CBB Bancorp, Inc. ("CBB" or the "Company”) (OTCQX: CBBI), the holding company of Commonwealth Business Bank, doing business as “CBB Bank” (the "Bank"), announced today net income of $4.9 million for the second quarter 2026, or $0.46 per diluted share down from $5.7 million in the first quarter 2026, or $0.53 per diluted share. The decrease in net income for the current quarter was primarily due to higher noninterest expense and lower noninterest income, partially offset by higher net interest income.
Second Quarter 2026 Highlights
- Return on Assets of 1.00%
- Net income of $4.9 million, or $0.46 per diluted share
- Loan originations of $152.0 million
- SBA loan sales of $37.1 million at an average premium of 8.2%
Seungho Park, President and CEO, said, “We delivered solid second quarter results while continuing to execute on our strategic growth initiatives. The opening of our new branch in Flushing, New York, represents another important step in expanding CBB’s presence in attractive markets and strengthening our ability to serve existing and new customers, especially customers in non-Korean ethnic markets. During the quarter, our team generated the highest level of loan originations in four years and continued to produce meaningful gains from the sale of the guaranteed portions of SBA loans. At the same time, we remain focused on disciplined balance sheet management, including reducing deposit costs, which contributed to an improvement in our net interest margin. We believe these results reflect the strength of our franchise, the dedication of our employees, and our continued focus on profitable and relationship-driven growth.”
INCOME STATEMENT
Net Interest Income
Net interest income for the second quarter 2026 was $15.4 million, an increase of $538 thousand, or 3.6% from the prior quarter and $323 thousand, or 2.1% from the second quarter 2025. The net interest margin for the second quarter 2026 was 3.22%, up from 3.13% for the first quarter of 2026, but down from 3.46% for the second quarter of 2025. The increase in net interest margin from the prior quarter was primarily attributable to the decrease in costs on interest-bearing deposits outpacing the decrease in yields on interest earning assets and having one more day in the quarter.
The overall cost of funds for the second quarter of 2026 was 3.16%, down from 3.25% for the first quarter of 2026 and 3.29% for the second quarter of 2025.
Provision for Credit Losses
The Company recorded a total provision for credit losses of $500 thousand for the second quarter of 2026, essentially equal to the first quarter of 2026 and slightly lower than the $590 thousand in the second quarter of 2025. The provision to increase the allowance for credit losses (“ACL”) was primarily attributable to one specific credit, while improved asset quality metrics offset the impact of portfolio growth during the current quarter. The ACL to total loans ratio decreased one basis point to 1.19% from the prior quarter.
Noninterest Income
Noninterest income for the second quarter of 2026 was $3.1 million, down from $3.6 million in the prior quarter, but up from $2.1 million in the same quarter of 2025. The quarter-over-quarter decrease in noninterest income was primarily the result of a lower gain on sales of loans of $521 thousand.
Noninterest Expenses
Noninterest expenses totaled $11.2 million for the second quarter of 2026, up from $10.1 million in the prior quarter and $10.3 million in the second quarter of 2025. Noninterest expense increased by $1.0 million quarter-over-quarter primarily due to higher salaries and employee benefits costs of $793 thousand and other operating expenses of $215 thousand.
The efficiency ratio was 60.55%, up from 54.85% in the prior quarter and 59.99% in the year-ago quarter. The efficiency ratio increase from the prior quarter was primarily due to a higher noninterest expense within the salaries and employee benefits category and lower noninterest income from lower gains on SBA loan sales.
Income Taxes
The Company’s effective tax rate for the second quarter of 2026 was 27.8%, compared to 27.7% for the first quarter of 2026 and 29.8% for the second quarter of 2025.
BALANCE SHEET
Investment Securities
Investment securities were $63.5 million at June 30, 2026, a decrease of $1.2 million, or 1.9%, from March 31, 2026, and a decrease of $2.1 million, or 3.1%, from June 30, 2025. The quarterly decline was mainly driven by scheduled principal paydowns and a strategic decision to limit reinvestment during the period.
Loans Receivable
Loans receivable, including loans held-for-sale, totaled $1.52 billion at June 30, 2026, an increase of $57.3 million, or 3.9%, from the prior quarter and $61.9 million, or 4.2%, from a year earlier. The growth from the previous quarter reflected continued strong loan production, partially offset by loan sales.
The Company’s loan originations remained robust, totaling $152.0 million for the quarter, up from $107.9 million in the prior quarter.
Allowance for Credit Losses and Asset Quality
The ACL was $17.4 million at June 30, 2026, representing 1.19% of loans held-for-investment, compared to $16.9 million, or 1.20%, at March 31, 2026, and $15.5 million, or 1.21%, at June 30, 2025.
Total nonperforming assets at June 30, 2026, were $21.6 million down from $22.7 million at March 31, 2026, but up from $ 17.0 million at June 30, 2025, primarily driven by an increase in nonaccrual loans.
The ACL coverage to nonperforming assets was 80.51% at June 30, 2026, up from 74.19% in the previous quarter, but down from 92.59% in the year-ago quarter.
SBA Loans Held-for-Sale
Total SBA loans held-for-sale were $66.5 million as of June 30, 2026, up from $62.2 million at March 31, 2026, but down from $184.0 million at June 30, 2025.
During the quarter, the Bank sold $37.1 million in SBA loans at an average premium of 8.2%, down from $48.2 million sold at an average premium of 8.0% in the prior quarter, but up from $17.6 million sold at 8.1% average premium in the same quarter of 2025.
Deposits
Total deposits were $1.66 billion at June 30, 2026, a decrease of $23.1 million, or 1.4%, from the prior quarter, but up $138.4 million, or 9.1%, from a year earlier. The decrease was primarily in the MMDA and wholesale deposits.
