C & F FINANCIAL CORPORATION

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2025


☐	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 000-23423

C&F FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)


Virginia	54-1680165
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

3600 La Grange Parkway Toano, VA	23168
(Address of principal executive offices)	(Zip Code)

(804) 843-2360

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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, $1.00 par value per share	CFFI	The NASDAQ Stock Market LLC

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 ☒

At May 2, 2025, the latest practicable date for determination, 3,239,798 shares of common stock, $1.00 par value, of the registrant were outstanding.

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TABLE OF CONTENTS


PART I - Financial Information		Page

Item 1.	Financial Statements	3

	Consolidated Balance Sheets (Unaudited) –March 31, 2025 and December 31, 2024	3

	Consolidated Statements of Income (Unaudited) – Three months ended March 31, 2025 and 2024	4

	Consolidated Statements of Comprehensive Income (Unaudited) – Three months ended March 31, 2025 and 2024	5

	Consolidated Statements of Equity (Unaudited) – Three months ended March 31, 2025 and 2024	6

	Consolidated Statements of Cash Flows (Unaudited) –Three months ended March 31, 2025 and 2024	7

	Notes to Consolidated Interim Financial Statements (Unaudited)	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	35

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	64

Item 4.	Controls and Procedures	66

PART II - Other Information		66

Item 1A.	Risk Factors	66

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67

Item 5.	Other Information	67

Item 6.	Exhibits	68

	Signatures	69

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Part I – FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

C&F FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in thousands, except per share amounts)


	March 31,		December 31,
	2025		2024
Assets
Cash and due from banks	$	13,468	$	16,163
Interest-bearing deposits in other banks		62,490		49,423
Total cash and cash equivalents		75,958		65,586
Securities—available for sale at fair value, amortized cost of $455,669 and $448,616, respectively		431,513		418,625
Loans held for sale, at fair value		27,278		20,112
Loans, net of allowance for credit losses of $40,043 and $40,087, respectively		1,903,283		1,880,311
Restricted stock, at cost		3,680		3,592
Corporate premises and equipment, net		39,580		40,118
Other real estate owned, net of valuation allowance of $215 and $215, respectively		1,316		1,316
Accrued interest receivable		10,598		10,592
Goodwill		25,191		25,191
Other intangible assets, net		1,084		1,147
Bank-owned life insurance		21,309		21,191
Net deferred tax asset		16,593		17,719
Other assets		55,147		57,874
Total assets	$	2,612,530	$	2,563,374

Liabilities
Deposits
Noninterest-bearing demand deposits	$	579,638	$	526,069
Savings and interest-bearing demand deposits		809,449		826,462
Time deposits		827,567		818,329
Total deposits		2,216,654		2,170,860
Short-term borrowings		35,909		28,994
Long-term borrowings		58,080		68,158
Trust preferred capital notes		25,466		25,457
Accrued interest payable		3,931		4,403
Other liabilities		37,219		38,532
Total liabilities		2,377,259		2,336,404

Commitments and contingent liabilities (Note 11)

Equity
Common stock ($1.00 par value, 8,000,000 shares authorized, 3,235,781 and 3,233,672 shares issued and outstanding, respectively, includes 113,808 and 119,778 of unvested shares, respectively)		3,123		3,114
Additional paid-in capital		108		36
Retained earnings		251,694		247,814
Accumulated other comprehensive loss, net		(20,291)		(24,604)
Equity attributable to C&F Financial Corporation		234,634		226,360
Noncontrolling interest		637		610
Total equity		235,271		226,970
Total liabilities and equity	$	2,612,530	$	2,563,374

See notes to consolidated interim financial statements.

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C&F FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Dollars in thousands, except per share amounts)


	Three Months Ended March 31,
	2025		2024
Interest income
Interest and fees on loans	$	32,382	$	29,586
Interest on interest-bearing deposits in other banks		502		259
Interest and dividends on securities
U.S. treasury, government agencies and corporations		289		602
Mortgage-backed securities		1,394		886
Tax-exempt obligations of states and political subdivisions		911		883
Taxable obligations of states and political subdivisions		195		184
Corporate and other		315		308
Total interest income		35,988		32,708
Interest expense
Savings and interest-bearing deposits		1,805		1,614
Time deposits		7,964		6,916
Borrowings		859		722
Trust preferred capital notes		350		298
Total interest expense		10,978		9,550
Net interest income		25,010		23,158
Provision for credit losses		3,000		3,500
Net interest income after provision for credit losses		22,010		19,658
Noninterest income
Gains on sales of loans		1,847		1,288
Interchange income		1,475		1,475
Service charges on deposit accounts		990		1,047
Investment income from other equity interests		207		167
Mortgage banking fee income		570		479
Wealth management services income, net		732		731
Mortgage lender services income		536		503
Other service charges and fees		498		396
Other income (loss), net		718		1,406
Total noninterest income		7,573		7,492
Noninterest expenses
Salaries and employee benefits		13,483		14,252
Occupancy		2,193		2,132
Data processing		2,866		2,829
Professional fees		921		915
Insurance expense		491		406
Marketing and advertising expenses		529		168
Loan processing and collection expenses		683		628
Other		1,893		1,820
Total noninterest expenses		23,059		23,150
Income before income taxes		6,524		4,000
Income tax expense		1,129		565
Net income		5,395		3,435
Less net income attributable to noncontrolling interest		27		34
Net income attributable to C&F Financial Corporation	$	5,368	$	3,401
Net income per share - basic and diluted	$	1.66	$	1.01

See notes to consolidated interim financial statements.

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C&F FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(Dollars in thousands)


	Three Months Ended March 31,
	2025		2024
Net income	$	5,395	$	3,435
Other comprehensive income (loss), net of tax:
Securities available for sale		4,610		(2,066)
Defined benefit plan		(9)		7
Cash flow hedges		(288)		77
Other comprehensive income (loss), net of tax		4,313		(1,982)
Comprehensive income		9,708		1,453
Less comprehensive income attributable to noncontrolling interest		27		34
Comprehensive income attributable to C&F Financial Corporation	$	9,681	$	1,419

See notes to consolidated interim financial statements.

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C&F FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024

(Unaudited)

(Dollars in thousands, except per share amounts)


	Attributable to C&F Financial Corporation
							Accumulated
			Additional				Other
	Common		Paid - In		Retained		Comprehensive		Noncontrolling		Total
	Stock		Capital		Earnings		Loss, Net		Interest		Equity
Balance December 31, 2024	$	3,114	$	36	$	247,814	$	(24,604)	$	610	$	226,970
Comprehensive income:
Net income		—		—		5,368		—		27		5,395
Other comprehensive income		—		—		—		4,313		—		4,313
Share-based compensation		—		461		—		—		—		461
Restricted stock vested		13		(13)		—		—		—		—
Common stock issued		1		45		—		—		—		46
Common stock purchased		(5)		(421)		—		—		—		(426)
Cash dividends declared ($0.46 per share)		—		—		(1,488)		—		—		(1,488)
Distributions to noncontrolling interest		—		—		—		—		—		—
Balance March 31, 2025	$	3,123	$	108	$	251,694	$	(20,291)	$	637	$	235,271


	Attributable to C&F Financial Corporation
							Accumulated
			Additional				Other
	Common		Paid - In		Retained		Comprehensive		Noncontrolling		Total
	Stock		Capital		Earnings		Loss, Net		Interest		Equity
Balance December 31, 2023	$	3,238	$	6,567	$	233,760	$	(26,687)	$	638	$	217,516
Comprehensive income:
Net income		—		—		3,401		—		34		3,435
Other comprehensive loss		—		—		—		(1,982)		—		(1,982)
Share-based compensation		—		510		—		—		—		510
Restricted stock vested		26		(26)		—		—		—		—
Common stock issued		1		45		—		—		—		46
Common stock purchased		(19)		(1,012)		—		—		—		(1,031)
Cash dividends declared ($0.44 per share)		—		—		(1,482)		—		—		(1,482)
Distributions to noncontrolling interest		—		—		—		—		(63)		(63)
Balance March 31, 2024	$	3,246	$	6,084	$	235,679	$	(28,669)	$	609	$	216,949

See notes to consolidated interim financial statements.

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C&F FINANCIAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in thousands)


	Three Months Ended March 31,
	2025		2024
Operating activities:
Net income	$	5,395	$	3,435
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		3,000		3,500
Accretion of certain acquisition-related discounts, net		(108)		(155)
Share-based compensation		461		510
Depreciation and amortization		988		937
Amortization of premiums and accretion of discounts on securities, net		20		397
Reversal of provision for indemnifications		(25)		(140)
Income from bank-owned life insurance		(106)		(106)
Pension expense		183		226
Proceeds from sales of loans held for sale		108,010		87,479
Origination of loans held for sale		(112,972)		(94,769)
Gains on sales of loans held for sale		(1,847)		(1,288)
Other gains, net		141		194
Change in other assets and liabilities:
Accrued interest receivable		(6)		(197)
Other assets		1,727		2,347
Accrued interest payable		(472)		1,151
Other liabilities		(1,178)		(2,626)
Net cash provided by operating activities		3,211		895
Investing activities:
Proceeds from sales, maturities and calls of securities available for sale and payments on mortgage-backed securities		17,176		37,324
Purchases of securities available for sale		(24,248)		(8,313)
Purchases of time deposits, net		(5)		491
Repayments on loans held for investment by non-bank affiliates		15,999		45,387
Purchases of loans held for investment by non-bank affiliates		(14,615)		(49,842)
Net increase in community banking loans held for investment		(27,487)		(73,617)
Purchases of corporate premises and equipment		(267)		(485)
Other investing activities, net		(92)		(566)
Net cash used in investing activities		(33,539)		(49,621)
Financing activities:
Net increase (decrease) in demand and savings deposits		36,556		(41,169)
Net increase in time deposits		9,238		62,971
Net decrease in short-term borrowings		(3,085)		(30,418)
Proceeds from long-term borrowings		—		40,000
Repurchases of common stock		(426)		(1,031)
Cash dividends paid		(1,488)		(1,482)
Other financing activities, net		(95)		(97)
Net cash provided by financing activities		40,700		28,774
Net increase (decrease) in cash and cash equivalents		10,372		(19,952)
Cash and cash equivalents at beginning of period		65,586		75,159
Cash and cash equivalents at end of period	$	75,958	$	55,207
Supplemental cash flow disclosures:
Interest paid	$	11,441	$	8,390
Income taxes paid		13		—
Supplemental disclosure of noncash investing and financing activities:
Liabilities assumed to acquire right of use assets at lease commencement		190		2,487

See notes to consolidated interim financial statements.

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C&F FINANCIAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS

(Unaudited)

NOTE 1: Summary of Significant Accounting Policies

Principles of Consolidation: The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial reporting and with applicable quarterly reporting regulations of the Securities and Exchange Commission (the SEC). They do not include all of the information and notes required by GAAP for complete financial statements. Therefore, these consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the C&F Financial Corporation Annual Report on Form 10-K for the year ended December 31, 2024 (2024 Annual Report). The accounting and reporting policies of the Corporation conform to GAAP and to predominant practices within the banking industry and are primarily disclosed in the 2024 Annual Report.

The unaudited consolidated financial statements include the accounts of C&F Financial Corporation (the Corporation), its direct wholly-owned subsidiary, Citizens and Farmers Bank (the Bank or C&F Bank), and indirect subsidiaries that are wholly-owned or controlled. Subsidiaries that are less than wholly owned are fully consolidated if they are controlled by the Corporation or one of its subsidiaries, and the portion of any subsidiary not owned by the Corporation is reported as noncontrolling interest. All significant intercompany accounts and transactions have been eliminated in consolidation. In addition, the Corporation owns all of the common stock of C&F Financial Statutory Trust I, C&F Financial Statutory Trust II, and Central Virginia Bankshares Statutory Trust I, all of which are unconsolidated subsidiaries. The subordinated debt owed to these trusts is reported as liabilities of the Corporation.

Nature of Operations: The Corporation is a bank holding company incorporated under the laws of the Commonwealth of Virginia. The Corporation owns all of the stock of its subsidiary, C&F Bank, which is an independent commercial bank chartered under the laws of the Commonwealth of Virginia.

C&F Bank has five wholly-owned subsidiaries: C&F Mortgage Corporation (C&F Mortgage), C&F Finance Company (C&F Finance), C&F Wealth Management Corporation (C&F Wealth Management), C&F Insurance Services, Inc. (C&F Insurance), and CVB Title Services, Inc. (CVB Title), all incorporated under the laws of the Commonwealth of Virginia. C&F Mortgage, organized in September 1995, originates and sells residential mortgages, provides mortgage loan origination services to third-party lenders and, through its subsidiary Certified Appraisals LLC, provides ancillary mortgage loan production services for residential appraisals. C&F Mortgage owns a 51 percent interest in C&F Select LLC, which was organized in January 2019 and is also engaged in the business of originating and selling residential mortgages. C&F Finance, acquired in September 2002, is a finance company purchasing automobile, marine and recreational vehicle (RV) loans through indirect lending programs. C&F Wealth Management, organized in April 1995, is a full-service brokerage firm offering a comprehensive range of wealth management services through third-party service providers. C&F Insurance and CVB Title were organized for the primary purpose of owning equity interests in an independent insurance agency and a full service title and settlement agency, respectively. Business segment data is presented in Note 10.

