ROCKVILLE, Md., April 27, 2026 (GLOBE NEWSWIRE) -- Capital Bancorp, Inc. (the "Company") (NASDAQ:CBNK), the holding company for Capital Bank, N.A. (the "Bank"), today reported:
| Quarter Ended | % Change(Annualized) | |||||||||||||
| (in millions, except per share data) | 1Q26 | 4Q25 | 1Q25 | 1Q26 vs 4Q25 | 1Q26 vs 1Q25 | |||||||||
| Balance Sheet Summary | ||||||||||||||
| Gross Loans(1) | $ | 3,026 | $ | 2,959 | $ | 2,678 | 9.2 | % | 13.0 | % | ||||
| Total Deposits | 3,292 | 3,093 | 2,891 | 26.1 | % | 13.9 | % | |||||||
| Customer Deposits(2) | 2,989 | 2,717 | 2,584 | 40.7 | % | 15.7 | % | |||||||
| Tangible Book Value per share(3) | $ | 22.62 | $ | 22.05 | $ | 19.81 | 10.5 | % | 14.2 | % | ||||
| GAAP | Core(3) | ||||||||||||||||||||||||||||||||||
| Quarter Ended | Change | Quarter Ended | Change | ||||||||||||||||||||||||||||||||
| (in millions, except per share data) | 1Q26 | 4Q25 | 1Q25 | 1Q26 vs 4Q25 | 1Q26 vs 1Q25 | 1Q26 | 4Q25 | 1Q25 | 1Q26 vs 4Q25 | 1Q26 vs 1Q25 | |||||||||||||||||||||||||
| Earnings Summary | |||||||||||||||||||||||||||||||||||
| Net Income | $ | 12.0 | $ | 15.0 | $ | 13.9 | (20.0 | )% | (13.7 | )% | $ | 12.0 | $ | 15.0 | $ | 14.9 | (20.0 | )% | (19.5 | )% | |||||||||||||||
| Earnings per share - diluted | $ | 0.73 | $ | 0.91 | $ | 0.82 | (19.8 | )% | (11.2 | )% | $ | 0.73 | $ | 0.91 | $ | 0.88 | (19.8 | )% | (16.9 | )% | |||||||||||||||
| ROA | 1.33 | % | 1.71 | % | 1.75 | % | (38) bps | (42) bps | 1.33 | % | 1.71 | % | 1.87 | % | (38) bps | (54) bps | |||||||||||||||||||
| ROTCE(3) | 13.58 | % | 17.23 | % | 17.57 | % | (365) bps | (399) bps | 13.58 | % | 17.23 | % | 18.77 | % | (365) bps | (519) bps | |||||||||||||||||||
| Including Card | Excluding Card | ||||||||||||||||||||||||||||||||||
| NIM | 5.71 | % | 5.94 | % | 6.05 | % | (23) bps | (34) bps | 4.15 | % | 4.19 | % | 4.36 | % | (4) bps | (21) bps | |||||||||||||||||||
(1) Gross loans represent portfolio loans receivable, net of deferred fees and costs.
(2) Customer deposits represents total deposits excluding brokered deposits.
(3) As used in this press release, Core net income, Core earnings per share - diluted, Core ROA, Core ROTCE, Tangible Book Value per share are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
"We are pleased that the sustained organic growth at the Commercial Bank permits us to accommodate an increase in noninterest expenses, while, at the same time, providing our stockholders with reasonable returns and a steadily growing TBV," said Steven J. Schwartz, Chairman of the Company. "We expect these expenditures to enable technology advancements in customer experience and back office efficiency, and to support the introduction by OpenSky™ of new products. We remain alert to the possibility that the markets in which we operate remain vulnerable to disruption from geopolitical and other developments, but have not yet seen any macroeconomic signs of credit deterioration in our markets."
First Quarter 2026 Highlights
- Delivered strong balance sheet growth, with gross loans increasing 9.2% (annualized) from 4Q 2025, driven by continued momentum in the Commercial Bank
- Generated robust deposit growth, with total deposits increasing 26.1% (annualized) from 4Q 2025. Excluding $107.8 million of deposit growth tied to a single customer relationship, total deposits grew 11.9% annualized while reducing brokered deposits by 19.5%
- Achieved strong customer deposit growth, which increased 40.7% (annualized) from 4Q 2025, or 27.0% annualized excluding the relationship noted above
- Continued tangible book value compounding, with tangible book value(3) per share increasing 10.5% annualized from 4Q 2025
- Expanded fee revenue, which increased 29.6% (annualized), primarily driven by SBA loan sales generated by a new team and increased USDA volume; fee revenue represented 21.3% of total revenue
- Advanced strategic investments in unsecured card, card partnerships, data infrastructure, and back-office support to enhance scalability and long-term growth
- Returned capital to shareholders, repurchasing $3.5 million of common stock under the Company's share repurchase program
- The Company also declared a cash dividend on its common stock of $0.12 per share. The dividend is payable on May 27, 2026 to shareholders of record on May 11, 2026.
"We continue to demonstrate our ability to grow across the Company, highlighted by the increase in customer deposits, which positions us for continued balance sheet growth." said Ed Barry, CEO of the Company. "Our investment program is underway across the Commercial and OpenSky™ division, including technology and data initiatives that will improve our competitive position."
Consolidated financial performance
Net income of $12.0 million decreased $3.0 million compared to 4Q 2025, and earnings per share - diluted of $0.73 decreased $0.18 per share from 4Q 2025. Net income decreased $1.9 million, or 13.7%, from $13.9 million, or $0.82 per diluted share, for 1Q 2025. 1Q 2026 Core net income(1) of $12.0 million, or $0.73 per diluted share, decreased $3.0 million, or 20.1%, from 4Q 2025 Core net income of $15.0 million, or $0.91 per diluted share. 1Q 2026 Core net income decreased $2.9 million, or 19.3%, from 1Q 2025 core net income of $14.9 million, or $0.88 per diluted share.
Quarterly net interest income:
- Net interest income of $49.4 million decreased $0.9 million, or 1.8% (not annualized), compared to 4Q 2025, and increased $3.4 million, or 7.3%, year-over-year.
- Interest income of $68.0 million decreased $0.7 million, or 1.0% (not annualized), compared to 4Q 2025, and increased $5.2 million, or 8.3%, year-over-year. The decrease from 4Q 2025 was primarily driven by a $1.3 million decrease from OpenSky™ due to changes in the rate environment, partially offset by a $0.7 million increase from the Commercial Bank driven by loan growth. The increase year-over-year was primarily driven by $4.6 million from the Commercial Bank due to strong balance sheet growth, and $0.6 million from OpenSky™ due to the growth from the unsecured loan product.
- Interest income included $0.3 million from net purchase accounting accretion ("PAA") in 1Q 2026, compared to $0.1 million in 4Q 2025 and $0.3 million in net PAA in 1Q 2025.
- Interest expense of $18.6 million increased $0.2 million, or 1.2% (not annualized), compared to 4Q 2025, and increased $1.9 million, or 11.1%, year-over-year. The increase of $0.2 million compared to 4Q 2025, was primarily driven by a shift in deposit mix. The increase of $1.9 million year-over-year was driven by $0.9 million of lower PAA, $0.7 million from a shift in deposit mix and $0.3 of million higher borrowing costs.
- Interest expense included a $0.1 million benefit from net PAA in 1Q 2026, compared to a $0.1 million benefit in 4Q 2025. There was a $1.1 million benefit from net PAA in 1Q 2025.
- Interest income of $68.0 million decreased $0.7 million, or 1.0% (not annualized), compared to 4Q 2025, and increased $5.2 million, or 8.3%, year-over-year. The decrease from 4Q 2025 was primarily driven by a $1.3 million decrease from OpenSky™ due to changes in the rate environment, partially offset by a $0.7 million increase from the Commercial Bank driven by loan growth. The increase year-over-year was primarily driven by $4.6 million from the Commercial Bank due to strong balance sheet growth, and $0.6 million from OpenSky™ due to the growth from the unsecured loan product.
Quarterly provision:
- The 1Q 2026 provision for credit losses was $3.0 million, a decrease of $1.0 million from 4Q 2025. Net charge-offs totaled $3.0 million, or 0.40% of portfolio loans (annualized), up from $2.4 million or 0.32% of portfolio loans (annualized), in 4Q 2025.
- Net charge-offs in the quarter include $3.1 million from OpenSky™ loans and a net recovery of $0.1 million from Commercial Bank loans. Net charge-offs for the Commercial Bank decreased $2.0 million from 4Q 2025 primarily driven by $1.9 million of legacy Commercial Bank loans that were charged off during 4Q 2025. OpenSky™ net charge-offs amounted to $0.5 million in 4Q 2025 compared to a net charge-offs of $3.1 million in 1Q 2026. During 4Q 2025, a $2.0 million credit to the allowance for credit losses was made to reflect recoveries resulting from the sale of $69.5 million of charged-off OpenSky™ credit card receivables.
- At March 31, 2026, the ACL Coverage Ratio was 1.81%, down 4 bps from December 31, 2025, and flat year-over-year.
Quarterly fee revenue:
- Fee Revenue of $13.4 million increased $0.9 million, compared to 4Q 2025 and increased $0.8 million year-over-year. The increase of $0.9 million during 1Q 2026 was primarily from a $0.9 million increase in government lending revenue with other offsetting activity. Year-over-year fee revenue increased $0.8 million primarily due to a $0.8 million increase from government loan servicing and packaging revenue (Windsor™) with other offsetting activity. Fee revenue mix1 was 21.3% of total revenue for 1Q 2026, compared to 19.9% during 4Q 2025, and 21.4% during 1Q 2025.
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1 As used in this press release, Core net income, and Core noninterest expense, are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
Quarterly noninterest expense:
- Noninterest expense of $43.7 million increased $4.6 million compared to 4Q 2025 and increased $5.6 million compared to 1Q 2025. Core noninterest expense(1) of $43.7 million increased $4.6 million compared to 4Q 2025 and increased $6.9 million compared to 1Q 2025. Core comparisons include:
- The increase of $4.6 million quarter-over-quarter was primarily driven by the following:
- $2.4 million from personnel expenses, driven by planned investment and expansion in headcount;
- $0.9 million from occupancy & equipment, driven by an increase in software contracts, acceleration of depreciation of capitalized assets related to OpenSky™ technology, and an increase in lease expenses;
- $0.7 million from professional fees, driven by planned investment in OpenSky™ initiatives and other professional fees;
- $0.3 million from data processing driven by OpenSky™ and other core processing costs; and
- $0.2 million from loan processing, driven by loan expenses associated with our government guaranteed lending portfolio;
- Year-over-year expense growth of $6.9 million was driven by professional fees associated with investments in shared services areas and OpenSky™, personnel expense due to headcount growth, growth in data processing costs from OpenSky™ and core processing for the Commercial Bank, and an increase in loan processing costs and loan expenses associated with our government guaranteed lending portfolio.
