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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30,
2025
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission File Number:
001-39165
BLUE RIDGE BANKSHARES, INC.
(Exact name of registrant as specified in its charter)
Virginia
54-1838100
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
1801 Bayberry Court, Suite 101
Richmond
,
Virginia
23226
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code: (
888
)
331-6521
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock, no par value
BRBS
NYSE
American
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes
☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☐
Accelerated filer
☒
Non-accelerated filer
☐
Smaller reporting company
☒
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
☒
As of October 31, 2025, the registra
nt had
91,488,661
sha
res of common stock, no par value per share, outstanding.
(Dollars in thousands except share and per share data)
September 30, 2025
December 31, 2024 (1)
ASSETS
Cash and due from banks
$
121,032
$
173,533
Restricted cash
—
2,459
Federal funds sold
7,773
838
Securities available for sale, at fair value
341,354
312,035
Restricted equity investments
18,988
19,275
Other equity investments
4,853
4,834
Other investments
20,804
19,405
Loans held for sale
12,819
30,976
Loans held for investment, net of deferred fees and costs
1,912,726
2,111,797
Less: allowance for credit losses
(
20,503
)
(
23,023
)
Loans held for investment, net
1,892,223
2,088,774
Accrued interest receivable
11,012
12,537
Premises and equipment, net
21,087
21,394
Right-of-use asset
6,927
7,962
Other intangible assets
2,941
3,859
Deferred tax asset, net
24,171
27,312
Other assets
10,965
12,067
Total assets
$
2,496,949
$
2,737,260
LIABILITIES & STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand
$
411,100
$
452,690
Interest-bearing demand and money market
621,268
598,875
Savings
100,300
100,857
Time
818,411
1,027,020
Total deposits
1,951,079
2,179,442
FHLB borrowings
150,000
150,000
Subordinated notes, net
14,731
39,789
Lease liabilities
7,580
8,613
Other liabilities
18,054
31,628
Total liabilities
2,141,444
2,409,472
Commitments and contingencies (Note 7)
Stockholders’ Equity:
Common stock,
no
par value;
150,000,000
shares authorized at September 30, 2025 and December 31, 2024, respectively; and
91,636,533
and
84,972,610
shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively
333,356
322,791
Additional paid-in capital
29,687
29,687
Retained earnings
24,237
17,772
Accumulated other comprehensive loss, net of tax
(
31,775
)
(
42,462
)
Total stockholders’ equity
355,505
327,788
Total liabilities and stockholders’ equity
$
2,496,949
$
2,737,260
(1)
Derived from audited
December 31, 2024
Consolidated Financial Statements.
See accompanying notes to unaudited consolidated financial statements.
3
Blue Ridge Bankshares, Inc.
Consolidated Stat
ements of Operations
(unaudited)
For the three months ended
For the nine months ended
(Dollars in thousands, except per share data)
September 30, 2025
September 30, 2024
September 30, 2025
September 30, 2024
INTEREST INCOME
Interest and fees on loans
$
32,000
$
34,747
$
93,884
$
109,289
Interest on securities, deposit accounts, and federal funds sold
4,213
4,478
12,415
13,098
Total interest income
36,213
39,225
106,299
122,387
INTEREST EXPENSE
Interest on deposits
12,501
16,984
39,495
52,741
Interest on subordinated notes
338
566
1,720
1,678
Interest on FHLB and FRB borrowings
1,463
2,574
4,342
8,433
Total interest expense
14,302
20,124
45,557
62,852
Net interest income
21,911
19,101
60,742
59,535
Recovery of credit losses - loans
(
1,800
)
(
6,000
)
(
2,500
)
(
2,400
)
Recovery of credit losses - unfunded commitments
—
(
200
)
—
(
1,700
)
Total recovery of credit losses
(
1,800
)
(
6,200
)
(
2,500
)
(
4,100
)
Net interest income after recovery of credit losses
23,711
25,301
63,242
63,635
NONINTEREST INCOME
Fair value adjustments of other equity investments
163
160
8
(
8,384
)
Residential mortgage banking income
5
2,746
847
8,214
Mortgage servicing rights ("MSRs")
(
48
)
(
2,915
)
(
185
)
(
166
)
Income (loss) on sale of MSRs
737
(
1,011
)
1,026
(
1,011
)
Wealth and trust management
458
730
1,321
1,873
Service charges on deposit accounts
725
376
1,903
1,123
Increase in cash surrender value of bank owned life insurance
9
127
25
797
Bank and purchase card, net
567
690
1,760
1,445
Loss on sale of securities available for sale
—
—
—
(
67
)
Swap transaction fees
258
—
258
—
Other
959
1,795
3,186
6,934
Total noninterest income
3,833
2,698
10,149
10,758
NONINTEREST EXPENSE
Salaries and employee benefits
11,388
13,938
36,998
44,918
Occupancy and equipment
1,190
1,394
3,700
4,221
Technology and communication
2,314
2,767
7,663
7,378
Legal and regulatory filings
1,008
614
1,842
1,424
Advertising and marketing
267
222
586
702
Audit fees
161
498
1,198
1,948
FDIC insurance
239
1,130
2,363
4,324
Intangible amortization
223
265
701
828
Other contractual services
645
1,634
1,673
5,299
Other taxes and assessments
895
759
2,771
2,290
Regulatory remediation
—
357
—
4,398
Other
1,711
2,876
5,506
10,469
Total noninterest expense
20,041
26,454
65,001
88,199
Income (loss) before income tax expense
7,503
1,545
8,390
(
13,806
)
Income tax expense (benefit)
1,900
599
1,925
(
424
)
Net income (loss)
$
5,603
$
946
$
6,465
$
(
13,382
)
Basic and diluted income (loss) per common share
$
0.06
$
0.01
$
0.07
$
(
0.34
)
See accompanying notes to unaudited consolidated financial statements.
4
Blue Ridge Bankshares, Inc.
Consolidated Statements
of Comprehensive Income (Loss)
(unaudited)
For the three months ended
For the nine months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
September 30, 2025
September 30, 2024
Net income (loss)
$
5,603
$
946
$
6,465
$
(
13,382
)
Other comprehensive income:
Gross unrealized gains on securities available for sale arising during the period
8,901
12,803
14,083
13,814
Deferred income tax expense
(
1,986
)
(
2,803
)
(
3,396
)
(
3,293
)
Reclassification of net loss on securities available for sale included in net loss
—
—
—
67
Deferred income tax benefit
—
—
—
(
15
)
Other comprehensive income, net of tax
6,915
10,000
10,687
10,573
Comprehensive net income (loss)
$
12,518
$
10,946
$
17,152
$
(
2,809
)
See accompanying notes to unaudited consolidated financial statements.
5
Blue Ridge Bankshares, Inc.
Consolidated Statements
of Changes in Stockholders’ Equity
(unaudited)
For the nine months ended September 30, 2025
(Dollars in thousands)
Shares of Common Stock
Common Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss) Income, net
Total
Balance at beginning of period
84,972,610
$
322,791
$
29,687
$
17,772
$
(
42,462
)
$
327,788
Net income
—
—
—
6,465
—
6,465
Other comprehensive income
—
—
—
—
10,687
10,687
Exercises of warrants to purchase common stock
3,903,000
9,758
—
—
—
9,758
Repurchases of common stock
(
659,949
)
(
2,767
)
—
—
—
(
2,767
)
Restricted stock awards, net of forfeitures
3,420,872
3,574
—
—
—
3,574
Balance at end of period
91,636,533
$
333,356
$
29,687
$
24,237
$
(
31,775
)
$
355,505
For the three months ended September 30, 2025
(Dollars in thousands)
Shares of Common Stock
Common Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss) Income, net
Total
Balance at beginning of period
92,174,530
$
334,634
$
29,687
$
18,634
$
(
38,690
)
$
344,265
Net income
—
—
—
5,603
—
5,603
Other comprehensive income
—
—
—
—
6,915
6,915
Exercises of warrants to purchase common stock
125,000
313
—
—
—
313
Repurchases of common stock
(
659,949
)
(
2,767
)
—
—
—
(
2,767
)
Restricted stock awards, net of forfeitures
(
3,048
)
1,176
—
—
—
1,176
Balance at end of period
91,636,533
$
333,356
$
29,687
$
24,237
$
(
31,775
)
$
355,505
6
For the nine months ended September 30, 2024
(Dollars in thousands)
Shares of Common Stock
Shares of Series C Preferred Stock
Common Stock
Series C Preferred Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss) Income, net
Total
Balance at beginning of period
19,198,379
—
$
197,636
$
—
$
252
$
33,157
$
(
45,056
)
$
185,989
Net loss
—
—
—
—
—
(
13,382
)
—
(
13,382
)
Other comprehensive income
—
—
—
—
—
—
10,573
10,573
Issuance of stock and warrants from Private Placements, net of issuance costs
53,922,000
2,732
102,108
137
49,903
—
—
152,148
Restricted stock awards, net of forfeitures
353,768
—
1,019
—
—
—
—
1,019
Balance at end of period
73,474,147
2,732
$
300,763
$
137
$
50,155
$
19,775
$
(
34,483
)
$
336,347
For the three months ended September 30, 2024
(Dollars in thousands)
Shares of Common Stock
Shares of Series C Preferred Stock
Common Stock
Series C Preferred Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive (Loss) Income, net
Total
Balance at beginning of period
73,503,647
2,732
$
300,976
$
137
$
50,155
$
18,829
$
(
44,483
)
$
325,614
Net income
—
—
—
—
—
946
—
946
Other comprehensive income
—
—
—
—
—
—
10,000
10,000
Issuance costs from Private Placements
—
—
(
326
)
—
—
—
—
(
326
)
Restricted stock awards, net of forfeitures
(
29,500
)
—
113
—
—
—
—
113
Balance at end of period
73,474,147
2,732
$
300,763
$
137
$
50,155
$
19,775
$
(
34,483
)
$
336,347
See accompanying notes to unaudited consolidated financial statements.
7
Blue Ridge Bankshares, Inc.
Consolidated Statem
ents of Cash Flows
(unaudited)
For the nine months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
Cash Flows From Operating Activities
Net income (loss)
$
6,465
$
(
13,382
)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization
1,028
1,171
Deferred income tax expense
3,396
3,308
Recovery of credit losses - loans
(
2,500
)
(
2,400
)
Recovery of credit losses - unfunded commitments
—
(
1,700
)
Accretion of fair value adjustments on acquired loans, time deposits, and subordinated notes
(
1,518
)
(
1,238
)
Fair value adjustments of other equity investments
(
8
)
8,384
Net adjustments attributable to MSRs
185
166
(Income) loss on sale of MSRs
(
1,026
)
1,011
Realized loss on sale of securities available for sale
—
67
Increase in cash surrender value of bank owned life insurance
(
25
)
(
797
)
Proceeds from sale of other loans held for sale
—
25,250
Proceeds from sale of mortgage loans held for sale
42,370
183,868
Mortgage loans held for sale, originated
(
34,168
)
(
177,632
)
Gain on sale of mortgage loans
(
532
)
(
1,469
)
Proceeds from sale of guaranteed government loans held for sale
—
1,626
Guaranteed government loans held for sale, originated
—
(
293
)
Gain on sale of guaranteed government loans
—
(
102
)
Loss (gain) on disposal of premises and equipment, other investments, other assets, and other real estate owned
256
(
252
)
Investment amortization expense, net
179
409
Amortization of subordinated debt issuance costs
189
26
Intangible amortization
701
828
Decrease in accrued interest receivable
1,525
1,796
Decrease in other assets
11,587
86
Decrease in other liabilities
(
14,607
)
(
16,932
)
Cash provided by operating activities
13,497
11,799
Cash Flows From Investing Activities
Purchase of securities available for sale
(
34,509
)
—
Proceeds from calls, sales, paydowns, and maturities of securities available for sale
19,446
19,770
Net (increase) decrease in federal funds sold
(
6,935
)
1,541
Proceeds from sale of premises and equipment, other investments, other assets, MSRs, and other real estate owned
1,132
18,252
Capital calls of SBIC funds and other investments
(
1,886
)
(
2,684
)
Nonincome distributions from limited liability companies
503
717
Net decrease in loans held for investment
200,462
236,445
Proceeds from surrender of bank owned life insurance policies
212
34,297
Net change in restricted equity and other investments
260
(
2,832
)
Purchase of premises and equipment
(
852
)
(
454
)
Cash provided by investing activities
177,833
305,052
Cash Flows From Financing Activities
Net decrease in demand, savings, and other interest-bearing deposits
(
19,754
)
(
361,678
)
Net (decrease) increase in time deposits
(
208,527
)
142,386
FHLB advances
—
726,000
FHLB repayments
—
(
746,000
)
FRB repayments
—
(
65,000
)
Subordinated note repayments
(
25,000
)
—
Proceeds from Private Placements, net of issuance costs
—
152,148
Repurchases of common stock
(
2,767
)
—
Exercises of warrants to purchase common stock
9,758
—
Cash used in financing activities
(
246,290
)
(
152,144
)
Net (decrease) increase in cash and due from banks
(
54,960
)
164,707
Cash and due from banks and restricted cash at beginning of period
175,992
121,151
Cash and due from banks and restricted cash at end of period
$
121,032
$
285,858
Supplemental Schedule of Cash Flow Information
Cash paid for:
Interest
$
48,517
$
64,704
Income taxes
$
2,920
$
—
Non-cash investing and financing activities:
Loans held for investment transferred to other non-real estate owned
$
222
$
—
Unrealized gains on securities available for sale
$
14,083
$
13,814
Restricted stock awards, net of forfeitures
$
3,574
$
1,019
See accompanying notes to unaudited consolidated financial statements.
8
Notes to Consolidated Financial Statements (Unaudited)
Note 1 – Organization and Basis of Presentation
Blue Ridge Bankshares, Inc. (the “Company”) conducts its business activities primarily through its wholly-owned subsidiary bank, Blue Ridge Bank, National Association (the “Bank”) and its wealth and trust management subsidiary, BRB Financial Group, Inc. (the “Financial Group”). The Company exists primarily for the purposes of holding the stock of its subsidiaries, the Bank and the Financial Group.
The accompanying unaudited consolidated financial statements of the Company include the accounts of the Bank and the Financial Group and were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and general practices within the banking industry. All significant intercompany balances and transactions have been eliminated in consolidation. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).
The Company's significant accounting policies are disclosed in Note 2 of the audited financial statements for the year ended December 31, 2024 included in the 2024 Form 10-K. There have been no significant changes to the application of significant accounting policies since December 31, 2024.
Certain amounts presented in the consolidated financial statements of prior periods have been reclassified to conform to current year presentations. The reclassifications had no effect on net income, net income per share, total assets, total liabilities, or stockholders’ equity as previously reported.
Share Repurchase Program
On August 25, 2025, the Company announced the adoption of a share repurchase program (the “Repurchase Program”) pursuant to which the Company may purchase up to $
15.0
million of the Company’s common stock.
Repurchases may be made in open market purchases, block trades, or privately negotiated transactions, including upon the exercise of outstanding warrants to purchase common stock. The Company cannot predict when or if it will repurchase additional shares of common stock as the Repurchase Program will depend on a number of factors, including constraints specified in any Securities and Exchange Commission Rule 10b5-1 trading plans, price, and general business and market conditions.
During the three months ended September 30, 2025, the Company repurchased
659,949
shares of common stock at a weighted average price of $
4.16
per share totaling $
2.8
million.
For additional information regarding the Repurchase Program, see Part II, Item 2 of this Form 10-Q.
Sale of Mortgage Division
On March 27, 2025, the Company completed the previously announced sale of its mortgage division operating as Monarch Mortgage. The sale, which included the transfer of certain assets and leases to an unrelated mortgage company, resulted in a $
0.2
million loss, reported in other noninterest income.
This transaction did not meet the criteria for classification as a discontinued operation under Accounting Standards Codification ("ASC") 205-20, Presentation of Financial Statements – Discontinued Operations, and is therefore reported within continuing operations as of and for all periods stated herein.
Private Placements
In the second quarter of 2024, the Company closed private placements in which it issued and sold shares of its common and preferred stock for gross proceeds of $
161.6
million (collectively, the "Private Placements"). In June 2024, the Company’s shareholders approved an amendment to the Company's articles of incorporation authorizing the issuance of additional shares of common stock, thus enabling the conversion of the preferred shares issued in the Private Placements into shares of th
e Company’s common stock. The
conversion occurred on June 28, 2024 and November 7, 2024. Capital proceeds received, net of issuance costs, from the Private Placements totaled $
152.1
million. The Private Placements also included the issuance of warrants to purchase common stock at $
2.50
per share.
9
The table below presents information pertaining to warrants to purchase the Company’s common stock as of and for the period stated.
As of and for the nine months ended September 30, 2025
Warrants Issued April 3, 2024
Warrants Issued June 13, 2024
Total Warrants
Warrants outstanding at beginning of period
29,027,999
2,424,000
31,451,999
Warrants exercised during the period (1)
(
3,903,000
)
—
(
3,903,000
)
Warrants outstanding at end of period
25,124,999
2,424,000
27,548,999
Remaining exercise term (years)
3.51
3.70
(1) Warrants to purchase
125,000
shares of common stock were exercised during the three months ended September 30, 2025.
Regulatory Matters
The Bank entered into a consent order with the Office of the Comptroller of the Currency (the "OCC") on January 24, 2024 (the "Consent Order"), which generally incorporates the provisions of the formal written agreement (the "Written Agreement") entered into between the Bank and the OCC on August 29, 2022, as well as adding new provisions. The Written Agreement principally concerned the Bank’s fintech operations and required the Bank to continue enhancing its controls for assessing and managing the third-party, Bank Secrecy Act/Anti-Money Laundering, and information technology risks stemming from its fintech partnerships and adds time frames by which certain of the directives are required. The Consent Order also requires the Bank to maintain a leverage ratio of
10.0
% and a total capital ratio of
13.0
%, referred to as minimum capital ratios. As of
September 30, 2025 and December 31, 2024, the Bank’s capital ratios exceeded these minimum capital ratios. The Company believes it has made significant progress towards meeting the requirements of the Consent Order. Complete copies of the Written Agreement and the Consent Order are included as Exhibits 10.9 and 10.10, respectively, to the 2024 Form 10-K.
Recent Accounting Pronouncements (Issued But Not Adopted)
Improvements to Income Tax Disclosures
. In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-09–Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of disaggregated income taxes paid, prescribes standard categories for components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. This standard was effective for annual periods beginning after December 15, 2024, with early adoption permitted. The ASU requires prospective application by providing the revised disclosures for the period ending December 31, 2025, and continuing to provide the pre-ASU disclosures for the prior periods, or alternately applying the amendments retrospectively by providing the revised disclosures for all periods presented. The Company does not expect the adoption of this ASU to have a material effect on its consolidated financial statements but will result in expanded income tax-related disclosures beginning with its 2025 Form 10-K.
Improvements to Expense Disaggregation Disclosures.
In January 2025, the FASB issued ASU 2025-01–Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which amended the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements but will result in expanded income statement expense disaggregation disclosures beginning with its financial statements for the year ending December 31, 2027.
10
Note 2 – In
vestment Securities and Other Investments
Investment securities classified as available for sale ("AFS") are carried at fair value in the consolidated balance sheets.
The following tables present amortized cost, fair values, and gross unrealized gains and losses of investment securities AFS as of the dates stated.
September 30, 2025
(Dollars in thousands)
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Available for sale
Mortgage backed securities
$
219,457
$
406
$
(
27,369
)
$
192,494
U.S. Treasury and agencies
78,905
—
(
6,866
)
72,039
State and municipal
49,352
1
(
5,060
)
44,293
Corporate bonds
34,738
67
(
2,277
)
32,528
Total investment securities
$
382,452
$
474
$
(
41,572
)
$
341,354
December 31, 2024
(Dollars in thousands)
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Fair
Value
Available for sale
Mortgage backed securities
$
199,453
$
—
$
(
35,015
)
$
164,438
U.S. Treasury and agencies
79,430
—
(
9,975
)
69,455
State and municipal
50,233
—
(
7,296
)
42,937
Corporate bonds
38,453
—
(
3,248
)
35,205
Total investment securities
$
367,569
$
—
$
(
55,534
)
$
312,035
As of September 30, 2025 and December 31, 2024
, securities with a fair value of $
176.6
million and $
268.9
million, respectively, were pledged to secure the Bank’s borrowings facility with the Federal Home Loan Bank of Atlanta ("FHLB").