Borrowings
The Bank had no outstanding borrowings as of June 30, 2026, consistent with the position since the second quarter of 2025.
Capital
Stockholders’ equity was $276.6 million at June 30, 2026, up $3.6 million, or 1.3%, from the prior quarter. Tangible book value per share was $25.91, an increase of $0.34, or 1.3%, quarter-over-quarter.
At quarter-end, Common Equity Tier 1 Risk-Based Capital Ratios were 18.73% for the Company and 18.65% for the Bank. Total Risk-Based Capital Ratios were 19.94% and 19.87%, respectively, and Leverage Ratios were 13.99% for the Company and 13.93% for the Bank. The Bank continues to be classified as “Well Capitalized” under applicable regulatory standards.
About CBB Bancorp, Inc.:
CBB Bancorp, Inc. is the holding company of Commonwealth Business Bank, a full-service commercial bank which specializes in loans to small-to-medium-sized businesses and does business as “CBB Bank.” As of June 30, 2026, the Bank had twelve full-service banking offices in Los Angeles and Orange Counties in California, Dallas County in Texas, Honolulu, Hawaii, Bergen County in New Jersey, and Queens County in New York. Three SBA regional offices in Los Angeles, Dallas, and Bergen Counties, and loan production offices in California, Georgia, Texas, and Virginia. For additional information, please go to under the tab “About Us” and select “Investor Relations” to see the 2Q 2026 Overview.
FORWARD-LOOKING STATEMENTS:
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. CBB Bancorp, Inc. (the “Company”) intends that such forward-looking statements be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described herein are necessarily subject to risks and uncertainties that may cause actual results to differ materially and adversely from those described herein. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that might cause actual results to differ materially from those presented, either expressed or implied, in this news release include, but are not limited to: the Company’s ability to successfully execute its business plans and achieve its objectives; changes in general economic and financial market conditions, either nationally or locally in areas in which the Company conducts its operations; changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; legislation or regulatory changes which adversely affect the Company’s operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies.
The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances, except to the extent required by law.
STATEMENT OF INCOME AND PERFORMANCE HIGHLIGHT (Unaudited) - Table 1 | (Dollars in thousands, except per share amounts) |
Three Months Ended Six Months Ended |
June 30, March 31, $ % June 30, $ % June 30, June 30, $ % |
2026 2026 Change Change 2025 Change Change 2026 2025 Change Change | Interest income $ 28,406 $ 28,164 $ 242 0.9 % $ 27,392 $ 1,014 3.7 % $ 56,570 $ 54,859 $ 1,711 3.1 % | Interest expense
13,036 13,332 (296 ) (2.2 %) 12,345 691 5.6 % 26,368 24,989 1,379 5.5 % | Net interest income
15,370 14,832 538 3.6 % 15,047 323 2.1 % 30,202 29,870 332 1.1 % | Provision for credit losses
500 500 - - 590 (90 ) (15.3 %) 1,000 1,090 (90 ) (8.3 %) | Net interest income after provision for credit losses
14,870 14,332 538 3.8 % 14,457 413 2.9 % 29,202 28,780 422 1.5 % | Gain on sale of loans
1,938 2,459 (521 ) (21.2 %) 900 1,038 115.3 % 4,397 1,921 2,476 128.9 % | Loss on sale of OREO
(96 ) - (96 ) (100.0 %) (67 ) (29 ) (43.3 %) (96 ) (159 ) 63 (39.6 %) | SBA servicing fee income, net
774 702 72 10.3 % 799 (25 ) (3.1 %) 1,476 1,490 (14 ) (0.9 %) | Recovery on impaired servicing liability
- - - - - - - - - - - | Service charges and other income
469 481 (12 ) (2.5 %) 450 19 4.2 % 950 946 4 0.4 % | Noninterest income
3,085 3,642 (557 ) (15.3 %) 2,082 1,003 48.2 % 6,727 4,198 2,529 60.2 % | Salaries and employee benefits
6,655 5,862 793 13.5 % 5,779 876 15.2 % 12,517 11,627 890 7.7 % | Occupancy and equipment
1,326 1,432 (106 ) (7.4 %) 1,293 33 2.6 % 2,758 2,607 151 5.8 % | Marketing expense