- The increase of $4.6 million quarter-over-quarter was primarily driven by the following:
Quarterly income taxes:
- Income tax expense of $3.9 million, or 24.3% of pre-tax income for 1Q 2026, decreased $0.8 million from $4.6 million, or 23.6% of pre-tax income for 4Q 2025. The effective income tax rate change quarter-over-quarter was primarily due to certain one-time tax benefits recognized during 4Q 2025.
Total assets:
Total assets of $3.8 billion at March 31, 2026 increased $202.3 million, or 22.7% (annualized) from December 31, 2025. Total assets growth year-over-year was $458.7 million, or 13.7%. The growth quarter-over-quarter, and year-over-year, was primarily driven by increases in portfolio loans, and cash balances.
Gross Loans:
- Gross Loans of $3.0 billion at March 31, 2026 increased $67.0 million, or 9.2% (annualized), from December 31, 2025 and increased $348.0 million, or 13.0%, year-over-year.
- Compared to December 31, 2025, growth was primarily driven by $32.3 million from commercial and industrial ("C&I"), $29.7 million from residential real estate, and $6.1 million from construction real estate. C&I contributed 48.2% of total loan growth in the quarter.
- C&l loans, plus owner-occupied CRE loans, totaled 38.3% of total portfolio loans at March 31, 2026, 37.7% for the prior quarter, and 37.9% at March 31, 2025.
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1 Fee revenue mix equals fee revenue divided by the sum of fee revenue and net interest income before provision for credit losses
Consolidated financial performance (Continued)
Deposits:
- Total deposits of $3.3 billion at March 31, 2026 increased $198.8 million, or 26.1% (annualized), from December 31, 2025, and increased $400.7 million, or 13.9% from March 31, 2025.
- When excluding the decrease in brokered time deposits of $73.6 million, customer deposits increased $272.5 million or 40.7% (annualized), including $170.9 million of growth in customer money market deposits, $84.5 million of growth in interest-bearing demand accounts, $18.9 million of growth in noninterest-bearing deposits, and $9.8 million of growth in savings accounts, offset by a decrease of $11.6 million in customer time deposits.
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- The growth in the quarter includes $107.8 million of deposits tied to one customer. Excluding this relationship, total deposits increased $91.0 million, or 11.9% (annualized) and customer deposits increased $164.7 million, or 27.0% (annualized).
- The increase in total deposits of $400.7 million year-over-year was driven by $363.6 million in growth from customer money market deposits, $59.5 million from noninterest-bearing deposits, $45.3 million from interest-bearing demand accounts, and $8.7 million from savings accounts, offset by a decrease of $71.5 million from customer time deposits, and $4.7 million from brokered time deposits.
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- When excluding the decrease in brokered time deposits of $73.6 million, customer deposits increased $272.5 million or 40.7% (annualized), including $170.9 million of growth in customer money market deposits, $84.5 million of growth in interest-bearing demand accounts, $18.9 million of growth in noninterest-bearing deposits, and $9.8 million of growth in savings accounts, offset by a decrease of $11.6 million in customer time deposits.
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- Insured and protected1 deposits were approximately $2.3 billion as of March 31, 2026 representing 69.4% of the Company's deposit portfolio.
- Low interest2 and noninterest-bearing demand deposit account ("DDA") deposits of $1.2 billion, or 37.5% of deposits, increased $113.2 million, or 40.9% (annualized) from 4Q 2025, and increased $113.4 million, or 10.1% year-over-year.
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- The growth in the quarter of low interest and noninterest-bearing DDA deposits includes $36.1 million of deposits tied to one customer, the same relationship mentioned above. Excluding this relationship, total low interest and noninterest-bearing DDA deposits increased $77.1 million, or 27.9% from 4Q 2025, and increased $77.3 million, or 27.9% year-over-year.
- The average rate on the low interest and noninterest-bearing deposits was 0.16% for 1Q 2026, which increased 2 bps compared to 4Q 2025 and increased 1 bps year-over-year.
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- The average portfolio loans-to-deposit ratio was 96.1% for 1Q 2026, compared to 97.0% for 4Q 2025, and 95.2% for 1Q 2025.
Investment securities:
- The investment securities portfolio continues to be classified as available-for-sale and had a fair market value of $230.5 million, or 6.1% of total assets, and an effective duration of 2.3 years, with U.S. Treasury Securities representing 61% of the overall investment portfolio at March 31, 2026. The accumulated other comprehensive income (loss) on the investment securities portfolio declined $0.6 million during the quarter to $(6.4) million after-tax as of March 31, 2026, which represents 1.6% of total stockholders' equity. The Company does not have a held-to-maturity investment securities portfolio.
Liquidity:
The Company maintains stable and diversified sources of contingent liquidity, generally consistent with prior quarter. Total available borrowing capacity as of March 31, 2026 was $809.5 million, compared to $816.9 million as of December 31, 2025, consisting of $705.3 million of available collateralized borrowing capacity, $96.0 million of unsecured lines of credit with other banks, and $8.2 million of unpledged investment securities available to collateralize potential additional borrowings.
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1 Protected deposits includes deposits that are indirectly protected under the product terms.
2 Low interest deposits include interest-bearing demand and savings accounts
Consolidated financial performance (Continued)
Capital:
As of March 31, 2026, the Company reported a Common Equity Tier-1 capital ratio of 12.92%, compared to 12.98% at December 31, 2025. At March 31, 2026, the Company and the Bank maintained regulatory capital ratios that exceed all capital adequacy requirements.
Shares repurchased and retired during the three months ended March 31, 2026, as part of the Company's stock repurchase program, totaled 122,757 shares at an average price of $28.89, for a total cost of $3.5 million. The share repurchases consisted of $0.9 million under the Company's previous stock repurchase program, which expired on February 28, 2026, and $2.6 million under the new stock repurchase program. As of March 31, 2026, there was $12.4 million remaining to be repurchased under the current $15.0 million authorization repurchase program, which will expire on December 31, 2026.
Financial Metrics
Net Interest Margin:
NIM of 5.71% for 1Q 2026, decreased 23 bps compared to the prior quarter, and decreased 34 bps year-over-year. Core NIM(1) of 4.15% decreased 4 bps (but decreased 7 bps when excluding PAA) compared to the prior quarter, and decreased 21 bps year-over-year. Net PAA for 1Q 2026 was 5 bps for NIM and 5 bps for Core NIM(1).
- The average yield on interest earning assets of 7.86% decreased 24 bps compared to the prior quarter and decreased 38 bps year-over-year. The decreases quarter-over-quarter and year-over-year were primarily due to OpenSky™ as a result of changes in the rate environment.
- The Core Loan Yield(1) of 6.93% for 1Q 2026 decreased 2 bps compared to 4Q 2025, and decreased 21 bps year-over-year. The decrease year-over-year was primarily a result of changes in the rate environment.
- The total cost of deposits of 2.34% for 1Q 2026 decreased 2 bps compared to the prior quarter and decreased 8 bps year-over-year. The decrease year-over-year was primarily a result of a shift in the product mix of the portfolio, and changes in the rate environment.
- The total cost of interest-bearing deposits of 3.17% for 1Q 2026 decreased 11 bps quarter-over-quarter, and decreased 20 bps year-over-year. The decreases quarter-over-quarter and year-over-year were due to a shift in product mix as well as changes in the rate environment.
- Net PAA of $0.4 million, or 5 bps of NIM and 5 bps of Core NIM(1), during 1Q 2026, increased $0.2 million from 4Q 2025 mainly due to a loan payoff during the quarter. There was $1.4 million from net PAA during 1Q 2025.
Credit Metrics and Asset Quality:
Nonperforming assets were $59.3 million or 1.56% of total assets at March 31, 2026, an increase of $1.0 million but a decrease of 6 bps compared to December 31, 2025. The increase in nonperforming assets from 4Q 2025 was primarily driven by a $0.8 million increase from the legacy CBNK portfolio and a $0.2 million increase from the acquired IFH portfolio. Nonperforming assets increased $16.3 million or 28 bps year-over-year, mainly due to the $15.9 million increase during 3Q 2025 from two loan relationships acquired as part of the IFH transaction. At March 31, 2026, substandard loans totaled $71.8 million, or 2.4% of total portfolio loans, compared to $58.5 million, or 2.0% of total portfolio loans, at December 31, 2025 and $45.7 million, or 1.7% of total portfolio loans, at March 31, 2025. The increase from December 31, 2025 of $13.3 million was primarily driven by one legacy bank loan relationship, with three loans accounting for $9.7 million of the increase quarter-over-quarter. The $26.1 million year-over-year increase in substandard loans was primarily driven by $15.9 million from the two loan relationships acquired as part of the IFH transaction, and the one legacy bank relationship accounting for $9.7 million. At March 31, 2026, special mention loans totaled $60.3 million, or 2.0% of total portfolio loans, compared to $57.9 million, or 2.0% of total portfolio loans, at December 31, 2025, and $63.0 million, or 2.4% of total portfolio loans, at March 31, 2025.
Efficiency Ratio:
The efficiency ratio was 69.6% for 1Q 2026, compared to 62.3% for 4Q 2025 and 64.9% for 1Q 2025. The core efficiency ratio(1) was 69.6% for 1Q 2026, which increased from 62.3% compared to the prior quarter, and increased from 62.8% for 1Q 2025.
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1 As used in this press release, Core NIM, Core Loan Yield, and Core efficiency ratio are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
Financial Metrics (Continued)
Returns:
ROA was 1.33% for 1Q 2026, compared to 1.71% for 4Q 2025, and 1.75% for 1Q 2025. Core ROA(1) for 1Q 2026 was 1.33%, compared to 1.71% for 4Q 2025, and 1.87% for 1Q 2025.
- ROE was 12.03% for 1Q 2026, compared to 15.23% for 4Q 2025, and 15.56% for 1Q 2025. Core ROE(1) was 12.03% for 1Q 2026, compared to 15.23% for 4Q 2025, and 16.64% for 1Q 2025.