As of September 30, 2025 and December 31, 2024
, securities with fair values of $
0
and $
16.3
million, respectively, were pledged to secure borrowing capacity with the Federal Reserve Bank of Richmond ("FRB") Discount Window.
The following table presents the amortized cost and fair value of securities available for sale by contractual maturity as of the date stated. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
September 30, 2025
(Dollars in thousands)
Amortized
Cost
Fair
Value
Due in one year or less
$
9,890
$
9,721
Due after one year through five years
60,979
57,503
Due after five years through ten years
95,584
85,934
Due after ten years
215,999
188,196
Total
$
382,452
$
341,354
The following tables present fair values and gross unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates stated.
The
reference point for determining when securities are in an unrealized loss position is period-end; therefore, it is possible that a security's market value exceeded its amortized cost on other days during the past twelve-month period. Excluded from the tables below were securities whose amortized cost equaled their fair value or were in an unrealized gain position as
11
of
the dates stated totaling
$
39.4
million and $
1.1
million as of
September 30, 2025 and December 31, 2024, respectively.
September 30, 2025
Less than 12 Months
12 Months or Greater
Total
(Dollars in thousands)
Number of Securities
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Mortgage backed securities
82
$
11,218
$
(
9
)
$
149,494
$
(
27,360
)
$
160,712
$
(
27,369
)
U.S. Treasury and agencies
29
—
—
72,039
(
6,866
)
72,039
(
6,866
)
State and municipal
56
—
—
41,417
(
5,060
)
41,417
(
5,060
)
Corporate bonds
33
1,298
(
100
)
26,448
(
2,177
)
27,746
(
2,277
)
Total
200
$
12,516
$
(
109
)
$
289,398
$
(
41,463
)
$
301,914
$
(
41,572
)
December 31, 2024
Less than 12 Months
12 Months or Greater
Total
(Dollars in thousands)
Number of Securities
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Fair
Value
Unrealized
Losses
Mortgage backed securities
85
$
11,637
$
(
107
)
$
152,802
$
(
34,908
)
$
164,439
$
(
35,015
)
U.S. Treasury and agencies
29
—
—
69,453
(
9,975
)
69,453
(
9,975
)
State and municipal
70
2,040
(
42
)
40,531
(
7,254
)
42,571
(
7,296
)
Corporate bonds
42
3,803
(
21
)
30,653
(
3,227
)
34,456
(
3,248
)
Total
226
$
17,480
$
(
170
)
$
293,439
$
(
55,364
)
$
310,919
$
(
55,534
)
At September 30, 2025 and December 31, 2024
, the majority of securities in an unrealized loss position were of investment grade; however, a portion of the portfolio does not have a third-party investment grade available (securities with fair values of $
24.2
million and $
29.3
million, respectively). These securities were primarily subordinated debt instruments issued by bank holding companies that are classified as corporate bonds in the tables above. The Company evaluated the issuers of these individually, observing that each issuer had strong capital ratios and profitability, thereby indicating limited exposure to asset quality or liquidity issues and resulted in no identifiable credit losses. Contractual cash flows for mortgage backed securities and U.S. Treasury and agencies are guaranteed and/or funded by the U.S. government and government agencies. State and municipal securities showed no indication that the contractual cash flows would not be received when due. The Company does not intend to sell, nor does it believe that it will be required to sell, any of its impaired securities prior to the recovery of the amortized cost. As of
September 30, 2025 and December 31, 2024, there was no allowance for credit losses ("ACL") for the Company's securities AFS portfolio. Any impairment that has not been recorded through an ACL is recognized in accumulated other comprehensive income (loss).
Restricted equity investments consiste
d of stock in the FHLB (carrying value of $
9.1
million and $
9.4
million as of
September 30, 2025 and December 31, 2024, respectively), FRB stock (carrying value of
$
9.4
million
at both September 30, 2025 and December 31, 2024), and stock in the Company’s correspondent bank (carrying value of
$
0.5
million at
both September 30, 2025 and December 31, 2024). Restricted equity investments are carried at cost.
The Company has various other equity investments, including an investment in a fintech company and limited partnerships, totaling $
4.9
mi
llion and
$
4.8
million as of September 30, 2025 and December 31, 2024, respectively.
The Company also holds other investments, primarily in early-stage focused investment funds, which totaled
$
20.8
million an
d $
19.4
million as of
September 30, 2025 and December 31, 2024, respectively, and
are reported in other investments on the consolidated balance sheets.
12
Note 3 – Loan
s and ACL
The following table presents the amortized cost of loans held for investment as of the dates stated.
(Dollars in thousands)
September 30, 2025
December 31, 2024
Commercial and industrial
$
276,609
$
354,904
Real estate – construction, commercial
73,473
114,491
Real estate – construction, residential
50,892
51,807
Real estate – commercial
818,101
847,842
Real estate – residential
654,030
692,253
Real estate – farmland
4,645
5,520
Consumer
33,778
43,938
Gross loans held for investment
1,911,528
2,110,755
Deferred costs, net of loan fees
1,198
1,042
Total
$
1,912,726
$
2,111,797
The Company has pledged certain commercial and residential mortgage loans as collateral for borrowings with the FHLB. Loans totaling $
736.0
million and $
797.7
million were pledged with the FHLB as of
September 30, 2025 and December 31, 2024, respectively. Additionally, t
he Company has pledged certain construction and commercial and industrial loans totaling $
75.4
million and $
91.6
million as of
September 30, 2025 and December 31, 2024, respectively, as collateral for borrowings with the FRB Discount Window.
The following tables present the aging of the recorded investment of loans held for investment by loan category as of the dates stated.
September 30, 2025
(Dollars in thousands)
Current
Loans
30-59
Days
Past Due
60-89
Days
Past Due
Greater than
90 Days Past
Due &
Accruing
Nonaccrual
Total
Loans
Commercial and industrial
$
263,961
$
1,328
$
1,171
$
1,700
$
8,449
$
276,609
Real estate – construction, commercial
73,237
236
—
—
—
73,473
Real estate – construction, residential
50,738
154
—
—
—
50,892
Real estate – commercial
809,216
303
831
—
7,751
818,101
Real estate – residential
642,241
536
1,351
2,350
7,552
654,030
Real estate – farmland
4,645
—
—
—
—
4,645
Consumer
31,831
995
175
202
575
33,778
Deferred costs, net of loan fees
1,198
—
—
—
—
1,198
Total
$
1,877,067
$
3,552
$
3,528
$
4,252
$
24,327
$
1,912,726
December 31, 2024
(Dollars in thousands)
Current
Loans
30-59
Days
Past Due
60-89
Days
Past Due
Greater than
90 Days Past
Due &
Accruing
Nonaccrual
Total
Loans
Commercial and industrial
$
339,893
$
1,335
$
1,232
$
2,259
$
10,185
$
354,904
Real estate – construction, commercial
114,238
—
33
—
220
114,491
Real estate – construction, residential
51,807
—
—
—
—
51,807
Real estate – commercial
842,982
625
—
—
4,235
847,842
Real estate – residential
680,406
3,874
476
—
7,497
692,253
Real estate – farmland
5,520
—
—
—
—
5,520
Consumer
41,295
1,296
300
227
820
43,938
Deferred costs, net of loan fees
1,042
—
—
—
—
1,042
Total
$
2,077,183
$
7,130
$
2,041
$
2,486
$
22,957
$
2,111,797
13
The following tables present the recorded investment of nonaccrual loans held for investment with and without an ACL by loan category as of the dates stated.
September 30, 2025
(Dollars in thousands)
Nonaccrual Loans with No ACL
Nonaccrual Loans with an ACL
Total Nonaccrual Loans
Commercial and industrial
$
481
$
7,968
$
8,449
Real estate – commercial
5,699
2,052
7,751
Real estate – residential
2,875
4,677
7,552
Consumer
—
575
575
Total
$
9,055
$
15,272
$
24,327
December 31, 2024
(Dollars in thousands)
Nonaccrual Loans with No ACL
Nonaccrual Loans with an ACL
Total Nonaccrual Loans
Commercial and industrial
$
778
$
9,407
$
10,185
Real estate – construction, commercial
—
220
220
Real estate – commercial
—
4,235
4,235
Real estate – residential
1,669
5,828
7,497
Consumer
—
820
820
Total
$
2,447
$
20,510
$
22,957
The Company recognized $
289
thousand and $
437
thousand of interest income on nonaccrual loans during the
three and nine months ended September 30, 2025
, respectively, compared to $
275
thousand and $
463
thousand for the same respective periods in
2024.
The following table presents accrued interest receivable by loan type reversed from interest income associated with loans held for investment that were placed on nonaccrual status for the periods stated.
For the three months ended September 30,
For the nine months ended September 30,
(Dollars in thousands)
2025
2024
2025
2024
Commercial and industrial
$
28
$
165
$
86
$
381
Real estate – construction, commercial
—
35
—
60
Real estate – commercial
27
77
29
175
Real estate – residential
35
52
102
104
Consumer
7
5
14
10
Total
$
97
$
334
$
231
$
730
Credit Quality Indicators
The Company segments loans held for investment into risk categories based on relevant information about the expected ability of borrowers to repay debt, such as current financial information, historical payment performance, experience, collateral adequacy, credit documentation, and current economic trends, among other factors. Management assigns loan risk grades by a numerical system as an indication of credit quality of its portfolio of loans held for investment. The Company uses the following definitions for loan risk ratings and periodically evaluates the appropriateness of these ratings across its loan portfolio. Independent third-party loan reviews are performed periodically on the Company's loan portfolio and such reviews validate management's determination of loan risk grades. Bank regulatory agencies also periodically review the Company's loan portfolio, including loan risk grades and may, on occasion, change a grade based on their judgment of the facts at the time of review.
Risk Grade 1 – Strong:
This grade is for the strongest of loans. These loans are extended to individuals or businesses where the probability of default is extremely low to the Bank and secured with liquid collateral where the loss given default is unlikely because of the source of repayment such as a lien on a deposit account held at the Bank. Character, credit history, and ability of individuals or company principals are excellent. High liquidity, minimum risk, strong ratios, and low servicing cost are present.
Risk Grade 2 – Minimal:
This grade is for loans deemed exceptionally strong. These loans are within established guidelines and where the borrowers have documented significant overall financial strength with consistent and
14
predictable cash flows. These loans have excellent sources of repayment, significant balance sheet liquidity, no significant identifiable risk of collection, and conform in all respects to policy, underwriting standards, and federal and state regulations (no exceptions of any kind). In addition, guarantor support, when provided, is deemed as excellent.
Risk Grade 3 – Acceptable:
This grade is for loans deemed strong. These loans have adequate sources of repayment, with a minimal identifiable risk of collection. Generally, loans assigned this risk grade will demonstrate the following characteristics: (1) conformity in all respects with policy, guidelines, underwriting standards, and federal and state regulations (no exceptions of any kind), (2) documented historical cash flow that meets or exceeds required minimum guidelines, or that can be supplemented with verifiable cash flow from other sources, and (3) adequate secondary sources to liquidate the debt. In addition, guarantor support, when provided, is deemed strong.
Risk Grade 4 – Satisfactory:
This grade is for satisfactory loans containing more but deemed acceptable risk, and where the borrower is deemed as sound. These loans have adequate sources of repayment, with minimal identifiable risk of collection. Loans assigned with this risk grade will demonstrate the following characteristics: (1) general conformity to the Bank's underwriting requirements, with limited exceptions to policy, product, or underwriting guidelines, and all exceptions noted have documented mitigating factors that offset any additional risk associated with the exceptions noted, (2) documented historical cash flow that meets or exceeds required minimum guidelines, or that can be supplemented with verifiable cash flow from other sources, and (3) adequate secondary sources to liquidate the debt. In addition, guarantor support, when provided, is deemed as satisfactory.
Risk Grade 5 – Watch:
This grade is for satisfactory loans containing acceptable but elevated risk. These loans are characterized by borrowers who exhibit signs of financial stress or are experiencing unstable or unfavorable change(s) adversely impacting the current or expected financial condition. The borrower's management is considered to be satisfactory; however, the collateral securing the loan may have decreased in value, the debt service coverage ratio is inconsistent or breakeven but mostly positive, and/or guarantor support, if any, is deemed limited or marginal. Loans classified as Watch warrant additional monitoring by management.
Risk Grade 6 – Special Mention:
This grade is for loans that have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the Bank's credit position potentially at a future date. Special Mention loans are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Special Mention credits typically do not conform to established guidelines and/or exceptions without mitigating factors, or have emerging weaknesses that may or may not be remedied with the passage of time.
Risk Grade 7 – Substandard:
This grade is for loans inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; characterized by the distinct
possibility
that the Bank will sustain some loss if the deficiencies are not corrected. The probability of default is highly likely and may have already occurred
. Loans in this category are characterized by deterioration in quality exhibited by any number of well-defined weaknesses requiring corrective action. The weaknesses may include, but are not limited to: (1) current or expected unprofitable operations, (2) inadequate debt service coverage, (3) declining or inadequate liquidity, (4) improper loan structure, (5) questionable or weak repayment sources, and (6) lack of well-defined secondary repayment source. There is a distinct possibility of loss and the Bank will sustain loss if the deficiencies remain uncorrected.
Risk Grade 8 – Doubtful:
Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values highly questionable and improbable. However, these loans are not yet rated as loss because certain events may occur which would salvage the Bank's position, which can include, but not limited to (1) an injection of capital, (2) alternative financing, and (3) liquidation of assets or the pledging of additional collateral. Doubtful is a temporary grade, where the Bank expects a loss but is presently not quantified with any degree of accuracy. Once the loss position is determined, the amount is recorded and charged off against the ACL.
Risk Grade 9 – Loss:
Loans classified Loss are deemed uncollectible and of such little value that continuance as assets held for investment is no longer warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer charging off the worthless loan, even though partial recovery may occur in the future.
Probable loss amounts, either principal or interest, deemed uncollectible are charged off promptly against the ACL.
The following table presents the recorded investment of loans held for investment by internal loan risk grade by year of origination as of
September 30, 2025. There were no loans classified as doubtful or loss (risk grades 8 and 9,
15
respectively) as of the same date. Also presented are current period gross charge-offs by loan type for the nine months ended September 30, 2025.
Term Loans Recorded Investment Basis by Origination Year
(Dollars in thousands)
2025
2024
2023
2022
2021
Prior
Revolving Loans
Total
Commercial and industrial
Risk Grades 1 - 4
$
17,449
$
8,903
$
11,166
$
45,179
$
10,938
$
23,464
$
98,045
$
215,144
Risk Grades 5 - 6
671
353
1,030
23,518
3,881
4,013
5,046
38,512
Risk Grade 7
—
—
1,804
4,702
12,801
1,879
1,767
22,953
Total
18,120
9,256
14,000
73,399
27,620
29,356
104,858
276,609
Current period gross charge-offs
—
346
368
5,505
12
161
50
6,442
Real estate – construction, commercial
Risk Grades 1 - 4
13,619
5,497
2,191
32,029
3,660
4,332
56
61,384
Risk Grades 5 - 6
176
—
1,078
—
690
10,136
—
12,080
Risk Grade 7
—
—
—
—
9
—
—
9
Total
13,795
5,497
3,269
32,029
4,359
14,468
56
73,473
Current period gross charge-offs
—
—
—
—
—
—
—
—
Real estate – construction, residential
Risk Grades 1 - 4
15,774
10,066
519
75
94
73
300
26,901
Risk Grades 5 - 6
338
—
—
3,186
20,000
—
—
23,524
Risk Grade 7
—
—
—
467
—
—
—
467
Total
16,112
10,066
519
3,728
20,094
73
300
50,892
Current period gross charge-offs
—
—
—
—
—
—
—
—
Real estate – commercial
Risk Grades 1 - 4
40,542
4,554
29,808
200,617
103,935
232,286
17,397
629,139
Risk Grades 5 - 6
—
513
3,368
81,731
8,416
47,878
4,862
146,768
Risk Grade 7
—
1,555
—
31,354
8,566
719
—
42,194
Total
40,542
6,622
33,176
313,702
120,917
280,883
22,259
818,101
Current period gross charge-offs
—
—
—
—
374
63
—
437
Real estate – residential
Risk Grades 1 - 4
4,004
3,062
68,780
210,258
105,871
185,953
54,206
632,134
Risk Grades 5 - 6
805
453
266
781
1,394
5,390
209
9,298
Risk Grade 7
319
—
1,104
3,492
1,264
5,823
596
12,598
Total
5,128
3,515
70,150
214,531
108,529
197,166
55,011
654,030
Current period gross charge-offs
—
—
65
—
—
43
107
215
Real estate – farmland
Risk Grades 1 - 4
—
144
—
990
1,198
1,883
147
4,362
Risk Grades 5 - 6
62
—
126
—
95
—
—
283
Total
62
144
126
990
1,293
1,883
147
4,645
Current period gross charge-offs
—
—
—
—
—
—
—
—
Consumer
Risk Grades 1 - 4
3,714
3,879
11,982
5,900
820
589
5,473
32,357
Risk Grades 5 - 6
—
202
165
199
28
26
—
620
Risk Grade 7
—
43
233
343
137
45
—
801
Total
3,714
4,124
12,380
6,442
985
660
5,473
33,778
Current period gross charge-offs
156
382
191
1,277
53
11
—
2,070
Total Loans
Risk Grades 1 - 4
$
95,102
$
36,105
$
124,446
$
495,048
$
226,516
$
448,580
$
175,624
$
1,601,421
Risk Grades 5 - 6
2,052
1,521
6,033
109,415
34,504
67,443
10,117
231,085
Risk Grade 7
319
1,598
3,141
40,358
22,777
8,466
2,363
79,022
Total
$
97,473
$
39,224
$
133,620
$
644,821
$
283,797
$
524,489
$
188,104
$
1,911,528
Total current period gross charge-offs
$
156
$
728
$
624
$
6,782
$
439
$
278
$
157
$
9,164
16
The following table presents the recorded investment of loans held for investment by internal loan risk grade by year of origination as of December 31, 2024. There were no loans classified as loss (risk grade 9) as of the same date.
Term Loans Recorded Investment Basis by Origination Year
(Dollars in thousands)
2024
2023
2022
2021
2020
Prior
Revolving Loans
Total
Commercial and industrial
Risk Grades 1 - 4
$
13,883
$
13,559
$
64,530
$
14,600
$
17,405
$
15,760
$
98,867
$
238,604
Risk Grades 5 - 6
672
24,430
37,503
10,201
5,183
979
15,092
94,060
Risk Grade 7
944
2,248
5,173
10,462
562
1,247
1,521
22,157
Risk Grade 8
—
—
—
82
—
1
—
83
Total
15,499
40,237
107,206
35,345
23,150
17,987
115,480
354,904
Real estate – construction, commercial
Risk Grades 1 - 4
6,219
6,277
65,560
7,776
5,405
4,792
399
96,428
Risk Grades 5 - 6
—
1,090
—
7,567
4,770
4,235
—
17,662
Risk Grade 7
—
116
—
24
—
261
—
401
Total
6,219
7,483
65,560
15,367
10,175
9,288
399
114,491
Real estate – construction, residential
Risk Grades 1 - 4
19,574
8,861
7,837
13,971
—
57
990
51,290
Risk Grades 5 - 6
193
—
—
—
—
—
—
193
Risk Grade 7
—
169
155
—
—
—
—
324
Total
19,767
9,030
7,992
13,971
—
57
990
51,807
Real estate – commercial
Risk Grades 1 - 4
4,747
34,698
245,563
118,435
142,211
133,856
21,323
700,833
Risk Grades 5 - 6
535
5,092
64,677
7,002
14,604
23,104
4,184
119,198
Risk Grade 7
1,565
—
9,970
10,380
2,945
1,355
25
26,240
Risk Grade 8
—
—
—
1,379
—
192
—
1,571
Total
6,847
39,790
320,210
137,196
159,760
158,507
25,532
847,842
Real estate – residential
Risk Grades 1 - 4
2,815
66,780
225,159
114,682
64,548
143,002
53,498
670,484
Risk Grades 5 - 6
853
—
2,303
1,295
318
2,378
95
7,242
Risk Grade 7
—
736
2,153
2,113
1,454
5,822
2,249
14,527
Total
3,668
67,516
229,615
118,090
66,320
151,202
55,842
692,253
Real estate – farmland
Risk Grades 1 - 4
147
—
997
1,239
—
2,753
149
5,285
Risk Grades 5 - 6
—
135
—
100
—
—
—
235
Total
147
135
997
1,339
—
2,753
149
5,520
Consumer
Risk Grades 1 - 4
5,944
17,211
8,716
1,650
1,034
486
7,283
42,324
Risk Grades 5 - 6
74
133
225
99
32
3
—
566
Risk Grade 7
87
330
332
184
63
24
28
1,048
Total
6,105
17,674
9,273
1,933
1,129
513
7,311
43,938
Total Loans
Risk Grades 1 - 4
$
53,329
$
147,386
$
618,362
$
272,353
$
230,603
$
300,706
$
182,509
$
1,805,248
Risk Grades 5 - 6
2,327
30,880
104,708
26,264
24,907
30,699
19,371
239,156
Risk Grade 7
2,596
3,599
17,783
23,163
5,024
8,709
3,823
64,697
Risk Grade 8
—
—
—
1,461
—
193
—
1,654
Total
$
58,252
$
181,865
$
740,853
$
323,241
$
260,534
$
340,307
$
205,703
$
2,110,755
17
The following tables present an analysis of the change in the ACL by loan segment for the periods stated.