Basis of Presentation: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for credit losses and evaluation of goodwill for impairment. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of the results of operations in these financial statements, have been made.

Reclassification: Certain reclassifications have been made to the prior period financial statements to conform to the current period presentation. None of these reclassifications are considered material.

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Derivative Financial Instruments: The Corporation recognizes derivative financial instruments at fair value as either an other asset or other liability in the Consolidated Balance Sheets. The Corporation’s derivative financial instruments include (1) interest rate swaps that qualify and are designated as cash flow hedges on the Corporation’s trust preferred capital notes, (2) interest rate swaps with certain qualifying commercial loan customers and dealer counterparties and (3) interest rate contracts arising from mortgage banking activities, including interest rate lock commitments (IRLCs) on mortgage loans. The gain or loss on the Corporation’s cash flow hedges is reported as a component of other comprehensive income (loss), net of deferred income taxes, and reclassified into earnings in the same period(s) during which the hedged transactions affect earnings. IRLCs and interest rate swaps with loan customers and dealer counterparties are not designated as hedging instruments, and therefore changes in the fair value of these instruments are reported as noninterest income. The Corporation’s derivative financial instruments are described more fully in Note 12.

Recent Significant Accounting Pronouncements: In November 2023, the Financial Accounting Standards Board (FASB) issued ASU 2023-09, “Income Taxes (Topic 740) – Improvements to Income Tax Disclosures.” The amendments in ASU 2023-09 require that a public entity disclose, on an annual basis, specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold, the amount of income taxes paid disaggregated by federal, state and foreign taxes, and the amount of income taxes paid disaggregated by individual jurisdictions in which income taxes paid is equal to or granter than five percent of total income taxes paid. The amendments also require that entities disclose income from continuing operations before income tax expense disaggregated between domestic and foreign, as well as income tax expense from continuing operations disaggregated by federal, state and foreign. The amendments apply to all public entities that are subject to Topic 740, “Income Taxes,” and are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments are to be applied on a prospective basis; however, retrospective application is permitted. The Corporation does not expect the adoption of ASU 2023-09 to have a material effect on its consolidated financial statements.

In November 2024, FASB issued ASU 2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures.” The amendments in ASU 2024-03 require disaggregated disclosure of income statement expenses for public business entities. Such disclosures must be made on an annual and interim basis in a tabular format in the footnotes to the financial statements. The amendments require companies to disclose disaggregated information about specific natural expense categories that are considered relevant and applicable, including (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) oil and gas activities. The amendments also provide clarification regarding identifying relevant expenses captions and requires disclosure of selling expenses on an annual and interim basis. Entities are required to apply the guidance in ASU 2024-03 consistently for all periods presented and is effective for all public business entities for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments are to be applied on a prospective basis; however, retrospective application is permitted. The Corporation does not expect the adoption of ASU 2024-03 to have a material effect on its consolidated financial statements.

Other accounting standards that have been issued by the FASB or other standards-setting bodies are not currently expected to have a material effect on the Corporation’s financial position, results of operations or cash flows.

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NOTE 2: Securities

The Corporation’s debt securities, all of which are classified as available for sale, are summarized in the table below. The Corporation has elected to exclude accrued interest receivable, totaling $2.31 million and $2.32 million at March 31, 2025 and December 31, 2024, respectively, from the amortized cost basis of securities.

March 31, 2025

Gross

Amortized

Unrealized

(Dollars in thousands)

Cost

Gains

Losses

Fair Value

U.S. Treasury securities

4,989

—

(220)

4,769

U.S. government agencies and corporations

68,773

—

(6,854)

61,919

Mortgage-backed securities

210,999

583

(12,185)

199,397

Obligations of states and political subdivisions

147,256

548

(4,308)

143,496

Corporate and other debt securities

23,652

(1,743)

21,932

455,669

1,154

(25,310)

431,513


	December 31, 2024
			Gross		Gross
	Amortized		Unrealized		Unrealized
(Dollars in thousands)	Cost		Gains		Losses		Fair Value
U.S. Treasury securities	$	10,985	$	—	$	(285)	$	10,700
U.S. government agencies and corporations		68,772		—		(8,113)		60,659
Mortgage-backed securities		197,923		69		(15,556)		182,436
Obligations of states and political subdivisions		147,532		691		(4,613)		143,610
Corporate and other debt securities		23,404		29		(2,213)		21,220
	$	448,616	$	789	$	(30,780)	$	418,625

The amortized cost and estimated fair value of securities at March 31, 2025, by the earlier of contractual maturity or expected maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties.


	March 31, 2025
	Amortized
(Dollars in thousands)	Cost		Fair Value
Due in one year or less	$	67,719	$	65,507
Due after one year through five years		179,812		169,117
Due after five years through ten years		138,031		129,762
Due after ten years		70,107		67,127
	$	455,669	$	431,513

The following table presents the gross realized gains and losses on and the proceeds from the sales, maturities and calls of securities. During the three months ended March 31, 2025 and 2024, there were no sales of securities.


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Realized gains from sales, maturities and calls of securities:
Gross realized gains	$	—	$	—
Gross realized losses		—		—
Net realized losses	$	—	$	—
Proceeds from sales, maturities, calls and paydowns of securities	$	17,176	$	37,324

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The Corporation pledges securities primarily to secure municipal deposits, repurchase agreements and lines of credit that provide liquidity to the Corporation and C&F Bank. Securities with an aggregate amortized cost of $206.11 million and an aggregate fair value of $192.44 million were pledged at March 31, 2025. Securities with an aggregate amortized cost of $212.92 million and an aggregate fair value of $196.10 million were pledged at December 31, 2024.

Securities in an unrealized loss position at March 31, 2025, by duration of the period of the unrealized loss, are shown below.

Less Than 12 Months

12 Months or More

Total

Fair

Unrealized

Fair

Unrealized

Fair

Unrealized

(Dollars in thousands)

Value

Loss

Value

Loss

Value

Loss

U.S. Treasury securities

—

4,769

220

4,769

220

U.S. government agencies and corporations

—

61,919

6,854

61,919

6,854

Mortgage-backed securities

34,422

457

118,296

11,728

152,718

12,185

Obligations of states and political subdivisions

32,175

600

62,499

3,708

94,674

4,308

Corporate and other debt securities

488

19,671

1,731

20,159

1,743

Total

67,085

1,069

267,154

24,241

334,239

25,310

There were 545 debt securities with a fair value below the amortized cost basis, totaling $334.24 million of aggregate fair value as of March 31, 2025. The Corporation concluded that a credit loss did not exist in its securities portfolio at March 31, 2025, and no allowance for credit losses has been recognized based on the fact that (1) changes in fair value were caused primarily by fluctuations in interest rates or other market factors, such as changes in demand, (2) securities with unrealized losses had generally high credit quality, (3) the Corporation intends to hold these investments in debt securities to maturity and it is more-likely-than-not that the Corporation will not be required to sell these investments before a recovery of its investment, and (4) issuers have continued to make timely payments of principal and interest. Additionally, the Corporation’s mortgage-backed securities are entirely issued by either U.S. government agencies or U.S. government-sponsored enterprises. Collectively, these entities provide a guarantee, which is either explicitly or implicitly supported by the full faith and credit of the U.S. government, that investors in such mortgage-backed securities will receive timely principal and interest payments.

Securities in an unrealized loss position at December 31, 2024, by duration of the period of the unrealized loss, are shown below.


	Less Than 12 Months				12 Months or More				Total
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
(Dollars in thousands)	Value		Loss		Value		Loss		Value		Loss
U.S. Treasury securities	$	—	$	—	$	10,700	$	285	$	10,700	$	285
U.S. government agencies and corporations		—		—		60,659		8,113		60,659		8,113
Mortgage-backed securities		53,734		1,253		123,307		14,303		177,041		15,556
Obligations of states and political subdivisions		31,981		412		66,743		4,201		98,724		4,613
Corporate and other debt securities		474		26		19,717		2,187		20,191		2,213
Total	$	86,189	$	1,691	$	281,126	$	29,089	$	367,315	$	30,780

The Corporation’s investment in restricted stock totaled $3.68 million at March 31, 2025 and $3.59 million at December 31, 2024 and consisted of Federal Home Loan Bank of Atlanta (FHLB) stock. Restricted stock is generally viewed as a long-term investment, which is carried at cost because there is no market for the stock other than to be redeemed or repurchased by the FHLB. Therefore, when evaluating restricted stock for impairment, its value is based on the ultimate recoverability of the par value rather than by recognizing any temporary decline in value. The Corporation did not consider its investment in restricted stock to be impaired at March 31, 2025 and no impairment has been recognized.

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NOTE 3: Loans

The Corporation’s loans are stated at their face amount, net of deferred fees and costs and discounts, and consist of the classes of loans included in the table below. The Corporation has elected to exclude accrued interest receivable, totaling $8.28 million and $8.27 million at March 31, 2025 and December 31, 2024, respectively, from the recorded balance of loans.


	March 31,		December 31,
(Dollars in thousands)	2025		2024
Commercial real estate	$	758,310	$	734,182
Commercial business		106,844		104,947
Construction - commercial real estate		121,140		132,717
Land acquisition and development		46,042		46,072
Builder lines		42,720		35,605
Construction - consumer real estate		21,188		18,799
Residential mortgage		308,549		308,809
Equity lines		66,440		62,204
Other consumer		9,957		10,270
Consumer finance - automobiles		396,590		398,651
Consumer finance - marine and recreational vehicles		65,546		68,142
Subtotal		1,943,326		1,920,398
Less allowance for credit losses		(40,043)		(40,087)
Loans, net	$	1,903,283	$	1,880,311

Other consumer loans included $220,000 and $255,000 of demand deposit overdrafts at March 31, 2025 and December 31, 2024, respectively.

The following table shows the aging of the Corporation’s loan portfolio, by class, at March 31, 2025:


	30-59		60-89		90+								90+ Days
	Days		Days		Days		Total						Past Due and
(Dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Current¹		Total Loans		Accruing
Commercial real estate	$	—	$	21	$	—	$	21	$	758,289	$	758,310	$	—
Commercial business		10		—		—		10		106,834		106,844		—
Construction - commercial real estate		—		—		—		—		121,140		121,140		—
Land acquisition and development		—		—		—		—		46,042		46,042		—
Builder lines		—		—		—		—		42,720		42,720		—
Construction - consumer real estate		—		—		—		—		21,188		21,188		—
Residential mortgage		1,694		—		1,066		2,760		305,789		308,549		111
Equity lines		328		—		—		328		66,112		66,440		—
Other consumer		—		—		—		—		9,957		9,957		—
Consumer finance - automobiles		11,438		1,437		911		13,786		382,804		396,590		—
Consumer finance - marine and recreational vehicles		99		139		64		302		65,244		65,546		—
Total	$	13,569	$	1,597	$	2,041	$	17,207	$	1,926,119	$	1,943,326	$	111

For the purposes of the table above, “Current” includes loans that are 1-29 days past due.

The table above includes nonaccrual loans that are current of $140,000, 30-59 days past due of $94,000, and 90+ days past due of $1.93 million.

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The following table shows the aging of the Corporation’s loan portfolio, by class, at December 31, 2024:


	30-59		60-89		90+								90+ Days
	Days		Days		Days		Total						Past Due and
(Dollars in thousands)	Past Due		Past Due		Past Due		Past Due		Current¹		Total Loans		Accruing
Commercial real estate	$	26	$	—	$	—	$	26	$	734,156	$	734,182	$	—
Commercial business		29		—		—		29		104,918		104,947		—
Construction - commercial real estate		—		—		—		—		132,717		132,717		—
Land acquisition and development		—		—		—		—		46,072		46,072		—
Builder lines		—		—		—		—		35,605		35,605		—
Construction - consumer real estate		747		—		—		747		18,052		18,799		—
Residential mortgage		1,012		1,076		426		2,514		306,295		308,809		334
Equity lines		85		—		76		161		62,043		62,204		76
Other consumer		9		—		—		9		10,261		10,270		—
Consumer finance - automobiles		14,703		2,650		599		17,952		380,699		398,651		—
Consumer finance - marine and recreational vehicles		215		22		15		252		67,890		68,142		—
Total	$	16,826	$	3,748	$	1,116	$	21,690	$	1,898,708	$	1,920,398	$	410

1For the purposes of the table above, “Current” includes loans that are 1-29 days past due.

The table above includes nonaccrual loans that are current of $124,000, 30-59 days past due of $117,000 and 90+ days past due of $706,000.

The following table shows the Corporation’s recorded balance of loans on nonaccrual status as of March 31, 2025 and December 31, 2024. The Corporation recognized $3,000 in interest income on loans on nonaccrual status as of March 31, 2025 and had $17,000 in reversals of interest income upon placing consumer loans on nonaccrual status during the three months ended March 31, 2025. All nonaccrual loans at March 31, 2025 and December 31, 2024 had an allowance for credit losses, with none individually evaluated.


