,568   $        8,264   $        7,997   $        6,590   $        2,095  
    Nonperforming loans/total loans held for investment(3)         1.15 %          1.18 %          1.20 %          1.08 %          0.81 %
    Nonperforming loans (excl gov’t gtd balance)/total loans held for investment(3)         0.88 %          1.00 %          1.01 %          0.84 %          0.29 %
    ACL/Total loans held for investment at amortized cost         1.62 %          1.64 %          1.68 %          1.61 %          1.69 %
    ACL/Total loans held for investment at amortized cost, excl government guaranteed loans         2.06 %          2.03 %          2.03 %          2.03 %          2.10 %
    Other Data:         
    Full-time equivalent employees 313    305    307    302    300  
    Banking center offices 12    11    10    9    9  
    (1) See section entitled "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" below for a reconciliation to most comparable GAAP equivalent.
    (2) Annualized
    (3) Excludes loans measured at fair value
     
     
    GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures


    Some of the financial measures included in this report are not measures of financial condition or performance recognized by GAAP. These non-GAAP financial measures include tangible common shareholders' equity and tangible book value per common share. Our management uses these non-GAAP financial measures in its analysis of our performance, and we believe that providing this information to financial analysts and investors allows them to evaluate capital adequacy.

    The following presents these non-GAAP financial measures along with their most directly comparable financial measures calculated in accordance with GAAP:

    Tangible Common Shareholders' Equity and Tangible Book Value Per Common Share (Unaudited)
     As of
    (Dollars in thousands, except for share data)March 31, 2024 December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023
    Total shareholders’ equity$        100,629  $        100,707  $        94,165  $        91,065  $        90,339 
    Less: Preferred stock liquidation preference         (16,051)          (16,051)          (11,440)          (9,605)          (9,605)
    Total equity available to common shareholders         84,578           84,656           82,725           81,460           80,734 
    Less: Goodwill         —           —           —           —           — 
    Tangible common shareholders' equity$        84,578  $        84,656  $        82,725  $        81,460  $        80,734 
              
    Common shares outstanding         4,134,914           4,110,470           4,110,650           4,103,834           4,098,805 
    Tangible book value per common share$        20.45  $        20.60  $        20.12  $        19.85  $        19.70 


