EX-99.1 2 earningsrelease3312025.htm EX-99.1 Document

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Announces Strong First Quarter Results and Successful IFH Conversion;
Continued Strong Organic Loan and Deposit Growth;
NIM and Fee Income Drives Robust Returns
First Quarter 2025 Highlights
•Net Income of $13.9 million, or $0.82 per share, and return on average assets ("ROA") of 1.75%
◦Core net income(1) of $14.9 million, or $0.88 per share, and core ROA(1) of 1.87%
•Book value per common share of $22.19 at March 31, 2025, increased $0.87 compared to 4Q 2024, and increased $3.51 when compared to 1Q 2024.
◦Tangible Book Value Per Share(1) of $19.81, increased 3.7% (not annualized), or $0.71(2) as compared to 4Q 2024, and increased 6.0%, or $1.13 compared to 1Q 2024
•Return on average equity ("ROE") of 15.56%, and return on average tangible common equity ("ROTCE")(1) of 17.57%
◦Core ROE(1) of 16.64%, and core ROTCE(1) of 18.77%
•Gross Loans grew $48.2 million, or 7.4% (annualized), during 1Q 2025, and growth of $713.9 million year-over-year including $340.4 million from organic growth and $373.5 million from the IFH acquisition
•Total Deposits grew $129.4 million, or 19.0% (annualized), from 4Q 2024. Year-over-year growth of $885.6 million includes $426.7 million from organic growth, and $459.0 million from the acquisition of IFH, or 44.2% from 1Q 2024
◦Customer Deposit growth of $154.6 million, or 25.8% (annualized) from 4Q 2024, and $738.5 million year-over-year, or 40.0% from 1Q 2024, including $445.0 million of organic growth, and $293.5 million from the acquisition of IFH
•Net Interest Income increased $1.7 million, or 3.9% (not annualized), from 4Q 2024 due to balance sheet growth and purchase accounting accretion, and increased $11.0 million, or 31.5%, year-over-year, primarily driven by strong organic growth and the acquisition of IFH.
•Net Interest Margin ("NIM") of 6.05% increased 18 bps compared to 4Q 2024 and decreased 19 bps compared to 1Q 2024 due to the acquisition of commercial loans from IFH, diluting the impact from OpenSky™
◦Commercial Bank NIM(1) of 4.32% increased by 33 bps and 55 bps, compared to 4Q 2024 and 1Q 2024, respectively
◦Net purchase accounting accretion of $1.5 million for 1Q 2025, increased $0.8 million compared to 4Q 2024, accounting for 20 bps of both reported NIM and Commercial Bank NIM(1)
•Fee Revenue (noninterest income) totaled $12.5 million, or 21.4% of total revenue for 1Q 2025, an increase of $0.6 million, from 4Q 2024 and $6.6 million, from 1Q 2024
•The allowance for credit losses to total loans ("ACL Coverage Ratio") equaled 1.81% at March 31, 2025 down 4 bps from 4Q 2024 and up 32 bps from 1Q 2024, primarily due to of the acquisition of IFH loans. The Commercial Bank ACL Coverage Ratio(1) equaled 1.67% at March 31, 2025, compared to 1.70% at December 31, 2024.
•Cash Dividend of $0.10 per share declared by the Board of Directors
(1) As used in this press release, core net income, core ROA, core ROE, ROTCE, core ROTCE, Commercial Bank NIM, Commercial Bank ACL Coverage Ratio, and Tangible Book Value are non–U.S. generally accepted accounting principles ("GAAP") financial measures. These non-GAAP financial metrics exclude merger-related and other certain one-time non-reoccurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
(2) 4Q 2024 Tangible Book Value restated to $19.10 from previously reported amount of $18.77 due to exclusion of Loan Servicing Assets.
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Rockville, Maryland, April 28, 2025 (GLOBE NEWSWIRE) – Capital Bancorp, Inc. (the "Company") (NASDAQ: CBNK), the holding company for Capital Bank, N.A. (the "Bank"), today reported net income of $13.9 million, or $0.82 per diluted share, for 1Q 2025, compared to net income of $7.5 million, or $0.45 per diluted share, for 4Q 2024, and $6.6 million, or $0.47 per diluted share, for 1Q 2024. Core net income(1) for 1Q 2025 of $14.9 million, or $0.88 per diluted share, compared to $15.5 million, or $0.92 per diluted share in 4Q 2024.
The Company also declared a cash dividend on its common stock of $0.10 per share. The dividend is payable on May 28, 2025 to shareholders of record on May 12, 2025.
“The first quarter continues the momentum from 2024 and further demonstrates the value of the larger and more diversified franchise resulting from the acquisition of IFH," said Ed Barry, CEO of the Company and the Bank. "I would like to thank Management and the teams across the organization for a successful integration of IFH in the first quarter. Our continued focused execution of our initiatives and growth objectives will build on a great start to 2025."
“Our record GAAP earnings per share for the quarter, increased net interest margin, solid loan and deposit growth, and superior return on tangible equity all confirm that we are on the right course for continued growth. We continue to benefit from our diversified earnings platform, both in terms of overall performance and risk mitigation,” said Steven J. Schwartz, Chairman of the Company. “That said, we intend to continue to monitor closely the possible impact on our businesses from emergent governmental policies, with a view towards insulating ourselves, to the extent we can, from the effects of such policies, including interest rate and price volatility and heightened economic uncertainty.”