For the three months ended September 30, 2025
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
5,846
$
1,272
$
398
$
5,879
$
8,001
$
15
$
563
$
21,974
(Recovery of) provision for credit losses - loans
(
2,594
)
(
135
)
(
8
)
314
(
304
)
(
1
)
928
(
1,800
)
Charge-offs
(
1,781
)
—
—
(
374
)
(
92
)
—
(
1,035
)
(
3,282
)
Recoveries
3,303
—
—
38
222
—
48
3,611
Net recoveries (charge-offs)
1,522
—
—
(
336
)
130
—
(
987
)
329
ACL, end of period
$
4,774
$
1,137
$
390
$
5,857
$
7,827
$
14
$
504
$
20,503
For the three months ended September 30, 2024
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
6,916
$
3,188
$
737
$
10,262
$
6,240
$
18
$
675
$
28,036
(Recovery of) provision for credit losses - loans
(
6,059
)
(
45
)
(
77
)
(
69
)
(
241
)
1
490
(
6,000
)
Charge-offs
(
6,001
)
—
—
(
1,109
)
(
30
)
—
(
773
)
(
7,913
)
Recoveries
11,095
—
—
—
60
—
175
11,330
Net recoveries (charge-offs)
5,094
—
—
(
1,109
)
30
—
(
598
)
3,417
ACL, end of period
$
5,951
$
3,143
$
660
$
9,084
$
6,029
$
19
$
567
$
25,453
For the nine months ended September 30, 2025
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
5,767
$
2,057
$
540
$
5,963
$
7,933
$
18
$
745
$
23,023
(Recovery of) provision for credit losses - loans
(
2,636
)
(
920
)
(
150
)
(
45
)
(
120
)
(
4
)
1,375
(
2,500
)
Charge-offs
(
6,442
)
—
—
(
437
)
(
215
)
—
(
2,070
)
(
9,164
)
Recoveries
8,085
—
—
376
229
—
454
9,144
Net recoveries (charge-offs)
1,643
—
—
(
61
)
14
—
(
1,616
)
(
20
)
ACL, end of period
$
4,774
$
1,137
$
390
$
5,857
$
7,827
$
14
$
504
$
20,503
For the nine months ended September 30, 2024
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
13,787
$
4,024
$
1,094
$
9,929
$
6,286
$
15
$
758
$
35,893
(Recovery of) provision for credit losses - loans
(
2,351
)
(
881
)
(
395
)
264
(
259
)
4
1,218
(
2,400
)
Charge-offs
(
19,940
)
—
(
39
)
(
1,109
)
(
74
)
—
(
2,063
)
(
23,225
)
Recoveries
14,455
—
—
—
76
—
654
15,185
Net charge-offs
(
5,485
)
—
(
39
)
(
1,109
)
2
—
(
1,409
)
(
8,040
)
ACL, end of period
$
5,951
$
3,143
$
660
$
9,084
$
6,029
$
19
$
567
$
25,453
18
There were no material changes to the assumptions, loss factors (both quantitative and qualitative), or reasonable and supportable forecasts used in the estimation of the ACL and the provision for (recovery of) credit losses for loans held for investment as of and for the three and nine months ended September 30, 2025.
Excluded from the ACL as of both September 30, 2025 and December 31, 2024
were $
9.0
million and $
10.7
million of accrued interest attributable to loans held for investment, respectively, which is included in accrued interest receivable on the consolidated balance sheets.
The following table presents the amortized cost of collateral-dependent loans that were individually evaluated for credit losses as of the dates stated.
(Dollars in thousands)
September 30, 2025
December 31, 2024
Commercial and industrial
$
20,145
$
42,723
Real estate – construction, commercial
—
116
Real estate – commercial
32,879
26,994
Real estate – residential
6,214
9,586
Total collateral-dependent loans
$
59,238
$
79,419
Acquired Loans
As of September 30, 2025 and December 31, 2024
, the amortized cost of purchased credit deteriorated ("PCD") loans totaled $
30.0
million and $
43.8
million, respectively, with an estimated ACL of $
0.2
million and $
0.3
million, respectively. The remaining non-credit discount on PCD loans was $
2.2
million and $
3.0
million as of
September 30, 2025 and December 31, 2024, respectively.
Troubled Loan Modifications
The Company closely monitors the performance of borrowers experiencing financial difficulty and grants certain loan modifications it would otherwise not consider. The Company refers to such loan modifications as troubled loan modifications ("TLMs").
19
The following table presents the amortized cost of loans designated as TLMs, categorized by loan type and type of concession granted, for the periods stated.
For the three months ended September 30,
2025
2024
(Dollars in thousands)
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Combined - term extension and payment deferral
Commercial and industrial
—
$
—
(
—
%)
1
$
229
0.06
%
Total combined - term extension and payment deferral
—
$
—
1
$
229
Combined - term extension, payment deferral, interest rate reduction
Commercial and industrial
—
$
—
(
—
%)
1
$
190
0.05
%
Total combined - term extension, payment deferral, interest rate reduction
—
$
—
1
$
190
Term extension
Commercial and industrial
—
$
—
(
—
%)
2
$
560
0.15
%
Real estate – commercial
3
472
0.06
%
—
—
(
—
%)
Real estate – residential
1
51
0.01
%
1
72
0.01
%
Total term extension
4
$
523
3
$
632
Payment deferral
Real estate – residential
—
$
—
(
—
%)
1
$
504
0.07
%
Consumer loans
—
—
(
—
%)
—
—
(
—
%)
Total payment deferral
—
$
—
1
$
504
Total
4
$
523
6
$
1,555
20
For the nine months ended September 30,
2025
2024
(Dollars in thousands)
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Combined - term extension and payment deferral
Commercial and industrial
—
$
—
(
—
%)
1
$
229
0.06
%
Total combined - term extension and payment deferral
—
$
—
1
$
229
Combined - term extension, payment deferral, interest rate reduction
Commercial and industrial
—
$
—
(
—
%)
2
$
409
0.11
%
Total combined - term extension, payment deferral, interest rate reduction
—
$
—
2
$
409
Interest forgiven
Real estate – residential
1
$
139
0.02
%
—
$
—
(
—
%)
Total interest forgiven
1
$
139
—
$
—
Term extension
Commercial and industrial
1
$
1,940
(
—
%)
2
$
560
0.15
%
Real estate – commercial
3
472
0.06
%
1
38
(
—
%)
Real estate – residential
1
51
0.01
%
1
72
0.01
%
Total term extension
5
$
2,463
4
$
670
Payment deferral
Commercial and industrial
—
$
—
(
—
%)
1
$
161
0.04
%
Real estate – residential
—
—
(
—
%)
1
504
0.07
%
Total payment deferral
—
$
—
2
$
665
Total
6
$
2,602
9
$
1,973
The following tables present additional information including the financial effects of TLMs as of and for the periods stated.
As of and for the three months ended September 30, 2025
(Dollars in thousands)
Weighted Average Term Extension (Months)
Weighted Average Interest Rate Reduction
Weighted Average Payment Deferral
Weighted Average Interest Forgiven
Commercial and industrial
20
—
$
—
$
—
Real estate – commercial
13
—
—
—
Real estate – residential
15
—
—
—
As of and for the three months ended September 30, 2024
(Dollars in thousands)
Weighted Average Term Extension (Months)
Weighted Average Interest Rate Reduction
Weighted Average Payment Deferral
Weighted Average Interest Forgiven
Commercial and industrial
76
12.24
%
$
6
$
—
Real estate – residential
84
—
162
—
Consumer loans
—
—
1
—
21
As of and for the nine months ended September 30, 2025
(Dollars in thousands)
Weighted Average Term Extension (Months)
Weighted Average Interest Rate Reduction
Weighted Average Payment Deferral
Weighted Average Interest Forgiven
Commercial and industrial
20
—
$
—
$
—
Real estate – commercial
13
—
—
—
Real estate – residential
15
—
—
45
As of and for the nine months ended September 30, 2024
(Dollars in thousands)
Weighted Average Term Extension (Months)
Weighted Average Interest Rate Reduction
Weighted Average Payment Deferral
Weighted Average Interest Forgiven
Commercial and industrial
65
11.28
%
$
10
$
—
Real estate – commercial
84
—
—
—
Real estate – residential
84
—
162
—
Consumer loans
—
—
1
—
The following tables present an aging analysis of the amortized cost of loans designated as TLMs as of the dates stated.
September 30, 2025
(Dollars in thousands)
Current
Loans
30-89
Days
Past Due
Greater than
90 Days Past
Due &
Accruing
Nonaccrual
Total
Commercial and industrial
$
939
$
—
$
—
$
4,279
$
5,218
Real estate – construction, residential
—
154
—
—
154
Real estate – commercial
506
—
—
2,999
3,505
Real estate – residential
238
—
—
630
868
Consumer loans
—
—
—
6
6
Total modified loans
$
1,683
$
154
$
—
$
7,914
$
9,751
December 31, 2024
(Dollars in thousands)
Current
Loans
30-89
Days
Past Due
Greater than
90 Days Past
Due &
Accruing
Nonaccrual
Total
Commercial and industrial
$
554
$
—
$
—
$
2,745
$
3,299
Real estate – construction, residential
155
—
—
—
155
Real estate – commercial
37
—
—
2,999
3,036
Real estate – residential
194
—
—
500
694
Consumer loans
—
—
—
10
10
Total modified loans
$
940
$
—
$
—
$
6,254
$
7,194
As of September 30, 2025 and December 31, 2024, there were
no
unfunded c
ommitments to borrowers with TLMs.
22
The following table presents the amortized cost of loans designated as TLMs that were modified in the preceding twelve months and had a payment default during the periods stated.
As of and for the nine months ended September 30,
2025
2024
(Dollars in thousands)
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Number of Loans
Amortized Cost
% of Amortized Cost to Gross Loans by Category
Interest forgiveness
Real estate – residential
1
$
139
0.02
%
—
$
—
0.00
%
Total interest forgiveness
1
$
139
—
$
—
Total
1
$
139
—
$
—
As of September 30, 2025
,
six
residential mortgage loans with a total amortized cost of $
2.7
million were in the process of foreclosure.
Note 4 – Borrowings
FHLB Borrowings
The Bank has a borrowing facility from the FHLB secured by pledged qualifying securities and commercial and residential mortgage loans. The FHLB will lend up to
30
% of the Bank’s total assets as of the prior quarter end, subject to certain eligibility requirements, including adequate collateral. The Bank had borrowings from the FHLB totaling $
150.0
million at both
September 30, 2025 and December 31, 2024. The FHL
B borrowings required the Bank to hold $
9.1
million and $
9.4
million of FHLB stock at September 30, 2025 and December 31, 2024, respectively, which is included in restricted equity investments on the consolidated balance sheets.
At September 30, 2025 and December 31, 2024,
the Bank also had letters of credit outstanding with the FHLB in the amounts of $
41.2
million and $
51.2
million, respectively, of which $
40.0
million and $
50.0
million was for the purpose of collateral for public deposits with the Treasury Board of the Commonwealth of Virginia as of the same respective dates. Outstanding letters of credit reduce the available balance of the borrowing facility with the FHLB.
At September 30, 2025 and December 31, 2024
, the secured facility totaled $
620.9
million and $
696.0
million, respectively, based on pledged collateral.
Available balances on the FHLB credit facility were $
429.7
million and $
494.9
million as of
September 30, 2025 and December 31, 2024, respectively. The decline in the secured capacity of the FHLB borrowing facility as of September 30, 2025 from the prior year end was primarily due to the release of securities held as collateral.
The following table presents information regarding FHLB borrowings outstanding as of both
September 30, 2025 and December 31, 2024.
(Dollars in thousands)
Balance
Origination Date
Stated Interest Rate
Maturity Date
Fixed rate credit
$
50,000
3/15/2023
4.07
%
3/15/2027
Fixed rate credit
50,000
5/2/2023
3.87
%
5/3/2027
Fixed rate credit
50,000
5/4/2023
3.52
%
5/4/2028
Total FHLB borrowings
$
150,000
23
At September 30, 2025
, 1-4 family residential loans, multi-family residential loans, and commercial real estate loans classified as held for investment with a lendable value of $
453.2
million and securities with a lendable value of $
167.7
million were pledged for the borrowing facility with the FHLB.
FRB Borrowings
The Company may obtain advances from the FRB through its Discount Window. Advances through the FRB Discount Window are secured by qualifying pledged construction and commercial and industrial loans. The Company had secured borrowing capacity with the FRB Discount Window of $
75.4
million and $
105.7
million as of
September 30, 2025 and December 31, 2024
, respectively, of which the Company had
no
outstanding advances as of either date.
Other Borrowings
The Company had an unsecured line of credit with a correspondent bank available for overnight borrowing, which totaled
$
10.0
mi
llion as of both September 30, 2025 and December 31, 2024. This line bears interest at the prevailing rates for such loans and is cancelable any time by the correspondent bank. As of both September 30, 2025 and December 31, 2024, the Company had no outstanding advances on this secured line.
Subordinated Notes
The Company had $
14.7
million and $
39.8
million of subordinated notes, net, outstanding as of
September 30, 2025 and December 31, 2024, respectively. Prior to June 1, 2025, the Company's subordinated notes had been comprised of a
$
15
million issuance in May 2020 maturing
June 1, 2030
(the “2030 Note”) and a
$
25
million issuance in October 2019 maturing
October 15, 2029
(the “2029 Notes”).
On
June 1, 2025
,
the Company completed the $
15.0
million redemption of the 2030 Note. The interest rate on the 2030 Note was
6.0
% up to the redemption date. Interest expense on the 2030 Note was $
0
and $
0.2
million for the
three months ended September 30, 2025 and 2024
, respectively, and $
0.4
million and $
0.7
million for the
nine months ended September 30, 2025 and 2024, respectively.
On
July 15, 2025
, the Company completed a $
10.0
million partial redemption of its 2029 Notes. The 2029 Notes bore interest at
5.625
% per annum, through October 14, 2024, payable
semi-annually
in arrears. From Oc
tober 15, 2024 through October 15, 2029, or up to an early redemption date, the interest rate resets quarterly to an interest rate per annum equal to the then current three-month Secured Overnight Funding Rate plus
433.5
basis points,
payable
quarterly in arrears.
As of September 30, 2025
, the 2029 Notes bore an annual interest rate of
8.65
%. As of
September 30, 2025
, the net carrying amount of the 2029 Notes was $
14.7
million, inclusive of a $
0.3
million purchase accounting adjustment (premium
). For the three months ended September 30, 2025 and 2024,
the effective interest rate on the 2029 Notes was
7.49
% a
nd
5.3
1
%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium). For the nine months ended September 30, 2025 and 2024,
the effective interest rate on the 2029 Notes was
7.84
% a
nd
5.21
%, respectively, i
nclusive of the amortization of the purchase accounting adjustment (premium).
Note 5 – Fair
Value
The fair value of a financial instrument is the current amount that would be exchanged between willing parties in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques.
The three levels of input that may be used to measure fair value are as follows:
Level 1 –
Valuation is based on quoted prices in active markets for identical assets and liabilities.
Level 2 –
Valuation is based on observable inputs including quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets and liabilities in less active markets, and model-based valuation techniques for which significant assumptions can be derived primarily from or corroborated by observable data in the market.
Level 3 –
Valuation is based on model-based techniques that use one or more significant inputs or assumptions that are unobservable in the market.
24
The following tables present the balances of financial assets measured at fair value on a recurring basis as of the dates stated.
September 30, 2025
(Dollars in thousands)
Total
Level 1
Level 2
Level 3
Securities available for sale
Mortgage backed securities
$
192,494
$
—
$
192,494
$
—
U.S. Treasury and agencies
72,039
—
72,039
—
State and municipals
44,293
—
44,293
—
Corporate bonds
32,528
—
32,028
500
Total securities available for sale
$
341,354
$
—
$
340,854
$
500
Other assets
MSRs
$
201
$
—
$
—
$
201
Rabbi trust assets
676
676
—
—
Interest rate swap asset
450
—
450
—
Other liabilities
Interest rate swap liability
480
—
480
—
December 31, 2024
(Dollars in thousands)
Total
Level 1
Level 2
Level 3
Securities available for sale
Mortgage backed securities
$
164,438
$
—
$
164,438
$
—
U.S. Treasury and agencies
69,455
—
69,455
—
State and municipals
42,937
—
42,937
—
Corporate bonds
35,205
—
34,455
750
Total securities available for sale
$
312,035
$
—
$
311,285
$
750
Other assets
MSRs
$
386
$
—
$
—
$
386
Rabbi trust assets
600
600
—
—
Mortgage derivative asset
140
—
140
—
Interest rate swap asset
95
—
95
—
Other liabilities
Interest rate swap liability
$
95
$
—
$
95
$
—
The following table presents the change in corporate bonds and MSRs using Level 3 inputs for the periods stated.
(Dollars in thousands)
Corporate
Bonds
MSRs
Balance as of December 31, 2024
$
750
$
386
Called security available for sale
(
250
)
—
Fair value adjustments
—
(
185
)
Balance as of September 30, 2025
$
500
$
201
As of September 30, 2025 and December 31, 2024
, one corporate bond totaling $
0.5
million and two corporate bonds totaling $
0.8
million, respectively, were reported at their respective amortized cost basis and as Level 3 assets in the fair value hierarchy, as there were no observable market prices for similar investments.
25
The following tables summarize assets that were measured at fair value on a nonrecurring basis as of the dates stated.
September 30, 2025
(Dollars in thousands)
Total
Level 1
Level 2
Level 3
Other equity investments
$
4,853
$
—
$
1,847
$
3,006
Collateral-dependent loans
3,053
—
—
3,053
Loans held for sale
12,819
—
12,819
—
Other non-real estate owned (1)
222
—
—
222
(1) Included in other assets on the consolidated balance sheets.
December 31, 2024
(Dollars in thousands)
Total
Level 1
Level 2
Level 3
Other equity investments
$
4,834
$
—
$
1,828
$
3,006
Collateral-dependent loans
6,954
—
—
6,954
Loans held for sale
30,976
—
30,976
—
Other real estate owned ("OREO") (1)
279
—
—
279
(1) Included in other assets on the consolidated balance sheets.
The following tables present quantitative information about Level 3 fair value measurements of assets measured on a nonrecurring basis as of the dates stated.
(Dollars in thousands)
Balance as of September 30, 2025
Unobservable Input
Range
Other equity investments
Probability weighted expected return technique
$
3,006
Discount Rate
20
%
Collateral-dependent loans
Discounted appraised value technique
3,053
Selling Costs
5
%
Other non-real estate owned (1)
Discounted cash flows technique
222
Discount Rate
20
%
(1) Included in other assets on the consolidated balance sheets.
(Dollars in thousands)
Balance as of December 31, 2024
Unobservable Input
Range
Other equity investments
Probability weighted expected return technique
$
3,006
Discount Rate
20
%
Collateral-dependent loans
Discounted appraised value technique
6,954
Selling Costs
7
% -
15
%
OREO (1)
Discounted sales price technique
279
Selling Costs
7
%
(1) Included in other assets on the consolidated balance sheets.