- ROTCE(1) was 13.58% for 1Q 2026, compared to 17.23% for 4Q 2025, and 17.57% for 1Q 2025. Core ROTCE(1) for 1Q 2026 was 13.58%, compared to 17.23% for 4Q 2025, and 18.77% for 1Q 2025.
Book Value:
Book value per common share of $25.10 at March 31, 2026, increased $0.57 when compared to December 31, 2025, and increased $2.91 when compared to March 31, 2025. Tangible book value per common share(1) increased $0.57, or 2.6% (not annualized), to $22.62 at March 31, 2026 when compared to December 31, 2025, and increased $2.81, or 14.2%, when compared to March 31, 2025.
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1 As used in this press release, Core ROA, Core ROE, ROTCE, Core ROTCE, and Tangible Book Value are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
Reportable Segments
Commercial Bank
Loan Growth – Portfolio loans(1) increased $73.0 million at March 31, 2026 compared to December 31, 2025, driven by $32.3 million from C&I, $29.7 million from residential real estate, and $6.1 million from construction real estate. Portfolio loans increased $330.6 million at March 31, 2026 compared to March 31, 2025, driven by $136.2 million from C&I, $101.9 million from residential real estate, and $46.1 million from CRE. Historical gross portfolio loan balances are disclosed in the Composition of Loans table within the Historical Financial Highlights.
Net Interest Income – Interest income of $52.7 million increased $0.7 million from the prior quarter, $0.5 million of which was due to growth in the Commercial Bank loan portfolio and $0.2 million of which was from higher loan PAA. Interest expense of $18.5 million increased $0.2 million, primarily due to a mix shift in the deposit portfolio.
Credit Metrics – Nonperforming assets decreased 7 bps to 1.64% of total assets at March 31, 2026 compared to December 31, 2025. Total nonaccrual loans at March 31, 2026 were $55.4 million, an increase of $1.0 million or 1.8% compared to $54.4 million at December 31, 2025.
Classified and Criticized Loans – At March 31, 2026, special mention loans totaled $60.3 million, or 2.0% of total portfolio loans, compared to $57.9 million, or 2.0% of total portfolio loans, at December 31, 2025. At March 31, 2026, substandard loans totaled $71.8 million, or 2.4% of total portfolio loans, compared to $58.5 million, or 2.0% of total portfolio loans, at December 31, 2025.
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(1) Portfolio loans represents portfolio loans receivable excluding deferred origination fees, net.
OpenSky™
Accounts – During 1Q 2026, credit card accounts grew to 588.2 thousand, increasing 2.7 thousand, or 0.5% (not annualized) from December 31, 2025, and increasing 24.5 thousand, or 4.3% year-over-year.
Loan and Deposit Balances – Secured and unsecured loan balances, net of reserves for interest and fees, of $134.8 million at March 31, 2026 decreased by $7.6 million, or 5.3% (not annualized), compared to December 31, 2025 and increased $16.1 million, or 13.5%, year-over-year. Deposit balances of $165.5 million at March 31, 2026 increased $2.3 million compared to December 31, 2025 and decreased $3.3 million, or 1.9% year-over-year. Gross unsecured loan balances of $46.6 million at March 31, 2026 decreased $0.6 million, or 1.2% (not annualized), compared to $47.1 million at December 31, 2025, and increased $19.9 million year-over-year. Gross secured loan balances of $90.0 million at March 31, 2026 decreased $7.3 million, or 7.5% (not annualized), compared to $97.3 million at December 31, 2025, and decreased $3.5 million, or 3.8% (not annualized) year-over-year.
Net Interest Income – Interest income of $15.1 million decreased $1.3 million compared to 4Q 2025. Average OpenSky™ credit card loan balances, net of reserves and deferred fees of $133.7 million for 1Q 2026, decreased $0.1 million, or 0.1% (not annualized), compared to 4Q 2025.
Fee Revenue – Total fee revenue of $4.7 million decreased $0.1 million from the prior quarter primarily driven by lower interchange and other credit-card related fees.
Noninterest Expense – Total noninterest expense of $16.2 million increased $1.6 million compared to 4Q 2025, driven by professional fees associated with the legacy and unsecured products, investment in headcount for initiatives, the acceleration of depreciation of capitalized assets related to OpenSky™ technology, and data processing costs.
OpenSky™ Credit – Portfolio credit metrics continued to be consistent with modeled expectations during 1Q 2026. The provision for credit losses of $2.7 million increased $1.4 million when compared to the prior quarter, primarily due to a $2.0 million credit in 4Q 2025 to the allowance for credit losses that was made to reflect the debt sale. Excluding this item in 4Q 2025, the provision for credit losses would have decreased $0.6 million primarily due to lower balances in the loan portfolio. OpenSky's™ unsecured loan product is offered exclusively to current and former secured card customers. Unsecured loans have been offered by OpenSky™ since the fourth quarter of 2021 and have generally performed in alignment with management expectations over that time period.
Capital Bank Home Loans
Originations of loans held for sale totaled $72.9 million during 1Q 2026, with $52.4 million of mortgage loans sold resulting in a gain on sale of loans of $1.5 million, representing a 2.85% gain on sale as a percentage of total loans sold. Originations of loans held for sale totaled $107.3 million during 4Q 2025, with $83.0 million of mortgage loans sold resulting in a gain on sale of loans of $2.1 million, representing a 2.58% gain on sale as a percentage of total loans sold.
Windsor Advantage™
Gross government loan servicing revenue totaled $5.6 million, including $1.3 million of Capital Bank related servicing fees, during 1Q 2026. Gross government loan servicing revenue totaled $5.0 million, including $1.0 million of Capital Bank related servicing fees, during 4Q 2025. Windsor's™ total servicing portfolio was $3.2 billion at March 31, 2026, and $3.1 billion at December 31, 2025.
| COMPARATIVE FINANCIAL HIGHLIGHTS - Unaudited | |||||||||||||||||||||||||
| Quarter Ended | 1Q26 vs 4Q25 | 1Q26 vs 1Q25 | |||||||||||||||||||||||
| (in thousands, except per share data) | March 31, 2026 | December 31, 2025 | March 31, 2025 | $ Change | % Change | $ Change | % Change | ||||||||||||||||||
| Earnings Summary | |||||||||||||||||||||||||
| Interest income | $ | 67,970 | $ | 68,634 | $ | 62,760 | $ | (664 | ) | (1.0 | )% | $ | 5,210 | 8.3 | % | ||||||||||
| Interest expense | 18,572 | 18,355 | 16,713 | 217 | 1.2 | % | 1,859 | 11.1 | % | ||||||||||||||||
| Net interest income | 49,398 | 50,279 | 46,047 | (881 | ) | (1.8 | )% | 3,351 | 7.3 | % | |||||||||||||||
| Provision for credit losses | 3,014 | 3,988 | 2,246 | (974 | ) | (24.4 | )% | 768 | 34.2 | % | |||||||||||||||
| Provision for (release of) credit losses on unfunded commitments | 205 | (29 | ) | — | 234 | (806.9 | )% | 205 | — | % | |||||||||||||||
| Noninterest income | 13,373 | 12,464 | 12,549 | 909 | 7.3 | % | 824 | 6.6 | % | ||||||||||||||||
| Noninterest expense | 43,681 | 39,103 | 38,053 | 4,578 | 11.7 | % | 5,628 | 14.8 | % | ||||||||||||||||
| Income before income taxes | 15,871 | 19,681 | 18,297 | (3,810 | ) | (19.4 | )% | (2,426 | ) | (13.3 | )% | ||||||||||||||
| Income tax expense | 3,853 | 4,644 | 4,365 | (791 | ) | (17.0 | )% | (512 | ) | (11.7 | )% | ||||||||||||||
| Net income | $ | 12,018 | $ | 15,037 | $ | 13,932 | $ | (3,019 | ) | (20.1 | )% | $ | (1,914 | ) | (13.7 | )% | |||||||||
| Pre-tax pre-provision net revenue ("PPNR")(1) | $ | 19,090 | $ | 23,640 | $ | 20,543 | $ | (4,550 | ) | (19.2 | )% | $ | (1,453 | ) | (7.1 | )% | |||||||||
| Core PPNR(1) | $ | 19,090 | $ | 23,640 | $ | 21,809 | $ | (4,550 | ) | (19.2 | )% | $ | (2,719 | ) | (12.5 | )% | |||||||||
| Common Share Data | |||||||||||||||||||||||||
| Earnings per share - Basic | $ | 0.74 | $ | 0.91 | $ | 0.84 | $ | (0.17 | ) | (18.7 | )% | $ | (0.10 | ) | (11.9 | )% | |||||||||
| Earnings per share - Diluted | $ | 0.73 | $ | 0.91 | $ | 0.82 | $ | (0.18 | ) | (19.8 | )% | $ | (0.09 | ) | (11.0 | )% | |||||||||
| Core earnings per share - Diluted(1) | $ | 0.73 | $ | 0.91 | $ | 0.88 | $ | (0.18 | ) | (19.8 | )% | $ | (0.15 | ) | (17.0 | )% | |||||||||
| Weighted average common shares - Basic | 16,345 | 16,493 | 16,666 | ||||||||||||||||||||||
| Weighted average common shares - Diluted | 16,441 | 16,493 | 16,925 | ||||||||||||||||||||||
| Return Ratios | |||||||||||||||||||||||||
| Return on average assets (annualized) | 1.33 | % | 1.71 | % | 1.75 | % | |||||||||||||||||||
| Core return on average assets (annualized)(1) | 1.33 | % | 1.71 | % | 1.87 | % | |||||||||||||||||||
| Return on average equity (annualized) | 12.03 | % | 15.23 | % | 15.56 | % | |||||||||||||||||||
| Core return on average equity (annualized)(1) | 12.03 | % | 15.23 | % | 16.64 | % | |||||||||||||||||||
| Return on average tangible common equity (annualized)(1) | 13.58 | % | 17.23 | % | 17.57 | % | |||||||||||||||||||
| Core return on average tangible common equity (annualized)(1) | 13.58 | % | 17.23 | % | 18.77 | % | |||||||||||||||||||
______________
(1) Refer to Appendix for reconciliation of non-GAAP measures.