Reconciliation of GAAP Net Income to Core (Non-GAAP) Net Income
The following table provides a reconciliation of the Company's net income under GAAP to Core net income (non-GAAP) results excluding merger-related expenses and other one-time non-recurring transactions.
First Quarter 2025
Fourth Quarter 2024
(in thousands, except per share data)Income Before Income TaxesIncome Tax ExpenseNet IncomeDiluted Earnings per ShareIncome Before Income TaxesIncome Tax ExpenseNet IncomeDiluted Earnings per Share
GAAP Net Income$18,297 $4,365 $13,932 $0.82 $10,776 $3,243 $7,533 $0.45 
Add: Merger-Related Expenses1,266 302 964 2,615 464 2,151 
Add: Non-recurring Equity and Debt Investment Write-Down— — — 2,620 — 2,620 
Add: Initial IFH ACL Provision— — — 4,194 1,025 3,169 
Core Net Income(1)
$19,563 $4,667 $14,896 $0.88 $20,205 $4,732 $15,473 $0.92 
Note: The income tax expense reflects the non-deductibility of certain merger-related expenses.
1 As used in this press release, core net income is a non-GAAP financial measure. This non-GAAP financial metric excludes merger-related and other certain one-time non-recurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
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First Quarter 2025 Results
Earnings Summary
Net income of $13.9 million, or $0.82 per diluted share, compared to net income of $7.5 million, or $0.45 per diluted share, for 4Q 2024, and $6.6 million or $0.47 per diluted share, for 1Q 2024. 1Q 2025 core net income(1) of $14.9 million, or $0.88 per diluted share, compared to 4Q 2024 of $15.5 million, or $0.92 per diluted share.
•Net interest income of $46.0 million increased $1.7 million, or 3.9% (not annualized), compared to 4Q 2024, and increased $11.0 million, or 31.5% year-over-year.
◦Interest income of $62.8 million increased $1.1 million, or 1.7% (not annualized), over 4Q 2024, and increased $14.4 million, or 29.8%, year-over-year. The increase quarter-over-quarter was driven by increases of $1.1 million from net purchase accounting accretion, $0.7 million from interest-bearing deposits held at other financial institutions, and $0.3 million from investments held for sale, partially offset by a decrease in loan interest income of $1.1 million due to rate and portfolio mix, while the increase year-over year was primarily driven by organic growth and the acquisition of IFH.
▪Interest income included $0.4 million from net purchase accounting accretion in 1Q 2025 compared to $0.7 million from net purchase accounting amortization in 4Q 2024. There was no related purchase accounting accretion or amortization during 1Q 2024.
◦Interest expense of $16.7 million decreased $0.7 million, or 3.8% (not annualized) compared to 4Q 2024, and increased $3.4 million, or 25.1%, year-over-year. The decrease quarter-over-quarter was primarily due to a decrease in borrowed funds partially offset by lower net purchase accounting accretion, and the increase year-over-year was driven by organic growth and the acquisition of IFH.
▪Interest expense included $1.1 million from net purchase accounting accretion in 1Q 2025 compared to $1.4 million from net purchase accounting accretion in 4Q 2024. There was no related purchase accounting accretion or amortization during 1Q 2024.
•The provision for credit losses was $2.2 million, a decrease of $5.6 million from 4Q 2024. The decrease over the prior quarter was primarily driven by the recognition of the Initial IFH ACL Provision of $4.2 million in 4Q 2024, and a $2.0 million lower provision from the commercial loan portfolio partially offset by an additional $0.6 million from OpenSky™ provision in the current quarter. Net charge-offs totaled $2.4 million, or 0.38% of portfolio loans (annualized), including $2.3 million from OpenSky™ loans. By comparison net charge-offs for 4Q 2024 totaled $2.4 million, or 0.37% of portfolio loans (annualized), including $2.1 million from OpenSky™ loans. At March 31, 2025, the ACL Coverage Ratio was 1.81%, down 4 bps from the ratio of 1.85% at December 31, 2024, due to the payoff of certain purchase credit deteriorated ("PCD") loans acquired from IFH, during the quarter. The provision for credit losses decreased $0.5 million, year-over-year (1Q 2024) primarily from lower commercial loan portfolio provision of $0.7 million, offset by slightly higher provision for OpenSky™ of $0.2 million, while the ACL Coverage Ratio increased 32 bps year-over-year driven by the acquisition of IFH.
1 As used in this press release, core net income is a non-GAAP financial measure. This non-GAAP financial metric excludes merger-related and other certain one-time non-recurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
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Earnings Summary (Continued)
•Noninterest income of $12.5 million increased $0.6 million compared to 4Q 2024 and increased $6.6 million year-over-year primarily due to the contributions made by the businesses IFH brought to the merged entity. Core fee revenue(1) of $12.5 million decreased $2.0 million, as a result of $1.2 million lower government lending revenue, $0.8 million lower SBIC investment income, $0.5 million lower loan servicing, $0.4 million lower government loan servicing revenue (Windsor), offset by a loan termination fee of $0.7 million during 1Q 2025.
•Noninterest expense of $38.1 million increased $0.5 million compared to 4Q 2024 and $8.6 million compared to 1Q 2024. Core noninterest expense(1) of $36.8 million increased $1.9 million compared to 4Q 2024 and $8.0 million compared to 1Q 2024. Core comparisons include:
◦Salaries and employee benefits expenses increased $1.6 million from 4Q 2024, primarily the result of $0.7 million lower deferred expenses related to loan production, $0.6 million from the seasonality of payroll related taxes, and $0.2 million in employee benefits.
◦Marketing expenses increased $0.7 million from 4Q 2024, primarily due to additional OpenSky™ advertising-related expenses due to seasonality.
◦Regulatory assessment expenses increased $0.4 million from 4Q 2024, primarily due to additional assessments from the acquisition of IFH.
◦Expense reduction of $0.8 million from 4Q 2024, includes $0.3 million from loan processing, $0.2 million from other operating, and $0.3 million from other areas.
◦Year-over-year expense growth of $8.6 million was primarily due to the acquisition of IFH.
◦Estimated total cost synergies resulting from the acquisition of IFH totaled $1.75 million in 1Q 2025, achieving the targeted savings earlier than anticipated.
•Income tax expense of $4.4 million, or 23.9% of pre-tax income for 1Q 2025, increased $1.1 million from $3.2 million, or 30.1% of pre-tax income for 4Q 2024. The core effective income tax rate(1) for 1Q 2025 and 4Q 2024 would have been 23.7% and 22.6%, respectively.
1 As used in this press release, core fee revenue, core noninterest expense, and core effective income tax rate are non-GAAP financial measures. These non-GAAP financial metrics exclude merger-related and other certain one-time non-recurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
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Balance Sheet
Total assets of $3.3 billion at March 31, 2025 increased $142.9 million, or 18.1% (annualized), from December 31, 2024. Total assets growth year-over-year of $1.0 billion, or 44.1%, included $559.4 million acquired with the IFH acquisition, net of purchase accounting, and $465.6 million of organic growth.
•Cash and cash equivalents of $294.0 million at March 31, 2025 increased $88.7 million from December 31, 2024 due to portfolio growth, and increased $208.8 million year-over-year including $130.9 million from organic growth and $77.8 million from the acquisition of IFH.
•Total portfolio loans of $2.68 billion at March 31, 2025 increased $48.2 million, or 7.4% (annualized), from December 31, 2024 and increased $713.9 million year-over-year including $373.5 million from the acquisition of IFH and $340.4 million of organic growth.
◦Compared to December 31, 2024, commercial and industrial loans increased $39.8 million and construction real estate loans increased $22.0 million, offset by a $9.1 million decrease in OpenSky™ loans and a $6.3 million decrease in commercial real estate loans.
◦Commercial and industrial loans, and owner-occupied commercial real estate loans totaled 37.9% of total portfolio loans at March 31, 2025, compared to 37.8% at December 31, 2024, and 29.6% at March 31, 2024.
•Total deposits of $2.89 billion at March 31, 2025 increased $129.4 million, or 19.0% (annualized), from December 31, 2024, and increased $885.6 million, or 44.2% (annualized) from March 31, 2024. The increase quarter-over-quarter includes $95.7 million of growth in customer money market deposits, $57.6 million of growth in interest-bearing demand accounts, $1.3 million of noninterest-bearing deposits, and $0.7 million of customer time deposits, partially offset by a decrease in brokered time deposits of $25.2 million. The increase year-over-year is driven by $459.0 million from the acquisition of IFH and $426.7 million from organic growth.
◦Insured and protected deposits were approximately $2.0 billion as of March 31, 2025 representing 70.4% of the Company's deposit portfolio.
◦Low-and-no interest bearing deposits of $1.1 billion, or 38.8% of deposits, increased $58.2 million, or 22.2% (annualized) from December 31, 2024, and increased $257.2 million, or 29.8% year-over-year, including $157.4 million of organic growth, and $91.5 million from the acquisition of IFH.
•The average portfolio loans-to-deposit ratio was 95.15% for the three months ended March 31, 2025, compared to 99.27% from 4Q 2024, and 98.46% from 1Q 2024.
•The investment securities portfolio continues to be classified as available-for-sale and had a fair market value of $213.5 million, or 6.4% of total assets, an effective duration of 3.0 years, with U.S. Treasury Securities representing 56% of the overall investment portfolio at March 31, 2025. The accumulated other comprehensive income (loss) on the investment securities portfolio decreased $2.3 million during the quarter to negative $9.2 million after-tax as of March 31, 2025, which represents 2.5% of total stockholders' equity. The Company does not have a held-to-maturity investment securities portfolio.
•Liquidity – The Company maintains stable and reliable sources of available borrowings, generally consistent with prior quarter. Sources of available borrowings at March 31, 2025 totaled $820.9 million, compared to $803.0 from 4Q 2024. During 1Q 2025 available collateralized lines of credit of $625.4 million, unsecured lines of credit with other banks of $76.0 million and unpledged investment securities available as collateral for potential additional borrowings of $119.5 million.
•Capital Positions – As of March 31, 2025, the Company reported a Common Equity Tier-1 capital ratio of 13.33%, compared to 13.74% at December 31, 2024. At March 31, 2025, the Company and the Bank maintain regulatory capital ratios that exceed all capital adequacy requirements.
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Financial Metrics
Net Interest Margin – Net interest margin of 6.05% for the three months ended March 31, 2025, increased 18 bps compared to the prior quarter, and decreased 19 bps year-over-year. Commercial Bank net interest margin(1), of 4.32% increased 33 bps compared to the prior quarter, and increased 55 bps year-over-year. Net purchase accounting accretion for 1Q 2025 was 20 bps for NIM and Commercial Bank NIM(1).
•The average yield on interest earning assets of 8.24% increased 7 bps compared to the prior quarter, due to portfolio mix, and decreased 39 bps year-over-year primarily due to the acquisition of commercial loans diluting the impact from OpenSky™. The Commercial Bank Loan Yield(1) of 7.14% for 1Q 2025, increased 16 bps 4Q 2024, and increased 18 bps year-over-year.
•The total cost of deposits of 2.42% for 1Q 2025 decreased 8 bps compared to the prior quarter due to rate and mix shift and decreased 22 bps year-over-year. The total cost of interest-bearing deposits decreased 9 bps quarter-over-quarter, and 54 bps year-over-year, to 3.37% for 1Q 2025 due to rate environment and product mix.
•Net purchase accounting accretion of $1.5 million during 1Q 2025, increased $0.8 million from 4Q 2024. There was no related purchase accounting accretion or amortization during 1Q 2024.
Efficiency Ratios – The efficiency ratio was 64.9% for the three months ended March 31, 2025, compared to 66.7% for the three months ended December 31, 2024 and 72.0% for the three months ended March 31, 2024. The core efficiency ratio(1) was 62.8%, for the three months ended March 31, 2025. The core efficiency ratio(1) was 59.3% for the three months ended December 31, 2024, and 70.2% for the three months ended March 31, 2024.
Credit Metrics and Asset Quality – The ACL Coverage Ratio equaled 1.81% at March 31, 2025, a decrease of 4 bps from December 31, 2024, and an increase of 32 bps year-over-year driven by the acquisition of IFH.
Nonperforming assets increased 27 bps to 1.21% of total assets at March 31, 2025 compared to December 31, 2024, and increased 59 bps year-over-year. Total nonaccrual loans at March 31, 2025 increased $10.2 million to $40.5 million compared to December 31, 2024, and increased $26.1 million year-over-year, mainly due to the acquisition of IFH. At March 31, 2025, special mention loans totaled $63.0 million, or 2.4% of total portfolio loans, compared to $60.0 million, or 2.3% of total portfolio loans, at December 31, 2024, and $27.5 million, or 1.4% of total portfolio loans, at March 31, 2024. At March 31, 2025, substandard loans totaled $45.7 million, or 1.7% of total portfolio loans, compared to $48.4 million, or 1.8% of total portfolio loans, at December 31, 2024 and $14.1 million, or 0.7% of total portfolio loans, at March 31, 2024.
1 As used in this press release, Commercial Bank NIM, Commercial Bank Loan Yield, and core efficiency ratio are non-GAAP financial measures. These non-GAAP financial metrics exclude merger-related and other certain one-time non-recurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release
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Financial Metrics (Continued)
Performance Ratios – ROA, ROE, ROTCE were 1.75%, 15.56%, and 17.57% respectively, for the three months ended March 31, 2025, compared to 0.96%, 8.50%, and 9.33%(1) respectively, for the three months ended December 31, 2024. For the three months ended March 31, 2024, ROA, ROE, and ROTCE were 1.15%, 10.19%, and 10.19%, respectively. As of March 31, 2024, the Company did not have goodwill or other intangible assets.
•Core ROA(2), core ROE(2), and core ROTCE(2) for the three months ended March 31, 2025 were 1.87%, 16.64%, and 18.77% respectively. Core ROA(2), core ROE(2), and core ROTCE(2) for the three months ended December 31, 2024, were 1.97%, 17.46%, and 18.91%(1), respectively. Core ROA(2), core ROE(2), and core ROTCE(2) for the three months ended March 31, 2024 were 1.24%, 11.03%, and 11.03%, respectively.
Book Value and Tangible Book Value – Book value per common share of $22.19 at March 31, 2025, increased $0.87 when compared to December 31, 2024, and increased $3.51 when compared to March 31, 2024. Tangible book value per common share(2) increased $0.71(3), or 3.7%, to $19.81 at March 31, 2025 when compared to December 31, 2024, and increased $1.13, or 6.0%, when compared to March 31, 2024. Tangible book value was impacted by the purchase accounting adjustments required as part of the IFH acquisition. Therefore, tangible book value per share(1) was equal to book value per share for periods prior to 4Q 2024.