26
The following tables present the estimated fair values, related carrying amounts, and valuation level of the financial instruments as of the dates stated.
September 30, 2025
Fair Value Measurements
(Dollars in thousands)
Carrying Value
Fair Value
Level 1
Level 2
Level 3
Financial Assets
Cash and due from banks
$
121,032
$
121,032
$
121,032
$
—
$
—
Federal funds sold
7,773
7,773
7,773
—
—
Securities available for sale
341,354
341,354
—
340,854
500
Restricted equity investments
18,988
18,988
—
18,988
—
Other equity investments
4,853
4,853
—
1,847
3,006
Other investments
20,804
20,804
—
—
20,804
Loans held for sale
12,819
12,819
—
12,819
—
Loans held for investment, net
1,892,223
1,826,790
—
—
1,826,790
Accrued interest receivable
11,012
11,012
—
11,012
—
Bank owned life insurance
896
896
—
896
—
MSRs
201
201
—
—
201
Financial Liabilities
Noninterest-bearing demand
$
411,100
$
411,100
$
411,100
$
—
$
—
Interest-bearing demand and money market
621,268
621,268
—
621,268
—
Savings
100,300
100,300
—
100,300
—
Time
818,411
821,302
—
—
821,302
FHLB borrowings
150,000
150,424
—
150,424
—
Subordinated notes, net
14,731
13,888
—
—
13,888
December 31, 2024
Fair Value Measurements
(Dollars in thousands)
Carrying Value
Fair Value
Level 1
Level 2
Level 3
Financial Assets
Cash and due from banks
$
173,533
$
173,533
$
173,533
$
—
$
—
Restricted cash
2,459
2,459
2,459
—
—
Federal funds sold
838
838
838
—
—
Securities available for sale
312,035
312,035
—
311,285
750
Restricted equity investments
19,275
19,275
—
19,275
—
Other equity investments
4,834
4,834
—
1,828
3,006
Other investments
19,405
19,405
—
—
19,405
Loans held for sale
30,976
30,976
—
30,976
—
Loans held for investment, net
2,088,774
1,998,668
—
—
1,998,668
Accrued interest receivable
12,537
12,537
—
12,537
—
Bank owned life insurance
1,083
1,083
—
1,083
—
MSRs
386
386
—
—
386
Financial Liabilities
Noninterest-bearing demand
$
452,690
$
452,690
$
452,690
$
—
$
—
Interest-bearing demand and money market
598,875
598,875
—
598,875
—
Savings
100,857
100,857
—
100,857
—
Time
1,027,020
1,029,199
—
—
1,029,199
FHLB borrowings
150,000
152,782
—
152,782
—
Subordinated notes, net
39,789
38,765
—
—
38,765
Note 6
– Minimum Regulatory Capital Requirements
Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, financial institutions must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and
27
certain off-balance sheet items as calculated under regulatory accounting practices. A financial institution's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.
Pursuant to the final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks, banks must hold a capital conservation buffer of
2.50
% above the adequately capitalized risk-based capital ratios for all ratios, except the tier 1 leverage ratio. If a banking organization dips into its capital conservation buffer, it is subject to limitations on certain activities, including payment of dividends, share repurchases, and discretionary compensation to certain officers. Federal and state banking regulations place certain additional restrictions on dividends paid by the Company.
Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized; although, these terms are not used to represent overall financial condition. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.
In addition to the foregoing capital requirements, the Bank is subject to minimum capital ratios set forth in the Consent Order that are higher than those required for capital adequacy purposes generally. The Bank is required to
maintain a leverage ratio of
10.00
% and a total capital ratio of
13.00
%. As of
September 30, 2025 and December 31, 2024, the Bank met these minimum capital ratios. Until the Consent Order has been lifted, the Bank is deemed to be less than well capitalized, thus adequately capitalized.
The Company adopted ASC 326, Financial Instruments - Credit Losses (referred to herein as "current expected credit losses" or "CECL") effective January 1, 2023. Federal and state banking regulations allow financial institutions to irrevocably elect to phase-in the after-tax cumulative effect adjustment to retained earnings (the "CECL Transitional Amount") over a three-year period. The three-year phase-in of the CECL Transitional Amount to regulatory capital was
25
% and
50
% in 2023 and 2024, respectively, and is
25
% in 2025. The Bank made this irrevocable election effective with its first quarter 2023 call report.
The following tables present the capital ratios to which banks are subject to be adequately and well capitalized, as well as the capital and capital ratios for the Bank as of the dates stated. Adequately capitalized ratios include the conservation buffer, if applicable. The following table also includes the capital adequacy ratios to which bank holding companies are subject. Also presented are the minimum capital ratios set forth in the Consent Order for the Bank and the related capital amounts for both the leverage ratio and the total risk based capital ratio. The CECL Transitional Amount was $
8.1
million, of which $
6.1
million and $
4.1
million reduced the regulatory capital amounts and capital ratios as of
September 30, 2025 and December 31, 2024, respectively.
September 30, 2025
Actual
For Capital Adequacy Purposes
To Be Well Capitalized
Minimum Capital Ratios
(Dollars in thousands)
Amount
Ratio
Amount
Ratio
Amount
Ratio
Amount
Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
365,989
19.96
%
$
192,507
10.50
%
$
183,340
10.00
%
$
238,342
13.00
%
Blue Ridge Bankshares, Inc.
$
407,122
22.02
%
$
147,898
8.00
%
n/a
n/a
n/a
n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
347,348
18.95
%
$
155,840
8.50
%
$
146,673
8.00
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
376,650
20.37
%
$
110,924
6.00
%
n/a
n/a
n/a
n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
347,348
18.95
%
$
128,338
7.00
%
$
119,171
6.50
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
376,650
20.37
%
$
83,193
4.50
%
n/a
n/a
n/a
n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.
$
347,348
13.67
%
$
101,650
4.00
%
$
127,062
5.00
%
$
254,125
10.00
%
Blue Ridge Bankshares, Inc.
$
376,650
14.70
%
$
102,518
4.00
%
n/a
n/a
n/a
n/a
28
December 31, 2024
Actual
For Capital Adequacy Purposes
To Be Well Capitalized
Minimum Capital Ratios
(Dollars in thousands)
Amount
Ratio
Amount
Ratio
Amount
Ratio
Amount
Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
358,848
17.26
%
$
218,260
10.50
%
$
207,866
10.00
%
$
270,226
13.00
%
Blue Ridge Bankshares, Inc.
$
414,284
19.79
%
$
167,444
8.00
%
n/a
n/a
n/a
n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
340,386
16.38
%
$
176,687
8.50
%
$
166,293
8.00
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
360,933
17.24
%
$
125,583
6.00
%
n/a
n/a
n/a
n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
340,386
16.38
%
$
145,507
7.00
%
$
135,113
6.50
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
360,933
17.24
%
$
94,187
4.50
%
n/a
n/a
n/a
n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.
$
340,386
11.80
%
$
115,364
4.00
%
$
144,204
5.00
%
$
288,409
10.00
%
Blue Ridge Bankshares, Inc.
$
360,933
12.43
%
$
116,169
4.00
%
n/a
n/a
n/a
n/a
Note 7 – Commitments and Contingencies
In the ordinary course of operations, the Company offers various financial products to its customers to meet their credit and liquidity needs. These instruments involve elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and stand-by letters of credit written is represented by the contractual amount of these instruments. The Company uses the same credit policies in making commitments and conditional commitments as it does for on-balance sheet commitments.
Subject to its normal credit standards and risk monitoring procedures, the Company makes contractual commitments to extend credit. Commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee. Since many of the commitments may expire without being completely drawn upon, the total commitment amounts do not necessarily represent future cash requirements. As of September 30, 2025 and December 31, 2024
, the Company had outstanding loan commitments of $
243.6
million and $
283.2
million, respectively
. Of these amounts, $
35.5
million and $
32.9
million were unconditionally cancelable at the sole discretion of the Company as of the same respective dates.
Conditional commitments are issued by the Company in the form of financial stand-by letters of credit, which guarantee payment to the underlying beneficiary (i.e., third party) if the customer fails to meet its designated financial obligation. As of September 30, 2025 and December 31, 2024, commitments under outstanding financial stand-by letters of credit totaled
$
9.5
million and $
12.5
mil
lion, respectively. The credit risk of issuing stand-by letters of credit can be greater than the risk involved in extending loans to customers.
The Company recorded
no
provision for credit losses for unfunded commitments for either the three months or nine months ended
September 30, 2025. The reserve for unfunded commitments, which is included in other liabilities on the consolidated balance sheets, w
as $
0.9
million as o
f both September 30, 2025 and December 31, 2024.
As part of the sale of substantially all of its MSR portfolio during 2024, the Company recorded a reserve for estimated putbacks, transition costs, and unearned sales proceeds. The putbacks related to industry-standard items, including prepayments or early delinquencies of the underlying mortgages, all of which were subject to term limits per the respective sales agreements. As of September 30, 2025, all such term limits have expired. The reserve for unearned sales proceeds relates to the Company providing certain documentation to the buyers. In the three and nine months ended September 30, 2025, the Company
received $
0.7
million and $
1.0
million, respectively, of pr
eviously unearned sale proceeds, which resulted in a corresponding release of the reserve and were reported as income on sale of MSRs on the consolidated statements of operations. As of September 30, 2025 and December 31, 2024
, the reserve was $
0.6
million and $
1.8
million, respectively, and was included in other liabilities on the consolidated balance sheet.
The Company has investments in various partnerships and limited liability companies. Pursuant to these investments, the Company commits to an investment amount that may be fulfilled in future periods. At September 30, 2025 and December 31, 2024
, the Company had future commitments outstanding totaling $
5.2
million and $
7.1
million, respectively, related to these investments.
29
Note 8
– Stock-Based Compensation
The Company has granted restricted stock awards (“time-based RSAs”) to employees and directors, and performance-based restricted stock awards (“PSAs”) to employees, under equity incentive plans that have been approved by the Company's shareholders. Time-based RSAs vest over time and are considered fixed awards as the number of shares and fair value is known at the date of grant. The fair value of the award at the grant date is amortized over the requisite service period, which is generally
three years
. PSAs vest at the end of a specified period contingent on the Company's achievement of financial goals and are expensed on a straight-line basis over the performance period, with adjustments periodically based on projected achievement of such performance goals.
On April 29, 2025, the Company granted PSAs totaling
3,400,000
shares of common stock to certain executive officers. The vesting of these awards is contingent upon the Company achieving specified performance thresholds over three one-year measurement periods. Stock-based compensation expense, reported as a component of salaries and employee benefits in the consolidated statements of operations, was $
1.2
million and $
3.5
million for the
three and nine months ended September 30, 2025
, respectively, compared to $
0.1
million and $
0.6
million for the
three and nine months ended September 30, 2024, respectively.
The following table presents the activity in time-based RSAs and PSAs as of the dates and for the periods stated.
For the nine months ended September 30, 2025
Time-based RSAs
PSAs
Shares
Weighted Average Fair Value
Shares
Weighted Average Fair Value
Shares unvested and outstanding at beginning of period
585,700
$
3.63
116,830
$
11.43
Granted
145,643
3.74
3,400,000
3.54
Vested (1)
(
179,590
)
4.09
—
—
Forfeited
(
49,395
)
4.34
(
56,346
)
14.20
Shares unvested and outstanding at end of period
502,358
$
3.43
3,460,484
$
3.60
(1) Shares totaling
19,022
were withheld as payment of taxes in the nine months ended September 30, 2025.
Note 9 – Earnings Per S
hare
The
following table shows the calculation of basic and diluted earnings per share ("EPS"), the weighted average number of shares outstanding used in computing EPS, the effect on the weighted average number of shares outstanding
30
of
dilutive potential common stock for the periods stated, and the weighted average number of securities excluded from the computation of diluted EPS because their effects would have been anti-dilutive.
For the three months ended September 30,
For the nine months ended September 30,
(Dollars in thousands, except per share data)
2025
2024
2025
2024
Net income (loss)
$
5,603
$
946
$
6,465
$
(
13,382
)
Weighted average common shares outstanding, basic
88,547,750
73,366,140
87,612,199
39,132,557
Effect of dilutive securities (1)
10,836,329
13,720,237
8,977,523
—
Weighted average common shares outstanding, dilutive
99,384,079
87,086,377
96,589,722
39,132,557
Basic and diluted income (loss) per common share
$
0.06
$
0.01
$
0.07
$
(
0.34
)
(1) Components of dilutive securities
PSAs
952,496
1,805
371,911
—
Preferred stock
—
10,928,000
—
—
Warrants
9,883,833
2,790,432
8,605,612
—
Total weighted average dilutive securities
10,836,329
13,720,237
8,977,523
—
Weighted average anti-dilutive securities excluded from diluted EPS
PSAs
—
92,727
1,613
95,605
Stock options
19,933
29,741
21,544
29,979
Preferred stock
—
—
—
10,928,000
Warrants
—
—
—
1,884,183
Total weighted average anti-dilutive securities
19,933
122,468
23,157
12,937,767
Note 10
– Segment Reporting
The Chief Operating Decision Maker (the "CODM") evaluates each of the Company's segments based on net income (loss), using segment financial information compiled utilizing
the accounting policies listed in Note 2 of the 2024 Form 10-K. The profitability of the segment helps the CODM evaluate staffing levels, assess available cash for allocation to projects and resources, and make informed decisions on whether the segment's activities should be modified to align with the Company’s overall near- and long-term strategies.
Until March 2025, the Company operated through
three
reportable business segments: commercial banking, mortgage banking, and holding company activities. The commercial banking business segment makes loans to and generates deposits from individuals and businesses, while offering a wide array of general financial services to its customers. The mortgage banking segment, which operated as Monarch Mortgage and focused on residential mortgage origination and sales activities, was sold in March 2025. The Company has closed, funded, and sold the loans that were in process at the time of the sale; it is therefore presented as a reportable segment for all periods stated for comparative purposes. Activities at the holding company or parent level are primarily associated with investments, borrowings, and certain noninterest expenses
.
31
Information about reportable segments, and reconciliation of such information to the consolidated financial statements follows, as of the dates and periods stated.
As of and for the three months ended September 30, 2025
(Dollars in thousands)
Commercial Banking
Mortgage Banking
Parent Only
Eliminations
Blue Ridge
Bankshares,
Inc.
Consolidated
NET INTEREST INCOME
Interest income
$
36,203
$
10
$
—
$
—
$
36,213
Interest expense
13,964
—
338
—
14,302
Net interest income
22,239
10
(
338
)
—
21,911
Recovery of credit losses
(
1,800
)
—
—
—
(
1,800
)
Net interest income after recovery of credit losses
24,039
10
(
338
)
—
23,711
NONINTEREST INCOME
Fair value adjustments of other equity investments
—
—
163
—
163
Residential mortgage banking income
—
5
—
—
5
MSRs
—
(
48
)
—
—
(
48
)
Income on sale of MSRs
—
737
—
—
737
Other
3,075
—
—
(
99
)
2,976
Total noninterest income
3,075
694
163
(
99
)
3,833
NONINTEREST EXPENSE
Salaries and employee benefits
11,325
63
—
—
11,388
Occupancy and equipment
1,179
11
—
—
1,190
Technology and communication
2,147
167
—
—
2,314
Other
5,121
71
56
(
99
)
5,149
Total noninterest expense
19,772
312
56
(
99
)
20,041
Income (loss) before income tax expense
7,342
392
(
231
)
—
7,503
Income tax expense (benefit)
1,949
—
(
49
)
—
1,900
Net income (loss)
$
5,393
$
392
$
(
182
)
$
—
$
5,603
Total assets
$
2,475,826
$
947
$
371,288
$
(
351,112
)
$
2,496,949
As of and for the three months ended September 30, 2024
(Dollars in thousands)
Commercial Banking
Mortgage Banking
Parent Only
Eliminations
Blue Ridge
Bankshares,
Inc.
Consolidated
NET INTEREST INCOME
Interest income
$
38,803
$
422
$
—
$
—
$
39,225
Interest expense
19,385
174
565
—
20,124
Net interest income
19,418
248
(
565
)
—
19,101
Recovery of credit losses
(
6,200
)
—
—
—
(
6,200
)
Net interest income after recovery of credit losses
25,618
248
(
565
)
—
25,301
NONINTEREST INCOME
Fair value adjustments of other equity investments
—
—
160
—
160
Residential mortgage banking income
—
2,746
—
—
2,746
MSRs
—
(
2,915
)
—
—
(
2,915
)
Loss on sale of MSRs
—
(
1,011
)
—
—
(
1,011
)
Other
3,812
—
2
(
96
)
3,718
Total noninterest income
3,812
(
1,180
)
162
(
96
)
2,698
NONINTEREST EXPENSE
Salaries and employee benefits
12,554
1,365
19
—
13,938
Occupancy and equipment
1,286
108
—
—
1,394
Technology and communication
2,457
310
—
—
2,767
Regulatory remediation
357
—
—
—
357
Other
6,953
722
419
(
96
)
7,998
Total noninterest expense
23,607
2,505
438
(
96
)
26,454
Income (loss) before income tax expense
5,823
(
3,437
)
(
841
)
—
1,545
Income tax expense (benefit)
1,523
(
751
)
(
173
)
—
599
Net income (loss)
$
4,300
$
(
2,686
)
$
(
668
)
$
—
$
946
Total assets
$
2,900,927
$
33,519
$
377,806
$
(
367,561
)
$
2,944,691
32
As of and for the nine months ended September 30, 2025
(Dollars in thousands)
Commercial Banking
Mortgage Banking
Parent Only
Eliminations
Blue Ridge
Bankshares,
Inc.
Consolidated
NET INTEREST INCOME
Interest income
$
106,108
$
191
$
—
$
—
$
106,299
Interest expense
43,797
40
1,720
—
45,557
Net interest income
62,311
151
(
1,720
)
—
60,742
Recovery of credit losses
(
2,500
)
—
—
—
(
2,500
)
Net interest income after recovery of credit losses
64,811
151
(
1,720
)
—
63,242
NONINTEREST INCOME
Fair value adjustments of other equity investments
—
—
8
—
8
Residential mortgage banking income
—
847
—
—
847
MSRs
—
(
185
)
—
—
(
185
)
Income on sale of MSRs
—
1,026
—
—
1,026
Other
8,750
—
—
(
297
)
8,453
Total noninterest income
8,750
1,688
8
(
297
)
10,149
NONINTEREST EXPENSE
Salaries and employee benefits
35,095
1,903
—
—
36,998
Occupancy and equipment
3,625
75
—
—
3,700
Technology and communication
6,686
977
—
—
7,663
Other
15,571
626
740
(
297
)
16,640
Total noninterest expense
60,977
3,581
740
(
297
)
65,001
Income (loss) before income tax expense
12,584
(
1,742
)
(
2,452
)
—
8,390
Income tax expense (benefit)
2,923
(
483
)
(
515
)
—
1,925
Net income (loss)
$
9,661
$
(
1,259
)
$
(
1,937
)
$
—
$
6,465
Total assets
$
2,475,826
$
947
$
371,288
$
(
351,112
)
$
2,496,949
As of and for the nine months ended September 30, 2024
(Dollars in thousands)
Commercial Banking
Mortgage Banking
Parent Only
Eliminations
Blue Ridge
Bankshares,
Inc.
Consolidated
NET INTEREST INCOME
Interest income
$
121,181
$
1,206
$
—
$
—
$
122,387
Interest expense
60,636
539
1,677
—
62,852
Net interest income
60,545
667
(
1,677
)
—
59,535
Recovery of credit losses
(
4,100
)
—
—
—
(
4,100
)
Net interest income after recovery of credit losses
64,645
667
(
1,677
)
—
63,635
NONINTEREST INCOME
Fair value adjustments of other equity investments
—
—
(
8,384
)
—
(
8,384
)
Residential mortgage banking income
—
8,214
—
—
8,214
MSRs
—
(
166
)
—
—
(
166
)
Loss on sale of MSRs
—
(
1,011
)
—
—
(
1,011
)
Other
12,374
—
19
(
288
)
12,105
Total noninterest income
12,374
7,037
(
8,365
)
(
288
)
10,758
NONINTEREST EXPENSE
Salaries and employee benefits
40,307
4,548
63
—
44,918
Occupancy and equipment
3,870
351
—
—
4,221
Technology and communication
6,425
953
—
—
7,378
Regulatory remediation
4,398
—
—
—
4,398
Other
24,460
2,231
881
(
288
)
27,284
Total noninterest expense
79,460
8,083
944
(
288
)
88,199
(Loss) income before income tax expense
(
2,441
)
(
379
)
(
10,986
)
—
(
13,806
)
Income tax expense (benefit)
1,960
(
90
)
(
2,294
)
—
(
424
)
Net (loss) income
$
(
4,401
)
$
(
289
)
$
(
8,692
)
$
—
$
(
13,382
)
Total assets
$
2,900,927
$
33,519
$
377,806
$
(
367,561
)
$
2,944,691
Included in other expenses are costs for legal and regulatory filings, audit fees, other contractual services, and other miscellaneous expenses.