418 396 22 5.6 % 404 14 3.5 % 814 619 195 31.5 % | Professional expense
517 399 118 29.6 % 619 (102 ) (16.5 %) 916 1,049 (133 ) (12.7 %) | Other expenses
2,259 2,044 215 10.5 % 2,181 78 3.6 % 4,303 4,607 (304 ) (6.6 %) | Noninterest expense
11,175 10,133 1,042 10.3 % 10,276 899 8.7 % 21,308 20,509 799 3.9 % | Income before income tax provision
6,780 7,841 (1,061 ) (13.5 %) 6,263 517 8.3 % 14,621 12,469 2,152 17.3 % | Income tax provision
1,883 2,171 (288 ) (13.3 %) 1,868 15 0.8 % 4,054 3,621 433 12.0 % | Net income $ 4,897 $ 5,670 $ (773 ) (13.6 %) $ 4,395 $ 502 11.4 % $ 10,567 $ 8,848 $ 1,719 19.4 % | Effective tax rate
27.77 % 27.69 % 0.09 % 0.31 % 29.83 % (2.05 %) (6.9 %) 27.73 % 29.04 % (1.31 %) (4.52 %) | Outstanding number of shares
10,588,136 10,588,136 - - 10,588,136 - - 10,588,136 10,588,136 - - | Weighted average shares for basic EPS
10,588,136 10,588,136 - - 10,588,136 - - 10,588,136 10,588,136 - - | Weighted average shares for diluted EPS
10,617,843 10,613,980 3,863 0.0 % 10,593,497 24,346 0.2 % 10,615,911 10,599,146 16,765 0.2 % | Basic EPS $ 0.46 $ 0.54 $ (0.08 ) (14.8 %) $ 0.42 $ 0.04 9.5 % $ 1.00 $ 0.84 $ 0.16 19.0 % | Diluted EPS $ 0.46 $ 0.53 $ (0.07 ) (13.2 %) $ 0.41 $ 0.05 12.2 % $ 0.99 $ 0.84 $ 0.15 17.9 % | Return on average assets
1.00 % 1.17 % (0.17 %) (14.5 %) 0.98 % 0.02 % 2.0 % 1.09 % 0.99 % 0.10 % 10.1 % | Return on average equity
7.16 % 8.49 % (1.33 %) (15.7 %) 6.76 % 0.40 % 5.9 % 7.82 % 6.89 % 0.93 % 13.5 % | Efficiency ratio
60.55 % 54.85 % 5.70 % 10.4 % 59.99 % 0.56 % 0.9 % 57.70 % 60.20 % (2.50 %) (4.2 %) | Yield on interest-earning assets¹
5.94 % 5.94 % - - 6.28 % (0.34 %) (5.4 %) 5.94 % 6.26 % (0.32 %) (5.1 %) | Cost of funds
3.16 % 3.25 % (0.09 %) (2.8 %) 3.29 % (0.13 %) (4.0 %) 3.21 % 3.31 % (0.10 %) (3.0 %) | Net interest margin¹
3.22 % 3.13 % 0.08 % 2.6 % 3.46 % (0.24 %) (7.0 %) 3.18 % 3.42 % (0.24 %) (7.0 %) | ¹ Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate |
| BALANCE SHEET, CAPITAL AND OTHER DATA (Unaudited) - Table 2 | (Dollars in thousands) | June 30, March 31, $ % June 30, $ % | 2026 2026 Change Change 2025 Change Change | ASSETS | Cash and due from banks $ 12,089 $ 13,776 $ (1,687 ) (12.2 %) $ 11,873 $ 216 1.8 % | Interest-earning deposits at the FRB and other banks
335,457 405,896 (70,439 ) (17.4 %) 235,436 100,021 42.5 % | Investment securities¹
63,455 64,674 (1,219 ) (1.9 %) 65,518 (2,063 ) (3.1 %) | Loans held-for-sale
66,477 62,173 4,304 6.9 % 183,996 (117,519 ) (63.9 %) | Loans held-for-investment
1,457,550 1,404,573 52,977 3.8 % 1,278,106 179,444 14.0 % | Less: Allowance for credit losses ("ACL")
(17,357 ) (16,854 ) (503 ) (3.0 %) (15,461 ) (1,896 ) (12.3 %) | Loans held-for-investment, net 1,440,193 1,387,719 52,474 3.8 % 1,262,645 177,548 14.1 % | Other real estate owned ("OREO") 1,192 5,651 (4,459 ) (78.9 %) 2,999 (1,807 ) (60.3 %) | Restricted stock investments
11,086 11,021 65 0.6 % 11,011 75 0.7 % | Servicing assets
6,935 6,671 264 4.0 % 6,609 326 4.9 % | Goodwill
2,185 2,185 - - 2,185 - - | Intangible assets
159 168 (9 ) (5.4 %) 195 (36 ) (18.5 %) | Other assets
27,075 30,964 (3,889 ) (12.6 %) 32,359 (5,284 ) (16.3 %) | Total assets $ 1,966,303 $ 1,990,898 $ (24,595 ) (1.2 %) $ 1,814,826 $ 151,477 8.3 % | LIABILITIES AND STOCKHOLDERS' EQUITY | Noninterest-bearing $ 301,491 $ 309,194 $ (7,703 ) (2.5 %) $ 309,160 $ (7,669 ) (2.5 %) | Interest-bearing
1,361,866 1,377,261 (15,395 ) (1.1 %) 1,215,760 146,106 12.0 % | Total deposits
1,663,357 1,686,455 (23,098 ) (1.4 %) 1,524,920 138,437 9.1 % | FHLB advances and other borrowing
- - - - - - - | Other liabilities
26,316 31,380 (5,064 ) (16.1 %) 27,972 (1,656 ) (5.9 %) | Total liabilities
1,689,673 1,717,835 (28,162 ) (1.6 %) 1,552,892 136,781 8.8 % | Stockholders' Equity
276,630 273,063 3,567 1.3 % 261,934 14,696 5.6 % | TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,966,303 $ 1,990,898 $ (24,595 ) (1.2 %) $ 1,814,826 $ 151,477 8.3 % | CAPITAL RATIOS | Leverage ratio | Company
13.99 % 13.78 % 0.21 % 1.5 % 14.48 % (0.49 %) (3.4 %) | Bank
13.93 % 13.76 % 0.17 % 1.2 % 14.45 % (0.51 %) (3.6 %) | Common equity tier 1 risk-based capital ratio | Company