1 Core ROTCE and core ROTCE for the three months ended December 31, 2024 were restated to 9.33% and 18.91%, respectively, from 9.47% and 19.19%, due to exclusion of Loan Servicing Assets.
2 As used in this press release, core ROA, core ROE, ROTCE, core ROTCE, and Tangible Book Value are non-GAAP financial measures. These non-GAAP financial metrics exclude merger-related and other certain one-time non-recurring pre-tax adjustments and tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.
3 4Q 2024 Tangible Book Value restated to $19.10 from previously reported amount of $18.77 due to exclusion of Loan Servicing Assets.
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Commercial Bank
Continued Portfolio Loan Growth – Gross portfolio loans increased $55.6 million at March 31, 2025 compared to December 31, 2024, including $39.8 million of commercial and industrial loans, and $22.0 million of construction real estate loans. Historical gross portfolio loan balances are disclosed in the Composition of Loans table within the Historical Financial Highlights.
Net Interest Income – Interest income of $48.2 million increased $2.1 million from the prior quarter, driven by loan growth and higher loan yields. Interest expense of $16.6 million decreased $0.6 million, resulting from a decrease in the average balance of borrowings in 1Q 2025.
Credit Metrics – Nonperforming assets, comprised solely of nonaccrual loans, increased 27 bps to 1.21% of total assets at March 31, 2025 compared to December 31, 2024. Total nonaccrual loans at March 31, 2025 increased to $40.5 million compared to $30.2 million at December 31, 2024.
Classified and Criticized Loans – At March 31, 2025, special mention loans totaled $63.0 million, or 2.4% of total portfolio loans, compared to $60.0 million, or 2.3% of total portfolio loans, at December 31, 2024. At March 31, 2025, substandard loans totaled $45.7 million, or 1.7% of total portfolio loans, compared to $48.4 million, or 1.8% of total portfolio loans, at December 31, 2024.