| COMPARATIVE FINANCIAL HIGHLIGHTS - Unaudited (Continued) | |||||||||||||||||
| Quarter Ended | Quarter Ended | ||||||||||||||||
| March 31, | December 31, | September 30, | June 30, | ||||||||||||||
| (in thousands, except per share data) | 2026 | 2025 | % Change | 2025 | 2025 | 2025 | |||||||||||
| Balance Sheet Highlights | |||||||||||||||||
| Assets | $ | 3,808,467 | $ | 3,349,805 | 13.7 | % | $ | 3,606,207 | $ | 3,389,442 | $ | 3,388,662 | |||||
| Investment securities available-for-sale | 230,525 | 213,452 | 8.0 | % | 230,083 | 232,640 | 228,923 | ||||||||||
| Mortgage loans held for sale | 13,739 | 30,005 | (54.2 | )% | 25,828 | 14,146 | 15,933 | ||||||||||
| Portfolio loans receivable(2) | 3,026,431 | 2,678,406 | 13.0 | % | 2,959,457 | 2,821,983 | 2,739,808 | ||||||||||
| Allowance for credit losses | 54,680 | 48,454 | 12.8 | % | 54,660 | 53,045 | 47,447 | ||||||||||
| Goodwill | 25,969 | 24,085 | 7.8 | % | 25,969 | 25,969 | 22,478 | ||||||||||
| Intangible assets | 14,511 | 15,556 | (6.7 | )% | 14,771 | 15,033 | 15,295 | ||||||||||
| Deposits | 3,292,047 | 2,891,333 | 13.9 | % | 3,093,200 | 2,912,053 | 2,940,738 | ||||||||||
| FHLB borrowings | 50,000 | 22,000 | 127.3 | % | 50,000 | 22,000 | 22,000 | ||||||||||
| Other borrowed funds | 2,062 | 12,062 | (82.9 | )% | 2,062 | 12,062 | 12,062 | ||||||||||
| Total stockholders' equity | 408,859 | 369,577 | 10.6 | % | 401,757 | 394,770 | 380,035 | ||||||||||
| Tangible common equity(1) | 368,379 | 329,936 | 11.7 | % | 361,017 | 353,768 | 342,262 | ||||||||||
| Common shares outstanding | 16,286 | 16,657 | (2.2 | )% | 16,373 | 16,589 | 16,582 | ||||||||||
| Book value per share | $ | 25.10 | $ | 22.19 | 13.1 | % | $ | 24.54 | $ | 23.80 | $ | 22.92 | |||||
| Tangible book value per share(1) | $ | 22.62 | $ | 19.81 | 14.2 | % | $ | 22.05 | $ | 21.33 | $ | 20.64 | |||||
| Dividends per share | $ | 0.12 | $ | 0.10 | 20.0 | % | $ | 0.12 | $ | 0.12 | $ | 0.10 | |||||
______________
(1) Refer to Appendix for reconciliation of non-GAAP measures.
(2) Loans are reflected net of deferred fees and costs.
| Consolidated Statements of Income (Unaudited) | |||||||||||||||||
| Three Months Ended | |||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||
| Interest income | |||||||||||||||||
| Loans, including fees | $ | 64,186 | $ | 64,933 | $ | 60,838 | $ | 60,810 | $ | 58,691 | |||||||
| Investment securities available-for-sale | 1,459 | 1,728 | 1,805 | 1,582 | 1,861 | ||||||||||||
| Federal funds sold and other | 2,325 | 1,973 | 2,248 | 2,194 | 2,208 | ||||||||||||
| Total interest income | 67,970 | 68,634 | 64,891 | 64,586 | 62,760 | ||||||||||||
| Interest expense | |||||||||||||||||
| Deposits | 18,070 | 17,805 | 12,732 | 16,722 | 16,512 | ||||||||||||
| Borrowed funds | 502 | 550 | 139 | 218 | 201 | ||||||||||||
| Total interest expense | 18,572 | 18,355 | 12,871 | 16,940 | 16,713 | ||||||||||||
| Net interest income | 49,398 | 50,279 | 52,020 | 47,646 | 46,047 | ||||||||||||
| Provision for credit losses | 3,014 | 3,988 | 4,650 | 4,081 | 2,246 | ||||||||||||
| Provision for (release of) credit losses on unfunded commitments | 205 | (29 | ) | 217 | — | — | |||||||||||
| Net interest income after provision for credit losses | 46,179 | 46,320 | 47,153 | 43,565 | 43,801 | ||||||||||||
| Noninterest income | |||||||||||||||||
| Service charges on deposits | 403 | 371 | 425 | 262 | 258 | ||||||||||||
| Credit card fees | 4,692 | 4,837 | 4,509 | 4,298 | 3,722 | ||||||||||||
| Mortgage banking revenue | 1,556 | 1,960 | 1,927 | 1,754 | 1,831 | ||||||||||||
| Government lending revenue | 923 | — | 14 | 3,112 | 1,096 | ||||||||||||
| Government loan servicing revenue | 4,345 | 4,036 | 4,265 | 3,644 | 3,568 | ||||||||||||
| Loan servicing rights | 497 | 295 | 368 | (590 | ) | 472 | |||||||||||
| Other income (loss) | 957 | 965 | (440 | ) | 626 | 1,602 | |||||||||||
| Total noninterest income | 13,373 | 12,464 | 11,068 | 13,106 | 12,549 | ||||||||||||
| Noninterest expenses | |||||||||||||||||
| Salaries and employee benefits | 20,317 | 17,914 | 17,728 | 18,460 | 18,067 | ||||||||||||
| Occupancy and equipment | 3,562 | 2,638 | 2,849 | 2,995 | 2,910 | ||||||||||||
| Professional fees | 4,965 | 4,294 | 2,131 | 2,422 | 2,112 | ||||||||||||
| Data processing | 7,767 | 7,502 | 7,654 | 7,520 | 7,112 | ||||||||||||
| Advertising | 1,466 | 1,398 | 1,714 | 1,371 | 1,779 | ||||||||||||
| Loan processing | 1,383 | 1,152 | 1,114 | 979 | 743 | ||||||||||||
| Merger-related expenses | — | — | 697 | 1,398 | 1,266 | ||||||||||||
| Operational and other card fraud related losses | 690 | 750 | 923 | 933 | 903 | ||||||||||||
| Regulatory assessment expenses | 941 | 858 | 740 | 884 | 889 | ||||||||||||
| Other operating | 2,590 | 2,597 | 2,804 | 2,610 | 2,272 | ||||||||||||
| Total noninterest expenses | 43,681 | 39,103 | 38,354 | 39,572 | 38,053 | ||||||||||||
| Income before income taxes | 15,871 | 19,681 | 19,867 | 17,099 | 18,297 | ||||||||||||
| Income tax expense | 3,853 | 4,644 | 4,802 | 3,963 | 4,365 | ||||||||||||
| Net income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | |||||||
| Consolidated Balance Sheets | |||||||||||||||||||
| (unaudited) | (audited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||||||
| (in thousands, except share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Assets | |||||||||||||||||||
| Cash and due from banks | $ | 20,182 | $ | 30,894 | $ | 25,724 | $ | 26,843 | $ | 27,836 | |||||||||
| Interest-bearing deposits at other financial institutions | 379,069 | 224,611 | 163,078 | 247,704 | 266,092 | ||||||||||||||
| Federal funds sold | 60 | 60 | 59 | 59 | 59 | ||||||||||||||
| Total cash and cash equivalents | 399,311 | 255,565 | 188,861 | 274,606 | 293,987 | ||||||||||||||
| Investment securities available-for-sale | 230,525 | 230,083 | 232,640 | 228,923 | 213,452 | ||||||||||||||
| Restricted investments | 8,691 | 8,397 | 7,057 | 7,043 | 7,031 | ||||||||||||||
| Loans held for sale | 13,739 | 25,828 | 14,146 | 15,933 | 30,005 | ||||||||||||||
| Portfolio loans receivable, net of deferred fees and costs | 3,026,431 | 2,959,457 | 2,821,983 | 2,739,808 | 2,678,406 | ||||||||||||||
| Less allowance for credit losses | (54,680 | ) | (54,660 | ) | (53,045 | ) | (47,447 | ) | (48,454 | ) | |||||||||
| Total portfolio loans held for investment, net | 2,971,751 | 2,904,797 | 2,768,938 | 2,692,361 | 2,629,952 | ||||||||||||||
| Premises and equipment, net | 17,732 | 15,072 | 15,304 | 14,863 | 15,085 | ||||||||||||||
| Accrued interest receivable | 16,795 | 16,695 | 19,011 | 15,149 | 19,458 | ||||||||||||||
| Goodwill | 25,969 | 25,969 | 25,969 | 22,478 | 24,085 | ||||||||||||||
| Intangible assets | 14,511 | 14,771 | 15,033 | 15,295 | 15,556 | ||||||||||||||
| Loan servicing assets | 1,957 | 1,816 | 2,070 | 2,221 | 2,244 | ||||||||||||||
| Deferred tax asset | 15,187 | 14,992 | 14,885 | 15,667 | 15,902 | ||||||||||||||
| Bank owned life insurance | 45,871 | 45,488 | 45,105 | 44,721 | 44,335 | ||||||||||||||
| Other assets | 46,428 | 46,734 | 40,423 | 39,402 | 38,713 | ||||||||||||||
| Total assets | $ | 3,808,467 | $ | 3,606,207 | $ | 3,389,442 | $ | 3,388,662 | $ | 3,349,805 | |||||||||
| Liabilities | |||||||||||||||||||
| Deposits | |||||||||||||||||||
| Noninterest-bearing | $ | 871,677 | $ | 852,741 | $ | 857,543 | $ | 836,979 | $ | 812,224 | |||||||||
| Interest-bearing | 2,420,370 | 2,240,459 | 2,054,510 | 2,103,759 | 2,079,109 | ||||||||||||||
| Total deposits | 3,292,047 | 3,093,200 | 2,912,053 | 2,940,738 | 2,891,333 | ||||||||||||||
| Federal Home Loan Bank advances | 50,000 | 50,000 | 22,000 | 22,000 | 22,000 | ||||||||||||||
| Other borrowed funds | 2,062 | 2,062 | 12,062 | 12,062 | 12,062 | ||||||||||||||
| Accrued interest payable | 8,944 | 8,745 | 8,045 | 8,158 | 9,995 | ||||||||||||||
| Other liabilities | 46,555 | 50,443 | 40,512 | 25,669 | 44,838 | ||||||||||||||
| Total liabilities | 3,399,608 | 3,204,450 | 2,994,672 | 3,008,627 | 2,980,228 | ||||||||||||||
| Stockholders' equity | |||||||||||||||||||
| Common stock | 163 | 164 | 166 | 166 | 167 | ||||||||||||||
| Additional paid-in capital | 112,268 | 114,604 | 121,707 | 121,362 | 123,476 | ||||||||||||||
| Retained earnings | 302,808 | 292,749 | 279,693 | 266,619 | 255,141 | ||||||||||||||
| Accumulated other comprehensive loss | (6,380 | ) | (5,760 | ) | (6,796 | ) | (8,112 | ) | (9,207 | ) | |||||||||
| Total stockholders' equity | 408,859 | 401,757 | 394,770 | 380,035 | 369,577 | ||||||||||||||
| Total liabilities and stockholders' equity | $ | 3,808,467 | $ | 3,606,207 | $ | 3,389,442 | $ | 3,388,662 | $ | 3,349,805 | |||||||||
The following tables show the average outstanding balance of each principal category of our assets, liabilities and stockholders' equity, together with the average yields on our assets and the average costs of our liabilities for the periods indicated. Such yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period.