The Company had no transactions wi
th a single customer that in the aggregate resulted in revenues exceeding
10
% of consolidated total revenues for the
three and nine months ended September 30, 2025 and 2024
.
33
Note 11 – Legal Matters
In the ordinary course of operations, the Company is party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, in the aggregate, will not have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows.
On December 20, 2024, a former Deputy Bank Secrecy Act Officer and manager at the Bank filed suit against the Company and the Company’s and the Bank’s Chief Executive Officer, in the Circuit Court of the City of Richmond (Virginia) alleging that she was retaliated against and constructively discharged in violation of the Virginia Whistleblower Protection Act, Va. Code § 40.1-27.3, and
Bowman v. State Bank of Keysville
, 331 S.E.2d 797 (Va. 1985). On December 30, 2024, the Company removed the matter to the United States District Court for the Eastern District of Virginia, where it subsequently filed a motion to dismiss. On July 18, 2025, the court granted the Company’s motion to dismiss. The case caption in the district court is
Porter v. Blue Ridge Bankshares, Inc.
(No. 3:24-cv-909 (E.D. Va.)). On August 15, 2025, the plaintiff appealed the dismissal of her claims to the U.S. Court of Appeals for the Fourth Circuit, Case No. 25-1970, asserting various violations of law. The Company believes the plaintiff’s claims are without merit and will continue to defend itself vigorously in the matter.
On December 5, 2023, an alleged shareholder of the Company commenced a putative class action in the U.S. District Court for the Eastern District of New York (No. 1:23-cv-08944) (
Russell Hunter v. Blue Ridge Bankshares, Inc., et al.
) on behalf of himself and any persons or entities who purchased the publicly traded stock of the Company between February 3, 2023 and October 31, 2023, both dates inclusive (the “Action”). The Action alleges violations of federal securities laws against the Company and certain of its current and former officers based on alleged material misstatements and omissions related to accounting judgments in the Company’s filings with the Securities and Exchange Commission. The complaint seeks certification of a class action, unspecified damages, and attorney’s fees. The putative class representative filed an amended complaint, and the Company filed a letter seeking permission to file a motion to dismiss. The parties engaged in non-binding mediation on December 5, 2024, during which the parties agreed in principle to settlement terms for $
2.5
million
. The Company was insured for its legal fees and for the settlement amount less a deductible that was expensed in 2024. On February 4, 2025, the plaintiff filed an unopposed motion for preliminary approval of the proposed class action settlement, which, if granted, would settle the Action and any claims related to the Action or that could have been brought in the Action by the parties, the parties’ counsel, or settlement class members (the “Motion”). The Motion expressly disclaims any fault, liability, or wrongdoing on the part of the Company. On June 6, 2025, the court conducted a preliminary fairness hearing regarding the Motion. On June 11, 2025, the federal magistrate judge recommended that the court grant the Motion. On July 5, 2025, the court adopted the magistrate’s report and recommendation, and on July 25, 2025, the court granted preliminary approval of the settlement, effective July 5, 2025. Also on July 25, 2025, the court set a final settlement approval hearing date of October 29, 2025. On July 29, 2025, the defendants satisfied their payment obligations under the settlement.
On October 29, 2025, the court held a final settlement approval hearing at which no objections to the settlement were raised.
Note 12 – Subsequent Events
On
October 27, 2025
, the Company announced a special cash dividend of $
0.25
per share of the Company’s common stock. The dividend is payable on
November 21, 2025
to shareholders of record as of the close of business on
November 7, 2025
and will total approximately $
30.0
million.
Subsequent to September 30, 2025, and pursuant to the Repurchase Program, warrants to purchase
3,229,000
shares of the Company's common stock
were repurchased by the Company for $
6.1
million.
34
Item 2. Management’s Discussion and Analysis o
f Financial Condition and Results of Operations
The following presents management’s discussion and analysis of the Company’s consolidated financial condition and the results of the Company's operations. This discussion should be read in conjunction with the unaudited consolidated financial statements and the notes thereto included in this Form 10-Q and the audited consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 (the
“
2024 Form 10-K
”
). Results of operations for the three and nine months ended September 30, 2025 are not necessarily indicative of the results of operations for the balance of 2025, or for any other period. As used in this report, the terms “the Company,” “we,” “us,” and “our” refer to Blue Ridge Bankshares, Inc. and its consolidated subsidiaries. The term “Bank” refers to Blue Ridge Bank, National Association.
Cautionary Note About Forward-Looking Statements
The Company makes certain forward-looking statements in this Form 10-Q that are subject to risks and uncertainties. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections, and statements of management’s beliefs concerning future events, business plans, objectives, expected operating results, and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate, or imply future results, performance or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan,” or words or phases of similar meaning. The Company cautions that the forward-looking statements are based largely on management’s expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond its control. Actual results, performance, or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements.
The following factors, among others, could cause the Company’s financial performance to differ materially from that expressed in such forward-looking statements:
•
the strength of the United States economy in general and the strength of the local economies in which the Company conducts operations;
•
the effects of, and changes in, the macroeconomic environment and financial market conditions, including monetary and fiscal policies, interest rates, and inflation;
•
the impact of, and the ability to comply with, the terms of the Consent Order, as defined below, with the Office of the Comptroller of the Currency ("OCC"), including the heightened capital requirements and other restrictions therein, and other regulatory directives;
•
the imposition of additional regulatory actions or restrictions for noncompliance with the Consent Order or otherwise;
•
the Company’s involvement in, and the outcome of, any litigation, legal proceedings, or enforcement actions that may be instituted against the Company;
•
reputational risk and potential adverse reactions of the Company’s customers, suppliers, employees, or other business partners;
•
the Company’s ability to manage its fintech relationships, including implementing enhanced controls, complying with the OCC directives and applicable laws and regulations, and managing the final phases of the wind down of these partnerships;
•
the quality and composition of the Company’s loan and investment portfolios, including changes in the level of the Company’s nonperforming assets and charge-offs;
•
the Company’s management of risks inherent in its loan portfolio, the credit quality of its borrowers, and the risk of a prolonged downturn in the real estate market, which could impair the value of the Company’s collateral and its ability to sell collateral upon any foreclosure;
•
the ability to maintain adequate liquidity by growing and retaining deposits and secondary funding sources, especially if the Company's or its industry's reputation become damaged;
35
•
The emergence of digital assets and payment stablecoins, and evolving legislative or regulatory frameworks, may alter deposit flows, competition, and credit intermediation. Changes or gaps in these emerging rules could adversely affect the Company’s funding, liquidity, or overall financial performance;
•
the ability to maintain capital levels adequate to support the Company's business and to comply with the Consent Order directives;
•
the ability of the Company to implement cost-saving initiatives and efficiency measures, as well as increase earning assets, in order to yield acceptable levels of profitability;
•
the ability to generate sufficient future taxable income for the Company to realize its deferred tax assets, including the net operating loss carryforward;
•
the timely development of competitive products and services and the acceptance of these products and services by new and existing customers;
•
changes in consumer spending and savings habits;
•
the willingness of users to substitute competitors’ products and services for the Company’s products and services;
•
the impact of unanticipated outflows of deposits;
•
technological and social media changes;
•
potential exposure to fraud, negligence, computer theft, and cyber-crime;
•
adverse developments in the financial industry generally, such as bank failures, responsive measures to mitigate and manage such developments, supervisory and regulatory actions and costs, and related impacts on customer and client behavior;
•
changing bank regulatory conditions, policies or programs, whether arising as new legislation or regulatory initiatives, that could lead to restrictions on activities of banks generally, or the Bank in particular, more restrictive regulatory capital requirements, increased costs, including deposit insurance premiums, regulation or prohibition of certain income producing activities or changes in the secondary market for loans and other products;
•
political developments, including government shutdowns and other significant disruptions and changes in the funding, size, scope and effectiveness of the federal government, its agencies and services;
•
the impact of changes in financial services policies, laws, and regulations, including laws, regulations, and policies concerning taxes, banking, securities, real estate and insurance, the application thereof by bank regulatory bodies, and the three branches of the federal government;
•
the effect of changes in accounting standards, policies, and practices as may be adopted from time to time;
•
estimates of the fair value and other accounting values, subject to impairment assessments, of certain of the Company’s assets and liabilities;
•
geopolitical conditions, including acts or threats of terrorism and/or military conflicts, or actions taken by the United States or other governments in response to acts or threats of terrorism and/or military conflicts, which could impact business and economic conditions in the United States and abroad;
•
the economic impact of duties, tariffs, or other barriers or restrictions on trade, any retaliatory countermeasures, and the volatility and uncertainty arising therefrom;
•
the occurrence or continuation of widespread health emergencies or pandemics, significant natural disasters, severe weather conditions, floods, and other catastrophic events;
•
other risks and factors identified in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections and elsewhere in the 2024 Form 10-K and in this Form 10-Q and in filings the Company makes from time to time with the Securities and Exchange Commission (“SEC”).
The foregoing factors should not be considered exhaustive and should be read together with other cautionary statements that are included in the 2024 Form 10-K and this Form 10-Q, including those discussed in the section
36
entitled "Risk Factors" in those filings. If one or more of the factors affecting forward-looking information and statements proves incorrect, then actual results, performance, or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained in this Form 10-Q. Therefore, the Company cautions not to place undue reliance on its forward-looking information and statements. The Company will not update the forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking statements. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how these risks and uncertainties will affect it.
Share Repurchase Program
On August 25, 2025, the Company announced the adoption of a share repurchase program (the “Repurchase Program”) pursuant to which the Company may purchase up to $15.0 million of the Company’s common stock.
Repurchases may be made in open market purchases, block trades, or privately negotiated transactions, including upon the exercise of outstanding warrants to purchase common stock. The Company cannot predict when or if it will repurchase additional shares of common stock as the Repurchase Program will depend on a number of factors, including constraints specified in any SEC Rule 10b5-1 trading plans, price, and general business and market conditions.
During the three months ended September 30, 2025, the Company repurchased 659,949 shares of common stock at a weighted average price of $4.16 per share totaling $2.8 million.
For information regarding the Repurchase Program, please see Part II, Item 2 of this Form 10-Q.
Sale of Mortgage Division
On March 27, 2025, the Company completed the previously announced sale of its mortgage division operating as Monarch Mortgage. The sale, which included the transfer of certain assets and leases, resulted in a $0.2 million loss, primarily due to the write-off of fixed assets and lease impairment, and is reported in other noninterest income.
This transaction did not meet the criteria for classification as a discontinued operation under Accounting Standards Codification ("ASC") 205-20, Presentation of Financial Statements – Discontinued Operations, and is therefore reported within continuing operations as of and for all periods stated herein.
Regulatory Matters
On January 24, 2024, the Bank consented to the issuance of the Consent Order by the OCC ("Consent Order"). The Consent Order generally incorporates the provisions of the formal written agreement (the "Written Agreement") entered into between the Bank and the OCC on August 29, 2022, as well as adding new provisions. The Written Agreement principally concerned the Bank’s fintech operations and required the Bank to continue enhancing its controls for assessing and managing the third-party, Bank Secrecy Act/Anti-Money Laundering, and information technology risks stemming from its fintech partnerships and adds time frames by which certain of the directives are required. The Consent Order also requires the Bank to maintain a leverage ratio of 10.0% and a total capital ratio of 13.0%, referred to as minimum capital ratios. As of September 30, 2025 and December 31, 2024, the Bank’s capital ratios exceeded these minimum capital ratios. The Company believes it has made significant progress towards meeting the requirements of the Consent Order. Complete copies of the Written Agreement and the Consent Order are included as Exhibits 10.9 and 10.10, respectively, of the 2024 Form 10-K.
Private Placements
In the second quarter of 2024, the Company closed private placements in which it issued and sold shares of its common and preferred stock for gross proceeds of $161.6 million (collectively, the "Private Placements"). On June 20, 2024, the Company’s shareholders approved an amendment to the Company's articles of incorporation authorizing the issuance of additional shares of common stock, thus enabling the conversion of the preferred shares issued in the Private Placements into shares of the Company’s common stock. The conversion occurred on June 28, 2024 and November 7, 2024. Capital proceeds received, net of issuance costs, from the Private Placements totaled $152.1 million. The Private Placements also included the issuance of warrants to purchase common stock at $2.50 per share.
37
The table below presents information pertaining to warrants to purchase the Company’s common stock as of and for the period stated.
As of and for the nine months ended September 30, 2025
Warrants Issued April 3, 2024
Warrants Issued June 13, 2024
Total Warrants
Warrants outstanding at beginning of period
29,027,999
2,424,000
31,451,999
Warrants exercised during the period (1)
(3,903,000
)
—
(3,903,000
)
Warrants outstanding at end of period
25,124,999
2,424,000
27,548,999
Remaining exercise term (years)
3.51
3.70
(1) Warrants to purchase 125,000 shares of common stock were exercised during the three months ended September 30, 2025.
General
There were no changes to the Critical Accounting Policies disclosed in Item 7 of the 2024 Form 10-K.
Certain amounts presented in the consolidated financial statements of prior periods have been reclassified to conform to current year presentations. The reclassifications had no effect on net income, net income per share, total assets, total liabilities, or stockholders’ equity as previously reported.
Comparison of Financial Condition as of September 30, 2025 and December 31, 2024
Total assets were $2.50 billion as of September 30, 2025, a decrease of $240.3 million from $2.74 billion as of December 31, 2024. Most of this decrease was attributable to a decline in loans held for investment, which decreased $199.1 million to $1.91 billion as of September 30, 2025, from $2.11 billion as of December 31, 2024. Of the decline in loans held for investment, $83.9 million was due to a continuation of the Company's actions beginning in 2024 to purposefully and selectively reduce balances of loans where borrowers did not represent in-market relationships. The allowance for credit losses ("ACL") was $20.5 million and $23.0 million as of September 30, 2025 and December 31, 2024, respectively.
Total deposits were $1.95 billion as of September 30, 2025, a net decrease of $228.4 million from December 31, 2024. The decline in the first nine months of 2025 was primarily due to a $134.6 million decrease in brokered time deposits.
Total stockholders’ equity increased by $27.7 million to $355.5 million as of September 30, 2025, from $327.8 million at December 31, 2024, primarily due to additional capital of $9.8 million from the exercise of warrants issued in the Private Placements, a $10.7 million decrease in after-tax unrealized losses in the Company’s portfolio of securities available for sale, and net income for the nine months ended September 30, 2025 of $6.5 million, partially offset by $2.8 million of share repurchases pursuant to the Repurchase Program.
Comparison of Results of Operations for the Three and Nine Months Ended September 30, 2025 and 2024
For the three months ended September 30, 2025, the Company reported net income of $5.6 million, or $0.06 per diluted common share, compared to net income of $0.9 million, or $0.01 per diluted common share, for the same period of 2024.
For the nine months ended September 30, 2025, the Company reported net income of $6.5 million, or $0.07 per diluted common share, compared to a net loss of $13.4 million, or ($0.34) per diluted common share, for the same period of 2024.
Net income for the three and nine months ended September 30, 2025 included $2.3 million and $2.7 million, respectively, of after-tax loan fee income due to the payoff of the Company's largest previously criticized out-of-market loan relationship. In the 2025 periods, the Company received unearned sale proceeds, resulting in an after-tax release of reserves of $0.6 million and $0.8 million for the three and nine months ended September 30, 2025, respectively, which were reported as income on sale of mortgage servicing rights ("MSRs") on the consolidated statements of operations. After-tax severance costs were $0.1 million and $0.9 million for the three and nine months ended September 30, 2025, respectively. After-tax regulatory remediation expenses in connection with the Consent Order for both the three and
38
nine months ended September 30, 2025 were $0, compared to $0.3 million and $3.4 million of after-tax costs incurred for the same respective periods in 2024.
Net income for the nine months ended September 30, 2025 also included an after-tax benefit of $1.0 million – primarily the recovery of non-credit-related amounts in the second quarter of 2025 reserved for in the prior year – as the Company concluded outstanding exit activities with a former fintech banking-as-a-service (“BaaS”) partner. The net loss for the nine months ended September 30, 2024 included a second quarter $6.7 million non-cash, after-tax negative fair value adjustment recorded for an equity investment in a fintech company, partially offset by a $6.6 million after-tax recovery of credit losses on a specialty finance loan that was sold in the third quarter of 2024.
Net Interest Income.
Net interest income is the excess of interest earned on loans, investments, and other interest-earning assets less the interest paid on deposits and borrowings and is the Company’s primary revenue source. Net interest income is thereby affected by overall balance sheet size, changes in interest rates, and changes in the mix of investments, loans, deposits, and borrowings. Net interest income for the three and nine months ended September 30, 2025 was $21.9 million and $60.7 million, respectively, a decline of $2.8 million and $1.2 million from the same respective periods in 2024.
Interest income for the three and nine months ended September 30, 2025 was $36.2 million and $106.3 million, respectively, representing decreases of $3.0 million and $16.1 million from the same respective periods in 2024. The decline was primarily attributable to lower average balances of loans held for investment, partially offset by realized loan fee income of $3.0 million and $3.5 million recognized in the same respective periods upon the payoff of the aforementioned out-of-market loan. Interest expense was $14.3 million and $45.6 million for the three and nine months ended September 30, 2025, respectively, a decrease of $5.8 million and $17.3 million from the same respective periods in 2024, largely driven by the decline in average balances and costs of interest-bearing deposits.
39
The following table presents the average balance sheets for the three months ended September 30, 2025 and 2024. Also shown are the amounts of interest earned on interest-earning assets, with related tax-equivalent yields, and interest expense on interest-bearing liabilities, with related rates, as well as a volume and rate analysis of changes in net interest income for the periods stated.
Average Balances, Income and Expense, Yields and Rates
For the three months ended September 30,
2025
2024
Total
Increase/
Increase/(Decrease)
Due to
(Dollars in thousands)
Average
Balance
Interest
Yield/
Rate (1)
Average
Balance
Interest
Yield/
Rate (1)
(Decrease)
Volume (2)
Rate (2)
Average Assets
Taxable securities
$
343,765
$
2,728
3.17
%
$
321,920
$
2,282
2.84
%
$
446
$
155
$
291
Tax-exempt securities (3)
12,216
87
2.85
%
12,560
80
2.55
%
7
(2
)
9
Total securities
355,981
2,815
3.16
%
334,480
2,362
2.82
%
453
153
300
Interest-earning deposits in other banks
129,766
1,383
4.26
%
149,990
2,053
5.48
%
(670
)
(277
)
(393
)
Federal funds sold
3,331
36
4.32
%
5,868
81
5.52
%
(45
)
(35
)
(10
)
Loans held for sale
16,074
1,059
26.35
%
65,219
2,242
13.75
%
(1,183
)
(1,689
)
506
Loans held for investment (4,5,6)
1,932,390
30,941
6.40
%
2,240,559
32,505
5.80
%
(1,564
)
(4,471
)
2,907
Total average interest-earning assets
2,437,542
36,234
5.95
%
2,796,116
39,243
5.61
%
(3,009
)
(6,319
)
3,310
Less: allowance for credit losses
(22,138
)
(32,001
)
Total noninterest-earning assets
120,449
203,659
Total average assets
$
2,535,853
$
2,967,774
Average Liabilities and Stockholders’ Equity:
Interest-bearing demand, money market, and savings
$
732,103
$
3,789
2.07
%
$
844,747
$
5,398
2.56
%
$
(1,609
)
$
(720
)
$
(889
)
Time (7)
838,825
8,712
4.15
%
1,003,751
11,586
4.62
%
(2,874
)
(1,904
)
(970
)
Total interest-bearing deposits
1,570,928
12,501
3.18
%
1,848,498
16,984
3.68
%
(4,483
)
(2,623
)
(1,860
)
FHLB borrowings
150,000
1,463
3.90
%
233,090
2,574
4.42
%
(1,111
)
(918
)
(193
)
Subordinated notes and other borrowings (8)
18,087
338
7.47
%
39,814
566
5.69
%
(228
)
(309
)
81
Total average interest-bearing liabilities
1,739,015
14,302
3.29
%
2,121,402
20,124
3.79
%
(5,822
)
(3,850
)
(1,972
)
Noninterest-bearing demand deposits
419,612
482,809
Other noninterest-bearing liabilities
31,868
36,683
Stockholders' equity
345,358
326,880
Total average liabilities and stockholders’ equity
$
2,535,853
$
2,967,774
Net interest income and margin (9)
$
21,932
3.60
%
$
19,119
2.74
%
$
2,813
$
(2,469
)
$
5,282
Cost of funds (10)
2.65
%
3.09
%
Net interest spread (11)
2.66
%
1.82
%
(1) Annualized.