18.73 % 19.24 % (0.51 %) (2.7 %) 18.98 % (0.25 %) (1.3 %) | Bank
18.65 % 19.22 % (0.57 %) (3.0 %) 18.94 % (0.28 %) (1.5 %) | Tier 1 risk-based capital ratio | Company
18.73 % 19.24 % (0.51 %) (2.7 %) 18.98 % (0.25 %) (1.3 %) | Bank
18.65 % 19.22 % (0.57 %) (3.0 %) 18.94 % (0.28 %) (1.5 %) | Total risk-based capital ratio | Company
19.94 % 20.47 % (0.53 %) (2.6 %) 20.13 % (0.19 %) (0.9 %) | Bank
19.87 % 20.45 % (0.58 %) (2.9 %) 20.09 % (0.22 %) (1.1 %) | Tangible book value per share $ 25.91 $ 25.57 $ 0.34 1.3 % $ 24.51 $ 1.40 5.7 % | Loans Held for Investments-to-Deposit ("LHFITD") ratio
87.63 % 83.29 % 4.34 % 5.2 % 83.81 % 3.82 % 4.6 % | Net Loan-to-Deposit ("LTD") ratio
90.58 % 85.97 % 4.61 % 5.4 % 94.87 % (4.29 %) (4.5 %) | Nonperforming assets $ 21,559 $ 22,717 $ (1,158 ) (5.1 %) $ 16,699 $ 4,860 29.1 % | Nonperforming assets as a % of loans held-for-investment
1.48 % 1.62 % (0.14 %) (8.6 %) 1.31 % 0.17 % 13.0 % | ACL as a % of loans held-for-investment
1.19 % 1.20 % (0.01 %) (0.8 %) 1.21 % (0.02 %) (1.7 %) | ¹ Includes AFS and HTM |
FIVE-QUARTER STATEMENT OF INCOME (Unaudited) - Table 3 | (Dollars in thousands, except per share amounts) |
Three Months Ended |
June 30, March 31, December 31, September 30, June 30, |
2026 2026 2025 2025 2025 | Interest income $ 28,406 $ 28,164 $ 29,869 $ 28,338 $ 27,392 | Interest expense
13,036 13,332 14,211 12,608 12,345 | Net interest income
15,370 14,832 15,658 15,730 15,047 | Provision for credit losses
500 500 300 470 590 | Net interest income after provision for credit losses
14,870 14,332 15,358 15,260 14,457 | Gain on sale of loans
1,938 2,459 802 648 900 | Gain (loss) on sale of OREO
(96 ) - - 29 (67 ) | SBA servicing fee income, net
774 702 587 705 799 | Recovery on impaired servicing liability
- - - - - | Service charges and other income
469 481 428 469 450 | Noninterest income
3,085 3,642 1,817 1,851 2,082 | Salaries and employee benefits
6,655 5,862 6,478 5,849 5,779 | Occupancy and equipment
1,326 1,432 1,400 1,378 1,293 | Marketing expense
418 396 380 397 404 | Professional expense
517 399 519 699 619 | Other expenses
2,259 2,044 2,255 2,485 2,181 | Noninterest expense
11,175 10,133 11,032 10,808 10,276 | Income before income tax expense
6,780 7,841 6,143 6,303 6,263 | Income tax expense
1,883 2,171 1,641 1,758 1,868 | Net income $ 4,897 $ 5,670 $ 4,502 $ 4,545 $ 4,395 | Effective tax rate
27.8 % 27.7 % 26.7 % 27.9 % 29.8 % | Outstanding number of shares
10,588,136 10,588,136 10,588,136 10,588,136 10,588,136 | Weighted average shares for basic EPS
10,588,136 10,588,136 10,588,136 10,588,136 10,588,136 | Weighted average shares for diluted EPS
10,617,843 10,613,980 10,602,538 10,600,724 10,593,497 | Basic EPS $ 0.46 $ 0.54 $ 0.42 $ 0.43 $ 0.42 | Diluted EPS $ 0.46 $ 0.53 $ 0.42 $ 0.43 $ 0.42 |
| FIVE-QUARTER SALARIES BENEFIT METRICS (Unaudited) - Table 4 | (Dollars in thousands) | At or for the Three Months Ended | June 30, March 31, December 31, September 30, June 30, | 2026 2026 2025 2025 2025 | Salaries and benefits $ 6,655 $ 5,862 $ 6,478 $ 5,849 $ 5,779 | FTE at the end of period
178 172 174 171 163 | Average FTE during the period
175 174 170 168 166 | Salaries and benefits/average FTE¹ $ 152 $ 137 $ 151 $ 138 $ 140 | Salaries and benefits/average assets¹
1.36 % 1.18 % 1.28 % 1.27 % 1.29 % | Noninterest expense/average assets¹
2.29 % 2.05 % 2.18 % 2.34 % 2.30 % | 1 Annualized |
FIVE-QUARTER BALANCE SHEET (Unaudited) - Table 5 | (Dollars in thousands) |
June 30, March 31, December 31, September 30, June 30, |
2026 2026 2025 2025 2025 | ASSETS | Cash and due from banks $ 12,089 $ 13,776 $ 10,265 $ 25,597 $ 11,873 | Interest-earning deposits at the FRB and other banks
335,457 405,896 426,000 385,282 235,436 | Investment securities
63,455 64,674 65,730 67,459 65,518 | Loans held-for-sale
66,477 62,173 65,419 175,158 183,996 | Loans held-for-investment
1,457,550 1,404,573 1,397,420 1,272,474 1,278,106 | Less: Allowance for credit losses
(17,357 ) (16,854 ) (16,345 ) (16,151 ) (15,461 ) | Loans held-for-investment, net