	March 31,		December 31,
(Dollars in thousands)	2025		2024
Residential mortgage	$	1,189	$	333
Consumer finance - automobiles		911		599
Consumer finance - marine and recreational vehicles		64		15
Total	$	2,164	$	947

Occasionally, the Corporation modifies loans to borrowers experiencing financial difficulties by providing principal forgiveness, term extensions, interest rate reductions or other-than-insignificant payment delays. As the effect of most modifications is already included in the allowance for credit losses due to the measurement methodologies used in its estimate, the allowance for credit losses is typically not adjusted upon modification. When principal forgiveness is provided at modification, the amount forgiven is charged against the allowance for credit losses. In some cases, the Corporation may provide multiple types of modifications on one loan and when multiple types of modifications occur within the same period, the combination of modifications is separately reported.

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There were no loans to borrowers experiencing financial difficulty and that were modified during the three months ended March 31, 2025. The following table presents the amortized cost basis of loans as of March 31, 2024 that were both experiencing financial difficulty and modified during the three months ended March 31, 2024.


	Three Months Ended March 31, 2024
			% of Total
	Amortized		Class of
(Dollars in thousands)	Cost		Loans
Term Extension
Residential mortgage	$	341		0.1	%
Total Term Extension	$	341

Combination Term Extension and Interest Rate Reduction
Residential mortgage	$	19		0.0	%
Total Combination Term Extension and Interest Rate Reduction	$	19
Total	$	360		0.1	%

The following table presents the financial effects of the loan modifications presented above to borrowers experiencing financial difficulty for the three months ended March 31, 2024.


	Three Months Ended March 31, 2024
	Weighted-			Weighted-
	Average			Average
	Interest Rate			Term Extension
(Dollars in thousands)	Reduction			(in years)
Residential mortgage		1.51	%		6.9
Total		1.51	%		6.9

The Corporation closely monitors the performance of modified loans to understand the effectiveness of its modification efforts. Upon the determination that all or a portion of a modified loan is uncollectible, that amount is charged against the allowance for credit losses. There were no payment defaults during the three months ended March 31, 2025 and 2024 of modified loans that were modified during the previous twelve months and all were current as of March 31, 2025.

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NOTE 4: Allowance for Credit Losses

The Corporation conducts an analysis of the collectability of the loan portfolio on a regular basis and uses this analysis to assess the sufficiency of the allowance for credit losses on loans and to determine the necessary provision for credit losses. The Corporation segmented the loan portfolio into three loan portfolios based on common risk characteristics. The Commercial portfolio consists of commercial real estate loans, commercial business loans, commercial and consumer real estate construction loans, land acquisition and development loans, and builder lines. The Consumer portfolio consists of residential mortgage loans, equity lines, and other consumer loans. The Consumer Finance portfolio consists of automobile and marine and RV loans.

The following table shows the allowance for credit losses activity by loan portfolio for the three months ended March 31, 2025 and 2024:

Consumer

(Dollars in thousands)

Commercial

Consumer

Finance

Total

Balance at December 31, 2024

13,347

4,032

22,708

40,087

Provision charged to operations

2,900

3,050

Loans charged off

—

(61)

(4,073)

(4,134)

Recoveries of loans previously charged off

997

1,040

Balance at March 31, 2025

13,425

4,086

22,532

40,043


					Consumer
(Dollars in thousands)	Commercial		Consumer		Finance		Total
Balance at December 31, 2023	$	12,315	$	3,758	$	23,578	$	39,651
Provision charged to operations		535		65		3,000		3,600
Loans charged off		—		(101)		(4,103)		(4,204)
Recoveries of loans previously charged off		9		53		1,091		1,153
Balance at March 31, 2024	$	12,859	$	3,775	$	23,566	$	40,200

The following table presents a breakdown of the provision for credit losses for the periods indicated.


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Provision for credit losses:
Provision for loans	$	3,050	$	3,600
Provision for unfunded commitments		(50)		(100)
Total	$	3,000	$	3,500

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The table below details the recorded balance of the classes of loans within the commercial and consumer loan portfolios by loan rating, which is reviewed on a quarterly basis, and year of origination as of March 31, 2025:


													Revolving		Revolving
	Term Loans Recorded Balance by Origination Year												Loans		Loans
													Recorded		Converted
(Dollars in thousands)	2025		2024		2023		2022		2021		Prior		Balance		to Term¹		Total
Commercial real estate:
Loan Rating
Pass	$	8,888	$	92,993	$	104,927	$	157,865	$	128,864	$	263,728	$	—	$	108	$	757,373
Special Mention		—		—		—		—		—		937		—		—		937
Total	$	8,888	$	92,993	$	104,927	$	157,865	$	128,864	$	264,665	$	—	$	108	$	758,310

Commercial business:
Loan Rating
Pass	$	4,272	$	8,185	$	12,143	$	14,374	$	13,565	$	30,153	$	24,088	$	64	$	106,844
Total	$	4,272	$	8,185	$	12,143	$	14,374	$	13,565	$	30,153	$	24,088	$	64	$	106,844

Construction - commercial real estate:
Loan Rating
Pass	$	1,494	$	52,162	$	35,566	$	25,693	$	—	$	6,225	$	—	$	—	$	121,140
Total	$	1,494	$	52,162	$	35,566	$	25,693	$	—	$	6,225	$	—	$	—	$	121,140

Land acquisition and development:
Loan Rating
Pass	$	—	$	36,537	$	—	$	352	$	1,321	$	7,832	$	—	$	—	$	46,042
Total	$	—	$	36,537	$	—	$	352	$	1,321	$	7,832	$	—	$	—	$	46,042

Builder lines:
Loan Rating
Pass	$	11,660	$	26,771	$	3,062	$	822	$	—	$	405	$	—	$	—	$	42,720
Total	$	11,660	$	26,771	$	3,062	$	822	$	—	$	405	$	—	$	—	$	42,720

Construction - consumer real estate:
Loan Rating
Pass	$	1,219	$	18,430	$	1,539	$	—	$	—	$	—	$	—	$	—	$	21,188
Total	$	1,219	$	18,430	$	1,539	$	—	$	—	$	—	$	—	$	—	$	21,188

Residential mortgage:
Loan Rating
Pass	$	7,950	$	48,261	$	56,758	$	78,656	$	37,674	$	77,426	$	—	$	—	$	306,725
Special Mention		—		—		23		—		215		227		—		—		465
Substandard		—		—		—		—		—		170		—		—		170
Substandard Nonaccrual		—		122		864		92		—		111		—		—		1,189
Total	$	7,950	$	48,383	$	57,645	$	78,748	$	37,889	$	77,934	$	—	$	—	$	308,549

Equity lines:
Loan Rating
Pass	$	—	$	—	$	—	$	—	$	—	$	679	$	65,308	$	370	$	66,357
Substandard		—		—		—		—		—		—		—		83		83
Total	$	—	$	—	$	—	$	—	$	—	$	679	$	65,308	$	453	$	66,440

Other consumer:
Loan Rating
Pass	$	1,115	$	4,646	$	1,877	$	1,427	$	187	$	659	$	46	$	—	$	9,957
Total	$	1,115	$	4,646	$	1,877	$	1,427	$	187	$	659	$	46	$	—	$	9,957

Total:
Loan Rating
Pass	$	36,598	$	287,985	$	215,872	$	279,189	$	181,611	$	387,107	$	89,442	$	542	$	1,478,346
Special Mention		—		—		23		—		215		1,164		—		—		1,402
Substandard		—		—		—		—		—		170		—		83		253
Substandard Nonaccrual		—		122		864		92		—		111		—		—		1,189
Total	$	36,598	$	288,107	$	216,759	$	279,281	$	181,826	$	388,552	$	89,442	$	625	$	1,481,190

Equity lines include $98,000 of revolving loans converted to term during the three months ended March 31, 2025.

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													Revolving		Revolving
	Term Loans Recorded Balance by Origination Year												Loans		Loans
													Recorded		Converted
(Dollars in thousands)	2024		2023		2022		2021		2020		Prior		Balance		to Term¹		Total
Commercial real estate:
Loan Rating
Pass	$	91,330	$	80,445	$	161,794	$	131,071	$	110,055	$	158,437	$	—	$	110	$	733,242
Special Mention		—		—		—		—		—		940		—		—		940
Total	$	91,330	$	80,445	$	161,794	$	131,071	$	110,055	$	159,377	$	—	$	110	$	734,182

Commercial business:
Loan Rating
Pass	$	9,425	$	13,097	$	14,663	$	13,954	$	8,843	$	22,690	$	22,206	$	69	$	104,947
Total	$	9,425	$	13,097	$	14,663	$	13,954	$	8,843	$	22,690	$	22,206	$	69	$	104,947

Construction - commercial real estate:
Loan Rating
Pass	$	47,294	$	55,159	$	24,320	$	—	$	5,944	$	—	$	—	$	—	$	132,717
Total	$	47,294	$	55,159	$	24,320	$	—	$	5,944	$	—	$	—	$	—	$	132,717

Land acquisition and development:
Loan Rating
Pass	$	33,129	$	2,653	$	366	$	1,323	$	8,601	$	—	$	—	$	—	$	46,072
Total	$	33,129	$	2,653	$	366	$	1,323	$	8,601	$	—	$	—	$	—	$	46,072

Builder lines:
Loan Rating
Pass	$	30,651	$	3,120	$	1,430	$	—	$	—	$	404	$	—	$	—	$	35,605
Total	$	30,651	$	3,120	$	1,430	$	—	$	—	$	404	$	—	$	—	$	35,605

Construction - consumer real estate:
Loan Rating
Pass	$	16,472	$	2,327	$	—	$	—	$	—	$	—	$	—	$	—	$	18,799
Total	$	16,472	$	2,327	$	—	$	—	$	—	$	—	$	—	$	—	$	18,799

Residential mortgage:
Loan Rating
Pass	$	47,653	$	58,590	$	80,991	$	38,833	$	34,979	$	45,831	$	—	$	—	$	306,877
Special Mention		—		890		—		223		103		211		—		—		1,427
Substandard		—		—		—		—		—		172		—		—		172
Substandard Nonaccrual		125		—		92		—		—		116		—		—		333
Total	$	47,778	$	59,480	$	81,083	$	39,056	$	35,082	$	46,330	$	—	$	—	$	308,809

Equity lines:
Loan Rating
Pass	$	—	$	—	$	—	$	—	$	60	$	628	$	61,077	$	277	$	62,042
Special Mention		—		—		—		—		—		—		—		76		76
Substandard		—		—		—		—		—		—		—		86		86
Total	$	—	$	—	$	—	$	—	$	60	$	628	$	61,077	$	439	$	62,204

Other consumer:
Loan Rating
Pass	$	5,274	$	2,384	$	1,547	$	257	$	132	$	630	$	46	$	—	$	10,270
Total	$	5,274	$	2,384	$	1,547	$	257	$	132	$	630	$	46	$	—	$	10,270

Total:
Loan Rating
Pass	$	281,228	$	217,775	$	285,111	$	185,438	$	168,614	$	228,620	$	83,329	$	456	$	1,450,571
Special Mention		—		890		—		223		103		1,151		—		76		2,443
Substandard		—		—		—		—		—		172		—		86		258
Substandard Nonaccrual		125		—		92		—		—		116		—		—		333
Total	$	281,353	$	218,665	$	285,203	$	185,661	$	168,717	$	230,059	$	83,329	$	618	$	1,453,605

Commercial business and equity lines include $69,000 and $179,000, respectively, of revolving loans converted to term during the year ended December 31, 2024.

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The table below details the recorded balance of the classes of loans within the consumer finance loan portfolio by credit rating at the time of origination and year of origination as of March 31, 2025:

Revolving

Term Loans Recorded Balance by Origination Year

Loans

Revolving

Converted

(Dollars in thousands)

2025

2024

2023

2022

2021

Prior

Loans

to Term

Total

Consumer finance - automobiles:

Credit rating¹

Very good

5,000

20,311

9,061

7,018

1,991

371

—

43,752

Good

11,291

37,641

23,331

26,222

8,233

1,454

—

108,172

Fairly good

11,905

39,128

30,788

33,678

14,894

3,638

—

134,031

Fair

7,189

24,500

19,755

21,700

11,480

4,506

—

89,130

Marginal

1,280

4,790

3,972

4,865

4,214

2,384

—

21,505

Total

36,665

126,370

86,907

93,483

40,812

12,353

—

396,590

Consumer finance - marine and recreational vehicles:

Credit rating¹

Very good

267

7,656

6,020

12,196

7,660

10,900

—

44,699

Good

355

4,362

6,227

6,526

1,224

1,682

—

20,376

Fairly good

—

197

181

—

471

Total

622

12,018

12,444

18,903

8,918

12,641

—

65,546

Total:

Credit rating¹

Very good

5,267

27,967

15,081

19,214

9,651

11,271

—

88,451

Good

11,646

42,003

29,558

32,748

9,457

3,136

—

128,548

Fairly good

11,905

39,128

30,985

33,859

14,928

3,697

—

134,502

Fair

7,189

24,500

19,755

21,700

11,480

4,506

—

89,130

Marginal

1,280

4,790

3,972

4,865

4,214

2,384

—

21,505

Total

37,287

138,388

99,351

112,386

49,730

24,994

—

462,136

1	Credit ratings with a FICO score greater than 739 are considered Very Good, FICO scores ranging from 670-739 are considered Good, FICO scores ranging from 625-669 are considered Fairly Good, FICO scores ranging from 580-624 are considered Fair and FICO scores less than 580 are considered Marginal.