OpenSky™
Accounts – During 1Q 2025, the number of credit card accounts of 563.7 thousand increased by 11.2 thousand, or 2.0% (not annualized) from December 31, 2024, and increased 36.8 thousand, or 7.0% year-over-year.
Loan and Deposit Balances – Loan balances, net of reserves, of $118.7 million at March 31, 2025 decreased by $9.1 million, or 28.7% (annualized), compared to December 31, 2024. Corresponding deposit balances of $168.8 million at March 31, 2025 increased $2.4 million, or 6.0% (annualized), compared to December 31, 2024. Gross unsecured loan balances of $39.0 million at March 31, 2025 decreased $3.4 million, or 32.9% (annualized), compared to $42.4 million at December 31, 2024, and increased $10.5 million year-over-year.
Revenues – Total revenue of $18.2 million decreased $1.0 million from the prior quarter. Interest income of $14.4 million decreased $1.0 million from the prior quarter. Average OpenSky™ credit card loan balances, net of reserves and deferred fees of $118.7 million for 1Q 2025, decreased $2.3 million, or 1.9% (not annualized), compared to the prior quarter. Noninterest income of $3.7 million remained generally consistent compared to the prior quarter.
Noninterest Expense – Total noninterest expense of $13.3 million decreased $0.7 million, primarily related to advertising related expenses due to seasonality.
OpenSky™ Credit – Portfolio credit metrics continue to be generally consistent with modeled expectations during 1Q 2025. The provision for credit losses of $1.8 million increased $0.6 million when compared to the prior quarter. OpenSky's unsecured loan product continues to be offered exclusively to current and former secured card customers in order to retain customer who have successfully improved their credit profiles. Unsecured loans have been offered by OpenSky since the fourth quarter of 2021 and have performed according to management expectations over that time period.
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Capital Bank Home Loans
Originations of loans held for sale totaled $65.8 million during 1Q 2025, with $54.1 million of mortgage loans sold resulting in a gain on sale of loans of $1.7 million, representing a 3.07% of gain on sale as a percentage of total loans sold. Originations of loans held for sale totaled $90.0 million during 4Q 2024, with $77.4 million of mortgage loans sold resulting in a gain on sale of loans of $1.9 million, representing a 2.45% of gain on sale as a percentage of total loans sold.

Windsor Advantage
Gross government loan servicing revenue totaled $4.6 million, including $1.0 million of Capital Bank related servicing fees, during 1Q 2025. Gross government loan servicing revenue totaled $4.6 million, including $0.9 million of Capital Bank related servicing fees, during 4Q 2024. Windsor's total servicing portfolio was $2.6 billion at March 31, 2025, and $2.5 billion at December 31, 2024.
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COMPARATIVE FINANCIAL HIGHLIGHTS - Unaudited
Quarter Ended1Q25 vs 4Q241Q25 vs 1Q24
(in thousands, except per share data)March 31, 2025December 31, 2024March 31, 2024$ Change% Change$ Change% Change
Earnings Summary
Interest income$62,760 $61,707 $48,369 $1,053 1.7 %$14,391 29.8 %
Interest expense16,713 17,380 13,361 (667)(3.8)%3,352 25.1 %
Net interest income46,047 44,327 35,008 1,720 3.9 %11,039 31.5 %
Provision for credit losses2,246 7,828 2,727 (5,582)(71.3)%(481)(17.6)%
Provision for credit losses on unfunded commitments— 122 142 (122)(100.0)%(142)(100.0)%
Noninterest income12,549 11,913 5,972 636 5.3 %6,577 110.1 %
Noninterest expense38,053 37,514 29,487 539 1.4 %8,566 29.1 %
Income before income taxes18,297 10,776 8,624 7,521 69.8 %9,673 112.2 %
Income tax expense4,365 3,243 2,062 1,122 34.6 %2,303 111.7 %
Net income$13,932 $7,533 $6,562 $6,399 84.9 %$7,370 112.3 %
Pre-tax pre-provision net revenue ("PPNR") (1)
$20,543 $18,726 $11,493 $1,817 9.7 %$9,050 78.7 %
Core PPNR(1)
$21,809 $23,961 $12,205 $(2,152)(9.0)%$9,604 78.7 %
Common Share Data
Earnings per share - Basic$0.84 $0.45 $0.47 $0.39 86.7 %$0.37 78.7 %
Earnings per share - Diluted$0.82 $0.45 $0.47 $0.37 82.2 %$0.35 74.5 %
Core earnings per share - Diluted(1)
$0.88 $0.92 $0.51 $(0.04)(4.3)%$0.37 72.5 %
Weighted average common shares - Basic16,666 16,595 13,919 
Weighted average common shares - Diluted16,925 16,729 13,919 
Return Ratios
Return on average assets (annualized)1.75 %0.96 %1.15 %
Core return on average assets (annualized)(1)
1.87 %1.97 %1.24 %
Return on average equity (annualized)15.56 %8.50 %10.19 %
Core return on average equity (annualized)(1)
16.64 %17.46 %11.03 %
Return on average tangible common equity (annualized)(1)
17.57 %9.33 %10.19 %
Core return on average tangible common equity (annualized)(1)
18.77 %18.91 %11.03 %
______________
(1) Refer to Appendix for reconciliation of non-GAAP measures.



10

COMPARATIVE FINANCIAL HIGHLIGHTS - Unaudited (Continued)
Quarter EndedQuarter Ended
March 31,December 31,September 30,June 30,
(in thousands, except per share data)20252024% Change202420242024
Balance Sheet Highlights
Assets$3,349,805 $2,324,238 44.1 %$3,206,911 $2,560,788 $2,438,583 
Investment securities available-for-sale213,452 202,254 5.5 %223,630 208,700 207,917 
Mortgage loans held for sale34,656 10,303 236.4 %21,270 19,554 19,219 
Portfolio loans receivable (2)
2,678,406 1,964,525 36.3 %2,630,163 2,107,522 2,021,588 
Allowance for credit losses48,454 29,350 65.1 %48,652 31,925 30,832 
Deposits2,891,333 2,005,695 44.2 %2,761,939 2,186,224 2,100,428 
FHLB borrowings 22,000 22,000 — %22,000 52,000 32,000 
Other borrowed funds12,062 12,062 — %12,062 12,062 12,062 
Total stockholders' equity369,577 259,465 42.4 %355,139 280,111 267,854 
Tangible common equity (1)
329,936 259,465 27.2 %318,196 280,111 267,854 
Common shares outstanding16,657 13,890 19.9 %16,663 13,918 13,910 
Book value per share$22.19 $18.68 18.8 %$21.31 $20.13 $19.26 
Tangible book value per share (1)
$19.81 $18.68 6.0 %$19.10 $20.13 $19.26 
Dividends per share
$0.10 $0.08 25.0 %$0.10 $0.10 $0.08 
______________
(1) Refer to Appendix for reconciliation of non-GAAP measures.
(2) Loans are reflected net of deferred fees and costs.
11