1,440,193 1,387,719 1,381,075 1,256,323 1,262,645 | Other real estate owned
1,192 5,651 5,651 297 2,999 | Restricted stock investments
11,086 11,021 11,011 11,011 11,011 | Servicing assets
6,935 6,671 6,141 6,342 6,609 | Goodwill
2,185 2,185 2,185 2,185 2,185 | Intangible assets
159 168 176 186 195 | Other assets
27,075 30,964 33,373 32,602 32,359 | Total assets $ 1,966,303 $ 1,990,898 $ 2,007,026 $ 1,962,442 $ 1,814,826 | LIABILITIES AND STOCKHOLDERS' EQUITY | Noninterest-bearing $ 301,491 $ 309,194 $ 301,775 $ 280,351 $ 309,160 | Interest-bearing
1,361,866 1,377,261 1,405,552 1,385,920 1,215,760 | Total deposits
1,663,357 1,686,455 1,707,327 1,666,271 1,524,920 | FHLB advances
- - - - - | Other liabilities
26,316 31,380 30,950 30,649 27,972 | Total liabilities
1,689,673 1,717,835 1,738,277 1,696,920 1,552,892 | Stockholders' Equity
276,630 273,063 268,749 265,522 261,934 | TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,966,303 $ 1,990,898 $ 2,007,026 $ 1,962,442 $ 1,814,826 |
| FIVE-QUARTER LOANS RECEIVABLE COMPONENTS (Unaudited) - Table 6 | (Dollars in thousands) | June 30, 2026March 31, 2026December 31, 2025September 30, 2025June 30, 2025 | Balance%Balance%Balance%Balance%Balance% | Construction $ 19,396 1.3 % $ 21,063 1.5 % $ 18,566 1.3 % $ 36,480 2.9 % $ 33,952 2.7 % | Commercial real estate
1,265,931 86.9 % 1,209,647 86.1 % 1,204,652 86.2 % 1,088,603 85.6 % 1,091,180 85.4 % | Commercial and industrial
135,376 9.3 % 135,286 9.6 % 134,306 9.6 % 103,276 8.1 % 108,461 8.5 % | Home mortgage
29,606 2.0 % 31,247 2.2 % 32,188 2.3 % 36,522 2.9 % 36,673 2.9 % | Consumer
3,893 0.3 % 3,803 0.3 % 4,174 0.3 % 3,548 0.3 % 3,527 0.3 % | Gross loans held-for-investment
1,454,202 99.8 % 1,401,046 99.7 % 1,393,886 99.7 % 1,268,429 99.7 % 1,273,793 99.7 % | Deferred loan fees/costs, net
3,348 0.2 % 3,527 0.3 % 3,534 0.3 % 4,045 0.3 % 4,313 0.3 % | Loans held-for-investment $ 1,457,550 100.0 % $ 1,404,573 100.0 % $ 1,397,420 100.0 % $ 1,272,474 100.0 % $ 1,278,106 100.0 % | Loans held-for-sale $ 66,477 $ 62,173 $ 65,419 $ 175,158 $ 183,996 | Total loans receivable $ 1,524,027 $ 1,466,746 $ 1,462,839 $ 1,447,632 $ 1,462,102 |
FIVE-QUARTER SBA LOAN PRODUCTIONS/SALES DATA (Unaudited) - Table 7 | (Dollars in thousands) |
Three Months Ended Six Months Ended |
June 30, March 31, December 31, September 30, June 30, June 30, June 30, | 2026 2026 2025 2025 2025 2026 2025 | SBA loans held-for-sale at beginning of the quarter/year $ 62,173 $ 65,419 $ 175,158 $ 183,996 $ 194,542 $ 65,419 $ 198,448 | SBA loans originated/transferred from/to held-for-investment during the quarter/year
42,126 46,078 (77,847 ) 19,835 20,135 88,204 43,913 | SBA loans sold during the quarter/year
(37,131 ) (48,199 ) (19,702 ) (14,539 ) (17,580 ) (85,330 ) (37,333 ) | SBA loans principal paydown/payoff, net of advance
(691 ) (1,125 ) (12,190 ) (14,134 ) (13,101 ) (1,816 ) (21,032 ) | SBA loans held-for-sale at end of the quarter/year $ 66,477 $ 62,173 $ 65,419 $ 175,158 $ 183,996 $ 66,477 $ 183,996 | Gain on sale of SBA loans $ 1,938 $ 2,459 $ 802 $ 648 $ 900 $ 4,397 $ 1,921 | Premium on sale (weighted average)
8.2 % 8.0 % 6.8 % 7.1 % 8.1 % 8.1 % 8.1 % | SBA loan production $ 53,013 $ 63,226 $ 12,952 $ 22,228 $ 28,860 $ 116,239 $ 60,894 |
| FIVE QUARTER SBA SERVICING ASSETS AND SERVICING FEES (Unaudited) - Table 8 | (Dollars in thousands) | Three Months Ended Six Months Ended | June 30, March 31, December 31, September 30, June 30, June 30, June 30, | 2026 2026 2025 2025 2025 2026 2025 | SBA servicing assets @ beginning of the quarter/year $ 6,671 $ 6,141 $ 6,342 $ 6,609 $ 6,708 $ 6,141 $ 6,909 | Newly added SBA servicing assets from SBA loans sold
754 1019 405 268 355 1,773 716 | Regular quarterly/annual servicing assets amortization
(290 ) (270 ) (279 ) (288 ) (299 ) (560 ) (604 ) | SBA servicing assets amortized from SBA loans paid off/charged off
(200 ) (219 ) (327 ) (247 ) (155 ) (419 ) (412 ) | Subtotal before impairment 6,935 6,671 6,141 6,342 6,609 6,935 6,609 | Reversal of valuation allowance on servicing assets