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															Revolving
	Term Loans Recorded Balance by Origination Year														Loans
													Revolving		Converted
(Dollars in thousands)	2024		2023		2022		2021		2020		Prior		Loans		to Term		Total
Consumer finance - automobiles:
Credit rating¹
Very good	$	22,161	$	10,039	$	7,971	$	2,359	$	426	$	77	$	—	$	—	$	43,033
Good		40,296		25,730		29,455		9,402		1,574		334		—		—		106,791
Fairly good		41,881		34,058		37,486		16,935		3,213		1,602		—		—		135,175
Fair		25,796		21,278		24,379		13,260		3,674		2,194		—		—		90,581
Marginal		5,049		4,383		5,621		4,856		1,681		1,481		—		—		23,071
Total	$	135,183	$	95,488	$	104,912	$	46,812	$	10,568	$	5,688	$	—	$	—	$	398,651

Consumer finance - marine and recreational vehicles:
Credit rating¹
Very good	$	8,124	$	6,283	$	12,670	$	8,003	$	7,927	$	3,754	$	—	$	—	$	46,761
Good		4,515		6,426		6,832		1,326		1,178		625		—		—		20,902
Fairly good		—		200		183		35		27		34		—		—		479
Total	$	12,639	$	12,909	$	19,685	$	9,364	$	9,132	$	4,413	$	—	$	—	$	68,142

Total:
Credit rating¹
Very good	$	30,285	$	16,322	$	20,641	$	10,362	$	8,353	$	3,831	$	—	$	—	$	89,794
Good		44,811		32,156		36,287		10,728		2,752		959		—		—		127,693
Fairly good		41,881		34,258		37,669		16,970		3,240		1,636		—		—		135,654
Fair		25,796		21,278		24,379		13,260		3,674		2,194		—		—		90,581
Marginal		5,049		4,383		5,621		4,856		1,681		1,481		—		—		23,071
Total	$	147,822	$	108,397	$	124,597	$	56,176	$	19,700	$	10,101	$	—	$	—	$	466,793

1	Credit ratings with a FICO score greater than 739 are considered Very Good, FICO scores ranging from 670-739 are considered Good, FICO scores ranging from 625-669 are considered Fairly Good, FICO scores ranging from 580-624 are considered Fair and FICO scores less than 580 are considered Marginal.

The following table details the current period gross charge-offs of loans by year of origination for the three months ended March 31, 2025:


															Revolving
	Current Period Gross Charge-offs by Origination Year														Loans
													Revolving		Converted
(Dollars in thousands)	2025		2024		2023		2022		2021		Prior		Loans		to Term		Total
Residential mortgage	$	6	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	6
Other consumer¹		45		10		—		—		—		—		—		—		55
Consumer finance - automobiles		—		593		1,004		1,616		587		196		—		—		3,996
Consumer finance - marine and recreational vehicles		—		—		13		52		10		2		—		—		77
Total	$	51	$	603	$	1,017	$	1,668	$	597	$	198	$	—	$	—	$	4,134

1	Gross charge-offs of other consumer loans for the three months ended March 31, 2025 included $45,000 of demand deposit overdrafts that originated in 2025.

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The following table details the current period gross charge-offs of loans by year of origination for the three months ended March 31, 2024:


															Revolving
	Current Period Gross Charge-offs by Origination Year														Loans
													Revolving		Converted
(Dollars in thousands)	2024		2023		2022		2021		2020		Prior		Loans		to Term		Total
Residential mortgage	$	3	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	3
Other consumer¹		90		3		5		—		—		—		—		—		98
Consumer finance - automobiles		—		724		1,869		1,059		213		190		—		—		4,055
Consumer finance - marine and recreational vehicles		—		17		23		—		8		—		—		—		48
Total	$	93	$	744	$	1,897	$	1,059	$	221	$	190	$	—	$	—	$	4,204

1	Gross charge-offs of other consumer loans for the three months ended March 31, 2024 included $90,000 of demand deposit overdrafts that originated in 2024.

As of March 31, 2025 and December 31, 2024, the Corporation had no collateral dependent loans for which repayment was expected to be derived substantially through the operation or sale of the collateral and where the borrower is experiencing financial difficulty.

NOTE 5: Goodwill and Other Intangible Assets

The carrying amount of goodwill was $25.19 million at March 31, 2025 and December 31, 2024. There were no changes in the recorded balance of goodwill during the three months ended March 31, 2025 or 2024.

The Corporation had $1.08 million and $1.15 million of other intangible assets as of March 31, 2025 and December 31, 2024, respectively. Other intangible assets were recognized in connection with the core deposits acquired from Peoples Bankshares, Incorporated in 2020 and customer relationships acquired by C&F Wealth Management in 2016.

The following table summarizes the gross carrying amounts and accumulated amortization of other intangible assets:

March 31,

December 31,

2025

2024

Gross

Carrying

Accumulated

Carrying

Accumulated

(Dollars in thousands)

Amount

Amortization

Amount

Amortization

Amortizable intangible assets:

Core deposit intangibles

1,711

(726)

1,711

(700)

Other amortizable intangibles

1,405

(1,306)

1,405

(1,269)

Total

3,116

(2,032)

3,116

(1,969)

Amortization expense was $63,000 and $65,000 for the three months ended March 31, 2025 and 2024, respectively.

NOTE 6: Equity, Other Comprehensive Income and Earnings Per Share

Equity and Noncontrolling Interest

The Board of Directors authorized a program, effective January 1, 2025 through December 31, 2025, to repurchase up to $5.0 million of the Corporation’s common stock (the 2025 Repurchase Program). During the three months ended March 31, 2025, the Corporation did not repurchase any of its common stock under the 2025 Repurchase Program. As of March 31, 2025, there was $5.0 million remaining available for repurchases of the Corporation’s common stock under the 2025 Repurchase Program. The Corporation’s previous share repurchase program (the 2024 Repurchase Program), which

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was authorized by the Board of Directors in December 2023, expired on December 31, 2024. Under the 2024 Repurchase Program, the Corporation repurchased $516,000 of its common stock during the three months ended March 31, 2024.

Additionally, during the three months ended March 31, 2025 and 2024, the Corporation withheld 5,357 shares and 9,151 shares of its common stock, respectively, from employees to satisfy tax withholding obligations upon vesting of restricted stock.

Noncontrolling interest represents an ownership interest in C&F Select LLC, a subsidiary of C&F Mortgage, held by an unrelated investor.

Accumulated Other Comprehensive Income (Loss), Net

Changes in each component of accumulated other comprehensive loss were as follows for the three months ended March 31, 2025 and 2024:

Securities

Defined

Cash

Available

Benefit

Flow

(Dollars in thousands)

For Sale

Plan

Hedges

Total

Accumulated other comprehensive (loss) income at December 31, 2024

(23,693)

(1,797)

886

(24,604)

Other comprehensive income (loss) arising during the period

5,835

—

(387)

5,448

Related income tax effects

(1,225)

—

100

(1,125)

4,610

—

(287)

4,323

Reclassifications into net income

—

(12)

(2)

(14)

Related income tax effects

—

(9)

(1)

(10)

Other comprehensive income (loss), net of tax

4,610

(9)

(288)

4,313

Accumulated other comprehensive (loss) income at March 31, 2025

(19,083)

(1,806)

598

(20,291)


	Securities		Defined		Cash
	Available		Benefit		Flow
(Dollars in thousands)	For Sale		Plan		Hedges		Total
Accumulated other comprehensive (loss) income at December 31, 2023	$	(25,002)	$	(2,752)	$	1,067	$	(26,687)

Other comprehensive (loss) income arising during the period		(2,615)		—		106		(2,509)
Related income tax effects		549		—		(27)		522
		(2,066)		—		79		(1,987)

Reclassifications into net income		—		9		(3)		6
Related income tax effects		—		(2)		1		(1)
		—		7		(2)		5

Other comprehensive (loss) income, net of tax		(2,066)		7		77		(1,982)

Accumulated other comprehensive (loss) income at March 31, 2024	$	(27,068)	$	(2,745)	$	1,144	$	(28,669)

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The following table provides information regarding reclassifications from accumulated other comprehensive loss into net income for the three months ended March 31, 2025 and 2024:


	Three Months Ended March 31,				Line Item In the Consolidated
(Dollars in thousands)	2025		2024		Statements of Income
Securities available for sale:
Reclassification of net realized losses into net income	$	—	$	—	Net losses on sales, maturities and calls of available for sale securities
Related income tax effects		—		—	Income tax expense
		—		—	Net of tax

Defined benefit plan:¹
Reclassification of recognized net actuarial losses into net income		(5)		(27)	Noninterest expenses - Other
Amortization of prior service credit into net income		17		18	Noninterest expenses - Other
Related income tax effects		(3)		2	Income tax expense
		9		(7)	Net of tax

Cash flow hedges:
Amortization of hedging gains into net income		2		3	Interest expense - Trust preferred capital notes
Related income tax effects		(1)		(1)	Income tax expense
		1		2	Net of tax

Total reclassifications into net income	$	10	$	(5)

1	See “Note 8: Employee Benefit Plans,” for additional information.

Earnings Per Share (EPS)

The components of the Corporation’s EPS calculations are as follows:


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Net income attributable to C&F Financial Corporation	$	5,368	$	3,401
Weighted average shares outstanding—basic and diluted		3,234,935		3,370,934

The Corporation has applied the two-class method of computing basic and diluted EPS for each period presented because the Corporation’s unvested restricted shares outstanding contain rights to nonforfeitable dividends equal to dividends on the Corporation’s common stock. Accordingly, the weighted average number of shares used in the calculation of basic and diluted EPS includes both vested and unvested shares outstanding.

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NOTE 7: Share-Based Plans

Under the 2022 Stock and Incentive Compensation Plan the Corporation is permitted to award, and previously under the 2013 Stock and Incentive Compensation Plan until April 19, 2022, the Corporation was permitted to award, shares of restricted stock to certain key employees, non-employee directors and consultants. Restricted shares awarded to employees generally vest over periods up to five years, and restricted shares awarded to non-employee directors generally vest over periods up to three years. A summary of the activity for restricted stock awards for the periods indicated is presented below:


	2025
		Weighted-
		Average
		Grant Date
	Shares	Fair Value
Unvested, December 31, 2024	119,778	$	54.56
Granted	8,550		86.03
Vested	(12,810)		53.20
Forfeited	(1,710)		56.96
Unvested, March 31, 2025	113,808		57.04


	2024
		Weighted-
		Average
		Grant Date
	Shares	Fair Value
Unvested, December 31, 2023	135,694	$	52.13
Granted	11,775		52.93
Vested	(26,096)		47.74
Forfeited	(135)		58.42
Unvested, March 31, 2024	121,238		53.15

The fair value of shares that vested during the three months ended March 31, 2025 and 2024 were $1.02 million and $1.46 million, respectively. Compensation is accounted for using the fair value of the Corporation’s common stock on the date the restricted shares are awarded. Compensation expense, net of forfeitures, is charged to income ratably over the required service periods and was $461,000 ($271,000 after income taxes) and $510,000 ($313,000 after income taxes) for the three months ended March 31, 2025 and 2024, respectively. As of March 31, 2025, there was $3.83 million of total unrecognized compensation cost related to restricted stock granted under the plans, which is expected to be recognized through 2029, with a weighted-average remaining service period of 2.9 years.

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NOTE 8: Employee Benefit Plans

The following table summarizes the components of net periodic benefit cost for the Bank’s non-contributory cash balance pension plan.


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Components of net periodic benefit cost:
Service cost, included in salaries and employee benefits	$	346	$	369

Other components of net periodic benefit cost:
Interest cost		218		189
Expected return on plan assets		(369)		(341)
Amortization of prior service credit		(17)		(18)
Recognized net actuarial losses		5		27
Other components of net periodic benefit cost, included in other noninterest expense		(163)		(143)

Net periodic benefit cost	$	183	$	226

NOTE 9: Fair Value of Assets and Liabilities

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. GAAP requires that valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. GAAP also establishes a fair value hierarchy which prioritizes the valuation inputs into three broad levels. Based on the underlying inputs, each fair value measurement in its entirety is reported in one of the three levels. These levels are:

●

Level 1—Valuation is based upon quoted prices for identical instruments traded in active markets. Level 1 assets and liabilities include debt securities traded in an active exchange market.

●

Level 2—Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

●

Level 3—Valuation is determined using model-based techniques that use at least one significant assumption not observable in the market. These unobservable assumptions reflect the Corporation’s estimates of assumptions that market participants would use in pricing the respective asset or liability. Valuation techniques may include the use of pricing models, discounted cash flow models and similar techniques.

GAAP allows an entity the irrevocable option to elect fair value (the fair value option) for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis. The Corporation has elected to use fair value accounting for its entire portfolio of loans held for sale (LHFS).

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following describes the valuation techniques and inputs used by the Corporation in determining the fair value of certain assets recorded at fair value on a recurring basis in the financial statements.