(2) Change in income/expense due to both volume and rate has been allocated in proportion to the absolute dollar amounts of the change in each.
(3) Computed on a fully taxable equivalent basis assuming a 22.32% and 21.89% income tax rate for the three months ended September 30, 2025 and 2024, respectively.
(4) Includes deferred loan fees/costs.
(5) Non-accrual loans have been included in the computations of average loan balances.
(6) Includes accretion of fair value adjustments (discounts) on acquired loans of $453 thousand and $311 thousand for the three months ended September 30, 2025 and 2024, respectively.
(7) Includes amortization of fair value adjustments (premiums) on assumed time deposits of $22 thousand and $70 thousand for the three months ended September 30, 2025 and 2024, respectively.
(8) Includes amortization of fair value adjustments (premiums) on assumed subordinated notes of $18 thousand and $25 thousand for the three months ended September 30, 2025 and 2024, respectively.
(9) Net interest margin is net interest income divided by average interest-earning assets.
(10) Cost of funds is total interest expense divided by total interest-bearing liabilities and non-interest bearing demand deposits.
(11) Net interest spread is the yield on average interest-earning assets less the cost of average interest-bearing liabilities.
Average balances of interest-earning assets decreased $358.6 million to $2.44 billion for the three months ended September 30, 2025 compared to $2.80 billion for the same period of 2024. Relative to the year-ago period, this decrease reflected primarily lower average balances of loans held for investment. The yield on average loans held for investment was 6.40% and 5.80% for the third quarters of 2025 and 2024, respectively. Fee income realized from the payoff of the aforementioned out-of-market loan positively affected the yield on average loans held for investment by 62 basis points in the 2025 period. Interest income for the three months ended September 30, 2025 and 2024 included accretion of discounts on acquired loans of $0.5 million and $0.3 million, respectively.
Average balances of interest-bearing liabilities decreased $382.4 million to $1.74 billion for the three months ended September 30, 2025 compared to $2.12 billion for the same period of 2024. The decline relative to the year-ago period was primarily due to the exit of fintech BaaS deposit operations and the reduction of wholesale funding, reported in time deposits, and borrowings.
Cost of funds was 2.65% for the third quarter of 2025 compared to 3.09% for the third quarter of 2024, while cost of deposits was 2.51% and 2.91%, for the same respective periods. Lower cost of funds and lower cost of deposits in the 2025 periods relative to the year-ago periods were primarily due to the exit of higher cost fintech BaaS deposit operations and the reduction in wholesale deposits. Cost of deposits, excluding wholesale deposits, was 1.17% for the third quarter of 2025 compared to 1.71% for the third quarter of 2024.
Net interest income (on a taxable equivalent basis) for the three months ended September 30, 2025 was $21.9 million compared to $19.1 million for the same period in 2024. Interest income declined $3.0 million to $36.2 million
40
for the three months ended September 30, 2025 from $39.2 million for the three months ended September 30, 2024, while interest expense declined $5.8 million to $14.3 million from $20.1 million for the same respective periods. Net interest margin improved to 3.60% for the third quarter of 2025 from 2.74% for the third quarter of 2024. For the third quarter of 2025, the aforementioned loan fee income of $3.0 million had a 49 basis point positive effect on net interest margin.
The following table presents the average balance sheets for the nine months ended September 30, 2025 and 2024. Also shown are the amounts of interest earned on interest-earning assets, with related tax-equivalent yields, and interest expense on interest-bearing liabilities, with related rates, as well as a volume and rate analysis of changes in net interest income for the periods stated.
Average Balances, Income and Expense, Yields and Rates
For the nine months ended September 30,
2025
2024
Total
Increase/
Increase/(Decrease)
Due to
(Dollars in thousands)
Average
Balance
Interest
Yield/
Rate (1)
Average
Balance
Interest
Yield/
Rate (1)
(Decrease)
Volume (2)
Rate (2)
Average Assets
Taxable securities
$
335,265
$
7,721
3.07
%
$
328,024
$
7,119
2.89
%
$
602
$
157
$
445
Tax-exempt securities (3)
12,344
250
2.70
%
12,584
236
2.50
%
14
(5
)
19
Total securities
347,609
7,971
3.06
%
340,608
7,355
2.88
%
616
153
463
Interest-earning deposits in other banks
139,943
4,440
4.23
%
138,255
5,501
5.31
%
(1,061
)
67
(1,128
)
Federal funds sold
1,866
60
4.29
%
7,200
294
5.44
%
(234
)
(218
)
(16
)
Loans held for sale
23,177
3,819
21.97
%
62,425
6,374
13.61
%
(2,555
)
(4,007
)
1,452
Loans held for investment (4,5,6)
2,014,767
90,065
5.96
%
2,334,126
102,915
5.88
%
(12,850
)
(14,081
)
1,231
Total average interest-earning assets
2,527,362
106,355
5.61
%
2,882,614
122,439
5.66
%
(16,084
)
(18,086
)
2,003
Less: allowance for credit losses
(22,656
)
(34,149
)
Total noninterest-earning assets
124,101
223,613
Total average assets
$
2,628,807
$
3,072,078
Average Liabilities and Stockholders’ Equity:
Interest-bearing demand, money market, and savings
$
727,333
$
10,301
1.89
%
$
971,362
$
19,235
2.64
%
$
(8,934
)
$
(4,832
)
$
(4,102
)
Time (7)
910,703
29,194
4.27
%
985,077
33,506
4.54
%
(4,312
)
(2,530
)
(1,782
)
Total interest-bearing deposits
1,638,036
39,495
3.21
%
1,956,439
52,741
3.59
%
(13,246
)
(7,362
)
(5,884
)
FHLB borrowings
150,000
4,342
3.86
%
226,117
7,353
4.34
%
(3,011
)
(2,475
)
(536
)
FRB borrowings
—
—
—
30,839
1,080
4.67
%
(1,080
)
(1,080
)
—
Subordinated notes and other borrowings (8)
30,732
1,720
7.46
%
39,840
1,678
5.62
%
42
(384
)
426
Total average interest-bearing liabilities
1,818,768
45,557
3.34
%
2,253,235
62,852
3.72
%
(17,295
)
(11,301
)
(5,994
)
Noninterest-bearing demand deposits
439,589
499,289
Other noninterest-bearing liabilities
32,335
43,095
Stockholders' equity
338,115
276,459
Total average liabilities and stockholders’ equity
$
2,628,807
$
3,072,078
Net interest income and margin (9)
$
60,798
3.21
%
$
59,587
2.76
%
$
1,211
$
(6,786
)
$
7,997
Cost of funds (10)
2.69
%
3.04
%
Net interest spread (11)
2.27
%
1.94
%
(1) Annualized.
(2) Change in income/expense due to both volume and rate has been allocated in proportion to the absolute dollar amounts of the change in each.
(3) Computed on a fully taxable equivalent basis assuming a 22.32% and 21.89% income tax rate for the nine months ended September 30, 2025 and 2024, respectively.
(4) Includes deferred loan fees/costs.
(5) Non-accrual loans have been included in the computations of average loan balances.
(6) Includes accretion of fair value adjustments (discounts) on acquired loans of $1.2 million and $915 thousand for the nine months ended September 30, 2025 and 2024, respectively.
(7) Includes amortization of fair value adjustments (premiums) on assumed time deposits of $82 thousand and $248 thousand for the nine months ended September 30, 2025 and 2024, respectively.
(8) Includes amortization of fair value adjustments (premiums) on assumed subordinated notes of $67 thousand and $75 thousand for the nine months ended September 30, 2025 and 2024, respectively.
(9) Net interest margin is net interest income divided by average interest-earning assets.
(10) Cost of funds is total interest expense divided by total interest-bearing liabilities and non-interest bearing demand deposits.
(11) Net interest spread is the yield on average interest-earning assets less the cost of average interest-bearing liabilities.
Average interest-earning assets were $2.53 billion for the nine months ended September 30, 2025 compared to $2.88 billion for the same period of 2024, a $355.3 million decrease. This decrease was primarily attributable to declines in average balances of loans held for investment, which decreased $319.4 million in the year-to-date period. Total interest income (on a taxable equivalent basis) decreased $16.1 million for the nine months ended September 30, 2025 from the same period of 2024 and was primarily due to lower average balances on loans held for investment and loans held for sale. The yield on loans held for investment was 5.96% and 5.88% for the nine months ended September 30, 2025 and 2024, respectively. Interest income on loans held for investment for the nine months ended September 30, 2025 included $3.5 million of fee income from the payoff of the aforementioned out-of-market loan, which had a 23 basis point positive effect on the yield on loans held for investment. Interest income for the nine months ended September 30, 2025 and 2024 included accretion of discounts on acquired loans of $1.2 million and $0.9 million, respectively.
41
Average interest-bearing liabilities were $1.82 billion for the nine months ended September 30, 2025 compared to $2.25 billion for the same period of 2024, a $434.5 million decrease. Interest expense decreased by $17.3 million to $45.6 million for the nine months ended September 30, 2025 compared to $62.9 million for the same period of 2024. Cost of interest-bearing liabilities decreased to 3.34% for the nine months ended September 30, 2025 from 3.72% for the same period in 2024, while cost of funds were 2.69% and 3.04% for the same respective periods. Lower cost of funds in the 2025 period was primarily due to the exit of higher cost fintech BaaS deposit operations.
Net interest income (on a taxable equivalent basis) was $60.8 million for the nine months ended September 30, 2025 compared to $59.6 million for the same period in 2024. Net interest margin was 3.21% and 2.76% for the first nine months of 2025 and 2024, respectively. Fee income from the aforementioned paid off loan had a positive 18 basis point effect on net interest margin for the nine months ended September 30, 2025.
Provision for Credit Losses
. A recovery of credit losses of $1.8 million was reported for the three months ended September 30, 2025, whereas a $2.5 million recovery of credit losses was reported for the nine months ended September 30, 2025. For the three and nine months ended September 30, 2024, the Company recorded total recoveries of credit losses of $6.2 million and $4.1 million, respectively. The recoveries of credit losses in the 2025 periods were primarily attributable to declines in the portfolio of loans held for investment of $65.9 million and $199.1 million, respectively, and recoveries of loans charged-off in prior periods. The recoveries of credit losses in the 2024 periods were primarily attributable to an $8.4 million recovery from the sale of previously reported specialty finance loan and lower reserve needs due to loan portfolio balance reductions, partially offset by higher specific reserves for certain purchased loans.
Noninterest Income
. The following tables present a summary of noninterest income and the dollar and percentage change for the periods presented.
For the three months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
Change $
Change %
Fair value adjustments of other equity investments
$
163
$
160
$
3
1.9
%
Residential mortgage banking income
5
2,746
(2,741
)
(99.8
%)
MSRs
(48
)
(2,915
)
2,867
(98.4
%)
Income (loss) on sale of MSRs
737
(1,011
)
1,748
(172.9
%)
Wealth and trust management
458
730
(272
)
(37.3
%)
Service charges on deposit accounts
725
376
349
92.8
%
Increase in cash surrender value of bank owned life insurance
9
127
(118
)
(92.9
%)
Bank and purchase card, net
567
690
(123
)
(17.8
%)
Swap transaction fees
258
—
258
100.0
%
Other
959
1,795
(836
)
(46.6
%)
Other
$
3,833
$
2,698
$
1,135
42.1
%
For the nine months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
Change $
Change %
Fair value adjustments of other equity investments
$
8
$
(8,384
)
$
8,392
(100.1
%)
Residential mortgage banking income
847
8,214
(7,367
)
(89.7
%)
MSRs
(185
)
(166
)
(19
)
11.4
%
Income (loss) on sale of MSRs
1,026
(1,011
)
2,037
(201.5
%)
Wealth and trust management
1,321
1,873
(552
)
(29.5
%)
Service charges on deposit accounts
1,903
1,123
780
69.5
%
Increase in cash surrender value of bank owned life insurance
25
797
(772
)
(96.9
%)
Bank and purchase card, net
1,760
1,445
315
21.8
%
Loss on sale of securities available for sale
—
(67
)
67
(100.0
%)
Swap transaction fees
258
—
258
100.0
%
Other
3,186
6,934
(3,748
)
(54.1
%)
Other
$
10,149
$
10,758
$
(609
)
(5.7
%)
Noninterest income in the nine months ended September 30, 2024 included an $8.5 million non-cash, negative fair value adjustment of an equity investment the Company holds in a fintech company. The declines in mortgage banking
42
income in the three and nine months ended September 30, 2025 compared to the same periods of 2024 were due to the previously mentioned sales of the mortgage division in the first quarter of 2025 and MSR portfolio in the third quarter of 2024. Mortgage servicing income (loss) represents fair value adjustments of MSR assets. Additionally, income on the sale of MSRs in the three and nine months ended September 30, 2025 included $0.7 million and $1.0 million, respectively, of reserves released upon the receipt of additional sales proceeds that were contractually held back from the 2024 sales.
Higher service charges on deposits accounts in the 2025 periods compared to the same periods of 2024 were primarily due to the execution of a project to more closely align products and pricing with competitors in the markets in which the Bank operates. The decline in bank owned life insurance income in the 2025 periods compared to the same periods of 2024 was due to the surrender of policies at their cash surrender values in the 2024 periods. The decline in other noninterest income was driven by the decrease in the number of fintech indirect lending relationships, which contributed $0.6 million and $3.5 million of noninterest income in the nine months ended September 30, 2025 and 2024, respectively.
Noninterest Expense.
The following tables present a summary of noninterest expense and the dollar and percentage change for the periods stated.
For the three months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
Change $
Change %
Salaries and employee benefits
$
11,388
$
13,938
$
(2,550
)
(18.3
%)
Occupancy and equipment
1,190
1,394
(204
)
(14.6
%)
Technology and communication
2,314
2,767
(453
)
(16.4
%)
Legal and regulatory filings
1,008
614
394
64.2
%
Advertising and marketing
267
222
45
20.3
%
Audit fees
161
498
(337
)
(67.7
%)
FDIC insurance
239
1,130
(891
)
(78.8
%)
Intangible amortization
223
265
(42
)
(15.8
%)
Other contractual services
645
1,634
(989
)
(60.5
%)
Other taxes and assessments
895
759
136
17.9
%
Regulatory remediation
—
357
(357
)
(100.0
%)
Other
1,711
2,876
(1,165
)
(40.5
%)
Other
$
20,041
$
26,454
$
(6,413
)
(24.2
%)
For the nine months ended
(Dollars in thousands)
September 30, 2025
September 30, 2024
Change $
Change %
Salaries and employee benefits
$
36,998
$
44,918
$
(7,920
)
(17.6
%)
Occupancy and equipment
3,700
4,221
(521
)
(12.3
%)
Technology and communication
7,663
7,378
285
3.9
%
Legal and regulatory filings
1,842
1,424
418
29.4
%
Advertising and marketing
586
702
(116
)
(16.5
%)
Audit fees
1,198
1,948
(750
)
(38.5
%)
FDIC insurance
2,363
4,324
(1,961
)
(45.4
%)
Intangible amortization
701
828
(127
)
(15.3
%)
Other contractual services
1,673
5,299
(3,626
)
(68.4
%)
Other taxes and assessments
2,771
2,290
481
21.0
%
Regulatory remediation
—
4,398
(4,398
)
(100.0
%)
Other
5,506
10,469
(4,963
)
(47.4
%)
Other
$
65,001
$
88,199
$
(23,198
)
(26.3
%)
Excluding regulatory remediation, noninterest expense decreased $6.1 million and $18.8 million for the three and nine months ended September 30, 2025, respectively, from the same respective periods of 2024. These declines relative to the prior periods were primarily due to lower expenses for salaries and employee benefits, other contractual services, Federal Deposit Insurance Corporation ("FDIC") insurance assessments, audit fees, and other noninterest expense.
The decline in salaries and employee benefits in the three and nine months ended September 30, 2025 reflected a reduction in headcount as the Company continues to right-size its workforce, with the completion of certain regulatory directives and the transitioning to a more traditional community banking model. As of September 30, 2025 and 2024,
43
the Company had 311 and 468 employees, respectively. Included in salaries and employee benefits expense for the three and nine months ended September 30, 2025 was $1.0 million and $3.0 million of expense, respectively, for performance-based restricted stock awards relating to 3,400,000 shares of the Company's common stock granted to certain executive officers, which vest contingent upon the Company achieving specified performance thresholds over three one-year measurement periods. There were no such expenses in the 2024 periods. Also included in salaries and employee benefits expense were severance costs of $0.1 million and $1.1 million for the three and nine months ended September 30, 2025, respectively, compared to $0 for the same respective periods in 2024.
Lower regulatory remediation costs, audit fees, and other contractual services fees in the 2025 periods compared to the same periods of 2024 reflect a reduction in the use of outside consulting and audit services, also due to the completion of certain regulatory directives. Lower FDIC insurance assessments in the 2025 periods compared to the same periods of 2024 reflect an improved regulatory position and a smaller balance sheet.
The decrease in other noninterest expense was partially due to the second quarter of 2025 recovery of non-credit-related amounts reserved for in the prior year, upon the conclusion of exit activities with a former fintech BaaS partner. Also contributing to the decline in other noninterest expense in the 2025 periods compared to the same periods of 2024 were lower mortgage servicing fees due to the 2025 first quarter sale of the mortgage division, in addition to the 2024 periods including $0.9 million of excise taxes related to the surrender of bank owned life insurance policies.
Income Tax Expense
. For the three and nine months ended September 30, 2025, effective tax rates were 25.3% and 22.9%, respectively, compared to 38.8% and 3.1% for the three and nine months ended September 30, 2024. The effective income tax rates for the three and nine months ended September 30, 2025 reflect the potential limitation on the deductibility of compensation costs in future taxable periods. The higher effective income tax rate for the three months ended September 30, 2024 was primarily attributable to the vesting of restricted stock awards, where the fair value of the underlying stock at the time of vesting was lower than the fair value previously recognized for financial reporting purposes. The lower effective income tax rate for the nine months ended September 30, 2024 was primarily attributable to $2.0 million of tax expense recognized in the second quarter of 2024 upon surrendering bank owned life insurance policies. Taxes on such earnings were previously permanently deferred but became subject to tax upon the surrender of the policies.
Analysis of Financial Condition
Loan Portfolio.
The Company makes loans to commercial entities and to individuals. Loan terms vary as to interest rate, repayment, and collateral requirements based on the type of loan and the creditworthiness of the borrower. Credit risk tends to be geographically concentrated in that a majority of the loans are to borrowers located in the markets served by the Company. All loans are underwritten within specific lending policy guidelines that are established to maximize the Company’s profitability within an acceptable level of business risk
.
The following table presents the Company’s loan portfolio by category of loan and the percentage of loans in each category to total loans as of the dates stated.
September 30, 2025
December 31, 2024
(Dollars in thousands)
Amount
Percent
Amount
Percent
Commercial and industrial
$
276,609
14.5
%
$
354,904
16.8
%
Real estate – construction, commercial
73,473
3.8
%
114,491
5.4
%
Real estate – construction, residential
50,892
2.7
%
51,807
2.4
%
Real estate – commercial
818,101
42.8
%
847,842
40.2
%
Real estate – residential
654,030
34.2
%
692,253
32.8
%
Real estate – farmland
4,645
0.2
%
5,520
0.3
%
Consumer
33,778
1.8
%
43,938
2.1
%
Gross loans held for investment
1,911,528
100.0
%
2,110,755
100.0
%
Deferred costs, net of loan fees
1,198
1,042
Gross loans held for investment, net of deferred costs
1,912,726
2,111,797
Less: allowance for credit losses
(20,503
)
(23,023
)
Net loans
$
1,892,223
$
2,088,774
Loans held for sale
(not included in totals above)
$
12,819
$
30,976
44
The following table presents the Company’s portfolio of commercial real estate loans by property type as of the dates stated.