    BAYFIRST FINANCIAL CORP.
    CONSOLIDATED BALANCE SHEETS
    (Dollars in thousands)3/31/202412/31/20233/31/2023
    AssetsUnaudited Unaudited
    Cash and due from banks$        4,425 $        4,099 $        3,766 
    Interest-bearing deposits in banks         53,080          54,286          127,901 
    Cash and cash equivalents         57,505          58,385          131,667 
    Time deposits in banks         3,000          4,646          4,881 
    Investment securities available for sale, at fair value (amortized cost $46,816, $43,597, and $46,728 at March 31, 2024, December 31, 2023, and March 31, 2023, respectively)         42,514          39,575          42,435 
    Investment securities held to maturity, at amortized cost, net of allowance for credit losses of $14, $17, and $18 (fair value: $2,352, $2,263, and $2,242 at March 31, 2024, December 31, 2023, and March 31, 2023, respectively)         2,487          2,484          2,484 
    Nonmarketable equity securities         5,228          4,770          5,115 
    Government guaranteed loans held for sale         2,226          —          1,174 
    Government guaranteed loans held for investment, at fair value         77,769          91,508          69,047 
    Loans held for investment, at amortized cost net of allowance for credit losses of $13,906, $13,497, and $12,208 at March 31, 2024, December 31, 2023, and March 31, 2023, respectively)         843,193          810,721          711,522 
    Accrued interest receivable         7,625          7,130          5,547 
    Premises and equipment, net         39,327          38,874          37,780 
    Loan servicing rights         15,742          14,959          11,625 
    Deferred income tax assets         —          —          1,338 
    Right-of-use operating lease assets         2,499          2,416          2,985 
    Bank owned life insurance         25,974          25,800          25,313 
    Other assets         18,805          16,150          16,421 
    Assets from discontinued operations         300          348          505 
    Total assets$        1,144,194 $        1,117,766 $        1,069,839 
    Liabilities:   
    Noninterest-bearing deposits$        96,977 $        93,708 $        106,622 
    Interest-bearing transaction accounts         250,478          259,422          266,445 
    Savings and money market deposits         391,915          373,000          364,269 
    Time deposits         267,945          259,008          195,565 
    Total deposits         1,007,315          985,138          932,901 
    FHLB borrowings 15,000          10,000          25,000 
    Subordinated debentures 5,950  5,949  5,994 
    Notes payable         2,276          2,389          2,731 
    Accrued interest payable         1,598          882          860 
    Operating lease liabilities         2,673          2,619          3,209 
    Deferred income tax liabilities         728          482          — 
    Accrued expenses and other liabilities         7,496          8,980          7,738 
    Liabilities from discontinued operations         529          620          1,067 
    Total liabilities         1,043,565          1,017,059          979,500 
    Shareholders’ equity:Unaudited Unaudited
    Preferred stock, Series A; no par value, 10,000 shares authorized, 6,395 shares issued and outstanding at March 31, 2024, December 31, 2023, and March 31, 2023; aggregate liquidation preference of $6,395 each period         6,161          6,161          6,161 
    Preferred stock, Series B; no par value, 20,000 shares authorized, 3,210 shares issued and outstanding at March 31, 2024, December 31, 2023, and March 31, 2023; aggregate liquidation preference of $3,210 each period         3,123          3,123          3,123 
    Preferred stock, Series C; no par value, 10,000 shares authorized, 6,446 shares issued and outstanding at March 31, 2024 and December 31, 2023, and no shares issued and outstanding as of March 31, 2023; aggregate liquidation preference of $6,446 at March 31, 2024 and December 31, 2023         6,446          6,446          — 
    Common stock and additional paid-in capital; no par value, 15,000,000 shares authorized, 4,134,914, 4,110,470, and 4,098,805 shares issued and outstanding at March 31, 2024, December 31, 2023, and March 31, 2023, respectively         54,776          54,521          54,003 
    Accumulated other comprehensive loss, net         (3,188)         (2,981)         (3,182)
    Unearned compensation         (1,192)         (958)         (940)
    Retained earnings         34,503          34,395          31,174 
    Total shareholders’ equity         100,629          100,707          90,339 
    Total liabilities and shareholders’ equity$        1,144,194 $        1,117,766 $        1,069,839 


    BAYFIRST FINANCIAL CORP.
    CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
     For the Quarter Ended
    (Dollars in thousands, except per share data)3/31/2024 12/31/2023 3/31/2023
    Interest income:     
    Loans, including fees$        18,228  $        17,714  $        13,071 
    Interest-bearing deposits in banks and other         959           1,140           1,180 
    Total interest income         19,187           18,854           14,251 
    Interest expense:     
    Deposits         10,215           9,719           4,923 
    Other         230           258           275 
    Total interest expense         10,445           9,977           5,198 
    Net interest income         8,742           8,877           9,053 
    Provision for credit losses         4,058           2,737           1,942 
    Net interest income after provision for credit losses         4,684           6,140           7,111 
    Noninterest income:     
    Loan servicing income, net         795           677           740 
    Gain on sale of government guaranteed loans, net         8,089           6,977           4,409 
    Service charges and fees         444           555           379 
    Government guaranteed loans fair value gain, net         3,305           4,697           3,574 
    Other noninterest income         1,635           1,785           346 
    Total noninterest income         14,268           14,691           9,448 
    Noninterest Expense:     
    Salaries and benefits         8,005           7,446           7,835 
    Bonus, commissions, and incentives         1,571           2,211           804 
    Occupancy and equipment         1,110           1,150           1,163 
    Data processing         1,560           1,422           1,347 
    Marketing and business development         588           640           665 
    Professional services         1,349           1,070           897 
    Loan origination and collection         1,719           2,728           1,495 
    Employee recruiting and development         597           510           568 
    Regulatory assessments         282           266           99 
    Other noninterest expense         992           1,023           539 
    Total noninterest expense         17,773           18,466           15,412 
    Income before taxes from continuing operations         1,179           2,365           1,147 
    Income tax expense from continuing operations         296           704           280 
    Net income from continuing operations         883           1,661           867 
    Loss from discontinued operations before income taxes         (78)          (8)          (170)
    Income tax benefit from discontinued operations         (19)          (2)          (42)
    Net loss from discontinued operations         (59)          (6)          (128)
          