Securities available for sale. The Corporation primarily values its investment portfolio using Level 2 fair value measurements, but may also use Level 1 or Level 3 measurements if required by the composition of the portfolio. At March 31, 2025 and December 31, 2024, the Corporation’s entire securities portfolio was comprised of investments in

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debt securities classified as available for sale, which were valued using Level 2 fair value measurements. The Corporation has contracted with third party portfolio accounting service vendors for valuation of its securities portfolio. The vendors’ sources for security valuation are ICE Data Services (ICE), LSEG, and Bloomberg Valuation Service (BVAL). Each source provides opinions, known as evaluated prices, as to the value of individual securities based on model-based pricing techniques that are partially based on available market data, including prices for similar instruments in active markets and prices for identical assets in markets that are not active. ICE provides evaluated prices for the Corporation’s obligations of states and political subdivisions category of securities. ICE uses proprietary pricing models and pricing systems, mathematical tools and judgment to determine an evaluated price for a security based upon a hierarchy of market information regarding that security or securities with similar characteristics. LSEG and BVAL provide evaluated prices for the Corporation’s U.S. treasury, government agencies and corporations, mortgage-backed, and corporate categories of securities. U.S. treasury securities and fixed-rate callable securities of U.S. government agencies and corporations are individually evaluated on an option adjusted spread basis for callable issues or on a nominal spread basis incorporating the term structure of agency market spreads and the appropriate risk free benchmark curve for non-callable issues. Pass-through mortgage-backed securities (MBS) in the mortgage-backed category are grouped into aggregate categories defined by issuer program, weighted average coupon, and weighted average maturity. Each aggregate is benchmarked to relative to-be-announced mortgage-backed securities (TBA securities) or other benchmark prices. TBA securities prices are obtained from market makers and live trading systems. Collateralized mortgage obligations in the mortgage-backed category are individually evaluated based upon a hierarchy of security specific information and market data regarding that security or securities with similar characteristics. Each evaluation is determined using an option adjusted spread and prepayment model based on volatility-driven, multi-dimensional spread tables. Fixed-rate securities issued by the Small Business Association in the mortgage-backed category are individually evaluated based upon a hierarchy of security specific information and market data regarding that security or securities with similar characteristics.

Other investments. The Corporation holds equity investments in funds that provide debt and equity financing to small businesses. These investments are recorded at fair value and included in other assets in the Consolidated Balance Sheets. Changes in fair value are recognized in net income. The funds are managed by investment companies, and the net asset value of each fund is reported regularly by the investment companies. At March 31, 2025 and December 31, 2024, the combined fair value of these investments was $1.70 million and $1.66 million, respectively. These investments, measured at net asset value, are not presented in the tables below related to fair value measurements. Changes in fair value of these investments resulted in the recognition of unrealized gains of $59,000 and $20,000 for the three months ended March 31, 2025 and 2024, respectively.

The Corporation also holds certain equity investments consisting of equity interests in an independent insurance agency and a full service title and settlement agency (collectively, the agencies). These investments are subject to contractual sale restrictions that only permit the sale of the investments back to the agencies themselves. At March 31, 2025 and December 31, 2024, the fair value of these investments was $3.98 million and $4.17 million, respectively. These investments are recorded at fair value based on the contractual redemption value of the Corporation’s proportionate share of the agencies’ equity. Changes in fair value are recognized in net income and resulted in the recognition of unrealized gains of $148,000 for each of the three months ended March 31, 2025 and 2024. The Corporation’s investments in these agencies are classified as Level 2.

Loans held for sale. Fair value of the Corporation’s LHFS is based on observable market prices for similar instruments traded in the secondary mortgage loan markets in which the Corporation conducts business. The Corporation’s portfolio of LHFS is classified as Level 2.

Derivative asset - IRLCs. The Corporation recognizes IRLCs at fair value. Fair value of IRLCs is based on either (i) the price of the underlying loans obtained from an investor for loans that will be delivered on a best efforts basis or (ii) the observable price for individual loans traded in the secondary market for loans that will be delivered on a mandatory basis. All of the Corporation’s IRLCs are classified as Level 2.

Derivative asset/liability – interest rate swaps on loans. The Corporation recognizes interest rate swaps at fair value. The Corporation has contracted with a third party vendor to provide valuations for these interest rate swaps using the discounted cash flow method. All of the Corporation’s interest rate swaps on loans are classified as Level 2.

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Derivative asset/liability – cash flow hedges. The Corporation recognizes cash flow hedges at fair value. The Corporation has contracted with a third party vendor to provide valuations for these cash flow hedges using the discounted cash flow method. All of the Corporation’s cash flow hedges are classified as Level 2.

The following table presents the balances of financial assets and liabilities measured at fair value on a recurring basis. The fair value of forward sales of mortgage loans were not material to the consolidated financial statements of the Corporation at March 31, 2025 or December 31, 2024.

March 31, 2025

Fair Value Measurements Classified as

Assets/Liabilities at

(Dollars in thousands)

Level 1

Level 2

Level 3

Fair Value

Assets:

Securities available for sale

U.S. Treasury securities

—

4,769

—

4,769

U.S. government agencies and corporations

—

61,919

—

61,919

Mortgage-backed securities

—

199,397

—

199,397

Obligations of states and political subdivisions

—

143,496

—

143,496

Corporate and other debt securities

—

21,932

—

21,932

Total securities available for sale

—

431,513

—

431,513

Loans held for sale

—

27,278

—

27,278

Other investments

—

3,976

—

3,976

Derivatives

IRLC

—

1,005

—

1,005

Interest rate swaps on loans

—

3,448

—

3,448

Cash flow hedges

—

915

—

915

Total assets

—

468,135

—

468,135

Liabilities:

Derivatives

Interest rate swaps on loans

—

3,448

—

3,448

Cash flow hedges

—

132

—

132

Total liabilities

—

3,580

—

3,580

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	December 31, 2024
	Fair Value Measurements Classified as						Assets/Liabilities at
(Dollars in thousands)	Level 1		Level 2		Level 3		Fair Value
Assets:
Securities available for sale
U.S. Treasury securities	$	—	$	10,700	$	—	$	10,700
U.S. government agencies and corporations		—		60,659		—		60,659
Mortgage-backed securities		—		182,436		—		182,436
Obligations of states and political subdivisions		—		143,610		—		143,610
Corporate and other debt securities		—		21,220		—		21,220
Total securities available for sale		—		418,625		—		418,625
Loans held for sale		—		20,112		—		20,112
Other investments		—		4,167		—		4,167
Derivatives
IRLC		—		585		—		585
Interest rate swaps on loans		—		4,636		—		4,636
Cash flow hedges		—		1,169		—		1,169
Total assets	$	—	$	449,294	$	—	$	449,294

Liabilities:
Derivatives
Interest rate swaps on loans	$	—	$	4,636	$	—	$	4,636
Total liabilities	$	—	$	4,636	$	—	$	4,636

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

The Corporation may be required, from time to time, to measure and recognize certain assets at fair value on a nonrecurring basis in accordance with GAAP. The following describes the valuation techniques and inputs used by the Corporation in determining the fair value of certain assets recorded at fair value on a nonrecurring basis in the financial statements.

OREO. At March 31, 2025 and December 31, 2024, OREO was comprised of a property previously used by the Bank as a branch, which was consolidated into a nearby branch in 2024. OREO is held for sale and initially recorded at fair value less estimated costs to sell. Initial fair value is based upon appraisals the Corporation obtains from independent licensed appraisers or recent sales of similar properties and general market conditions. Subsequently, management periodically performs valuations of the assets based on updated appraisals, general market conditions, recent sales of similar properties, length of time the properties have been held, and our ability and intent with regard to continued ownership of the properties. The Corporation may incur additional write-downs of OREO to fair value less estimated costs to sell if valuations indicate a further deterioration in market conditions. As such, the Corporation records OREO as a nonrecurring fair value measurement classified as Level 3.

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The following tables present the balances of assets measured at fair value on a nonrecurring basis at March 31, 2025 and December 31, 2024.

March 31, 2025

Fair Value Measurements Classified as

Assets at Fair

(Dollars in thousands)

Level 1

Level 2

Level 3

Value

Other real estate owned, net

—

1,316

Total

—

1,316


	December 31, 2024
	Fair Value Measurements Classified as						Assets at Fair
(Dollars in thousands)	Level 1		Level 2		Level 3		Value
Other real estate owned, net	$	—	$	—	$	1,316	$	1,316
Total	$	—	$	—	$	1,316	$	1,316

Fair Value of Financial Instruments

FASB ASC 825, Financial Instruments, requires disclosure about fair value of financial instruments, including those financial assets and financial liabilities that are not required to be measured and reported at fair value on a recurring or nonrecurring basis. ASC 825 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Corporation. The Corporation uses the exit price notion in calculating the fair values of financial instruments not measured at fair value on a recurring basis.

The following tables reflect the carrying amounts and estimated fair values of the Corporation’s financial instruments whether or not recognized on the Consolidated Balance Sheets at fair value.

Carrying

Fair Value Measurements at March 31, 2025 Classified as

Total Fair

(Dollars in thousands)

Value

Level 1

Level 2

Level 3

Value

Financial assets:

Cash and short-term investments

77,229

75,958

1,271

—

77,229

Securities available for sale

431,513

—

431,513

—

431,513

Loans, net

1,903,283

—

1,877,069

Loans held for sale

27,278

—

27,278

—

27,278

Other investments

3,976

—

3,976

—

3,976

Derivatives

IRLC

1,005

—

1,005

—

1,005

Interest rate swaps on loans

3,448

—

3,448

—

3,448

Cash flow hedges

915

—

915

—

915

Bank-owned life insurance

21,309

—

21,309

—

21,309

Accrued interest receivable

10,598

—

10,598

Financial liabilities:

Demand and savings deposits

1,389,087

—

1,389,087

Time deposits

827,567

—

827,464

—

827,464

Borrowings

111,367

—

102,710

—

102,710

Derivatives

Interest rate swaps on loans

3,448

—

3,448

—

3,448

Cash flow hedges

132

—

132

—

132

Accrued interest payable

3,931

—

3,931

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	Carrying		Fair Value Measurements at December 31, 2024 Classified as						Total Fair
(Dollars in thousands)	Value		Level 1		Level 2		Level 3		Value
Financial assets:
Cash and short-term investments	$	66,853	$	65,586	$	1,265	$	—	$	66,851
Securities available for sale		418,625		—		418,625		—		418,625
Loans, net		1,880,311		—		—		1,838,887		1,838,887
Loans held for sale		20,112		—		20,112		—		20,112
Other investments		4,167		—		4,167		—		4,167
Derivatives
IRLC		585		—		585		—		585
Interest rate swaps on loans		4,636		—		4,636		—		4,636
Cash flow hedges		1,169		—		1,169		—		1,169
Bank-owned life insurance		21,191		—		21,191		—		21,191
Accrued interest receivable		10,592		10,592		—		—		10,592
Financial liabilities:
Demand and savings deposits		1,352,531		1,352,531		—		—		1,352,531
Time deposits		818,329		—		819,276		—		819,276
Borrowings		114,440		—		105,533		—		105,533
Derivatives
Interest rate swaps on loans		4,636		—		4,636		—		4,636
Accrued interest payable		4,403		4,403		—		—		4,403

NOTE 10: Business Segments

The Corporation operates in a decentralized fashion in three business segments: community banking, mortgage banking and consumer finance. The community banking segment comprises C&F Bank, C&F Wealth Management, C&F Insurance and CVB Title. Revenues from community banking operations consist primarily of net interest income related to investments in loans and securities and outstanding deposits and borrowings, fees earned on deposit accounts, debit card interchange activity, and net revenues from offering wealth management services through third-party service providers. Through C&F Mortgage, mortgage banking operating revenues consist principally of gains on sales of loans in the secondary market, mortgage banking fee income related to loan originations, fees earned by providing mortgage loan origination functions to third-party lenders, and net interest income on mortgage loans held for sale. Revenues from consumer finance operations through C&F Finance consist primarily of net interest income earned on purchased retail installment sales contracts.

The standalone Corporation’s revenues and expenses are comprised primarily of interest expense associated with the Corporation’s trust preferred capital notes and subordinated debt, general corporate expenses, and changes in the value of investments held in the rabbi trust and the deferred compensation liability related to its nonqualified deferred compensation plan. The results of the Corporation, which includes funding and operating costs that are not allocated to the business segments, are included in the column labeled “Other” in the tables below.

The Corporation’s chief operating decision makers (CODMs) are the President/Chief Executive Officer and the Chief Financial Officer. The CODMs use net income to evaluate income generated from segment assets in deciding whether to reinvest profits into the segments or into other parts of the entity, such as for acquisitions or to pay dividends. Net income is used to monitor budget versus actual results. The CODMs also use net income in competitive analysis by benchmarking to the Corporation’s competitors. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segments and in establishing management’s compensation.

Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment. The community banking segment extends two warehouse lines of credit to the mortgage banking segment, providing a portion of the funds needed to originate mortgage loans, that carry interest rates at the daily FHLB advance rate plus a spread ranging from 50 basis points to 175 basis points. The community banking segment also provides the consumer finance segment with a portion of the funds needed to purchase loan contracts by means of a variable

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rate line of credit that carries interest at one-month term SOFR plus 211.5 basis points, with a floor of 3.5 percent and a ceiling of 6.0 percent, and fixed rate notes that carry interest at rates ranging from 3.8 percent to 4.0 percent. The community banking segment acquires certain residential real estate loans from the mortgage banking segment at prices similar to those paid by third-party investors. These transactions are eliminated to reach consolidated totals. In addition to unallocated expenses recorded by the holding company, certain overhead costs are incurred by the community banking segment and are not allocated to the mortgage banking and consumer finance segments.