September 30, 2025
December 31, 2024
(Dollars in thousands)
Amount
Percent
Amount
Percent
Commercial real estate – owner occupied
$
191,933
23.5
%
$
193,608
22.8
%
Commercial real estate – non-owner occupied
Hospitality
147,041
18.0
%
120,910
14.3
%
Multi-family
172,315
21.1
%
186,619
22.0
%
Retail
98,236
12.0
%
104,363
12.3
%
Office
64,693
7.9
%
73,871
8.7
%
Mixed use
51,670
6.3
%
49,666
5.9
%
Warehouse and industrial
36,884
4.5
%
39,830
4.7
%
Other
55,329
6.8
%
78,975
9.3
%
Total real estate – commercial
$
818,101
100.0
%
$
847,842
100.0
%
The current lending environment for commercial real estate (“CRE”) loans has heightened risk due to a higher interest rate environment. Potential negative impacts include higher debt service burdens for floating rate loans and fixed rate loans originated in a lower rate environment that reprice or mature, requiring renewal or refinancing. As these loans mature, they may be repriced at significantly higher interest rates leading to increased debt service costs that can strain borrowers' ability to meet payment obligations. In some cases, the higher cost of refinancing may lead to loan defaults, particularly if property cash flows have not increased relatively.
Additionally, collateral values overall may be impaired by higher capitalization rates, further complicating refinancing efforts and increasing credit risk to the Bank. Certain CRE collateral types have experienced declining occupancy, demand, and rental rates, which could potentially lead to material declines in property level economics and further weaken borrowers' ability to service their debt.
The Bank’s credit administration department led by its Chief Credit Officer performs periodic analyses of emerging trends by geography where the Bank has the largest concentrations by CRE property type. These analyses include all real estate property types and geographic markets represented in the loan portfolio and are provided to the Bank's board of directors to assess whether the CRE lending strategy and risk appetite continue to be appropriate, considering changes in local market conditions and the Bank’s exposure to collateral type concentrations. Also, concentration limits by real estate collateral type are approved and monitored by the board of directors. As of September 30, 2025, the Bank was in compliance with all limits.
The following table presents the remaining maturities, based on contractual maturity, by loan type and by rate type (variable or fixed), as of September 30, 2025.
Variable rate
Fixed rate
(Dollars in thousands)
Total Maturities
One Year
or Less
Total
1-5 years
5-15 years
More than 15 years
Total
1-5 years
5-15 years
More than 15 years
Commercial and industrial
$
276,609
$
52,458
$
121,555
$
95,729
$
24,242
$
1,584
$
102,596
$
39,056
$
45,520
$
18,020
Real estate – construction, commercial
73,473
12,717
47,013
17,914
3,813
25,286
13,743
12,892
851
—
Real estate – construction, residential
50,892
43,982
2,042
1,730
—
312
4,868
406
—
4,462
Real estate – commercial
818,101
100,529
437,234
101,376
160,325
175,533
280,338
179,175
92,148
9,015
Real estate – residential
654,030
12,123
383,615
19,850
73,377
290,388
258,292
31,332
27,720
199,240
Real estate – farmland
4,645
1,415
1,983
146
221
1,616
1,247
413
117
717
Consumer loans
33,778
2,081
4,647
4,558
89
—
27,050
24,118
2,932
—
Gross loans
$
1,911,528
$
225,305
$
998,089
$
241,303
$
262,067
$
494,719
$
688,134
$
287,392
$
169,288
$
231,454
Allowance for Credit Losses
. In determining the adequacy of the Company’s ACL, management makes estimates based on facts available at the time the ACL is determined. Such estimation requires significant judgment at the time made. Management believes that the Company’s ACL was adequate as of September 30, 2025 and December 31, 2024. There can be no assurance, however, that adjustments to the ACL will not be required in the future. Changes in the economic assumptions underlying management’s estimates and judgments, adverse developments in the economy, on a national basis or in the Company’s market area, and changes in the circumstances of particular borrowers are criteria, among others that could increase the level of the ACL required, resulting in charges to the provision for credit losses for loans. In addition, bank regulatory agencies periodically review the Bank's ACL and may require an increase in the ACL or the recognition of further loan charge-offs, based on their judgment of the facts at the time of their review that may differ than that of management.
45
The following tables present an analysis of the change in the ACL by loan type as of and for the periods stated.
For the three months ended September 30, 2025
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
5,846
$
1,272
$
398
$
5,879
$
8,001
$
15
$
563
$
21,974
(Recovery of) provision for credit losses - loans
(2,594
)
(135
)
(8
)
314
(304
)
(1
)
928
(1,800
)
Charge-offs
(1,781
)
—
—
(374
)
(92
)
—
(1,035
)
(3,282
)
Recoveries
3,303
—
—
38
222
—
48
3,611
Net recoveries (charge-offs)
1,522
—
—
(336
)
130
—
(987
)
329
ACL, end of period
$
4,774
$
1,137
$
390
$
5,857
$
7,827
$
14
$
504
$
20,503
Ratio of net charge-offs (recoveries) to average loans outstanding
-1.81
%
0.00
%
0.00
%
0.17
%
-0.08
%
0.00
%
9.85
%
-0.07
%
For the three months ended September 30, 2024
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
6,916
$
3,188
$
737
$
10,262
$
6,240
$
18
$
675
$
28,036
Provision for (recovery of) credit losses - loans
(6,059
)
(45
)
(77
)
(69
)
(241
)
1
490
(6,000
)
Charge-offs
(6,001
)
—
—
(1,109
)
(30
)
—
(773
)
(7,913
)
Recoveries
11,095
—
—
—
60
—
175
11,330
Net recoveries (charge-offs)
5,094
—
—
(1,109
)
30
—
(598
)
3,417
ACL, end of period
$
5,951
$
3,143
$
660
$
9,084
$
6,029
$
19
$
567
$
25,453
Ratio of net charge-offs (recoveries) to average loans outstanding
-4.91
%
0.00
%
0.00
%
0.53
%
-0.02
%
0.00
%
4.51
%
-0.61
%
For the nine months ended September 30, 2025
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
5,767
$
2,057
$
540
$
5,963
$
7,933
$
18
$
745
$
23,023
(Recovery of) provision for credit losses - loans
(2,636
)
(920
)
(150
)
(45
)
(120
)
(4
)
1,375
(2,500
)
Charge-offs
(6,442
)
—
—
(437
)
(215
)
—
(2,070
)
(9,164
)
Recoveries
8,085
—
—
376
229
—
454
9,144
Net recoveries (charge-offs)
1,643
—
—
(61
)
14
—
(1,616
)
(20
)
ACL, end of period
$
4,774
$
1,137
$
390
$
5,857
$
7,827
$
14
$
504
$
20,503
Ratio of net charge-offs (recoveries) to average loans outstanding
-1.95
%
0.00
%
0.00
%
0.03
%
-0.01
%
0.00
%
16.12
%
0.00
%
For the nine months ended September 30, 2024
(Dollars in thousands)
Commercial and industrial
Real estate – construction, commercial
Real estate – construction, residential
Real estate – commercial
Real estate – residential
Real estate – farmland
Consumer
Total
ACL, beginning of period
$
13,787
$
4,024
$
1,094
$
9,929
$
6,286
$
15
$
758
$
35,893
(Recovery of) provision for credit losses - loans
(2,351
)
(842
)
(434
)
264
(259
)
4
1,218
(2,400
)
Charge-offs
(19,940
)
—
(39
)
(1,109
)
(74
)
—
(2,063
)
(23,225
)
Recoveries
14,455
—
—
—
76
—
654
15,185
Net charge-offs
(5,485
)
—
(39
)
(1,109
)
2
—
(1,409
)
(8,040
)
ACL, end of period
$
5,951
$
3,182
$
621
$
9,084
$
6,029
$
19
$
567
$
25,453
Ratio of net charge-offs to average loans outstanding
4.67
%
0.00
%
0.25
%
0.52
%
0.00
%
0.00
%
10.06
%
1.38
%
The ACL includes specific reserves for individually evaluated loans and a general allowance applicable to all loan categories; however, management has allocated the ACL by loan type to provide an indication of the relative risk characteristics of the loan portfolio. The allocation is an estimate and should not be interpreted as an indication that charge-offs will occur in these amounts or that the allocation indicates future trends, and does not restrict the usage of the allowance for any specific loan or category. The following table presents the allocation of the ACL by loan category and the percentage of loans in each category to total loans as of the dates stated.
September 30, 2025
December 31, 2024
(Dollars in thousands)
ACL Amount
% of
Loans
ACL Amount
% of
Loans
Commercial and industrial
$
4,774
14.5
%
$
5,767
16.8
%
Real estate – construction, commercial
1,137
3.8
%
2,057
5.4
%
Real estate – construction, residential
390
2.7
%
540
2.4
%
Real estate – commercial
5,857
42.8
%
5,963
40.2
%
Real estate – residential
7,827
34.2
%
7,933
32.8
%
Real estate – farmland
14
0.2
%
18
0.3
%
Consumer
504
1.8
%
745
2.1
%
Total
$
20,503
100.0
%
$
23,023
100.0
%
46
Nonperforming Assets.
The following table presents a summary of nonperforming assets and various measures as of the dates stated.
(Dollars in thousands)
September 30, 2025
December 31, 2024
Nonaccrual loans held for investment
$
24,325
$
22,957
Loans past due 90 days and still accruing
4,253
2,486
Total nonperforming loans
$
28,578
$
25,443
Other real estate owned ("OREO") (1)
—
279
Other non-real estate owned (1)
222
—
Total nonperforming assets
$
28,800
$
25,722
Loans held for investment
$
1,912,726
$
2,111,797
Total assets
$
2,496,949
$
2,737,260
ACL on loans held for investment
$
20,503
$
23,023
ACL to loans held for investment
1.07
%
1.09
%
ACL to nonaccrual loans
84.29
%
100.29
%
ACL to nonperforming loans
71.74
%
90.49
%
Nonaccrual loans to loans held for investment
1.27
%
1.09
%
Nonperforming loans to loans held for investment
1.49
%
1.20
%
Nonperforming loans to total assets
1.14
%
0.93
%
Nonperforming assets to total assets
1.15
%
0.94
%
(1) Included in other assets on the consolidated balance sheets.
The increase in nonperforming loans since December 31, 2024 was primarily attributable to a $4.7 million multifamily loan that was placed on nonaccrual status in the third quarter of 2025. The loan was current as to principal and interest as of September 30, 2025, and based on the payment performance, strength of the guarantors, and value of the collateral, the Company believes that future credit losses, if any, will not be significant.
Loans are generally placed into nonaccrual status when they are past due 90 days or more as to either principal or interest or when, in the opinion of management, the collection of principal and/or interest is in doubt. A loan remains in nonaccrual status until the loan is current as to payment of both principal and interest or past due less than 90 days and the borrower demonstrates the ability to pay and remain current. For nonaccrual loans, when cash payments are received, they are applied to principal first, then to accrued interest. It is the Company's policy not to record interest income on nonaccrual loans until principal has become current. In certain instances, accruing loans that are past due 90 days or more as to principal or interest may not be placed on nonaccrual status, if the Company determines that the loans are well-secured and are in the process of collection. OREO includes properties that have been substantively repossessed or acquired in complete or partial satisfaction of debt. Such properties, which are held for resale, are initially stated at fair value, including a reduction for the estimated selling expenses, which becomes the carrying value. In subsequent periods, such properties are stated at the lower of the restated carrying value or fair value.
Investment Securities.
The investment portfolio is used as a source of interest income, credit risk diversification, and liquidity, as well as to manage interest rate sensitivity and provide collateral for short-term borrowings. Securities in the investment portfolio classified as securities available for sale ("AFS") may be sold in response to changes in market interest rates, securities’ prepayment risk, liquidity needs, and other similar factors, and are carried at estimated fair value. The fair value of the Company’s AFS investment securities portfolio was $341.4 million as of September 30, 2025, an increase of $29.3 million from $312.0 million at December 31, 2024, primarily due to the purchase of securities. As a result of elevated market interest rates, the Company’s portfolio of AFS securities had unrealized losses of approximately $41.6 million and $55.5 million as of September 30, 2025 and December 31, 2024, respectively, of which approximately 83% and 81%, respectively, were related to securities backed by U.S. government agencies as of the same dates.
As of September 30, 2025 and December 31, 2024, the majority of the investment securities portfolio consisted of securities rated investment grade by a leading rating agency. Investment grade securities are judged to have a low risk of default, to be of the best quality, and to carry the smallest degree of investment risk. At September 30, 2025 and December 31, 2024, securities with a fair value of $176.6 million and $268.9 million,
respectively, were pledged to secure the Bank’s borrowing facility with the Federal Home Loan Bank of Atlanta ("FHLB"). As of September 30, 2025 and December 31, 2024, the Company had pledged securities with a fair value of $0 and $16.3 million, respectively, as collateral for the Federal Reserve Bank of Richmond ("FRB") Discount Window. The decline in
47
pledged securities as of September 30, 2025 from December 31, 2024 with both FHLB and FRB reflects the release of securities held as collateral.
The Company reviews its AFS investment securities portfolio for potential credit losses at least quarterly. AFS investment securities with unrealized losses are generally a result of pricing changes due to changes in the current interest rate environment and not as a result of permanent credit impairment. The Company does not intend to sell nor does it believe that it will be required to sell, any of its impaired securities prior to the recovery of the amortized cost. No ACL has been recognized for AFS securities as of both September 30, 2025 and December 31, 2024.
Restricted equity investments consisted of stock in the FHLB (carrying basis $9.1 million and $9.4 million at September 30, 2025 and December 31, 2024, respectively), FRB stock (carrying value of $9.4 million at both September 30, 2025 and December 31, 2024, respectively), and stock in the Company’s correspondent bank (carrying value of $0.5 million at both September 30, 2025 and December 31, 2024). Restricted equity investments are carried at cost.
The Company has various other equity investments, including an investment in a fintech company and limited partnerships, totaling $4.9 million and $4.8 million as of September 30, 2025 and December 31, 2024, respectively.
The Company also holds investments in early-stage focused investment funds and low-income housing partnerships, which totaled $20.8 million and $19.4 million as of September 30, 2025 and December 31, 2024, respectively, and are reported in other investments on the consolidated balance sheets.
The following table presents the amortized cost of the investment portfolio by contractual maturities, as well as the weighted average yields for each of the maturity ranges as of and for the period stated. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
September 30, 2025
Within One Year
One to Five Years
Five to Ten Years
Over Ten Years
(Dollars in thousands)
Amortized
Cost
Weighted
Average
Yield
Amortized
Cost
Weighted
Average
Yield
Amortized
Cost
Weighted
Average
Yield
Amortized
Cost
Weighted
Average
Yield
Total Amortized Cost
Securities available for sale
Mortgage backed securities
$
—
—
$
1,244
2.80
%
$
13,340
2.15
%
$
204,873
2.50
%
$
219,457
U. S. Treasury and agencies
7,501
0.87
%
36,528
1.23
%
29,658
2.39
%
5,218
1.89
%
78,905
State and municipal
889
3.57
%
12,832
2.46
%
30,223
2.15
%
5,408
3.07
%
49,352
Corporate bonds
1,500
7.00
%
10,375
7.58
%
22,363
4.15
%
500
4.00
%
34,738
Total
$
9,890
$
60,979
$
95,584
$
215,999
$
382,452
Deposits.
The principal sources of funds for the Company are deposits, including transaction accounts (demand and money market accounts), time deposits, and savings accounts, of customers in the Company’s primary geographic market area. Such customers provide the Bank a source of fee income and cross-marketing opportunities and are generally a lower cost source of funding for the Bank.
In prior years, deposits sourced through fintech partnerships, inclusive of fintech BaaS deposits, were a significant source of deposits for the Company. In the fourth quarter of 2024, the Company completed the exit of its fintech BaaS deposit operations, thus substantially reducing its fintech-related deposit exposure to approximately 1.0% of deposits as of December 31, 2024. As of September 30, 2025 and December 31, 2024, fintech-related deposits totaled $4.7 million and $21.3 million, respectively.
Brokered deposit balances are sourced through intermediaries and are an unsecured source of funding for the Bank. Brokered deposits were added throughout 2023 and early 2024 to enhance liquidity in light of financial industry events that began in March 2023 and in anticipation of the exit of the Company's fintech BaaS deposit operations. Brokered deposits represented approximately 13.7% and 18.5% of total deposits as of September 30, 2025 and December 31, 2024, respectively, which consisted entirely of time deposits at September 30, 2025. The Bank has a liquidity management program, with oversight by the Bank’s asset and liability management committee (the “ALCO”), that sets forth guidelines for the desired maximum level of brokered deposits, which is 20.0% of total deposits. In recent quarters, the Company has reduced levels of brokered deposits and expects to continue to reduce levels in future periods to a level of 10.0% or less of total deposits. As certain brokered deposits have multiple-year terms, the Company expects brokered deposits to be a funding source for several years.
48
Total deposits decreased $228.4 million from $2.18 billion as of December 31, 2024 to $1.95 billion as of September 30, 2025, as:
•
Deposits, excluding fintech-related and brokered deposits, decreased $77.1 million from approximately $1.76 billion as of December 31, 2024 to approximately $1.68 billion as of September 30, 2025;
•
Brokered deposits decreased $134.6 million from approximately $402.5 million, or 18.5% of total deposits, as of December 31, 2024 to approximately $267.9 million, or 13.7% of total deposits, as of September 30, 2025; and
•
Fintech-related deposits decreased $16.6 million from approximately $21.3 million as of December 31, 2024 to approximately $4.7 million as of September 30, 2025. Remaining fintech-related deposits as of September 30, 2025 included funds in the process of escheatment or distribution to customers, fintech partner corporate operating accounts, and fintech partner corporate accounts held as reserves.
Estimated uninsured deposits totaled approximately $404.3 million as of September 30, 2025, or 19.8% of total deposits, compared to $399.3 million, or 18.0% of total deposits, as of December 31, 2024.
The following table presents a summary of average deposits and the weighted average rate paid for the periods stated. The decline in average balances and rate for interest-bearing demand accounts reflects the exit of fintech BaaS depository operations.
For the nine months ended
September 30, 2025
September 30, 2024
(Dollars in thousands)
Average
Balance
Average Rate
Average
Balance
Average Rate
Noninterest-bearing demand
$
439,589
—
$
499,289
—
Interest-bearing:
Demand
239,777
0.44
%
478,664
2.35
%
Savings
102,296
4.12
%
110,102
4.68
%
Money market
385,260
2.20
%
382,596
2.41
%
Time
910,703
4.27
%
985,077
4.54
%
Total interest-bearing
$
1,638,036
$
1,956,439
Total average deposits
$
2,077,625
$
2,455,728
The following table presents maturities of time deposits for certificate of deposits of $250 thousand or greater as of the dates stated.
(Dollars in thousands)
September 30, 2025
December 31, 2024
Maturing in:
3 months or less
$
31,557
$
38,758
Over 3 months through 6 months
34,373
33,845
Over 6 months through 12 months
55,319
60,308
Over 12 months
29,487
31,117
$
150,736
$
164,028
49
Borrowings.
The Company uses short-term and long-term borrowings from various sources, including FHLB advances and FRB advances, to fund assets and operations. The following tables present information on the balances and interest rates on borrowings as of and for the periods stated.
As of and for the nine months ended September 30, 2025
(Dollars in thousands)
Period-End Balance
Highest Month-End Balance
Average Balance
Weighted Average Rate
FHLB borrowings
$
150,000
$
150,000
$
150,000
3.86
%
As of and for the year ended December 31, 2024
(Dollars in thousands)
Period-End Balance
Highest Month-End Balance
Average Balance
Weighted Average Rate
FHLB borrowings
$
150,000
$
280,000
$
213,003
4.27
%
FRB borrowings
—
65,000
23,087
4.68
%
FHLB advances are secured by collateral consisting of a blanket lien on qualifying pledged loans in the Company’s residential, multi-family, and commercial real estate mortgage loan portfolios, as well as select investment securities. FRB advances through the FRB Discount Window are secured by qualifying pledged construction and commercial and industrial loans.