    Net income         824           1,655           739 
    Preferred dividends         385           341           208 
    Net income available to common shareholders$        439  $        1,314  $        531 
    Basic earnings (loss) per common share:     
    Continuing operations$        0.12  $        0.32  $        0.16 
    Discontinued operations         (0.01)          —           (0.03)
    Basic earnings per common share$        0.11  $        0.32  $        0.13 
          
    Diluted earnings (loss) per common share:     
    Continuing operations$        0.12  $        0.32  $        0.16 
    Discontinued operations         (0.01)          —           (0.03)
    Diluted earnings per common share$        0.11  $        0.32  $        0.13 

            

    Loan Composition
             
    (Dollars in thousands)3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
     (Unaudited)   (Unaudited) (Unaudited) (Unaudited)
    Real estate:         
    Residential$        285,214  $        264,126  $        248,973  $        235,339  $        214,638 
    Commercial         273,227           293,595           280,620           272,200           239,720 
    Construction and land         36,764           26,272           25,339           15,575           11,069 
    Commercial and industrial         182,264           177,566           174,238           198,639           199,721 
    Commercial and industrial - PPP         2,965           3,202           15,364           15,808           18,430 
    Consumer and other         63,854           47,287           39,024           38,103           32,697 
    Loans held for investment, at amortized cost, gross         844,288           812,048           783,558           775,664           716,275 
    Deferred loan costs, net         16,233           14,707           12,928           11,506           10,678 
    Discount on government guaranteed loans sold         (7,674)          (7,040)          (6,623)          (5,937)          (6,046)
    Premium on loans purchased, net         4,252           4,503           4,406           3,306           2,823 
    Loans held for investment, at amortized cost, net         857,099           824,218           794,269           784,539           723,730 
    Government guaranteed loans held for investment, at fair value         77,769           91,508           84,178           52,165           69,047 
    Total loans held for investment, net$        934,868  $        915,726  $        878,447  $        836,704  $        792,777 


    Nonperforming Assets (Unaudited)          
    (Dollars in thousands)3/31/2024 12/31/2023 9/30/2023 6/30/2023 3/31/2023
    Nonperforming loans (government guaranteed balances), at amortized cost, gross$        2,309   $        1,424   $        1,521   $        1,888   $        3,795  
    Nonperforming loans (unguaranteed balances), at amortized cost, gross         7,568            8,264            7,997            6,590            2,095  
    Total nonperforming loans, at amortized cost, gross         9,877            9,688            9,518            8,478            5,890  
    Nonperforming loans (government guaranteed balances), at fair value         94            —            96            127            —  
    Nonperforming loans (unguaranteed balances), at fair value         729            648            363            —            —  
    Total nonperforming loans, at fair value         823            648            459            127            —  
    OREO         404            —            —            3            3  
    Total nonperforming assets, gross$        11,104   $        10,336   $        9,977   $        8,608   $        5,893  
    Nonperforming loans as a percentage of total loans held for investment(1)         1.15 %          1.18 %          1.20 %          1.08 %          0.81 %
    Nonperforming loans (excluding government guaranteed balances) to total loans held for investment(1)         0.88 %          1.00 %          1.01 %          0.84 %          0.29 %
    Nonperforming assets as a percentage of total assets         0.97 %          0.92 %          0.88 %          0.79 %          0.55 %
    Nonperforming assets (excluding government guaranteed balances) to total assets         0.70 %          0.74 %          0.71 %          0.62 %          0.20 %
    ACL to nonperforming loans(1)         140.79 %          139.32 %          128.60 %          146.39 %          207.27 %
    ACL to nonperforming loans (excluding government guaranteed balances)(1)         183.75 %          163.32 %          152.29 %          191.17 %          582.72 %
    (1) Excludes loans measured at fair value
     
    Note: Transmitted on Globe Newswire on April 25, 2024, at 4:00 p.m. ET.


    Contacts: 
    Thomas G. ZernickScott J. McKim
    Chief Executive OfficerChief Financial Officer
    727.399.5680727.521.7085
      


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