Three Months Ended March 31, 2025

Community

Mortgage

Consumer

(Dollars in thousands)

Banking

Finance

Other

Eliminations

Consolidated

Interest income

23,384

339

12,123

—

142

35,988

Interest expense

10,381

—

597

—

10,978

Net interest income before allocation

13,003

339

12,123

(597)

142

25,010

Net interest allocation¹

5,754

(72)

(5,682)

—

Net interest income

18,757

267

6,441

(597)

142

25,010

Gain on sales of loans

—

1,985

—

(138)

1,847

Other noninterest income

4,230

1,136

177

222

(39)

5,726

Net revenue

22,987

3,388

6,618

(375)

(35)

32,583

Provision for credit losses

100

—

2,900

—

3,000

Salaries and employee benefits

9,279

1,792

1,977

435

—

13,483

Occupancy expense

1,830

213

150

—

2,193

Data processing

2,342

226

290

—

2,866

Professional fees

724

—

921

Insurance expense

416

—

491

Marketing and advertising expenses

384

140

—

529

Loan processing and collection expenses

230

411

—

683

Provision for indemnifications

—

(25)

—

(25)

Other segment items²

1,215

177

436

107

(17)

1,918

Total noninterest expense

16,232

2,809

3,405

630

(17)

23,059

Income (loss) before taxes

6,655

579

313

(1,005)

(18)

6,524

Income tax expense (benefit)

1,210

148

(312)

(4)

1,129

Net income (loss)

5,445

431

226

(693)

(14)

5,395

Other data:

Capital expenditures

236

—

267

Depreciation and amortization

875

—

988

1	Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment.

2	Other segment items for each reportable segment include:

Community banking – licenses and other taxes expense, travel and education expense, telecommunications expense, other real estate owned losses and expense, net periodic pension cost, office supplies, and certain overhead expenses.

Mortgage banking – licenses and other taxes expense, travel and education expense, telecommunications expense, office supplies, and certain overhead expenses.

Consumer finance – licenses and taxes other expense, travel and education expense, telecommunications expense, payment processing expense, office supplies, and certain overhead expenses.

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	Three Months Ended March 31, 2024
	Community		Mortgage		Consumer
(Dollars in thousands)	Banking		Banking		Finance		Other		Eliminations		Consolidated
Interest income	$	20,322	$	281	$	12,025	$	—	$	80	$	32,708
Interest expense		9,005		—		—		545		—		9,550
Net interest income before allocation		11,317		281		12,025		(545)		80		23,158
Net interest allocation¹		5,847		(44)		(5,803)		—		—		—
Net interest income		17,164		237		6,222		(545)		80		23,158
Gain on sales of loans		—		1,481		—		—		(193)		1,288
Other noninterest income		4,110		1,048		255		840		(49)		6,204
Net revenue		21,274		2,766		6,477		295		(162)		30,650

Provision for credit losses		500		—		3,000		—		—		3,500

Salaries and employee benefits		9,443		1,599		2,144		1,066		—		14,252
Occupancy expense		1,743		232		157		—		—		2,132
Data processing		2,231		240		340		18		—		2,829
Professional fees		709		20		87		99		—		915
Insurance expense		337		30		39		—		—		406
Marketing and advertising expenses		51		103		14		—		—		168
Loan processing and collection expenses		48		184		396		—		—		628
Provision for indemnifications		—		(140)		—		—		—		(140)
Other segment items²		1,354		105		383		134		(16)		1,960
Total noninterest expense		15,916		2,373		3,560		1,317		(16)		23,150

Income (loss) before taxes		4,858		393		(83)		(1,022)		(146)		4,000
Income tax expense (benefit)		846		99		(20)		(328)		(32)		565
Net income (loss)	$	4,012	$	294	$	(63)	$	(694)	$	(114)	$	3,435

Other data:
Capital expenditures	$	293	$	81	$	111	$	—	$	—	$	485
Depreciation and amortization		838		14		85		—		—		937

1	Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment.

2	Other segment items for each reportable segment include:

Mortgage banking – licenses and other taxes expense, travel and education expense, telecommunications expense, office supplies, and certain overhead expenses.

Consumer finance – licenses and taxes other expense, travel and education expense, telecommunications expense, payment processing expense, office supplies, and certain overhead expenses.


	Community		Mortgage		Consumer
(Dollars in thousands)	Banking		Banking		Finance		Other		Eliminations		Consolidated
At March 31, 2025:
Total assets	$	2,499,614	$	35,467	$	468,437	$	29,809	$	(420,797)	$	2,612,530
Total loans held for investment, net		1,463,679		—		439,604		—		—		1,903,283
Total loans held for sale		—		28,089		—		—		(811)		27,278
Total deposits		2,229,805		—		—		—		(13,151)		2,216,654

At December 31, 2024:
Total assets	$	2,449,641	$	29,837	$	472,672	$	31,823	$	(420,599)	$	2,563,374
Total loans held for investment, net		1,436,226		—		444,085		—		—		1,880,311
Total loans held for sale		—		21,906		—		—		(1,794)		20,112
Total deposits		2,186,139		—		—		—		(15,279)		2,170,860

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NOTE 11: Commitments and Contingent Liabilities

The Corporation enters into commitments to extend credit in the normal course of business to meet the financing needs of its customers, including loan commitments and standby letters of credit. These instruments involve elements of credit and interest rate risk in excess of the amounts recorded on the Consolidated Balance Sheets. The Corporation’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit written is represented by the contractual amount of these instruments. The Corporation uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. Collateral is obtained based on management’s credit assessment of the customer.

Loan commitments are agreements to extend credit to a customer provided that there are no violations of the terms of the contract prior to funding. Commitments have fixed expiration dates or other termination clauses and may require payment of a fee by the customer. Because many of the commitments may expire without being completely drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount of loan commitments at the Bank was $469.85 million at March 31, 2025 and $469.77 million at December 31, 2024, which does not include IRLCs at the mortgage banking segment, which are discussed in Note 12. Off balance sheet credit exposures, including loan commitments, are not recorded on balance sheet, but expected credit losses arising from off balance sheet credit exposures are recorded as a reserve for unfunded commitments and reported in Other Liabilities. The following table presents the Corporation’s reserve for unfunded commitments for the periods indicated.


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Balance at the beginning of period	$	1,800	$	1,650
Provision charged to operations		(50)		(100)
Balance at the end of period	$	1,750	$	1,550

Standby letters of credit are written conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loans to customers. The total contract amount of standby letters of credit, whose contract amounts represent credit risk, was $18.54 million at March 31, 2025 and $18.79 million at December 31, 2024.

The mortgage banking segment sells the majority of the residential mortgage loans it originates to third-party investors. Additionally, the community banking segment purchases residential mortgage loans from the mortgage banking segment under terms and conditions similar to third-party investors. As is customary in the industry, the agreements with these investors require the mortgage banking segment to extend representations and warranties with respect to program compliance, borrower misrepresentation, fraud, and early payment performance. Under the agreements, the investors are entitled to make loss claims and repurchase requests of the mortgage banking segment for loans that contain covered deficiencies. The mortgage banking segment has obtained early payment default recourse waivers for a portion of its business. Recourse periods for early payment default for the remaining investors vary from 90 days up to one year. Recourse periods for borrower misrepresentation or fraud, or underwriting error do not have a stated time limit. The mortgage banking segment maintains an allowance for indemnifications that represents management’s estimate of losses that are probable of arising under these recourse provisions. As performance data for loans that have been sold is not made available to the mortgage banking segment by the investors, the estimate of potential losses is inherently subjective and is based on historical indemnification payments and management’s assessment of current conditions that may contribute to indemnified losses on mortgage loans that have been sold in the secondary market. For the three months ended March 31, 2025, the Corporation recorded a net reversal of provision for indemnifications of $25,000 compared to a net reversal of provision for indemnifications of $140,000 for the three months ended March 31, 2024, which is included in “Noninterest Expenses – Other” on the Consolidated Statements of Income. No indemnification payments were made

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during the three months ended March 31, 2025 and 2024. The allowance for indemnifications was $1.32 million and $1.35 million at March 31, 2025 and December 31, 2024, respectively.

NOTE 12: Derivative Financial Instruments

The Corporation uses derivative financial instruments primarily to manage risks to the Corporation associated with changing interest rates, and to assist customers with their risk management objectives. The Corporation designates certain interest rate swaps as hedging instruments in qualifying cash flow hedges. The changes in fair value of these designated hedging instruments is reported as a component of other comprehensive income (loss). Derivative contracts that are not designated in a qualifying hedging relationship include customer accommodation loan swaps and contracts related to mortgage banking activities.

Cash flow hedges. The Corporation designates interest rate swaps as cash flow hedges when they are used to manage exposure to variability in cash flows on variable rate borrowings such as the Corporation’s trust preferred capital notes. These interest rate swaps are derivative financial instruments that manage the risk of variability in cash flows by exchanging variable-rate interest payments on a notional amount of the Corporation’s borrowings for fixed-rate interest payments. Interest rate swaps designated as cash flow hedges are expected to be highly effective in offsetting the effect of changes in interest rates on the amount of variable-rate interest payments, and the Corporation assesses the effectiveness of each hedging relationship quarterly. If the Corporation determines that a cash flow hedge is no longer highly effective, future changes in the fair value of the hedging instrument would be reported in earnings. As of March 31, 2025, the Corporation has designated cash flow hedges to manage its exposure to variability in cash flows on certain variable rate borrowings for periods that end between June 2026 and June 2029.

All interest rate swaps were entered into with counterparties that met the Corporation’s credit standards and the agreements contain collateral provisions protecting the at-risk party. The Corporation believes that the credit risk inherent in these derivative contracts is not significant.

These cash flow hedges are reported at fair value in “other assets” in the Consolidated Balance Sheets. Unrealized gains or losses recorded in other comprehensive income (loss) related to cash flow hedges are reclassified into earnings in the same period(s) during which the hedged interest payments affect earnings. When a designated hedging instrument is terminated and the hedged interest payments remain probable of occurring, any remaining unrecognized gain or loss in other comprehensive income (loss) is reclassified into earnings in the period(s) during which the forecasted interest payments affect earnings. Amounts reclassified into earnings and interest receivable or payable under designated interest rate swaps are reported in interest expense. The Corporation does not expect any unrealized losses related to cash flow hedges to be reclassified into earnings in the next twelve months. Refer to Note 6 for additional information on amounts reclassified into net income related to these cash flow hedges.

Loan swaps. The Bank also enters into interest rate swaps with certain qualifying commercial loan customers to meet their interest rate risk management needs. The Bank simultaneously enters into interest rate swaps with dealer counterparties, with identical notional amounts and offsetting terms. The net result of these interest rate swaps is that the customer pays a fixed rate of interest and the Corporation receives a floating rate. These back-to-back loan swaps are derivative financial instruments and are reported at fair value in “other assets” and “other liabilities” in the Consolidated Balance Sheets. Changes in the fair value of loan swaps are recorded in other noninterest income and sum to zero because of the offsetting terms of swaps with borrowers and swaps with dealer counterparties.

Mortgage banking. The mortgage banking segment enters into IRLCs with customers to originate loans for which the interest rates are determined (or “locked”) prior to funding. The mortgage banking segment is exposed to interest rate risk through fixed-rate IRLCs and mortgage loans from the time that interest rates are locked until the loans are sold in the secondary market. The mortgage banking segment mitigates this interest rate risk by entering into forward sales contracts with investors, which at times includes the community banking segment, at the time that interest rates are locked for mortgage loans to be delivered on a best efforts basis. IRLCs are derivative financial instruments and are reported at fair value in other assets and other liabilities in the Consolidated Balance Sheets, along with the changes in fair value of the related forward sales of loans. Changes in the fair value of mortgage banking derivatives are recorded as a component of gains on sales of loans.

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At March 31, 2025, the mortgage banking segment had $71.78 million of IRLCs and $27.28 million of unpaid principal on mortgage loans held for sale for which it managed interest rate risk using best-efforts forward sales contracts for $99.06 million in mortgage loans.

At December 31, 2024, the mortgage banking segment had $39.29 million of IRLCs and $20.11 million of unpaid principal on mortgage loans held for sale for which it managed interest rate risk using best-efforts forward sales contracts for $59.40 million in mortgage loans.

The following tables summarize key elements of the Corporation’s derivative instruments.