| Three Months Ended March 31, 2026 | Three Months Ended December 31, 2025 | Three Months Ended March 31, 2025 | ||||||||||||||||||||||||
| Average Outstanding Balance | Interest Income/ Expense | Average Yield/ Rate(1) | Average Outstanding Balance | Interest Income/ Expense | Average Yield/ Rate(1) | Average Outstanding Balance | Interest Income/ Expense | Average Yield/ Rate(1) | ||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||
| Interest earning assets: | ||||||||||||||||||||||||||
| Interest-bearing deposits | $ | 246,346 | $ | 2,200 | 3.62 | % | $ | 196,281 | $ | 1,868 | 3.78 | % | $ | 203,053 | $ | 2,138 | 4.27 | % | ||||||||
| Federal funds sold | 60 | 1 | 6.76 | 60 | 1 | 6.61 | 58 | 1 | 6.99 | |||||||||||||||||
| Investment securities available-for-sale | 233,165 | 1,459 | 2.54 | 238,295 | 1,728 | 2.88 | 235,605 | 1,861 | 3.20 | |||||||||||||||||
| Restricted investments | 8,441 | 124 | 5.96 | 6,725 | 104 | 6.14 | 5,761 | 69 | 4.86 | |||||||||||||||||
| Loans held for sale | 12,916 | 177 | 5.56 | 17,118 | 263 | 6.10 | 9,356 | 238 | 10.32 | |||||||||||||||||
| Portfolio loans receivable(2)(3) | 3,008,187 | 64,009 | 8.63 | 2,902,033 | 64,670 | 8.84 | 2,634,110 | 58,453 | 9.00 | |||||||||||||||||
| Total interest earning assets | 3,509,115 | 67,970 | 7.86 | 3,360,512 | 68,634 | 8.10 | 3,087,943 | 62,760 | 8.24 | |||||||||||||||||
| Noninterest earning assets | 142,697 | 138,028 | 134,021 | |||||||||||||||||||||||
| Total assets | $ | 3,651,812 | $ | 3,498,540 | $ | 3,221,964 | ||||||||||||||||||||
| Liabilities and Stockholders' Equity | ||||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||||
| Interest-bearing demand accounts | $ | 263,645 | 414 | 0.64 | $ | 269,342 | 366 | 0.54 | $ | 242,355 | 368 | 0.62 | ||||||||||||||
| Savings | 13,701 | 30 | 0.89 | 12,033 | 11 | 0.36 | 13,204 | 18 | 0.55 | |||||||||||||||||
| Money market accounts | 1,189,642 | 9,479 | 3.23 | 1,061,293 | 9,124 | 3.41 | 869,978 | 7,399 | 3.45 | |||||||||||||||||
| Time deposits | 842,137 | 8,147 | 3.92 | 812,186 | 8,304 | 4.06 | 859,729 | 8,727 | 4.12 | |||||||||||||||||
| Borrowed funds | 52,062 | 502 | 3.91 | 46,497 | 550 | 4.69 | 34,062 | 201 | 2.39 | |||||||||||||||||
| Total interest-bearing liabilities | 2,361,187 | 18,572 | 3.19 | 2,201,351 | 18,355 | 3.31 | 2,019,328 | 16,713 | 3.36 | |||||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||||
| Noninterest-bearing liabilities | 64,056 | 67,509 | 56,503 | |||||||||||||||||||||||
| Noninterest-bearing deposits | 821,267 | 837,930 | 783,018 | |||||||||||||||||||||||
| Stockholders' equity | 405,302 | 391,750 | 363,115 | |||||||||||||||||||||||
| Total liabilities and stockholders' equity | $ | 3,651,812 | $ | 3,498,540 | $ | 3,221,964 | ||||||||||||||||||||
| Net interest spread | 4.67 | % | 4.79 | % | 4.88 | % | ||||||||||||||||||||
| Net interest income | $ | 49,398 | $ | 50,279 | $ | 46,047 | ||||||||||||||||||||
| Net interest margin(4) | 5.71 | % | 5.94 | % | 6.05 | % | ||||||||||||||||||||
_______________
(1) Annualized.
(2) Includes nonaccrual loans.
(3) For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, collectively, Core Loan Yield was 6.93%, 6.95% and 7.14%, respectively.
(4) For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, collectively, Core Net Interest Margin was 4.15%, 4.19% and 4.36%, respectively.
The Company's reportable segments represent business units with discrete financial information whose results are regularly reviewed by management. The four segments include Commercial Banking, OpenSky™ (the Company's credit card division), Windsor Advantage™ and Capital Bank Home Loans (the Company's mortgage loan division).
The following schedules reported internally for performance assessment by the chief operating decision maker presents financial information for each reportable segment for the periods indicated. Total assets are presented as of March 31, 2026, December 31, 2025, and March 31, 2025.
| Segments | ||||||||||||||||
| For the three months ended March 31, 2026 | ||||||||||||||||
| (in thousands) | Commercial Bank | OpenSky™ | Windsor Advantage™ | CBHL | Consolidated | |||||||||||
| Interest income | $ | 52,732 | $ | 15,061 | $ | — | $ | 177 | $ | 67,970 | ||||||
| Interest expense | 18,472 | — | — | 100 | 18,572 | |||||||||||
| Net interest income | 34,260 | 15,061 | — | 77 | 49,398 | |||||||||||
| Provision for credit losses | 344 | 2,670 | — | — | 3,014 | |||||||||||
| Provision for credit losses on unfunded commitments | 205 | — | — | — | 205 | |||||||||||
| Net interest income after provision | 33,711 | 12,391 | — | 77 | 46,179 | |||||||||||
| Noninterest income | ||||||||||||||||
| Service charges on deposits | 403 | — | — | — | 403 | |||||||||||
| Credit card fees | — | 4,692 | — | — | 4,692 | |||||||||||
| Mortgage banking revenue | 416 | — | — | 1,140 | 1,556 | |||||||||||
| Government lending revenue | 923 | — | — | — | 923 | |||||||||||
| Government loan servicing revenue(1) | (1,262 | ) | — | 5,607 | — | 4,345 | ||||||||||
| Loan servicing rights | 497 | — | — | — | 497 | |||||||||||
| Other income | 707 | 12 | — | 238 | 957 | |||||||||||
| Total noninterest income | 1,684 | 4,704 | 5,607 | 1,378 | 13,373 | |||||||||||
| Noninterest expenses | ||||||||||||||||
| Salaries and employee benefits | 12,090 | 3,887 | 2,664 | 1,676 | 20,317 | |||||||||||
| Occupancy and equipment | 1,870 | 1,118 | 392 | 182 | 3,562 | |||||||||||
| Professional fees | 2,468 | 1,861 | 278 | 358 | 4,965 | |||||||||||
| Data processing | 545 | 7,107 | 59 | 56 | 7,767 | |||||||||||
| Advertising | 718 | 592 | 60 | 96 | 1,466 | |||||||||||
| Loan processing | 1,076 | 47 | 22 | 238 | 1,383 | |||||||||||
| Merger-related expenses | — | — | — | — | — | |||||||||||
| Operational and other card fraud related losses | 65 | 625 | — | — | 690 | |||||||||||
| Regulatory assessment expenses | 598 | 215 | 66 | 62 | 941 | |||||||||||
| Other operating | 1,140 | 715 | 605 | 130 | 2,590 | |||||||||||
| Total noninterest expenses | 20,570 | 16,167 | 4,146 | 2,798 | 43,681 | |||||||||||
| Net income (loss) before taxes | $ | 14,825 | $ | 928 | $ | 1,461 | $ | (1,343 | ) | $ | 15,871 | |||||
| Total assets | $ | 3,624,207 | $ | 135,414 | $ | 28,535 | $ | 20,311 | $ | 3,808,467 | ||||||
________________________
(1) Gross government loan servicing revenue totaled $5.6 million, including $1.3 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended March 31, 2026.