Consolidated Statements of Income (Unaudited)
Three Months Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Interest income
Loans, including fees$58,691 $58,602 $50,047 $48,275 $45,991 
Investment securities available-for-sale1,861 1,539 1,343 1,308 1,251 
Federal funds sold and other2,208 1,566 1,220 1,032 1,127 
Total interest income62,760 61,707 52,610 50,615 48,369 
Interest expense
Deposits16,512 16,385 13,902 13,050 12,833 
Borrowed funds201 995 354 508 528 
Total interest expense16,713 17,380 14,256 13,558 13,361 
Net interest income46,047 44,327 38,354 37,057 35,008 
Provision for credit losses2,246 7,828 3,748 3,417 2,727 
Provision for credit losses on unfunded commitments— 122 17 104 142 
Net interest income after provision for credit losses43,801 36,377 34,589 33,536 32,139 
Noninterest income
Service charges on deposits258 241 235 200 207 
Credit card fees3,722 3,733 4,055 4,330 3,881 
Mortgage banking revenue1,831 1,821 1,882 1,990 1,453 
Government lending revenue1,096 2,301 — — — 
Government loan servicing revenue3,568 3,993 — — — 
Loan servicing rights (government guaranteed)472 1,013 — — — 
Non-recurring equity and debt investment write-down— (2,620)— — — 
Other income1,602 1,431 463 370 431 
Total noninterest income12,549 11,913 6,635 6,890 5,972 
Noninterest expenses
Salaries and employee benefits18,067 16,513 13,345 13,272 12,907 
Occupancy and equipment2,910 2,976 1,791 1,864 1,613 
Professional fees2,112 2,150 1,980 1,769 1,947 
Data processing7,112 7,210 6,930 6,788 6,761 
Advertising1,779 1,032 1,223 2,072 2,032 
Loan processing743 969 615 476 371 
Foreclosed real estate expenses, net1 — 1 — 1 
Merger-related expenses1,266 2,615 520 83 712 
Operational losses903 993 1,008 782 931 
Regulatory assessment expenses889 484 427 553 473 
Other operating2,271 2,572 1,885 1,834 1,739 
Total noninterest expenses38,053 37,514 29,725 29,493 29,487 
Income before income taxes18,297 10,776 11,499 10,933 8,624 
Income tax expense4,365 3,243 2,827 2,728 2,062 
Net income$13,932 $7,533 $8,672 $8,205 $6,562 
12

Consolidated Balance Sheets
(unaudited)(audited)(unaudited)(unaudited)(unaudited)
(in thousands, except share data)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Assets
Cash and due from banks$27,836 $25,433 $23,462 $19,294 $12,361 
Interest-bearing deposits at other financial institutions266,092 179,841 133,180 117,160 72,787 
Federal funds sold59 58 58 57 56 
Total cash and cash equivalents293,987 205,332 156,700 136,511 85,204 
Investment securities available-for-sale213,452 223,630 208,700 207,917 202,254 
Restricted investments7,031 4,479 5,895 4,930 4,441 
Loans held for sale34,656 21,270 19,554 19,219 10,303 
Portfolio loans receivable, net of deferred fees and costs2,678,406 2,630,163 2,107,522 2,021,588 1,964,525 
   Less allowance for credit losses(48,454)(48,652)(31,925)(30,832)(29,350)
Total portfolio loans held for investment, net2,629,952 2,581,511 2,075,597 1,990,756 1,935,175 
Premises and equipment, net15,085 15,525 5,959 5,551 4,500 
Accrued interest receivable19,458 16,664 12,468 12,162 12,258 
Goodwill24,085 21,126 — — — 
Intangible assets13,861 14,072 — — — 
Core deposit intangibles1,695 1,745 — — — 
Loan servicing assets2,244 5,511 — — — 
Deferred tax asset15,902 16,670 10,748 12,150 12,311 
Bank owned life insurance44,335 43,956 38,779 38,414 38,062 
Other assets34,062 35,420 26,388 10,973 19,730 
Total assets$3,349,805 $3,206,911 $2,560,788 $2,438,583 $2,324,238 
Liabilities
Deposits
Noninterest-bearing$812,224 $810,928 $718,120 $684,574 $665,812 
Interest-bearing2,079,109 1,951,011 1,468,104 1,415,854 1,339,883 
Total deposits2,891,333 2,761,939 2,186,224 2,100,428 2,005,695 
Federal Home Loan Bank advances22,000 22,000 52,000 32,000 22,000 
Other borrowed funds12,062 12,062 12,062 12,062 12,062 
Accrued interest payable9,995 9,393 8,503 6,573 6,009 
Other liabilities44,838 46,378 21,888 19,666 19,007 
Total liabilities2,980,228 2,851,772 2,280,677 2,170,729 2,064,773 
Stockholders' equity
Common stock167 167 139 139 139 
Additional paid-in capital128,692 128,598 55,585 55,005 54,229 
Retained earnings249,925 237,843 232,995 225,824 218,731 
Accumulated other comprehensive loss(9,207)(11,469)(8,608)(13,114)(13,634)
Total stockholders' equity369,577 355,139 280,111 267,854 259,465 
Total liabilities and stockholders' equity$3,349,805 $3,206,911 $2,560,788 $2,438,583 $2,324,238 
13

The following tables show the average outstanding balance of each principal category of our assets, liabilities and stockholders’ equity, together with the average yields on our assets and the average costs of our liabilities for the periods indicated. Such yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period.
Three Months Ended
March 31, 2025		Three Months Ended
December 31, 2024		Three Months Ended
March 31, 2024
Average
Outstanding
Balance		Interest Income/
Expense
Average
Yield/
Rate(1)
Average
Outstanding
Balance		Interest Income/
Expense
Average
Yield/
Rate(1)
Average
Outstanding
Balance		Interest Income/
Expense
Average
Yield/
Rate(1)
(in thousands)
Assets
Interest earning assets:
Interest-bearing deposits$203,053 $2,138 4.27 %$140,206 $1,446 4.10 %$84,531 $1,049 4.99 %
Federal funds sold58 1 6.99 58 — — 56 1 7.18 
Investment securities available-for-sale235,605 1,861 3.20 236,951 1,539 2.58 233,231 1,251 2.16 
Restricted investments5,761 69 4.86 7,292 120 6.55 4,601 77 6.73 
Loans held for sale 9,356 238 10.32 25,614 193 3.00 4,872 83 6.85 
Portfolio loans receivable(2)(3)
2,634,110 58,453 9.00 2,592,960 58,409 8.96 1,927,372 45,908 9.58 
Total interest earning assets3,087,943 62,760 8.24 3,003,081 61,707 8.17 2,254,663 48,369 8.63 
Noninterest earning assets134,021 117,026 44,571 
Total assets
$3,221,964 $3,120,107 $2,299,234 
Liabilities and Stockholders’ Equity
Interest-bearing liabilities:
Interest-bearing demand accounts$242,355 368 0.62 $257,446 424 0.66 $183,217 110 0.24 
Savings13,204 18 0.55 13,497 20 0.59 4,841 1 0.08 
Money market accounts869,978 7,399 3.45 763,526 7,131 3.72 682,414 7,136 4.21 
Time deposits859,729 8,727 4.12 847,618 8,810 4.13 449,963 5,586 4.99 
Borrowed funds34,062 201 2.39 97,116 995 4.08 58,963 528 3.60 
Total interest-bearing liabilities2,019,328 16,713 3.36 1,979,203 17,380 3.49 1,379,398 13,361 3.90 
Noninterest-bearing liabilities:
Noninterest-bearing liabilities56,503 58,460 23,820 
Noninterest-bearing deposits783,018 729,907 637,124 
Stockholders’ equity
363,115 352,537 258,892 
Total liabilities and stockholders’ equity$3,221,964 $3,120,107 $2,299,234 
Net interest spread4.88 %4.68 %4.73 %
Net interest income$46,047 $44,327 $35,008 
Net interest margin(4)
6.05 %5.87 %6.24 %
_______________
(1)Annualized.
(2)Includes nonaccrual loans.
(3)For the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, collectively, Commercial Bank Loan Yield was 7.14%, 6.98% and 6.96%, respectively.
(4)For the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, collectively, Commercial Bank Net Interest Margin was 4.32%, 3.99% and 3.77%, respectively.