	March 31, 2025
	Notional
(Dollars in thousands)	Amount		Assets		Liabilities
Cash flow hedges:
Interest rate swap contracts	$	25,000	$	915	$	132
Not designated as hedges:
Customer-related interest rate swap contracts:
Matched interest rate swaps with borrower		77,373		—		3,448
Matched interest rate swaps with counterparty		77,373		3,448		—
Mortgage banking contracts:
IRLCs		71,779		1,005		—


	December 31, 2024
	Notional
(Dollars in thousands)	Amount		Assets		Liabilities
Cash flow hedges:
Interest rate swap contracts	$	25,000	$	1,169	$	—
Not designated as hedges:
Customer-related interest rate swap contracts:
Matched interest rate swaps with borrower		77,820		—		4,636
Matched interest rate swaps with counterparty		77,820		4,636		—
Mortgage banking contracts:
IRLCs		39,291		585		—

The Corporation and the Bank are required to maintain cash collateral with dealer counterparties for interest rate swap relationships in a loss position. At both March 31, 2025 and December 31, 2024, there was no cash collateral maintained with dealer counterparties.

NOTE 13: Other Noninterest Expenses

The following table presents the significant components in the Consolidated Statements of Income line “Noninterest Expenses-Other.”


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Telecommunication expenses	$	371	$	391
Licenses and taxes expense		305		236
Travel and educational expenses		266		289
Postage and courier expenses		260		265
Other components of net periodic pension cost		(163)		(143)
Provision for indemnifications		(25)		(140)
All other noninterest expenses		879		922
Total other noninterest expenses	$	1,893	$	1,820

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion supplements and provides information about the major components of the results of operations, financial condition, liquidity and capital resources of the Corporation. This discussion and analysis should be read in conjunction with the accompanying consolidated financial statements. In addition to current and historical information, the following discussion and analysis contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to our future business, financial condition or results of operations. For a description of certain factors that may have a significant impact on our future business, financial condition or results of operations, see “Cautionary Statement About Forward-Looking Statements” at the end of this discussion and analysis.

OVERVIEW

Our primary financial goals are to maximize the Corporation’s earnings and to deploy capital in profitable growth initiatives that will enhance long-term shareholder value. We track three primary financial performance measures in order to assess the level of success in achieving these goals: (1) return on average assets (ROA), (2) return on average equity (ROE), and (3) growth in earnings. In addition to these financial performance measures, we track the performance of the Corporation’s three business segments: community banking, mortgage banking, and consumer finance. We balance these financial measures with acceptable levels of interest rate risk, while satisfying liquidity and capital requirements and monitoring asset quality. We also actively manage our capital through growth, dividends and share repurchases, while considering the need to maintain a strong capital position. The following table presents selected financial performance highlights for the periods indicated:

TABLE 1: Financial Performance Highlights


(Dollars in thousands, except for per share data)	Three Months Ended March 31,
	2025			2024
Net Income (Loss):
Community Banking	$	5,445		$	4,012
Mortgage Banking		431			294
Consumer Finance		226			(63)
Other		(707)			(808)
Consolidated net income	$	5,395		$	3,435

Earnings per share - basic and diluted	$	1.66		$	1.01

Annualized return on average equity		9.35	%		6.33	%
Annualized return on average assets		0.84	%		0.57	%
Annualized return on average tangible common equity (ROTCE)¹		10.65	%		7.30	%

¹	Refer to “Use of Certain Non-GAAP Financial Measures,” below, for information about these non-GAAP financial measures, including a quantitative reconciliation to the most directly comparable financial measures calculated in accordance with GAAP.

Consolidated net income increased $2.0 million for the first quarter of 2025 compared to the same period in 2024 due to higher net income at all business segments, primarily the community banking segment. A discussion of the performance of our business segments is included under the heading “Business Segments” in the “Results of Operations” section of this discussion and analysis.

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Key factors affecting comparison for the first quarter of 2025 are as follows.

●

Community banking segment loans grew $27.6 million, or 7.6 percent annualized, compared to December 31, 2024;

●

Consumer finance segment loans decreased $4.7 million, or 4.0 percent annualized, compared to December 31, 2024;

●

Deposits increased $45.8 million, or 8.4 percent annualized, compared to December 31, 2024;

●

Consolidated annualized net interest margin was 4.16 percent for the first quarter of 2025 compared to 4.09 percent for the first quarter of 2024 and 4.13 percent in the fourth quarter of 2024;

●

The community banking segment recorded provision for credit losses of $100,000 for the first quarter of 2025 compared to $500,000 for the same period in 2024;

●

The consumer finance segment recorded provision for credit losses of $2.9 million for the first quarter of 2025 compared to $3.0 million for the same period in 2024;

●

Mortgage banking segment loan originations increased $19.5 million, or 20.6 percent, to $113.8 million for the first quarter of 2025 compared to the first quarter of 2024 and decreased $16.7 million, or 12.8 percent compared to the fourth quarter of 2024.

Capital Management and Dividends

Total equity was $235.3 million at March 31, 2025, compared to $227.0 million at December 31, 2024. Under regulatory capital standards, the Corporation’s tier 1 risk-based capital and total risk-based capital ratios at March 31, 2025 and December 31, 2024 were 11.9 percent and 14.1 percent, respectively. At March 31, 2025, the book value per share of the Corporation’s common stock was $72.51 and tangible book value per share, which is a non-GAAP financial measure, was $64.39, compared to $70.00 and $61.86, respectively, at December 31, 2024.

Total equity increased $8.3 million at March 31, 2025 compared to December 31, 2024, due primarily to net income and lower unrealized losses in the market value of securities available for sale, which are recognized as a component of other comprehensive income, partially offset by dividends paid on the Corporation’s common stock. The Corporation’s securities available for sale are fixed income debt securities and their net unrealized loss position is a result of increased market interest rates since they were purchased. The Corporation expects to recover its investments in debt securities through scheduled payments of principal and interest. Unrealized losses are not expected to affect the earnings or regulatory capital of the Corporation or C&F Bank. The accumulated other comprehensive loss related to the Corporation’s securities available for sale, net of deferred income taxes, decreased to $19.1 million at March 31, 2025, compared to $23.7 million at December 31, 2024 due primarily to fluctuations in debt security market interest rates and a decrease in the balance of securities available for sale in an unrealized loss position as a result of maturities, calls and paydowns.

The Corporation’s Board of Directors declared a quarterly cash dividend of 46 cents per share during the first quarter of 2025, which was paid on April 1, 2025. This dividend represents a payout ratio of 27.7 percent of earnings per share for the first quarter of 2025. The Board of Directors of the Corporation continually reviews the amount of cash dividends per share and the resulting dividend payout ratio in light of changes in economic conditions, current and future capital levels and requirements and expected future earnings. In making its decision on the payment of dividends on the Corporation’s common stock, the Corporation’s Board of Directors considers operating results, financial condition, capital adequacy, regulatory requirements, shareholder returns, growth expectations and other factors.

The Corporation has a share repurchase program that was authorized by the Board of Directors to repurchase up to $5.0 million of the Corporation’s common stock, effective January 1, 2025 through December 31, 2025. During the first quarter of 2025, the Corporation did not make any repurchases of its common stock under this share repurchase program.

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CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements requires us to make estimates and assumptions. Those accounting policies with the greatest uncertainty and that require management’s most difficult, subjective or complex judgments affecting the application of these policies, and the greatest likelihood that materially different amounts would be reported under different conditions, or using different assumptions, are described below.

Allowance for Credit Losses: We establish the allowance for credit losses through charges to earnings in the form of a provision for credit losses. Loan losses are charged against the allowance for credit losses for the difference between the carrying value of the loan and the estimated net realizable value or fair value of the collateral, if collateral dependent, when management believes that the collectability of the principal is unlikely. Subsequent recoveries, if any, are credited to the allowance. The allowance represents management’s current estimate of expected credit losses over the contractual term of loans held for investment, and is recorded at an amount that, in management’s judgment, reduces the recorded investment in loans to the net amount expected to be collected. Management’s judgment in determining the level of the allowance is based on evaluations of historical loan losses, current conditions and reasonable and supportable forecasts relevant to the collectability of loans. The measurement of the allowance for credit losses on commercial and consumer loans is based in part on forecasts of the national unemployment rate, which we believe to be indicative of risk factors related to the collectability of commercial and consumer loans. In addition, management’s estimate of expected credit losses is based on the remaining life of loans held for investment, and changes in expected prepayment behavior may result in changes in the remaining life of loans and expected credit losses. Management also assesses the risk of credit losses arising from changes in general market, economic and business conditions; the nature and volume of the loan portfolio; the volume and severity of delinquencies and adversely classified loan balances and the value of underlying collateral in determining the recorded balance of the allowance for credit losses. This evaluation is inherently subjective because it requires estimates that are susceptible to significant revision as more information becomes available. In evaluating the level of the allowance, we consider a range of possible assumptions and outcomes related to the various factors identified above. The level of the allowance is particularly sensitive to changes in the actual and forecasted national unemployment rate and changes in current conditions or reasonably expected future conditions affecting the collectability of loans.

Goodwill: The Corporation’s goodwill was recognized in connection with past business combinations and is reported at the community banking segment and the consumer finance segment. The Corporation reviews the carrying value of goodwill at least annually or more frequently if certain impairment indicators exist. In testing goodwill for impairment, the Corporation may first consider qualitative factors to determine whether the existence of events or circumstances lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, we conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then no further testing is required and the goodwill of the reporting unit is not impaired. If the Corporation elects to bypass the qualitative assessment or if we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, then the fair value of the reporting unit is compared with its carrying value to determine whether an impairment exists. In the last evaluation of goodwill at the community banking segment and the consumer finance segment, which was the annual evaluation in the fourth quarter of 2024, the Corporation concluded that no impairment existed based on an assessment of qualitative factors.

For further information concerning accounting policies, refer to Item 8. “Financial Statements and Supplementary Data,” under the heading “Note 1: Summary of Significant Accounting Policies” in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024.

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RESULTS OF OPERATIONS

NET INTEREST INCOME

The following table shows the average balance sheets, the amounts of interest earned on earning assets, with related yields, and interest expense on interest-bearing liabilities, with related rates, for the three months ended March 31, 2025 and 2024. Interest on tax-exempt loans and securities is presented on a taxable-equivalent basis (which converts the income on loans and investments for which no income taxes are paid to the equivalent yield as if income taxes were paid) using the federal corporate income tax rate of 21 percent that was applicable for all periods presented. Average balances of securities available for sale are included at amortized cost. Loans include loans held for sale. Loans placed on a nonaccrual status are included in the balances and are included in the computation of yields, but had no material effect.

TABLE 2: Average Balances, Income and Expense, Yields and Rates


	Three Months Ended March 31,
	2025						2024
	Average		Income/		Yield/		Average		Income/		Yield/
(Dollars in thousands)	Balance		Expense		Rate		Balance		Expense		Rate
Assets
Securities:
Taxable	$	339,450	$	2,193	2.58	%	$	365,244	$	1,980	2.17	%
Tax-exempt		119,033		1,153	3.87			120,920		1,118	3.70
Total securities		458,483		3,346	2.92			486,164		3,098	2.55
Loans:
Community banking segment		1,467,555		19,966	5.52			1,302,260		17,331	5.35
Mortgage banking segment		20,968		339	6.56			17,700		281	6.39
Consumer finance segment		465,526		12,123	10.56			473,848		12,024	10.21
Total loans		1,954,049		32,428	6.73			1,793,808		29,636	6.64
Interest-bearing deposits in other banks		55,830		502	3.65			28,417		259	3.67
Total earning assets		2,468,362		36,276	5.95			2,308,389		32,993	5.75
Allowance for credit losses		(40,605)						(40,292)
Total non-earning assets		154,554						156,800
Total assets	$	2,582,311					$	2,424,897

Liabilities and Equity
Interest-bearing deposits:
Interest-bearing demand deposits	$	332,341		600	0.67		$	335,570		553	0.66
Savings and money market deposit accounts		489,217		1,205	1.00			484,645		1,061	0.88
Time deposits		821,949		7,964	3.93			705,167		6,916	3.94
Total interest-bearing deposits		1,643,507		9,769	2.40			1,525,382		8,530	2.25
Borrowings:
Repurchase agreements		28,192		112	1.59			27,997		111	1.59
Other borrowings		93,597		1,097	4.69			78,445		909	4.64
Total borrowings		121,789		1,209	3.97			106,442		1,020	3.83
Total interest-bearing liabilities		1,765,296		10,978	2.51			1,631,824		9,550	2.35
Noninterest-bearing demand deposits		545,346						531,885
Other liabilities		40,874						44,125
Total liabilities		2,351,516						2,207,834
Equity		230,795						217,063
Total liabilities and equity	$	2,582,311					$	2,424,897
Net interest income			$	25,298					$	23,443
Interest rate spread					3.44	%					3.40	%
Interest expense to average earning assets					1.79	%					1.66	%
Net interest margin					4.16	%					4.09	%

Interest income and expense are affected by fluctuations in interest rates, by changes in the volume of earning assets and interest-bearing liabilities, and by the interaction of rate and volume factors. The following table shows the direct causes of the period-to-period changes in the components of net interest income on a taxable-equivalent basis. The Corporation calculates the rate and volume variances using a formula prescribed by the SEC. Rate/volume variances, the third element

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in the calculation, are not shown separately in the table, but are allocated to the rate and volume variances in proportion to the absolute dollar amounts of each.