| Segments | ||||||||||||||||||
| For the three months ended December 31, 2025 | ||||||||||||||||||
| (in thousands) | Commercial Bank | OpenSky™ | Windsor Advantage™ | CBHL | Consolidated | |||||||||||||
| Interest income(2) | $ | 51,994 | $ | 16,377 | $ | — | $ | 263 | $ | 68,634 | ||||||||
| Interest expense(3) | 18,230 | — | — | 125 | 18,355 | |||||||||||||
| Net interest income | 33,764 | 16,377 | — | 138 | 50,279 | |||||||||||||
| Provision for credit losses | 2,715 | 1,273 | — | — | 3,988 | |||||||||||||
| Release of credit losses on unfunded commitments | (29 | ) | — | — | — | (29 | ) | |||||||||||
| Net interest income after provision | 31,078 | 15,104 | — | 138 | 46,320 | |||||||||||||
| Noninterest income | ||||||||||||||||||
| Service charges on deposits | 371 | — | — | — | 371 | |||||||||||||
| Credit card fees | — | 4,837 | — | — | 4,837 | |||||||||||||
| Mortgage banking revenue | 433 | — | — | 1,527 | 1,960 | |||||||||||||
| Government lending revenue | — | — | — | — | — | |||||||||||||
| Government loan servicing revenue(1) | (952 | ) | — | 4,988 | — | 4,036 | ||||||||||||
| Loan servicing rights | 295 | — | — | — | 295 | |||||||||||||
| Other income | 698 | 10 | — | 257 | 965 | |||||||||||||
| Total noninterest income | 845 | 4,847 | 4,988 | 1,784 | 12,464 | |||||||||||||
| Noninterest expenses | ||||||||||||||||||
| Salaries and employee benefits | 11,071 | 3,038 | 2,425 | 1,380 | 17,914 | |||||||||||||
| Occupancy and equipment | 1,773 | 688 | 40 | 137 | 2,638 | |||||||||||||
| Professional fees | 3,047 | 947 | 53 | 247 | 4,294 | |||||||||||||
| Data processing | 1,026 | 6,687 | (165 | ) | (46 | ) | 7,502 | |||||||||||
| Advertising | 608 | 634 | (3 | ) | 159 | 1,398 | ||||||||||||
| Loan processing | 101 | 475 | 163 | 413 | 1,152 | |||||||||||||
| Merger-related expenses | — | — | — | — | — | |||||||||||||
| Operational and other card fraud related losses | 13 | 737 | — | — | 750 | |||||||||||||
| Regulatory assessment expenses | 230 | 388 | 143 | 97 | 858 | |||||||||||||
| Other operating | 639 | 966 | 763 | 229 | 2,597 | |||||||||||||
| Total noninterest expenses | 18,508 | 14,560 | 3,419 | 2,616 | 39,103 | |||||||||||||
| Net income (loss) before taxes | $ | 13,415 | $ | 5,391 | $ | 1,569 | $ | (694 | ) | $ | 19,681 | |||||||
| Total assets | $ | 3,407,326 | $ | 140,914 | $ | 25,993 | $ | 31,974 | $ | 3,606,207 | ||||||||
________________________
(1) Gross government loan servicing revenue totaled $5.0 million, including $1.0 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended December 31, 2025.
| Segments | ||||||||||||||||
| For the three months ended March 31, 2025 | ||||||||||||||||
| (in thousands) | Commercial Bank | OpenSky™ | Windsor Advantage™ | CBHL | Consolidated | |||||||||||
| Interest income | $ | 48,164 | $ | 14,444 | $ | — | $ | 152 | $ | 62,760 | ||||||
| Interest expense | 16,649 | — | — | 64 | 16,713 | |||||||||||
| Net interest income | 31,515 | 14,444 | — | 88 | 46,047 | |||||||||||
| Provision for credit losses | 446 | 1,800 | — | — | 2,246 | |||||||||||
| Provision for credit losses on unfunded commitments | — | — | — | — | — | |||||||||||
| Net interest income after provision | 31,069 | 12,644 | — | 88 | 43,801 | |||||||||||
| Noninterest income | ||||||||||||||||
| Service charges on deposits | 258 | — | — | — | 258 | |||||||||||
| Credit card fees | — | 3,722 | — | — | 3,722 | |||||||||||
| Mortgage banking revenue | 263 | — | — | 1,568 | 1,831 | |||||||||||
| Government lending revenue | 1,096 | — | — | — | 1,096 | |||||||||||
| Government loan servicing revenue(1) | (1,038 | ) | — | 4,606 | — | 3,568 | ||||||||||
| Loan servicing rights | 472 | — | — | — | 472 | |||||||||||
| Non-recurring equity and debt investment write-down | — | — | — | — | — | |||||||||||
| Other income | 1,423 | 11 | 30 | 139 | 1,603 | |||||||||||
| Total noninterest income | 2,474 | 3,733 | 4,636 | 1,707 | 12,550 | |||||||||||
| Noninterest expenses | ||||||||||||||||
| Salaries and employee benefits | 10,626 | 3,345 | 2,406 | 1,690 | 18,067 | |||||||||||
| Occupancy and equipment | 1,577 | 488 | 711 | 134 | 2,910 | |||||||||||
| Professional fees | 1,151 | 591 | 120 | 250 | 2,112 | |||||||||||
| Data processing | 440 | 6,582 | 53 | 37 | 7,112 | |||||||||||
| Advertising | 718 | 874 | 104 | 83 | 1,779 | |||||||||||
| Loan processing | 477 | 19 | 7 | 240 | 743 | |||||||||||
| Merger-related expenses | 1,266 | — | — | — | 1,266 | |||||||||||
| Operational and other card fraud related losses | 31 | 872 | — | — | 903 | |||||||||||
| Regulatory assessment expenses | 865 | 15 | 5 | 4 | 889 | |||||||||||
| Other operating | 1,409 | 516 | 254 | 93 | 2,272 | |||||||||||
| Total noninterest expenses | 18,560 | 13,302 | 3,660 | 2,531 | 38,053 | |||||||||||
| Net income (loss) before taxes | $ | 14,983 | $ | 3,075 | $ | 976 | $ | (736 | ) | $ | 18,298 | |||||
| Total assets | $ | 3,192,327 | $ | 119,636 | $ | 23,750 | $ | 14,092 | $ | 3,349,805 | ||||||
________________________
(1) Gross government loan servicing revenue totaled $4.6 million, including $1.0 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended March 31, 2025.
| HISTORICAL FINANCIAL HIGHLIGHTS - Unaudited | |||||||||||||||||||
| Quarter Ended | |||||||||||||||||||
| (in thousands, except per share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Earnings: | |||||||||||||||||||
| Net income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | |||||||||
| Earnings per common share, diluted | 0.73 | 0.91 | 0.89 | 0.78 | 0.82 | ||||||||||||||
| Net interest margin | 5.71 | % | 5.94 | % | 6.36 | % | 6.04 | % | 6.05 | % | |||||||||
| Core net interest margin(2) | 4.15 | % | 4.19 | % | 4.66 | % | 4.42 | % | 4.36 | % | |||||||||
| Return on average assets(1) | 1.33 | % | 1.71 | % | 1.77 | % | 1.60 | % | 1.75 | % | |||||||||
| Return on average equity(1) | 12.03 | % | 15.23 | % | 15.57 | % | 14.17 | % | 15.56 | % | |||||||||
| Efficiency ratio | 69.59 | % | 62.32 | % | 60.79 | % | 65.14 | % | 64.94 | % | |||||||||
| Balance Sheet: | |||||||||||||||||||
| Total portfolio loans receivable, net deferred fees | $ | 3,026,431 | $ | 2,959,457 | $ | 2,821,983 | $ | 2,739,808 | $ | 2,678,406 | |||||||||
| Total deposits | 3,292,047 | 3,093,200 | 2,912,053 | 2,940,738 | 2,891,333 | ||||||||||||||
| Total assets | 3,808,467 | 3,606,207 | 3,389,442 | 3,388,662 | 3,349,805 | ||||||||||||||
| Total stockholders' equity | 408,859 | 401,757 | 394,770 | 380,035 | 369,577 | ||||||||||||||
| Total average portfolio loans receivable, net deferred fees | 3,008,187 | 2,902,033 | 2,789,815 | 2,733,865 | 2,634,110 | ||||||||||||||
| Total average deposits | 3,130,392 | 2,992,784 | 2,917,067 | 2,841,153 | 2,768,284 | ||||||||||||||
| Portfolio loans-to-deposit ratio (period-end balances) | 91.93 | % | 95.68 | % | 96.91 | % | 93.17 | % | 92.64 | % | |||||||||
| Portfolio loans-to-deposit ratio (average balances) | 96.10 | % | 96.97 | % | 95.64 | % | 96.22 | % | 95.15 | % | |||||||||
| Asset Quality Ratios: | |||||||||||||||||||
| Nonperforming assets to total assets | 1.56 | % | 1.62 | % | 1.54 | % | 1.07 | % | 1.28 | % | |||||||||
| Nonperforming loans to total loans | 1.83 | % | 1.84 | % | 1.85 | % | 1.32 | % | 1.60 | % | |||||||||
| Net charge-offs to average portfolio loans(1) | 0.40 | % | 0.32 | % | 0.35 | % | 0.75 | % | 0.38 | % | |||||||||
| Allowance for credit losses to total loans | 1.81 | % | 1.85 | % | 1.88 | % | 1.73 | % | 1.81 | % | |||||||||
| Allowance for credit losses to non-performing loans | 98.67 | % | 100.44 | % | 101.53 | % | 131.19 | % | 112.86 | % | |||||||||
| Bank Capital Ratios: | |||||||||||||||||||
| Total risk based capital ratio | 12.52 | % | 12.60 | % | 12.95 | % | 13.13 | % | 12.93 | % | |||||||||
| Tier-1 risk based capital ratio | 11.26 | % | 11.34 | % | 11.69 | % | 11.87 | % | 11.67 | % | |||||||||
| Leverage ratio | 9.00 | % | 9.24 | % | 9.34 | % | 9.39 | % | 9.27 | % | |||||||||
| Common Equity Tier-1 capital ratio | 11.26 | % | 11.34 | % | 11.69 | % | 11.87 | % | 11.67 | % | |||||||||
| Tangible common equity | 8.40 | % | 8.75 | % | 9.06 | % | 8.84 | % | 8.66 | % | |||||||||
| Holding Company Capital Ratios: | |||||||||||||||||||
| Total risk based capital ratio | 14.25 | % | 14.31 | % | 15.25 | % | 15.30 | % | 14.97 | % | |||||||||
| Tier-1 risk based capital ratio | 12.99 | % | 13.05 | % | 13.62 | % | 13.66 | % | 13.32 | % | |||||||||
| Leverage ratio | 10.48 | % | 10.71 | % | 10.98 | % | 10.90 | % | 10.68 | % | |||||||||
| Common Equity Tier-1 capital ratio | 12.92 | % | 12.98 | % | 13.54 | % | 13.58 | % | 13.24 | % | |||||||||
| Tangible common equity | 9.73 | % | 10.07 | % | 10.60 | % | 10.22 | % | 9.94 | % | |||||||||
_______________
(1) Annualized.