14

The Company’s reportable segments represent business units with discrete financial information whose results are regularly reviewed by management. The four segments include Commercial Banking, Capital Bank Home Loans (the Company’s mortgage loan division), OpenSky™ (the Company’s credit card division) and Windsor Advantage.

Effective January 1, 2024, the Company allocated certain expenses previously recorded directly to the Commercial Bank segment to the other segments. These expenses are for shared services also consumed by OpenSky™, CBHL, and Windsor. The Company performs an allocation process based on several metrics the Company believes more accurately ascribe shared service overhead to each segment. The Company believes this reflects the cost of support for each segment that should be considered in assessing segment performance. Historical information has been recast to reflect financial information consistently with the 2024 presentation.

The following schedule presents financial information for the periods indicated. Total assets are presented as of March 31, 2025, December 31, 2024, and March 31, 2024.

15

Segments
For the three months ended March 31, 2025
(in thousands)Commercial BankCBHL
OpenSky™
Windsor AdvantageConsolidated
Interest income$48,164 $152 $14,444 $— $62,760 
Interest expense16,649 64 — — 16,713 
Net interest income31,515 88 14,444 — 46,047 
Provision for credit losses446 — 1,800 — 2,246 
Net interest income after provision31,069 88 12,644 — 43,801 
Noninterest income2,474 1,736 3,733 4,606 12,549 
Noninterest expense(1)
18,560 2,531 13,302 3,660 38,053 
Net income (loss) before taxes$14,983 $(707)$3,075 $946 $18,297 
Total assets$3,192,327 $14,092 $119,636 $23,750 $3,349,805 
For the three months ended December 31, 2024
(in thousands)Commercial BankCBHL
OpenSky™
Windsor AdvantageConsolidated
Interest income$46,061 $192 $15,454 $— $61,707 
Interest expense17,249 131 — — 17,380 
Net interest income28,812 61 15,454 — 44,327 
Provision for credit losses6,651 — 1,177 — 7,828 
Provision for credit losses on unfunded commitments122 — — — 122 
Net interest income after provision22,039 61 14,277 — 36,377 
Noninterest income1,928 1,676 3,743 4,566 11,913 
Noninterest expense(1)
19,872 2,377 12,595 2,670 37,514 
Net income (loss) before taxes$4,095 $(640)$5,425 $1,896 $10,776 
Total assets$3,033,792 $21,691 $125,913 $25,515 $3,206,911 
For the three months ended March 31, 2024
(in thousands)Commercial BankCBHL
OpenSky™
Windsor AdvantageConsolidated
Interest income$33,365 $83 $14,921 $— $48,369 
Interest expense13,320 41 — — 13,361 
Net interest income20,045 42 14,921 — 35,008 
Provision for credit losses1,168 — 1,559 — 2,727 
Provision for credit losses on unfunded commitments142 — — — 142 
Net interest income after provision18,735 42 13,362 — 32,139 
Noninterest income705 1,352 3,915 — 5,972 
Noninterest expense(1)
13,783 2,105 13,599 — 29,487 
Net income (loss) before taxes$5,657 $(711)$3,678 $— $8,624 
Total assets$2,208,135 $10,785 $105,318 $— $2,324,238 
________________________
(1)     Noninterest expense includes $6.4 million, $6.3 million, and $6.1 million in data processing expense in OpenSky’s™ segment for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively.

16

HISTORICAL FINANCIAL HIGHLIGHTS - Unaudited
Quarter Ended
(in thousands, except per share data)March 31,
2025		December 31, 2024September 30,
2024		June 30,
2024		March 31,
2024
Earnings:
Net income$13,932 $7,533 $8,672 $8,205 $6,562 
Earnings per common share, diluted0.82 0.45 0.62 0.59 0.47 
Net interest margin6.05 %5.87 %6.41 %6.46 %6.24 %
Commercial Bank net interest margin(2)
4.32 %3.99 %4.01 %3.90 %3.77 %
Return on average assets(1)
1.75 %0.96 %1.42 %1.40 %1.15 %
Return on average equity(1)
15.56 %8.50 %12.59 %12.53 %10.19 %
Efficiency ratio64.94 %66.70 %66.07 %67.11 %71.95 %
Balance Sheet:
Total portfolio loans receivable, net deferred fees$2,678,406 $2,630,163 $2,107,522 $2,021,588 $1,964,525 
Total deposits2,891,333 2,761,939 2,186,224 2,100,428 2,005,695 
Total assets3,349,805 3,206,911 2,560,788 2,438,583 2,324,238 
Total stockholders' equity369,577 355,139 280,111 267,854 259,465 
Total average portfolio loans receivable, net deferred fees2,634,110 2,592,960 2,053,619 1,992,630 1,927,372 
Total average deposits2,768,284 2,611,994 2,091,294 2,010,736 1,957,559 
Portfolio loans-to-deposit ratio (period-end balances)92.64 %95.23 %96.40 %96.25 %97.95 %
Portfolio loans-to-deposit ratio (average balances)95.15 %99.27 %98.20 %99.10 %98.46 %
Asset Quality Ratios:
Nonperforming assets to total assets1.21 %0.94 %0.60 %0.58 %0.62 %
Nonperforming loans to total loans1.51 %1.15 %0.73 %0.70 %0.73 %
Net charge-offs to average portfolio loans (1)
0.38 %0.37 %0.51 %0.39 %0.41 %
Allowance for credit losses to total loans1.81 %1.85 %1.51 %1.53 %1.49 %
Allowance for credit losses to non-performing loans119.73 %160.88 %206.50 %219.40 %204.37 %
Bank Capital Ratios:
Total risk based capital ratio13.00 %12.79 %13.76 %14.51 %14.36 %
Tier-1 risk based capital ratio11.75 %11.54 %12.50 %13.25 %13.10 %
Leverage ratio9.27 %9.17 %9.84 %10.36 %10.29 %
Common Equity Tier-1 capital ratio11.75 %11.54 %12.50 %13.25 %13.10 %
Tangible common equity8.66 %9.31 %9.12 %9.53 %9.66 %
Holding Company Capital Ratios:
Total risk based capital ratio15.05 %15.48 %16.65 %16.98 %16.83 %
Tier-1 risk based capital ratio13.41 %13.83 %14.88 %15.19 %15.03 %
Leverage ratio10.68 %11.07 %11.85 %11.93 %11.87 %
Common Equity Tier-1 capital ratio13.33 %13.74 %14.78 %15.08 %14.92 %
Tangible common equity9.94 %11.07 %10.94 %10.98 %11.16 %
_______________
(1)Annualized.
(2)Refer to Appendix for reconciliation of non-GAAP measures.