The Company had $14.7 million and $39.8 million of subordinated notes, net, outstanding as of September 30, 2025 and December 31, 2024, respectively. Prior to June 1, 2025, the Company's subordinated notes had been comprised of a $15 million issuance in May 2020 maturing June 1, 2030 (the “2030 Note”) and a $25 million issuance in October 2019 maturing October 15, 2029 (the “2029 Notes”).
On June 1, 2025, the Company completed the $15.0 million redemption of the 2030 Note. The interest rate on the 2030 Note was 6.0% up to the redemption date. Interest expense on the 2030 Note was $0 and $0.2 million for the three months ended September 30, 2025 and 2024, respectively, and $0.4 million and $0.7 million for the nine months ended September 30, 2025 and 2024, respectively.
On July 15, 2025, the Company completed a $10.0 million partial redemption of its 2029 Notes. The 2029 Notes bore interest at 5.625% per annum, through October 14, 2024, payable semi-annually in arrears. From October 15, 2024 through October 15, 2029, or up to an early redemption date, the interest rate resets quarterly to an interest rate per annum equal to the then current three-month Secured Overnight Funding Rate plus 433.5 basis points, payable quarterly in arrears. As of September 30, 2025, the 2029 Notes bore an annual interest rate of 8.65%. As of September 30, 2025, the net carrying amount of the 2029 Notes was $14.7 million, inclusive of a $0.3 million purchase accounting adjustment (premium). For the three months ended September 30, 2025 and 2024, the effective interest rate on the 2029 Notes was 7.49% and 5.31%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium). For the nine months ended September 30, 2025 and 2024, the effective interest rate on the 2029 Notes was 7.84% and 5.21%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium).
Liquidity
. Liquidity is essential to the Company’s business. The Company’s liquidity could be impaired by unforeseen outflows of cash, including deposits, or the inability to access the capital and/or wholesale funding markets. This situation may arise due to circumstances that the Company may be unable to control, such as general market disruption, negative views about the Company or the financial services industry generally, or an operational problem that affects the Company or a third party. The Company’s ability to borrow from other financial institutions on favorable terms or at all could be adversely affected by disruptions in the markets in which they operate or other events.
Deposits are the primary source of the Company’s liquidity. Cash flows from amortizing or maturing assets also provide funding to meet the liquidity needs of the Company. Deposits are sourced from the Bank’s customers and, as needed, through wholesale deposit markets. The wholesale deposit markets are accessed through brokers or through the IntraFi Network (“IntraFi”), of which the Bank is a member. IntraFi facilitates the Bank attaining brokered deposits via an on-line marketplace. The Bank also utilizes IntraFi's reciprocal deposit services to offer its high-value customers access to FDIC insurance through IntraFi's network of banks.
While subject to the Consent Order, the Bank may not be deemed to be “well capitalized,” which restricts it from accepting, renewing, or rolling over brokered deposits except in compliance with certain applicable restrictions under federal law. Since the third quarter of 2024, the Bank has received approvals from the FDIC allowing the Bank to
50
accept, renew, or rollover brokered deposits for consecutive six-month periods through December 2025 and limited to the amount of maturities during these periods. The Company expects to continue to seek waivers of this prohibition in the future; however, there is no assurance that such waivers will be approved or that the Company will be able to rely on brokered deposits as a source of funding in the future.
The Company has established a formal liquidity contingency plan that provides guidelines for liquidity management. Pursuant to the Company’s liquidity contingency plan, liquidity needs are forecasted based on anticipated changes in the balance sheet. In this forecast, the Company expects to maintain a liquidity cushion. Management then stress tests the Company’s liquidity position under several different stress scenarios, from moderate to severe. Guidelines for the forecasted liquidity cushion and for liquidity cushions for each stress scenario have been established and are reviewed by the Bank's ALCO. Management also monitors the Company’s liquidity position on a day-to-day basis through daily cash monitoring and short- and long-term cash flow forecasting and believes its sources of liquidity are adequate to conduct the business of the Company.
The following table presents information on the Company's available sources of liquidity as of the date stated.
(Dollars in thousands)
Capacity
Less: Outstanding Borrowings
Available Balance
Cash and due from banks
$
121,032
Fed funds sold
7,773
Unpledged securities available for sale
164,707
Total
$
293,512
Borrowings
FHLB
$
620,908
$
191,160
(1)
$
429,748
FRB
75,395
—
75,395
Unsecured line of credit
10,000
—
10,000
Total
$
706,303
$
191,160
$
515,143
Available liquidity as of September 30, 2025
$
808,655
(1) Outstanding borrowings are comprised of advances of $150.0 million and letters of credit totaling $41.2 million, of which $40 million served as collateral for public deposits with the Treasury Board of the Commonwealth of Virginia.
Uninsured deposits at September 30, 2025 were $404.3 million. In the unlikely event that uninsured deposit balances leave the Bank over a short period of time, management could more than satisfy the demand with cash on-hand and FHLB borrowing capacity.
Capital.
Capital adequacy is an important measure of financial stability and performance. The Company’s objectives are to maintain a level of capitalization that is sufficient to support the Company's strategic objectives.
Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, financial institutions must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. A financial institution's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.
Banks must hold a capital conservation buffer of 2.50% above the adequately capitalized risk-based capital ratios for all ratios except the Tier 1 leverage ratio. If a banking organization dips into its capital conservation buffer, it is subject to limitations on certain activities, including payment of dividends, share repurchases, and discretionary compensation to certain officers. Additionally, regulators may place certain restrictions on dividends paid by banks.
Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized; although, these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.
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The Consent Order requires the Bank to achieve and maintain minimum capital requirements that are higher than those required for capital adequacy purposes. Specifically, the Bank is required to maintain a leverage ratio of 10.0% and a total capital ratio of 13.0%. As of September 30, 2025 and December 31, 2024, the Bank met these minimum capital ratios. Until the Bank has been released from the Consent Order, the Bank is deemed to be less than well capitalized, thus adequately capitalized.
Because the Bank may not be deemed to be “well capitalized” while subject to the Consent Order, it could be required to pay higher insurance premiums to the FDIC, obtain approval prior to acquiring branches or opening new lines of business, and be subject to increased regulatory scrutiny such as limitations on asset growth.
The Company adopted ASC 326, Financial Instruments - Credit Losses (referred to herein as "current expected credit losses" or "CECL") effective January 1, 2023. Federal and state banking regulations allow financial institutions to irrevocably elect to phase-in the after-tax cumulative effect adjustment at adoption to retained earnings (“CECL Transitional Amount”) over a three-year period. The three-year phase-in of the CECL Transitional Amount to regulatory capital is 25%, 50%, and 25% in 2023, 2024, and 2025, respectively. The Bank made this irrevocable election effective with its first quarter 2023 call report.
The following tables present the capital ratios to which banks are subject to be adequately and well capitalized, as well as the capital and capital ratios for the Bank as of the dates stated. Adequately capitalized ratios include the conversation buffer, if applicable. The following table also includes the capital adequacy ratios to which bank holding companies are subject. Also presented are the minimum capital ratios set forth in the Consent Order for the Bank with the corresponding capital amounts for both the leverage ratio and the total capital ratio as of the periods stated. The CECL Transitional Amount was $8.1 million, of which $6.1 million and $4.1 million reduced the regulatory capital amounts and capital ratios as of September 30, 2025 and December 31, 2024, respectively.
September 30, 2025
Actual
For Capital
Adequacy Purposes
To Be Well Capitalized
Minimum Capital Ratios
(Dollars in thousands)
Amount
Ratio
Amount
Ratio
Amount
Ratio
Amount
Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
365,989
19.96
%
$
192,507
10.50
%
$
183,340
10.00
%
$
238,342
13.00
%
Blue Ridge Bankshares, Inc.
$
407,122
22.02
%
$
147,898
8.00
%
n/a
n/a
n/a
n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
347,348
18.95
%
$
155,840
8.50
%
$
146,673
8.00
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
376,650
20.37
%
$
110,924
6.00
%
n/a
n/a
n/a
n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
347,348
18.95
%
$
128,338
7.00
%
$
119,171
6.50
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
376,650
20.37
%
$
83,193
4.50
%
n/a
n/a
n/a
n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.
$
347,348
13.67
%
$
101,650
4.00
%
$
127,062
5.00
%
$
254,125
10.00
%
Blue Ridge Bankshares, Inc.
$
376,650
14.70
%
$
102,518
4.00
%
n/a
n/a
n/a
n/a
December 31, 2024
Actual
For Capital
Adequacy Purposes
To Be Well Capitalized
Minimum Capital Ratios
(Dollars in thousands)
Amount
Ratio
Amount
Ratio
Amount
Ratio
Amount
Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
358,848
17.26
%
$
218,260
10.50
%
$
207,866
10.00
%
$
270,226
13.00
%
Blue Ridge Bankshares, Inc.
$
414,284
19.79
%
$
167,444
8.00
%
n/a
n/a
n/a
n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
340,386
16.38
%
$
176,687
8.50
%
$
166,293
8.00
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
360,933
17.24
%
$
125,583
6.00
%
n/a
n/a
n/a
n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.
$
340,386
16.38
%
$
145,507
7.00
%
$
135,113
6.50
%
n/a
n/a
Blue Ridge Bankshares, Inc.
$
360,933
17.24
%
$
94,187
4.50
%
n/a
n/a
n/a
n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.
$
340,386
11.80
%
$
115,364
4.00
%
$
144,204
5.00
%
$
288,409
10.00
%
Blue Ridge Bankshares, Inc.
$
360,933
12.43
%
$
116,169
4.00
%
n/a
n/a
n/a
n/a
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Commitments and Contingencies
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract and involve the same credit risk and evaluation as making a loan to a customer. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit worthiness, in a manner similar to that if underwriting a loan. As of September 30, 2025 and December 31, 2024, the Company had outstanding loan commitments of $243.6 million and $283.2 million, respectively. Of these amounts, $35.5 million and $32.9 million were unconditionally cancelable at the sole discretion of the Company as of the same respective dates.
Conditional commitments are issued by the Company in the form of financial stand-by letters of credit, which guarantee payment to the underlying beneficiary (i.e., third party) if the customer fails to meet its designated financial obligation. As of September 30, 2025 and December 31, 2024, commitments under outstanding financial stand-by letters of credit totaled $9.5 million and $12.5 million, respectively. The credit risk of issuing stand-by letters of credit can be greater than the risk involved in extending loans to customers.
The Company recorded no provision for credit losses for unfunded commitments for either the three months or nine months ended September 30, 2025. As of both September 30, 2025 and December 31, 2024, the reserve for unfunded commitments was $0.9 million and is included in other liabilities on the consolidated balance sheets.
As part of the sale of substantially all of its MSR portfolio during 2024, the Company recorded a reserve for estimated putbacks, transition costs, and unearned sales proceeds. The putbacks related to industry-standard items, including prepayments or early delinquencies of the underlying mortgages, all of which were subject to term limits per the respective sales agreements. As of September 30, 2025, all such term limits have expired. The reserve for unearned sales proceeds relates to the Company providing certain documentation to the buyers. In the three and nine months ended September 30, 2025, the Company received $0.7 million and $1.0 million, respectively, of previously unearned sale proceeds, which resulted in a corresponding release of the reserve and were reported as income on sale of MSRs on the consolidated statements of operations. As of September 30, 2025 and December 31, 2024, the reserve was $0.6 million and $1.8 million, respectively, and was included in other liabilities on the consolidated balance sheet.
The Company has investments in various partnerships and limited liability companies. Pursuant to these investments, the Company commits to an investment amount that may be fulfilled in future periods. At September 30, 2025 and December 31, 2024, the Company had future commitments outstanding totaling $5.2 million and $7.1 million, respectively, related to these investments.
Interest Rate Risk Management
As a financial institution, the Company is exposed to various business risks, including interest rate risk. Interest rate risk is the risk to earnings and value arising from volatility in market interest rates. Interest rate risk arises from timing differences in the repricing and cash flows of interest-earning assets and interest-bearing liabilities, changes in the expected cash flows of assets and liabilities arising from embedded options, such as borrowers' ability to prepay loans and depositors' ability to redeem certificates of deposit before maturity, changes in the shape of the yield curve where interest rates increase or decrease in a nonparallel fashion, and changes in spread relationships between different yield curves, such as U.S. Treasuries and other market-based index rates. The Company’s goal is to maximize net interest income without incurring excessive interest rate risk. Management of net interest income and interest rate risk must be consistent with the level of capital and liquidity that the Bank maintains. The Company manages interest rate risk through the ALCO comprised of members of management, with oversight by a committee of its board of directors. The ALCO is responsible for monitoring the Company’s interest rate risk in conjunction with liquidity and capital management, pursuant to policy guidelines approved by the board of directors.
The Company employs an independent firm to model its interest rate sensitivity that uses a net interest income simulation model as its primary tool to measure interest rate sensitivity. Assumptions for modeling are developed based on expected activity in the balance sheet. For maturing assets, assumptions are created for the redeployment of these assets. For maturing liabilities, assumptions are developed for the replacement of these funding sources. Assumptions are also developed for assets and liabilities that could reprice during the modeled time period. These assumptions also cover how management expects rates to change on non-maturity deposits, such as demand, money market, and savings accounts, as well as certificates of deposit. Based on inputs that include the current balance sheet, the current level of interest rates, and the developed assumptions, the model produces an expected level of net interest income assuming that market rates remain unchanged. This is considered the base case. The model then simulates what net interest
53
income would be based on specific changes in interest rates. The rate simulations are performed for a two-year period and include rapid rate changes of down 100 basis points to 400 basis points and up 100 basis points to 400 basis points. The results of these simulations are then compared to the base case.
The following tables present the estimated change in net interest income under various rate change scenarios as of the dates presented. The scenarios assume rate changes occur instantaneous and in a parallel manner, which means the changes are the same on all points of the rate curve. Estimated changes set forth below are dependent on material assumptions, such as those previously discussed.
September 30, 2025
Instantaneous Parallel Rate Shock Scenario
Change in Net Interest Income - Year 1
Change in Net Interest Income - Year 2
Change in interest rates:
+400 basis points
$
6,921
8.8
%
$
7,616
9.1
%
+300 basis points
5,189
6.6
%
5,722
6.8
%
+200 basis points
3,495
4.4
%
3,931
4.7
%
+100 basis points
1,799
2.3
%
2,122
2.5
%
Base case
-100 basis points
(2,228
)
(2.8
%)
(3,007
)
(3.6
%)
-200 basis points
(4,764
)
(6.0
%)
(6,721
)
(8.0
%)
-300 basis points
(6,898
)
(8.7
%)
(9,725
)
(11.6
%)
-400 basis points
(9,536
)
(12.1
%)
(13,893
)
(16.5
%)
December 31, 2024
Instantaneous Parallel Rate Shock Scenario
Change in Net Interest Income - Year 1
Change in Net Interest Income - Year 2
Change in interest rates:
+400 basis points
$
3,288
3.8
%
$
6,628
6.7
%
+300 basis points
3,347
3.8
%
5,842
5.9
%
+200 basis points
2,877
3.3
%
4,610
4.7
%
+100 basis points
1,798
2.1
%
2,751
2.8
%
Base case
-100 basis points
(2,978
)
(3.4
%)
(4,205
)
(4.3
%)
-200 basis points
(6,468
)
(7.4
%)
(9,650
)
(9.8
%)
-300 basis points
(9,831
)
(11.2
%)
(15,174
)
(15.4
%)
-400 basis points
(12,664
)
(14.5
%)
(19,666
)
(20.0
%)
Stress testing the balance sheet and net interest income using instantaneous parallel rate shock movements in the yield curve is a regulatory and banking industry practice. However, these stress tests may not represent a realistic forecast of future interest rate movements in the yield curve. In addition, instantaneous parallel rate shock modeling is not a predictor of actual future performance of earnings. It is a financial metric used to manage interest rate risk and track the movement of the Company’s interest rate risk position over a historical time frame for comparison purposes.
The asset and liability repricing characteristics of the Company’s assets and liabilities will have a significant impact on its future interest rate risk profile.
Item 3. Quantitative and Qualitati
ve Disclosures about Market Risk
This information is incorporated herein by reference to the information in section "Interest Rate Risk Management" within Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Form 10-Q.
Item 4. Controls
and Procedures
Evaluation of Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures that are designed to provide assurance that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of
54
1934 is recorded, processed, summarized, and reported within the time periods required by the SEC and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. An evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of September 30, 2025 was carried out under the supervision and with the participation of management, including the Company’s Chief Executive Officer and Chief Financial Officer. Based on and as of the date of such evaluation, the aforementioned officers concluded that the Company’s disclosure controls and procedures were effective.
The Company’s management is also responsible for establishing and maintaining adequate internal control over financial reporting. There were no changes in the Company’s internal control over financial reporting that occurred during the Company’s last fiscal quarter that materially affected, or are reasonably likely to materially affect, internal control over financial reporting.
55
PART II. OTHER
INFORMATION
Item 1. Legal
Proceedings
In the ordinary course of operations, the Company is party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, in the aggregate, will not have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows.
For information regarding legal proceedings in which the Company is involved, please see Note 11 to the unaudited consolidated financial statements included in this Form 10-Q.
Item 1A. Ri
sk Factors
There have been no material changes to the risk factors disclosed in the 2024 Form 10-K. Additional risks not presently known to the Company, or that are currently deemed immaterial, may also adversely affect the Company's business, financial condition, or results of operations. See also “Cautionary Note About Forward-Looking Statements,” included in Part 1, Item 2, of this Form 10-Q.
Item 2. Unregistered Sales of Equi
ty Securities and Use of Proceeds
On August 25, 2025, the Company announced the adoption of the Repurchase Program pursuant to which the Company may purchase up to $15 million of the Company’s issued and outstanding shares of common stock. The Repurchase Program may be modified, suspended, or terminated at any time without notice, at the Company’s discretion, based upon a number of factors, including market conditions, the cost of repurchasing shares, the availability of alternative investment opportunities, liquidity, the need for capital in the Company’s operations, and other factors deemed appropriate. These factors may also affect the timing and amount of share repurchases. The Repurchase Program does not obligate the Company to repurchase any shares.
When incentive stock awards vest, employees and directors may elect to have the Company withhold shares of the Company’s common stock as payment for income and payroll taxes, as applicable.
The following table provides information regarding repurchases of common stock for the three months ended September 30, 2025.
Shares Purchased or Withheld (1) (2)
Average Price Paid per Share
Shares Purchased as Part of a Publicly Announced Program
Approximate Value of Shares that May Yet Be Purchased Under the Program
July 1, 2025 through July 31, 2025
5,318
$
3.61
—
$
—
August 1, 2025 through August 31, 2025
2,885
3.66
—
15,000,000
September 1, 2025 through September 30, 2025
660,862
4.16
659,949
12,233,238
Total
669,065
$
4.15
659,949
(1) The total number of shares for each period includes shares purchased as part of the Repurchase Program and/or shares withheld from employees upon the vesting of restricted stock awards in satisfaction of applicable tax withholding obligations.
(2) For the three months ended September 30, 2025, employees and directors of the Company elected to have 9,116 shares of their vesting restricted stock awards withheld as payment for tax obligations.
Item 3. Defaults Upo
n Senior Securities
None
Item 4. Mine Saf
ety Disclosures
None
Item 5. Other
Information
During the fiscal quarter ended September 30, 2025, none of the Company’s directors or officers (
as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934)
adopted
or
terminated
a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408(a) of Regulation S-K).
The following materials from Blue Ridge Bankshares, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025, formatted in Inline Extensible Business Reporting Language (XBRL), include: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (Loss), (iv) Consolidated Statements of Changes in Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) related notes (filed herewith).
104
The cover page from Blue Ridge Bankshares, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025, formatted in Inline XBRL (included with Exhibit 101).
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SIGNAT
URES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
BLUE RIDGE BANKSHARES, INC.
Date: November 4, 2025
By:
/s/ G. William Beale
G. William Beale
President and Chief Executive Officer
By:
/s/ Judy C. Gavant
Judy C. Gavant
Executive Vice President and Chief Financial Officer
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