(2) Refer to Appendix for reconciliation of non-GAAP measures.
| HISTORICAL FINANCIAL HIGHLIGHTS - Unaudited (Continued) | |||||||||||||||||||
| Quarter Ended | |||||||||||||||||||
| (in thousands, except per share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Composition of Loans: | |||||||||||||||||||
| Commercial real estate, non owner-occupied | $ | 522,498 | $ | 533,141 | $ | 509,878 | $ | 495,341 | $ | 484,399 | |||||||||
| Commercial real estate, owner-occupied | 428,632 | 418,701 | 442,827 | 436,421 | 420,643 | ||||||||||||||
| Residential real estate | 795,505 | 765,808 | 740,060 | 710,730 | 693,597 | ||||||||||||||
| Construction real estate | 365,706 | 359,566 | 344,290 | 343,189 | 343,280 | ||||||||||||||
| Commercial and industrial | 730,576 | 698,289 | 619,148 | 593,279 | 594,331 | ||||||||||||||
| Lender finance | 43,775 | 41,421 | 31,883 | 32,494 | 23,165 | ||||||||||||||
| Business equity lines of credit | 4,170 | 3,818 | 2,931 | 2,853 | 3,468 | ||||||||||||||
| Credit card, net of reserve(3) | 134,789 | 142,397 | 136,483 | 131,029 | 118,709 | ||||||||||||||
| Other consumer loans | 4,779 | 1,930 | 2,010 | 2,727 | 2,200 | ||||||||||||||
| Portfolio loans receivable | $ | 3,030,430 | $ | 2,965,071 | $ | 2,829,510 | $ | 2,748,063 | $ | 2,683,792 | |||||||||
| Deferred origination fees, net | (3,999 | ) | (5,614 | ) | (7,527 | ) | (8,255 | ) | (5,386 | ) | |||||||||
| Portfolio loans receivable, net | $ | 3,026,431 | $ | 2,959,457 | $ | 2,821,983 | $ | 2,739,808 | $ | 2,678,406 | |||||||||
| Composition of Deposits: | |||||||||||||||||||
| Noninterest-bearing | $ | 871,677 | $ | 852,741 | $ | 857,543 | $ | 836,979 | $ | 812,224 | |||||||||
| Interest-bearing demand | 341,723 | 257,233 | 275,767 | 319,431 | 296,455 | ||||||||||||||
| Savings | 21,471 | 11,679 | 12,835 | 12,879 | 12,819 | ||||||||||||||
| Money markets | 1,276,034 | 1,105,183 | 989,159 | 960,237 | 912,418 | ||||||||||||||
| Customer time deposits | 478,085 | 489,687 | 539,207 | 541,079 | 549,630 | ||||||||||||||
| Brokered time deposits | 303,057 | 376,677 | 237,542 | 270,133 | 307,787 | ||||||||||||||
| Total deposits | $ | 3,292,047 | $ | 3,093,200 | $ | 2,912,053 | $ | 2,940,738 | $ | 2,891,333 | |||||||||
| Capital Bank Home Loan Metrics: | |||||||||||||||||||
| Origination of loans held for sale | $ | 72,933 | $ | 107,283 | $ | 80,651 | $ | 80,334 | $ | 65,815 | |||||||||
| Mortgage loans sold | 52,423 | 82,998 | 66,409 | 59,663 | 54,144 | ||||||||||||||
| Gain on sale of loans | 1,496 | 2,145 | 1,698 | 1,597 | 1,664 | ||||||||||||||
| Purchase volume as a % of originations | 73.15 | % | 72.77 | % | 92.32 | % | 91.61 | % | 90.73 | % | |||||||||
| Gain on sale as a % of loans sold(4) | 2.85 | % | 2.58 | % | 2.56 | % | 2.68 | % | 3.07 | % | |||||||||
| Mortgage commissions | $ | 594 | $ | 899 | $ | 656 | $ | 501 | $ | 545 | |||||||||
| OpenSky™Portfolio Metrics: | |||||||||||||||||||
| Open customer accounts | 588,190 | 585,492 | 587,641 | 585,372 | 563,718 | ||||||||||||||
| Secured credit card loans, gross | $ | 90,021 | $ | 97,313 | $ | 98,793 | $ | 100,037 | $ | 93,570 | |||||||||
| Unsecured credit card loans, gross | 46,574 | 47,131 | 39,576 | 32,715 | 26,670 | ||||||||||||||
| Noninterest secured credit card deposits | 165,506 | 163,184 | 166,874 | 168,936 | 168,796 | ||||||||||||||
_______________
(3) Credit card loans are presented net of reserve for interest and fees.
(4) Gain on sale percentage is calculated as gain on sale of loans divided by mortgage loans sold.
Appendix
Reconciliation of Non-GAAP Measures
The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company's results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company's industry. Investors should recognize that the Company's presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.
| Core Earnings Metrics | Quarter Ended | ||||||||||||||||||
| (in thousands, except per share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Net Income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | |||||||||
| Deduct: Income from the Call of Brokered Time Deposits, Net of Tax | — | — | (3,489 | ) | — | — | |||||||||||||
| Add: Merger-Related Expenses, Net of Tax | — | — | 575 | 1,070 | 964 | ||||||||||||||
| Core Net Income | $ | 12,018 | $ | 15,037 | $ | 12,151 | $ | 14,206 | $ | 14,896 | |||||||||
| Weighted Average Common Shares - Diluted | 16,441 | 16,493 | 16,844 | 16,802 | 16,925 | ||||||||||||||
| Earnings per Share - Diluted | $ | 0.73 | $ | 0.91 | $ | 0.89 | $ | 0.78 | $ | 0.82 | |||||||||
| Core Earnings per Share - Diluted | $ | 0.73 | $ | 0.91 | $ | 0.72 | $ | 0.85 | $ | 0.88 | |||||||||
| Average Assets | $ | 3,651,812 | $ | 3,498,540 | $ | 3,378,296 | $ | 3,292,533 | $ | 3,221,964 | |||||||||
| Return on Average Assets(1) | 1.33 | % | 1.71 | % | 1.77 | % | 1.60 | % | 1.75 | % | |||||||||
| Core Return on Average Assets(1) | 1.33 | % | 1.71 | % | 1.43 | % | 1.73 | % | 1.87 | % | |||||||||
| Average Equity | $ | 405,302 | $ | 391,750 | $ | 383,922 | $ | 371,795 | $ | 363,115 | |||||||||
| Return on Average Equity(1) | 12.03 | % | 15.23 | % | 15.57 | % | 14.17 | % | 15.56 | % | |||||||||
| Core Return on Average Equity(1) | 12.03 | % | 15.23 | % | 12.56 | % | 15.33 | % | 16.64 | % | |||||||||
| Net Interest Income | $ | 49,398 | $ | 50,279 | $ | 52,020 | $ | 47,646 | $ | 46,047 | |||||||||
| Noninterest Income | 13,373 | 12,464 | 11,068 | 13,106 | 12,549 | ||||||||||||||
| Total Revenue | $ | 62,771 | $ | 62,743 | $ | 63,088 | $ | 60,752 | $ | 58,596 | |||||||||
| Noninterest Expense | 43,681 | 39,103 | 38,354 | 39,572 | 38,053 | ||||||||||||||
| Efficiency Ratio(2) | 69.6 | % | 62.3 | % | 60.8 | % | 65.1 | % | 64.9 | % | |||||||||
| Net Interest Income | $ | 49,398 | $ | 50,279 | $ | 52,020 | $ | 47,646 | $ | 46,047 | |||||||||
| Deduct: Income from the Call of Brokered Time Deposits | — | — | 4,618 | — | — | ||||||||||||||
| Core Net Interest Income (a) | $ | 49,398 | $ | 50,279 | $ | 47,402 | $ | 47,646 | $ | 46,047 | |||||||||
| Noninterest Income | 13,373 | 12,464 | 11,068 | 13,106 | 12,549 | ||||||||||||||
| Core Fee Revenue (b) | $ | 13,373 | $ | 12,464 | $ | 11,068 | $ | 13,106 | $ | 12,549 | |||||||||
| Core Revenue (a) + (b) | $ | 62,771 | $ | 62,743 | $ | 58,470 | $ | 60,752 | $ | 58,596 | |||||||||
| Noninterest Expense | $ | 43,681 | $ | 39,103 | $ | 38,354 | $ | 39,572 | $ | 38,053 | |||||||||
| Less: Merger-Related Expenses | — | — | 697 | 1,398 | 1,266 | ||||||||||||||
| Core Noninterest Expense | $ | 43,681 | $ | 39,103 | $ | 37,657 | $ | 38,174 | $ | 36,787 | |||||||||
| Core Efficiency Ratio(2) | 69.6 | % | 62.3 | % | 64.4 | % | 62.8 | % | 62.8 | % | |||||||||
_______________
(1) Annualized.
(2) The efficiency ratio is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income).