- - - - - - - | SBA servicing assets @ the end of the quarter/year $ 6,935 $ 6,671 $ 6,141 $ 6,342 $ 6,609 $ 6,935 $ 6,609 |
FIVE-QUARTER DEPOSIT COMPONENTS (Unaudited) - Table 9 | (Dollars in thousands) |
June 30, 2026 March 31, 2026 December 31, 2025 September 30, 2025 June 30, 2025 |
Balance % Balance % Balance % Balance % Balance % | Noninterest-bearing demand $ 301,491 18.1 % $ 309,194 18.3 % $ 301,775 17.7 % $ 280,351 16.8 % $ 309,160 20.3 % | Interest-bearing demand
7,537 0.5 % 6,362 0.4 % 5,813 0.3 % 5,745 0.3 % 10,698 0.7 % | NOW & MMDA
280,223 16.8 % 291,265 17.3 % 310,147 18.2 % 305,649 18.4 % 274,578 18.0 % | Savings
92,440 5.6 % 92,238 5.5 % 87,036 5.1 % 83,368 5.0 % 85,609 5.6 % | TCDs of $250K and under
436,083 26.2 % 435,372 25.8 % 433,873 25.4 % 419,821 25.2 % 319,209 20.9 % | TCDs of $250K over
485,582 29.2 % 467,016 27.7 % 473,025 27.7 % 471,048 28.3 % 403,676 26.5 % | Wholesale deposits
60,001 3.6 % 85,008 5.0 % 95,658 5.6 % 100,289 6.0 % 121,990 8.0 % | Total Deposits $ 1,663,357 100.0 % $ 1,686,455 100.0 % $ 1,707,327 100.0 % $ 1,666,271 100.0 % $ 1,524,920 100.0 % | Recap: | Noninterest-bearing demand $ 301,491 18.1 % $ 309,194 18.3 % $ 301,775 17.7 % $ 280,351 16.8 % $ 309,160 20.3 % | Interest-bearing demand
7,537 0.5 % 6,362 0.4 % 5,813 0.3 % 5,745 0.3 % 10,698 0.7 % | NOW & MMDA
280,223 16.8 % 291,265 17.3 % 310,147 18.2 % 305,649 18.4 % 274,578 18.0 % | Savings
92,440 5.6 % 92,238 5.5 % 87,036 5.1 % 83,368 5.0 % 85,609 5.6 % | TCDs of $250K and under
436,083 26.2 % 435,372 25.8 % 433,873 25.4 % 419,821 25.2 % 319,209 20.9 % | Core Deposits
1,117,774 67.2 % 1,134,431 67.3 % 1,138,644 66.7 % 1,094,934 65.7 % 999,254 65.5 % | TCDs of $250K over
485,582 29.2 % 467,016 27.7 % 473,025 27.7 % 471,048 28.3 % 403,676 26.5 % | Nonreciprocal ICS MMDA
- - - - - - - - - - | Wholesale deposits
60,001 3.6 % 85,008 5.0 % 95,658 5.6 % 100,289 6.0 % 121,990 8.0 % | Noncore Deposits
545,583 32.8 % 552,024 32.7 % 568,683 33.3 % 571,337 34.3 % 525,666 34.5 % | Total Deposits $ 1,663,357 100.0 % $ 1,686,455 100.0 % $ 1,707,327 100.0 % $ 1,666,271 100.0 % $ 1,524,920 100.0 % |
| FIVE-QUARTER SELECTED LOAN AND ASSET QUALITY HIGHLIGHTS (Unaudited) - Table 10 | (Dollars in thousands) | 2nd Qtr. 1st Qtr. 4th Qtr. 3rd Qtr. 2nd Qtr. | 2026 2026 2025 2025 2025 | Allowance for Credit Losses | Balance at beginning of period $ 16,854 $ 16,345 $ 16,151 $ 15,461 $ 14,850 | Provision for credit losses
500 500 210 500 590 | Charge-offs
- (1 ) (27 ) - (143 ) | Recoveries
3 10 11 190 164 | Balance at the end of period $ 17,357 $ 16,854 $ 16,345 $ 16,151 $ 15,461 | Nonperforming Assets:¹ | Over 90 days still accruing $ - $ - $ - $ 1,237 $ 1,487 | Nonaccrual loans
20,367 17,066 15,960 14,865 12,213 | Total nonperforming loans
20,367 17,066 15,960 16,102 13,700 | Other real estate owned $ 1,192 5,651 5,651 297 2,999 | Total nonperforming assets $ 21,559 $ 22,717 $ 21,611 $ 16,399 $ 16,699 | Classified Assets:¹ | Substandard $ 29,868 $ 23,147 $ 29,666 $ 31,465 $ 30,442 | Doubtful
- - - - - | Loss
- - - - - | Total classified loans $ 29,868 $ 23,147 $ 29,666 $ 31,465 $ 30,442 | Other real estate owned $ 1,192 5,651 5,651 297 2,999 | Total classified assets $ 31,060 $ 28,798 $ 35,317 $ 31,762 $ 33,441 | Performing modified loans:¹ $ - $ - $ 1,176 $ 160 $ 160 | Delinquent Loans:¹ | Loans 30-89 days past due $ 8,056 $ 11,078 $ 7,563 $ 7,478 $ 11,548 | 90 days or more past due and still accruing
- - - 1,237 1,487 | Nonaccrual
20,367 17,066 15,960 14,865 12,213 | Total delinquent loans $ 28,423 $ 28,144 $ 23,523 $ 23,580 $ 25,248 | Asset Quality Ratios: | Net (recoveries) charge-offs to average loans²
0.00 % 0.00 % 0.00 % (0.05 %) (0.01 %) | Nonaccrual loans to loans held-for-investment
1.40 % 1.22 % 1.14 % 1.17 % 0.96 % | Nonperforming loans to loans held-for-investment
1.40 % 1.22 % 1.14 % 1.27 % 1.07 % | Nonperforming assets to total assets
1.10 % 1.14 % 1.08 % 0.84 % 0.92 % | Classified loans to loans held-for-investment
2.05 % 1.65 % 2.12 % 2.47 % 2.38 % | Classified loans to Tier 1 and ACL
10.24 % 8.05 % 10.49 % 11.27 % 11.07 % | Classified assets to total assets