17

HISTORICAL FINANCIAL HIGHLIGHTS - Unaudited (Continued)
Quarter Ended
(in thousands, except per share data)March 31,
2025		December 31, 2024September 30,
2024		June 30,
2024		March 31,
2024
Composition of Loans:
Commercial real estate, non owner-occupied$484,399 $471,329 $403,487 $397,080 $377,224 
Commercial real estate, owner-occupied420,643 440,026 351,462 319,370 330,840 
Residential real estate693,597 688,552 623,684 601,312 577,112 
Construction real estate343,280 321,252 301,909 294,489 290,016 
Commercial and industrial594,331 554,550 271,811 255,686 254,577 
Lender finance23,165 28,574 29,546 33,294 13,484 
Business equity lines of credit3,468 3,090 2,663 2,989 14,768 
Credit card, net of reserve(2)
118,709 127,766 127,098 122,217 111,898 
Other consumer loans2,200 2,089 2,045 1,930 738 
Portfolio loans receivable$2,683,792 $2,637,228 $2,113,705 $2,028,367 $1,970,657 
Deferred origination fees, net(5,386)(7,065)(6,183)(6,779)(6,132)
Portfolio loans receivable, net$2,678,406 $2,630,163 $2,107,522 $2,021,588 $1,964,525 
Composition of Deposits:
Noninterest-bearing$812,224 $810,928 $718,120 $684,574 $665,812 
Interest-bearing demand296,455 238,881 266,493 266,070 193,963 
Savings12,819 13,488 3,763 4,270 4,525 
Money markets912,418 816,708 686,526 672,455 678,435 
Customer time deposits549,630 548,901 358,300 317,911 302,319 
Brokered time deposits307,787 333,033 153,022 155,148 160,641 
Total deposits$2,891,333 $2,761,939 $2,186,224 $2,100,428 $2,005,695 
Capital Bank Home Loan Metrics:
Origination of loans held for sale$65,815 $89,998 $74,690 $82,363 $52,080 
Mortgage loans sold54,144 77,399 67,296 66,417 40,377 
Gain on sale of loans1,664 1,897 1,644 1,732 1,238 
Purchase volume as a % of originations90.73 %90.42 %90.98 %96.48 %97.83 %
Gain on sale as a % of loans sold(3)
3.07 %2.45 %2.44 %2.61 %3.07 %
Mortgage commissions$545 $620 $598 $582 $490 
OpenSky™ Portfolio Metrics:
Open customer accounts563,718 552,566 548,952 537,734 526,950 
Secured credit card loans, gross$81,252 $87,226 $89,641 $90,961 $85,663 
Unsecured credit card loans, gross38,987 42,430 39,730 33,560 28,508 
Noninterest secured credit card deposits168,796 166,355 170,750 173,499 171,771 
_______________
(3)Credit card loans are presented net of reserve for interest and fees.
(4)Gain on sale percentage is calculated as gain on sale of loans divided by mortgage loans sold.
18

Appendix

Reconciliation of Non-GAAP Measures




The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company’s industry. Investors should recognize that the Company’s presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.
19

Appendix

Reconciliation of Non-GAAP Measures




Core Earnings MetricsQuarter Ended
(in thousands, except per share data)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Net Income$13,932 $7,533 $8,672 $8,205 $6,562 
Add: Merger-Related Expenses, net of tax964 2,151 557 62 538 
Add: Non-recurring equity and debt investment write-down— 2,620 — — — 
Add: IFH ACL Provision, net of tax— 3,169 — — — 
Core Net Income$14,896 $15,473 $9,229 $8,267 $7,100 
Weighted Average Common Shares - Diluted16,925 16,729 13,951 13,895 13,919 
Earnings per Share - Diluted$0.82 $0.45 $0.62 $0.59 $0.47 
Core Earnings per Share - Diluted$0.88 $0.92 $0.66 $0.59 $0.51 
Average Assets$3,221,964 $3,120,107 $2,437,870 $2,353,868 $2,299,234 
Return on Average Assets(1)
1.75 %0.96 %1.42 %1.40 %1.15 %
Core Return on Average Assets(1)
1.87 %1.97 %1.51 %1.41 %1.24 %
Average Equity$363,115 $352,537 $274,087 $263,425 $258,892 
Return on Average Equity(1)
15.56 %8.50 %12.59 %12.53 %10.19 %
Core Return on Average Equity(1)
16.64 %17.46 %13.40 %12.62 %11.03 %
Net Interest Income (a)$46,047 $44,327 $38,354 $37,057 $35,008 
Noninterest Income12,549 11,913 6,635 6,890 5,972 
Total Revenue$58,596 $56,240 $44,989 $43,947 $40,980 
Noninterest Expense$38,053 $37,514 $29,725 $29,493 $29,487 
Efficiency Ratio(2)
64.9 %66.7 %66.1 %67.1 %72.0 %
Noninterest Income$12,549 $11,913 $6,635 $6,890 $5,972 
Add: Non-recurring equity and debt investment write-down— 2,620 — — — 
Core Fee Revenue (b)$12,549 $14,533 $6,635 $6,890 $5,972 
Core Revenue (a) + (b)$58,596 $58,860 $44,989 $43,947 $40,980 
Noninterest Expense$38,053 $37,514 $29,725 $29,493 $29,487 
Less: Merger-Related Expenses1,266 2,615 520 83 712 
Core Noninterest Expense$36,787 $34,899 $29,205 $29,410 $28,775 
Core Efficiency Ratio(2)
62.8 %59.3 %64.9 %66.9 %70.2 %
_______________
(1)Annualized.
(2)The efficiency ratio is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income).


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Appendix

Reconciliation of Non-GAAP Measures




Commercial Bank Net Interest MarginQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Commercial Bank Net Interest Income$31,515 $28,812 $22,676 $21,223 $20,045 
Average Interest Earning Assets3,087,943 3,003,081 2,380,946 2,307,070 2,254,663 
Less: Average Non-Commercial Bank Interest Earning Assets128,278 133,401 129,906 119,801 116,197 
Average Commercial Bank Interest Earning Assets$2,959,665 $2,869,680 $2,251,040 $2,187,269 $2,138,466 
Commercial Bank Net Interest Margin4.32%3.99%4.01%3.90%3.77%
Commercial Bank Portfolio Loans Receivable YieldQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Portfolio Loans Receivable Interest Income$58,453 $58,409 $49,886 $48,143 $45,908 
Less: Credit Card Loan Income14,148 15,022 15,137 15,205 14,457 
Commercial Bank Portfolio Loans Receivable Interest Income$44,305 $43,387 $34,749 $32,938 $31,451 
Average Portfolio Loans Receivable2,634,110 2,592,960 2,053,619 1,992,630 1,927,372 
Less: Average Credit Card Loans118,723 120,993 119,458 111,288 110,483 
Total Commercial Bank Average Portfolio Loans Receivable$2,515,387 $2,471,967 $1,934,161 $1,881,342 $1,816,889 
Commercial Bank Portfolio Loans Receivable Yield7.14%6.98%7.15%7.04%6.96%
Pre-tax, Pre-Provision Net Revenue ("PPNR")Quarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Net Income
$13,932 $7,533 $8,672 $8,205 $6,562 
Add: Income Tax Expense4,365 3,243 2,827 2,728 2,062 
Add: Provision for Credit Losses2,246 7,828 3,748 3,417 2,727 
Add: Provision for Credit Losses on Unfunded Commitments— 122 17 104 142 
Pre-tax, Pre-Provision Net Revenue ("PPNR")$20,543 $18,726 $15,264 $14,454 $11,493 