| Core Net Interest Margin | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Net Interest Income | $ | 49,398 | $ | 50,279 | $ | 52,020 | $ | 47,646 | $ | 46,047 | |||||||||
| Less: Credit Card Loan Income | 14,882 | 16,196 | 15,386 | 14,116 | 14,147 | ||||||||||||||
| Core Net Interest Income | 34,516 | 34,083 | 36,634 | 33,530 | 31,900 | ||||||||||||||
| Average Interest Earning Assets | 3,509,115 | 3,360,576 | 3,246,653 | 3,163,421 | 3,087,943 | ||||||||||||||
| Less: Average Credit Card Loans | 133,712 | 133,858 | 129,100 | 121,414 | 118,723 | ||||||||||||||
| Average Core Interest Earning Assets | $ | 3,375,403 | $ | 3,226,718 | $ | 3,117,553 | $ | 3,042,007 | $ | 2,969,220 | |||||||||
| Core Net Interest Margin | 4.15 | % | 4.19 | % | 4.66 | % | 4.42 | % | 4.36 | % | |||||||||
| Core Loan Yield | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Portfolio Loans Receivable Interest Income | $ | 64,009 | $ | 64,670 | $ | 60,610 | $ | 60,647 | $ | 58,453 | |||||||||
| Less: Credit Card Loan Income | 14,882 | 16,197 | 15,387 | 14,116 | 14,148 | ||||||||||||||
| Core Portfolio Loans Receivable Interest Income | $ | 49,127 | $ | 48,473 | $ | 45,223 | $ | 46,531 | $ | 44,305 | |||||||||
| Average Portfolio Loans Receivable | 3,008,187 | 2,902,033 | 2,789,815 | 2,733,865 | 2,634,110 | ||||||||||||||
| Less: Average Credit Card Loans | 133,712 | 133,858 | 129,100 | 121,414 | 118,723 | ||||||||||||||
| Total Core Average Portfolio Loans Receivable | $ | 2,874,475 | $ | 2,768,175 | $ | 2,660,715 | $ | 2,612,451 | $ | 2,515,387 | |||||||||
| Core Portfolio Loans Receivable Yield | 6.93 | % | 6.95 | % | 6.74 | % | 7.14 | % | 7.14 | % | |||||||||
| Pre-tax, Pre-Provision Net Revenue ("PPNR") | Quarter Ended | ||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||
| Net Income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | |||||
| Add: Income Tax Expense | 3,853 | 4,644 | 4,802 | 3,963 | 4,365 | ||||||||||
| Add: Provision for Credit Losses | 3,014 | 3,988 | 4,650 | 4,081 | 2,246 | ||||||||||
| Add: Provision for (Release of) Credit Losses on Unfunded Commitments | 205 | (29 | ) | 217 | — | — | |||||||||
| Pre-tax, Pre-Provision Net Revenue ("PPNR") | $ | 19,090 | $ | 23,640 | $ | 24,734 | $ | 21,180 | $ | 20,543 | |||||
| Core PPNR | Quarter Ended | |||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | |||||||||||
| Net Income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | ||||||
| Add: Income Tax Expense | 3,853 | 4,644 | 4,802 | 3,963 | 4,365 | |||||||||||
| Add: Provision for Credit Losses | 3,014 | 3,988 | 4,650 | 4,081 | 2,246 | |||||||||||
| Add: Provision for (Release of) Credit Losses on Unfunded Commitments | 205 | (29 | ) | 217 | — | — | ||||||||||
| Deduct: Income from the Call of Brokered Time Deposits | — | — | (4,618 | ) | — | — | ||||||||||
| Add: Merger-Related Expenses | — | — | 697 | 1,398 | 1,266 | |||||||||||
| Add: Non-Recurring Equity and Debt Investment Write-Down | — | — | — | — | — | |||||||||||
| Core PPNR | $ | 19,090 | $ | 23,640 | $ | 20,813 | $ | 22,578 | $ | 21,809 | ||||||
| Allowance for Credit Losses to Total Portfolio Loans | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Allowance for Credit Losses | $ | 54,680 | $ | 54,660 | $ | 53,045 | $ | 47,447 | $ | 48,454 | |||||||||
| Total Portfolio Loans | 3,026,431 | 2,959,457 | 2,821,983 | 2,739,808 | 2,678,406 | ||||||||||||||
| Allowance for Credit Losses to Total Portfolio Loans | 1.81 | % | 1.85 | % | 1.88 | % | 1.73 | % | 1.81 | % | |||||||||
| Commercial Bank Allowance for Credit Losses to Commercial Bank Portfolio Loans | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Allowance for Credit Losses | $ | 54,680 | $ | 54,660 | $ | 53,045 | $ | 47,447 | $ | 48,454 | |||||||||
| Less: Credit Card Allowance for Credit Losses | 7,802 | 8,232 | 7,413 | 6,762 | 5,905 | ||||||||||||||
| Commercial Bank Allowance for Credit Losses | $ | 46,878 | $ | 46,428 | $ | 45,632 | $ | 40,685 | $ | 42,549 | |||||||||
| Total Portfolio Loans | 3,026,431 | 2,959,457 | 2,821,983 | 2,739,808 | 2,678,406 | ||||||||||||||
| Less: Gross Credit Card Loans | 131,887 | 137,905 | 130,897 | 126,233 | 115,991 | ||||||||||||||
| Commercial Bank Portfolio Loans | $ | 2,894,544 | $ | 2,821,552 | $ | 2,691,086 | $ | 2,613,575 | $ | 2,562,415 | |||||||||
| Commercial Bank Allowance for Credit Losses to Total Portfolio Loans | 1.62 | % | 1.65 | % | 1.70 | % | 1.56 | % | 1.67 | % | |||||||||
| Nonperforming Assets to Total Assets | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Total Nonperforming Assets | $ | 59,273 | $ | 58,276 | $ | 52,247 | $ | 36,167 | $ | 42,934 | |||||||||
| Total Assets | 3,808,467 | 3,606,207 | 3,389,442 | 3,388,662 | 3,349,805 | ||||||||||||||
| Nonperforming Assets to Total Assets | 1.56 | % | 1.62 | % | 1.54 | % | 1.07 | % | 1.28 | % | |||||||||
| Nonperforming Loans to Total Portfolio Loans | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Total Nonperforming Loans | $ | 55,417 | $ | 54,421 | $ | 52,247 | $ | 36,167 | $ | 42,934 | |||||||||
| Total Portfolio Loans | 3,026,431 | 2,959,457 | 2,821,983 | 2,739,808 | 2,678,406 | ||||||||||||||
| Nonperforming Loans to Total Portfolio Loans | 1.83 | % | 1.84 | % | 1.85 | % | 1.32 | % | 1.60 | % | |||||||||
| Net Charge-Offs to Average Portfolio Loans | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Total Net Charge-Offs | $ | 2,994 | $ | 2,373 | $ | 2,476 | $ | 5,088 | $ | 2,444 | |||||||||
| Total Average Portfolio Loans | 3,008,187 | 2,902,033 | 2,789,815 | 2,733,865 | 2,634,110 | ||||||||||||||
| Net Charge-Offs to Average Portfolio Loans, Annualized | 0.40 | % | 0.32 | % | 0.35 | % | 0.75 | % | 0.38 | % | |||||||||
| Tangible Book Value per Share | Quarter Ended | |||||||||||||
| (in thousands, except share and per share data) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | |||||||||
| Total Stockholders' Equity | $ | 408,859 | $ | 401,757 | $ | 394,770 | $ | 380,035 | $ | 369,577 | ||||
| Less: Intangible Assets | 40,480 | 40,740 | 41,002 | 37,773 | 39,641 | |||||||||
| Tangible Common Equity | $ | 368,379 | $ | 361,017 | $ | 353,768 | $ | 342,262 | $ | 329,936 | ||||
| Period End Shares Outstanding | 16,286,480 | 16,373,288 | 16,589,241 | 16,581,990 | 16,657,168 | |||||||||
| Tangible Book Value per Share | $ | 22.62 | $ | 22.05 | $ | 21.33 | $ | 20.64 | $ | 19.81 | ||||
| Return on Average Tangible Common Equity | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Net Income | $ | 12,018 | $ | 15,037 | $ | 15,065 | $ | 13,136 | $ | 13,932 | |||||||||
| Add: Intangible Amortization, Net of Tax | 197 | 200 | 199 | 200 | 199 | ||||||||||||||
| Net Tangible Income | $ | 12,215 | $ | 15,237 | $ | 15,264 | $ | 13,336 | $ | 14,131 | |||||||||
| Average Equity | 405,302 | 391,750 | 383,922 | 371,795 | 363,115 | ||||||||||||||
| Less: Average Intangible Assets | 40,628 | 40,884 | 37,706 | 39,534 | 36,896 | ||||||||||||||
| Net Average Tangible Common Equity | $ | 364,674 | $ | 350,866 | $ | 346,216 | $ | 332,261 | $ | 326,219 | |||||||||
| Return on Average Equity | 12.03 | % | 15.23 | % | 15.57 | % | 14.17 | % | 15.56 | % | |||||||||
| Return on Average Tangible Common Equity | 13.58 | % | 17.23 | % | 17.49 | % | 16.10 | % | 17.57 | % | |||||||||
| Core Return on Average Tangible Common Equity | Quarter Ended | ||||||||||||||||||
| (in thousands) | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | ||||||||||||||
| Core Net Income | $ | 12,018 | $ | 15,037 | $ | 12,151 | $ | 14,206 | $ | 14,896 | |||||||||
| Add: Intangible Amortization, Net of Tax | 197 | 200 | 199 | 200 | 199 | ||||||||||||||
| Core Net Tangible Income | $ | 12,215 | $ | 15,237 | $ | 12,350 | $ | 14,406 | $ | 15,095 | |||||||||
| Core Return on Average Tangible Common Equity | 13.58 | % | 17.23 | % | 14.15 | % | 17.39 | % | 18.77 | % | |||||||||
ABOUT CAPITAL BANCORP, INC.
Capital Bancorp, Inc., Rockville, Maryland is a registered bank holding company incorporated under the laws of Maryland. Capital Bancorp has been providing financial services since 1999 and now operates bank branches in four locations in the Washington, D.C., Baltimore, other Maryland markets, one bank branch in Fort Lauderdale, Florida, one bank branch in Chicago, Illinois and one bank branch in Raleigh, North Carolina. Capital Bancorp had assets of approximately $3.8 billion at March 31, 2026 and its common stock is traded in the NASDAQ Global Market under the symbol "CBNK." More information can be found at the Company's website www.CapitalBankMD.com under its investor relations page.
FORWARD-LOOKING STATEMENTS
This earnings release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management'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," "optimistic," "intends" and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements. Accordingly, we caution you that any such forward-looking statements are not a guarantee of future performance and that actual results may prove to be materially different from the results expressed or implied by the forward-looking statements due to a number of factors. For details on some of the factors that could affect these expectations, see risk factors and other cautionary language included in the Company's Annual Report on Form 10-K and other periodic and current reports filed with the Securities and Exchange Commission.
While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ materially from those contained or implied in the forward-looking statements: the strength of the United States ("U.S.") economy in general and the strength of the local economies in
which we conduct operations; geopolitical concerns, including acts or threats of terrorism and the ongoing wars in Israel, Iran and Ukraine; uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market, and monetary fluctuations; volatility and disruptions in global capital and credit markets; changes in U.S. trade policies, including the implementation of tariffs and other protectionist trade policies; the effects of federal government shutdowns, debt ceiling standoff, or other fiscal policy uncertainty; competitive pressures on product pricing and services; success, impact, and timing of our business strategies, including market acceptance of any new products or services; the impact of changes in financial services policies, laws, and regulations, including those concerning taxes, banking, securities, and insurance, and the application thereof by regulatory bodies; cybersecurity threats and the cost of defending against them; climate change, and other catastrophic disasters; the effectiveness of the Company's internal control over financial reporting and disclosure controls and procedures; the Company's ability to remediate the material weakness in the Company's internal control over financial reporting; the effect of the IFH acquisition or any other acquisitions we have made or may make, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target into our operations, including the planned growth of Windsor Advantage™; and other factors that may affect our future results.
These forward-looking statements are made as of the date of this communication, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by law.
FINANCIAL CONTACT: Jake Dalaya (301) 637-5118
MEDIA CONTACT: Ed Barry (240) 283-1912
WEB SITE: www.CapitalBankMD.com