1.58 % 1.45 % 1.76 % 1.62 % 1.84 % | Classified assets to Tier 1 and ACL
10.65 % 10.01 % 12.49 % 11.37 % 12.16 % | ACL to loans held-for-investment
1.19 % 1.20 % 1.17 % 1.27 % 1.21 % | ACL to nonaccrual loans
85.22 % 98.76 % 102.41 % 108.65 % 126.59 % | ACL to nonperforming loans
85.22 % 98.76 % 102.41 % 100.30 % 112.85 % | ACL to nonperforming assets
80.51 % 74.19 % 75.63 % 98.49 % 92.59 % | Texas ratio ³
7.39 % 7.90 % 7.64 % 5.87 % 6.07 % | 1 Net of SBA guaranteed balance | 2 Includes loans held-for-sale | 3 Nonperforming assets divided by tangible common equity and ACL |
| FIVE-QUARTER CAPITAL RATIOS (Unaudited) - Table 11 | Well Capitalized Adequately Capitalized June 30, March 31, December 31, September 30, June 30, | Regulatory BASEL III | Requirement Fully Phased In 2026 2026 2025 2025 2025 | Leverage ratio | Company N/A N/A 13.99 % 13.78 % 13.25 % 14.34 % 14.48 % | Bank 5.00% 4.00% 13.93 % 13.76 % 13.23 % 14.32 % 14.45 % | Common equity tier 1 risk-based capital ratio | Company N/A N/A 18.73 % 19.24 % 19.03 % 19.26 % 18.98 % | Bank 6.50% 7.00% 18.65 % 19.22 % 19.01 % 19.22 % 18.94 % | Tier 1 risk-based capital ratio | Company N/A N/A 18.73 % 19.24 % 19.03 % 19.26 % 18.98 % | Bank 8.00% 8.50% 18.65 % 19.22 % 19.01 % 19.22 % 18.94 % | Total risk-based capital ratio | Company N/A N/A 19.94 % 20.47 % 20.22 % 20.46 % 20.13 % | Bank 10.00% 10.50% 19.87 % 20.45 % 20.20 % 20.42 % 20.09 % | Tangible common equity/total assets
13.97 % 13.61 % 13.29 % 13.43 % 14.32 % | Tangible common equity per share $ 25.91 $ 25.57 $ 25.16 $ 24.85 $ 24.51 |
| FIVE-QUARTER MARGIN ANALYSIS (Unaudited) -Table 12 | (Dollars in thousands) | Three Months Ended | June 30, 2026March 31, 2026December 31, 2025September 30, 2025June 30, 2025 | Avg BalanceInterestYieldAvg BalanceInterestYieldAvg BalanceInterestYieldAvg BalanceInterestYieldAvg BalanceInterestYield | Number of Days in the Period | INTEREST-EARNING ASSETS | Loans Receivable¹ $ 1,501,200 $ 24,318 6.50 % $ 1,482,057 $ 23,778 6.51 % $ 1,475,995 $ 24,828 6.67 % $ 1,463,183 $ 24,653 6.68 % $ 1,461,584 $ 24,171 6.63 % | Investment securities ²
64,176 653 4.08 % 65,507 657 4.07 % 65,279 676 4.10 % 66,623 707 4.21 % 64,990 686 4.23 % | Interest-earning deposits at the FRB and other banks
346,082 3,193 3.70 % 366,481 3,343 3.70 % 420,854 4,213 3.97 % 254,301 2,826 4.41 % 214,514 2,383 4.46 % | Other earning assets
11,075 293 10.61 % 11,016 434 15.98 % 11,011 202 7.28 % 11,011 201 7.24 % 11,011 200 7.29 % | Total interest-earning assets ²
1,922,533 28,457 5.94 % 1,925,061 28,212 5.94 % 1,973,139 29,919 6.02 % 1,795,118 28,387 6.27 % 1,752,099 27,440 6.28 % | NONINTEREST-EARNING ASSETS | Cash and due from banks
11,796 10,909 11,799 14,221 11,512 | Other noninterest-earning assets
42,660 44,918 40,927 40,578 44,078 | Total noninterest-earning assets
54,456 55,827 52,726 54,799 55,590 | Less: Allowance for credit losses
(16,938 ) (16,355 ) (16,152 ) (15,577 ) (14,899 ) | TOTAL ASSETS $ 1,960,051 $ 1,964,533 $ 2,009,713 $ 1,834,340 $ 1,792,790 | INTEREST-BEARING DEPOSITS | Interest-bearing demand $ 9,636 $ 5 0.20 % $ 9,415 $ 5 0.20 % $ 9,432 $ 4 0.20 % $ 9,682 $ 5 0.20 % $ 9,957 $ 5 0.20 % | Money market
280,759 2,460 3.51 % 286,298 2,451 3.47 % 324,316 2,990 3.66 % 282,010 2,699 3.80 % 263,197 2,540 3.87 % | Savings
90,272 686 3.05 % 87,429 653 3.03 % 83,166 644 3.07 % 84,339 653 3.07 % 83,261 633 3.05 % | Time deposits
971,648 9,885 4.08 % 998,868 10,223 4.15 % 998,575 10,573 4.20 % 863,224 9,251 4.25 % 847,092 9,159 4.34 % | Total interest-bearing deposits
1,352,315 13,036 3.87 % 1,382,010 13,332 3.91 % 1,415,489 14,211 3.98 % 1,239,255 12,608 4.04 % 1,203,507 12,337 4.11 % | Borrowings
1 - 0.0 % - - - 2 - 0.0 % - - - 4,122 8 0.78 % | Total interest-bearing liabilities
1,352,316 13,036 3.87 % 1,382,010 13,332 3.91 % 1,415,491 14,211 3.98 % 1,239,255 12,608 4.04 % 1,207,629 12,345 4.10 % | Noninterest-bearing deposits
301,938 279,851 294,726 301,776 296,496 | Other liabilities
31,484 31,922 32,412 29,249 28,026 | Stockholders' equity