Core PPNRQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Net Income
$13,932 $7,533 $8,672 $8,205 $6,562 
Add: Income Tax Expense4,365 3,243 2,827 2,728 2,062 
Add: Provision for Credit Losses2,246 7,828 3,748 3,417 2,727 
Add: Provision for Credit Losses on Unfunded Commitments— 122 17 104 142 
Add: Merger-Related Expenses1,266 2,615 520 83 712 
Add: Non-recurring equity and debt investment write-down— 2,620 — — — 
Core PPNR$21,809 $23,961 $15,784 $14,537 $12,205 
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Appendix

Reconciliation of Non-GAAP Measures




Allowance for Credit Losses to Total Portfolio LoansQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Allowance for Credit Losses$48,454 $48,652 $31,925 $30,832 $29,350 
Total Portfolio Loans2,678,406 2,630,163 2,107,522 2,021,588 1,964,525 
Allowance for Credit Losses to Total Portfolio Loans1.81%1.85%1.51%1.53%1.49%

Commercial Bank Allowance for Credit Losses to Commercial Bank Portfolio LoansQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Allowance for Credit Losses$48,454 $48,652 $31,925 $30,832 $29,350 
Less: Credit Card Allowance for Credit Losses5,905 6,402 7,339 6,768 5,991 
Commercial Bank Allowance for Credit Losses42,549 42,250 24,586 24,064 23,359 
Total Portfolio Loans2,678,406 2,630,163 2,107,522 2,021,588 1,964,525 
Less: Gross Credit Card Loans115,991 122,928 121,718 116,180 106,572 
Commercial Bank Portfolio Loans2,562,415 2,507,235 1,985,804 1,905,408 1,857,953 
Commercial Bank Allowance for Credit Losses to Total Portfolio Loans1.67%1.70%1.24%1.26%1.26%

Nonperforming Assets to Total AssetsQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Total Nonperforming Assets$40,471 $30,241 $15,460 $14,053 $14,361 
Total Assets3,349,805 3,206,911 2,560,788 2,438,583 2,324,238 
Nonperforming Assets to Total Assets1.21%0.94%0.60%0.58%0.62%


Nonperforming Loans to Total Portfolio LoansQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Total Nonperforming Loans$40,471 $30,241 $15,460 $14,053 $14,361 
Total Portfolio Loans2,678,406 2,630,163 2,107,522 2,021,588 1,964,525 
Nonperforming Loans to Total Portfolio Loans1.51%1.15%0.73%0.70%0.73%


Net Charge-Offs to Average Portfolio LoansQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Total Net Charge-Offs$2,444 $2,427 $2,655 $1,935 $1,987 
Total Average Portfolio Loans2,634,110 2,592,960 2,053,619 1,992,630 1,927,372 
Net Charge-Offs to Average Portfolio Loans, Annualized0.38%0.37%0.51%0.39%0.41%






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Appendix

Reconciliation of Non-GAAP Measures

Tangible Book Value per ShareQuarter Ended
(in thousands, except share and per share data)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Total Stockholders' Equity$369,577 $355,139 $280,111 $267,854 $259,465 
Less: Preferred Equity
— — — — — 
Less: Intangible Assets
39,641 36,943 — — — 
Tangible Common Equity$329,936 $318,196 $280,111 $267,854 $259,465 
Period End Shares Outstanding16,657,168 16,662,626 13,917,891 13,910,467 13,889,563 
Tangible Book Value per Share$19.81 $19.10 $20.13 $19.26 $18.68 

Return on Average Tangible Common EquityQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Net Income
$13,932 $7,533 $8,672 $8,205 $6,562 
Add: Intangible Amortization, Net of Tax199 198 — — — 
Net Tangible Income$14,131 $7,731 $8,672 $8,205 $6,562 
Average Equity363,115 352,537 274,087 263,425 258,892 
Less: Average Intangible Assets36,896 22,890 — — — 
Net Average Tangible Common Equity$326,219 $329,647 $274,087 $263,425 $258,892 
Return on Average Equity15.56 %8.50 %12.59 %12.53 %10.19 %
Return on Average Tangible Common Equity17.57 %9.33 %12.59 %12.53 %10.19 %


Core Return on Average Tangible Common EquityQuarter Ended
(in thousands)March 31, 2025December 31, 2024September 30, 2024June 30, 2024March 31, 2024
Net Income, as Adjusted$14,896 $15,473 $9,229 $8,267 $7,100 
Add: Intangible Amortization, Net of Tax199 198 — — — 
Core Net Tangible Income$15,095 $15,671 $9,229 $8,267 $7,100 
Core Return on Average Tangible Common Equity18.77 %18.91 %13.40 %12.62 %11.03 %


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ABOUT CAPITAL BANCORP, INC.
Capital Bancorp, Inc., Rockville, Maryland is a registered bank holding company incorporated under the laws of Maryland. Capital Bancorp has been providing financial services since 1999 and now operates bank branches in four locations in the Washington, D.C., Baltimore, other Maryland markets, one bank branch in Fort Lauderdale, Florida, one bank branch in Chicago, Illinois and one bank branch in Raleigh, North Carolina. Capital Bancorp had assets of approximately $3.3 billion at March 31, 2025 and its common stock is traded in the NASDAQ Global Market under the symbol “CBNK.” More information can be found at the Company's website www.CapitalBankMD.com under its investor relations page.
FORWARD-LOOKING STATEMENTS
This earnings release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” "optimistic," “intends” and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements.  Accordingly, we caution you that any such forward-looking statements are not a guarantee of future performance and that actual results may prove to be materially different from the results expressed or implied by the forward-looking statements due to a number of factors. For details on some of the factors that could affect these expectations, see risk factors and other cautionary language included in the Company's Annual Report on Form 10-K and other periodic and current reports filed with the Securities and Exchange Commission.

While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ materially from those contained or implied in the forward-looking statements: changes in general economic, political, or industry conditions; geopolitical concerns, including the ongoing wars in Ukraine and in the Middle East; uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Board of Governors of the Federal Reserve System; inflation/deflation, interest rate, market, and monetary fluctuations; volatility and disruptions in global capital and credit markets; competitive pressures on product pricing and services; success, impact, and timing of our business strategies, including market acceptance of any new products or services; the impact of changes in financial services policies, laws, and regulations, including those concerning taxes, banking, securities, and insurance, and the application thereof by regulatory bodies; cybersecurity threats and the cost of defending against them, including the costs of compliance with potential legislation to combat cybersecurity at a state, national, or global level; climate change, including any enhanced regulatory, compliance, credit and reputational risks and costs; the expected cost savings, synergies and other financial benefits from the acquisition of IFH or any other acquisition the Company has made or may make might not be realized within the expected time frames or at all; the effect of acquisitions we have made or may make, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target into our operations; and other factors that may affect our future results.

These forward-looking statements are made as of the date of this communication, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by law.

FINANCIAL CONTACT: Dominic Canuso (301) 468-8848 x1403
MEDIA CONTACT: Ed Barry (240) 283-1912
WEB SITE: www.CapitalBankMD.com

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