274,313 270,750 267,084 264,060 260,639 | TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,960,051 $ 1,964,533 $ 2,009,713 $ 1,834,340 $ 1,792,790 | Net interest income² $ 15,421 $ 14,880 $ 15,708 $ 15,779 $ 15,095 | Net interest spread 2.07 % 2.03 % 2.04 % 2.23 % 2.18 % | Effect of noninterest-bearing sources 1.15 % 1.10 % 1.12 % 1.26 % 1.28 % | Net interest margin² 3.22 % 3.13 % 3.16 % 3.49 % 3.46 % | Cost of deposits $ 1,654,253 $ 13,036 3.16 % $ 1,661,861 $ 13,332 3.25 % $ 1,710,215 $ 14,211 3.30 % $ 1,541,031 $ 12,608 3.25 % $ 1,500,003 $ 12,337 3.30 % | Cost of funds $ 1,654,254 $ 13,036 3.16 % $ 1,661,861 $ 13,332 3.25 % $ 1,710,217 $ 14,211 3.30 % $ 1,541,031 $ 12,608 3.25 % $ 1,504,125 $ 12,345 3.29 % | ¹ Loan held-for-investment, plus loans held-for-sale | ² Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate |
| FIVE-QUARTER COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 13 | (Dollars in thousands) | Three Months Ended | June 30, 2026March 31,2026December 31, 2025September 30, 2025June 30, 2025 | AmountYieldAmountYieldAmountYieldAmountYieldAmountYield | Contractual yield $ 23,678 6.33 % $ 23,193 6.35 % $ 24,154 6.49 % $ 24,171 6.55 % $ 23,731 6.51 % | SBA discount accretion
697 0.19 % 636 0.17 % 883 0.24 % 728 0.20 % 588 0.16 % | Prepayment penalties and late fees
33 0.01 % 96 0.03 % 50 0.01 % 51 0.01 % 53 0.01 % | Amortization of net deferred costs
(90 ) (0.03 %) (147 ) (0.04 %) (259 ) (0.07 %) (297 ) (0.08 %) (201 ) (0.05 %) | As reported yield on loans $ 24,318 6.50 % $ 23,778 6.51 % $ 24,828 6.67 % $ 24,653 6.68 % $ 24,171 6.63 % |
| MARGIN ANALYSIS (Unaudited) - Table 14 | (Dollars in thousands) | Six Months Ended | June 30, 2026June 30, 2025 | Avg BalanceInterestYieldAvg BalanceInterestYield | Number of Days in the Period | INTEREST-EARNING ASSETS | Loans Receivable ¹ $ 1,491,681 $ 48,096 6.50 % $ 1,449,780 $ 47,789 6.65 % | Investment securities ²
64,838 1,310 4.07 % 63,469 1,353 4.30 % | Interest-earning deposits at the FRB and other banks
356,225 6,536 3.70 % 244,844 5,412 4.46 % | Other earning assets
11,046 727 13.27 % 11,011 403 7.38 % | Total interest-earning assets ²
1,923,790 56,669 5.94 % 1,769,104 54,957 6.26 % | NONINTEREST-EARNING ASSETS | Cash and due from banks
11,355 11,784 | Other noninterest-earning assets
43,783 42,701 | Total noninterest-earning assets
55,138 54,485 | Less: Allowance for credit losses
(16,648 ) (15,232 ) | TOTAL ASSETS $ 1,962,280 $ 1,808,357 | INTEREST-BEARING DEPOSITS | Interest-bearing demand $ 9,527 $ 10 0.20 % $ 9,790 $ 10 0.20 % | Money market
283,513 4,911 3.49 % 264,435 5,095 3.89 % | Savings
88,859 1,339 3.04 % 83,618 1,271 3.07 % | Time deposits
985,182 20,108 4.12 % 838,927 18,490 4.44 % | Total interest-bearing deposits
1,367,081 26,368 3.89 % 1,196,770 24,866 4.19 % | Borrowings
1 - 0.00 % 26,382 123 0.94 % | Total interest-bearing liabilities
1,367,082 26,368 3.89 % 1,223,152 24,989 4.12 % | Noninterest-bearing deposits
290,955 297,532 | Other liabilities
31,701 28,603 | Stockholders' equity
272,542 259,070 | TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 1,962,280 $ 1,808,357 | Net interest income² $ 30,301 $ 29,968 | Net interest spread 2.05 % 2.14 % | Effect of noninterest-bearing sources 1.13 % 1.28 % | Net interest margin² 3.18 % 3.42 % | Cost of deposits $ 1,658,036 $ 26,368 3.21 % $ 1,494,302 $ 24,866 3.36 % | Cost of funds $ 1,658,037 $ 26,368 3.21 % $ 1,520,684 $ 24,989 3.31 % | ¹ Loan held-for-investment, plus loans held-for-sale | ² Amounts calculated on a fully taxable equivalent basis using the current statutory federal tax rate |
| COMPONENTS OF YIELD ON LOANS (Unaudited) - Table 15 | (Dollars in thousands) | Six Months Ended | June 30, 2026June 30, 2025 | AmountYieldAmountYield | Contractual yield $ 46,871 6.34 % $ 46,597 6.48 % | SBA discount accretion
1,333 0.18 % 1,369 0.19 % | Prepayment penalties and late fees
129 0.02 % 189 0.03 % | Amortization of net deferred costs
(237 ) (0.04 %) (366 ) (0.05 %) | As reported yield on loans $ 48,096 6.50 % $ 47,789 6.65 % |
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