TABLE 3: Rate-Volume Recap


	Three Months Ended March 31, 2025 from 2024
	Increase (Decrease)				Total
	Due to				Increase
(Dollars in thousands)	Rate		Volume		(Decrease)
Interest income:
Loans:
Community banking segment	$	528	$	2,107	$	2,635
Mortgage banking segment		7		51		58
Consumer finance segment		343		(244)		99
Securities:
Taxable		359		(146)		213
Tax-exempt		52		(17)		35
Interest-bearing deposits in other banks		(1)		244		243
Total interest income		1,288		1,995		3,283
Interest expense:
Interest-bearing deposits:
Interest-bearing demand deposits		35		12		47
Savings and money market deposit accounts		135		9		144
Time deposits		(18)		1,066		1,048
Total interest-bearing deposits		152		1,087		1,239
Borrowings:
Repurchase agreements		—		1		1
Other borrowings		10		178		188
Total interest expense		162		1,266		1,428
Change in net interest income	$	1,126	$	729	$	1,855

Net interest income, on a taxable-equivalent basis, for the first quarter of 2025 increased to $25.3 million, compared to $23.4 million for the first quarter of 2024, due primarily to an increase in net interest margin and higher average balances of earning assets. Annualized net interest margin increased 7 basis points to 4.16 percent for the first quarter of 2025 compared to the same period of 2024, due primarily to a change in the mix of earning assets and higher yields on earning assets, partially offset by an increase in costs of interest-bearing deposits. The Federal Reserve Bank (FRB) target federal funds interest rate was at an upper limit of 5.50 percent at December 31, 2023 until the FRB began decreasing it in September 2024, decreasing it to 4.50 percent by December 31, 2024, where it remained during the first quarter of 2025. The yield on interest-earning assets increased by 20 basis points for the first quarter of 2025 compared to the same period in 2024. The cost of interest-bearing liabilities increased by 16 basis points for the first quarter of 2025 compared to the same period of 2024. Average earning assets increased $160.0 million for the first quarter of 2025 compared to the same period in 2024. Average interest-bearing liabilities increased $133.5 million for the first quarter of 2025 compared to the same period in 2024. Average noninterest-bearing demand deposits increased $13.5 million for the first quarter of 2025 compared to the same period in 2024.

Average loans, which includes both loans held for investment and loans held for sale, increased $160.2 million to $1.95 billion for the first quarter of 2025 compared to the same period in 2024. Average loans at the community banking segment increased $165.3 million, or 12.7 percent, for the first quarter of 2025, compared to the same period in 2024, due primarily to growth in the construction, commercial real estate, land acquisition and development and builder lines segments of the loan portfolio. Average loans at the consumer finance segment decreased $8.3 million, or 1.8 percent, for the first quarter of 2025, compared to the same period in 2024, due primarily to lower average balances of automobile loans. Average loans at the mortgage banking segment, which consist of loans held for sale, increased $3.3 million, or 18.5 percent, for the first quarter of 2025 compared to the same period in 2024.

The community banking segment average loan yield increased 17 basis points to 5.52 percent for the first quarter of 2025 compared to the same period in 2024, due primarily to a shift in the mix of the loan portfolio to higher yielding loans and renewals of fixed rate loans originated during periods of lower interest rates. The consumer finance segment average loan yield increased 35 basis points to 10.56 percent for the first quarter of 2025, compared to the same period in 2024, due primarily to the effects of the overall higher interest rate environment. The mortgage banking segment average loan yield

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increased 17 basis points to 6.56 percent for the first quarter of 2025, compared to the same period in 2024, due to fluctuations in mortgage interest rates.

Average securities available for sale decreased $27.7 million to $458.5 million for the first quarter of 2025, compared to the same period in 2024, due primarily to maturities, calls and paydowns outpacing purchases in the portfolio. The average yield on the securities portfolio on a taxable-equivalent basis increased 37 basis points to 2.92 percent for the first quarter of 2025 compared to the same period in 2024, due primarily to purchases of securities in the overall higher interest rate environment and maturities of lower-yielding securities.

Average interest-bearing deposits in other banks, consisting primarily of excess cash reserves maintained at the FRB, increased $27.4 million to $55.8 million for the first quarter of 2025 compared to the same period of 2024. The average yield on interest-bearing deposits in other banks decreased 2 basis points for the first quarter of 2025, compared to the same period in 2024, due to the decrease in the federal funds interest rate, partially offset by the impacts of the timing of cash items in process, which don’t earn interest until they settle and have a larger effect on yields during periods of lower average balances.

Average savings and money market and interest-bearing demand deposits combined increased $1.3 million to $821.5 million for the first quarter of 2025, compared to the same period in 2024. Average non-interest-bearing demand deposits increased $13.5 million to $545.3 million for the first quarter of 2025 compared to the same period in 2024. Average time deposits increased $116.8 million to $821.9 million for the first quarter of 2025 compared to the same period in 2024. The average cost of interest-bearing deposits increased 15 basis points to 2.40 percent for the first quarter of 2025, compared to the same period in 2024, due primarily to a shift in composition towards time deposits amid the overall higher interest rate environment and increased competition for deposits.

Average borrowings increased $15.3 million to $121.8 million for the first quarter of 2025, compared to the same period in 2024, due primarily to fluctuations in repurchase agreements and Federal Home Loan Bank of Atlanta (FHLB) advances. The average cost of borrowings increased 14 basis points for the first quarter of 2025, compared to the same period in 2024, due primarily to a shift in the mix of borrowings.

The Corporation believes that the effects of declining market interest rates, if continued during 2025, could adversely affect its net interest margin in the short term as its assets typically reprice downward more quickly than its deposits and borrowings. The Corporation also believes any such adverse impacts could be somewhat mitigated by renewals of fixed rate loans originated during periods of lower interest rates and purchases of securities available for sale in the overall higher interest rate environment. The interest rate environment has grown increasingly uncertain during 2025 and the ultimate effect of these factors on the Corporation’s net interest margin will also depend on other factors, including the Corporation’s ability to grow loans at the community banking and consumer finance segments, to compete for deposits, and the extent of its reliance on borrowings. The Corporation gives no assurance as to the timing or extent of changes in market interest rates or the impact of those changes or any other factor on the Corporation's ability to compete for loans and deposits or on its net interest margin. If market interest rates were to rise, net interest margin could be positively affected in the short term as the Corporation generally expects its assets to reprice upward more quickly than its deposits and borrowings.

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Noninterest Income

TABLE 4: Noninterest Income


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Gains on sales of loans	$	1,847	$	1,288
Interchange income		1,475		1,475
Service charges on deposit accounts		990		1,047
Wealth management services income, net		732		731
Mortgage banking fee income		570		479
Mortgage lender services income		536		503
Other service charges and fees		498		396
Unrealized gain (loss) on investments held in rabbi trust		211		840
Investment income from other equity interests		207		167
Other income, net		507		566
Total noninterest income	$	7,573	$	7,492

Total noninterest income increased $81,000, or 1.1 percent, for the first quarter of 2025, compared to the same period of 2024, due primarily to higher volume of mortgage loan production which resulted in higher gains on sales of loans and higher mortgage banking fee income, and higher other service charges, partially offset by fluctuations in unrealized gains and losses on investments held in the rabbi trust.

The Corporation uses a rabbi trust to fund liabilities under its nonqualified deferred compensation plan. Unrealized gains and losses on investments held in the Corporation’s rabbi trust are offset by changes in deferred compensation liabilities, recorded in salaries and employee benefits expense.

Noninterest Expense

TABLE 5: Noninterest Expense


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Salaries and employee benefits:
Compensation, payroll taxes and employee benefits	$	13,272	$	13,412
Increase in nonqualified deferred compensation plan liabilities		211		840
Total salaries and employee benefits		13,483		14,252

Occupancy expense		2,193		2,132
Data processing		2,866		2,829
Professional fees		921		915
Loan processing and collection expenses		683		628
Insurance expense		491		406
Marketing and advertising expenses		529		168
Other expenses:
Telecommunication expenses		371		391
Licenses and taxes expense		305		236
Travel and educational expenses		266		289
Postage and courier expenses		260		265
Other components of net periodic pension cost		(163)		(143)
Provision for indemnifications		(25)		(140)
All other noninterest expenses		879		922
Total other noninterest expenses		1,893		1,820
Total noninterest expense	$	23,059	$	23,150

Total noninterest expenses decreased $91,000, or less than one percent, in the first quarter of 2025, compared to the same period in 2024, due primarily to fluctuations in deferred compensation liabilities and lower compensation, payroll taxes and employee benefits due primarily to a reduction in headcount through attrition, partially offset by higher marketing and

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advertising expenses related to the strategic marketing initiative that began in the second half of 2024 and a lower net reversal of provision for indemnifications.

Changes in deferred compensation liabilities are offset by unrealized gains and losses on investments held in the Corporation’s rabbi trust and are recorded in noninterest income.

Income Taxes

The Corporation’s consolidated effective income tax rate was 17.3 percent for the first quarter of 2025, an increase compared to 14.1 percent for the same period in 2024 due primarily to a lower share of income at the community banking segment, which is primarily not subject to state income taxes.

Business Segments

The Corporation operates in a decentralized manner in three business segments: community banking, mortgage banking and consumer finance. An overview of the financial results for each of the Corporation’s business segments is presented below.

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Community Banking: The community banking segment comprises C&F Bank, C&F Wealth Management, C&F Insurance and CVB Title. The following table presents the community banking segment operating results for the periods indicated.

TABLE 6: Community Banking Segment Operating Results


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Interest income	$	23,384	$	20,322
Interest expense		10,381		9,005
Net interest income before allocation		13,003		11,317
Net interest allocation¹		5,754		5,847
Net interest income		18,757		17,164
Provision for credit losses		100		500
Net interest income after provision for credit losses		18,657		16,664
Noninterest income:
Interchange income		1,475		1,475
Service charges on deposit accounts		1,007		1,061
Wealth management services income, net		732		731
Other service charges and fees		497		396
Investment income from other equity interests		207		167
Other income, net		312		280
Total noninterest income		4,230		4,110
Noninterest expense:
Salaries and employee benefits		9,279		9,443
Occupancy expense		1,830		1,743
Data processing		2,342		2,231
Professional fees		724		709
Insurance expense		416		337
Marketing and advertising expenses		384		51
Loan processing and collection expenses		42		48
Other expenses		1,215		1,354
Total noninterest expenses		16,232		15,916
Income before income taxes		6,655		4,858
Income tax expense		1,210		846
Net income	$	5,445	$	4,012

1	Interest expense is allocated to the mortgage banking and consumer finance segments through borrowings from the community banking segment.

The community banking segment reported net income of $5.4 million for the first quarter of 2025, compared to $4.0 million for the same period in 2024. The increase in community banking segment net income was due primarily to:

●

higher interest income resulting from higher average balances of loans and the effects of higher average interest rates on asset yields; and

●

lower provision for credit losses due primarily to lower loan growth;

partially offset by:

●

higher interest expense due primarily to higher average balances of interest-bearing deposits and higher average rates on deposits; and

●

higher marketing and advertising expenses related to the strategic marketing initiative, which began in the second half of 2024.

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Net interest income for the community banking segment increased by $1.6 million to $18.8 million for the first quarter of 2025, compared to the same period in 2024 due primarily to higher average balances of earning assets and an increase in net interest margin. Average interest-earning asset yields were higher for the first quarter of 2025, compared to the same period of 2024, due primarily to a shift in the mix of the loan portfolio to higher yielding loans, renewals of fixed rate loans originated during periods of lower interest rates, purchases of securities in the overall higher interest rate environment and maturities of lower-yielding securities. This increase was partially offset by an increase in the average costs of interest-bearing deposits for the first quarter of 2025, compared to the same period of 2024, due primarily to the continued effects of a shift in the mix of deposits with customers seeking higher yielding opportunities as a result of higher interest rates paid on time deposits. Interest income allocated to the community banking segment includes interest income on loans to the consumer finance and mortgage banking segments. These transactions are eliminated to reach consolidated totals.

The community banking segment recorded $100,000 in provision for credit losses for the first quarter of 2025, compared to $500,000 for the same period of 2024, due primarily to lower loan growth. Noninterest income increased for the first quarter of 2025, compared to the same period in 2024, due primarily to higher other service charges and fees and higher investment income from other equity interests, partially offset by lower service charges on deposit accounts. Noninterest expenses increased for the first quarter of 2025, compared to the same period in 2024, due primarily to higher marketing and advertising expenses and data processing, partially offset by lower salaries and employee benefits .

Mortgage Banking: The following table presents the mortgage banking operating results for the periods indicated.

TABLE 7: Mortgage Banking Segment Operating Results


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Interest income	$	339	$	281
Interest expense		—		—
Net interest income before allocation		339		281
Net interest allocation¹		(72)		(44)
Net interest income		267		237
Provision for credit losses		—		—
Net interest income after provision for credit losses		267		237
Noninterest income:
Gains of sales of loans		1,985		1,481
Mortgage banking fee income		592		514
Mortgage lender services fee income		541		503
Other income		3		31
Total noninterest income		3,121		2,529
Noninterest expense:
Salaries and employee benefits		1,792		1,599
Occupancy expense		213		232
Data processing		226		240
Loan processing and collection expenses		26		20
Marketing and advertising expenses		30		30
Professional fees		140		103
Insurance expense		230		184
Provision for indemnifications		(25)		(140)
Other expenses		177		105
Total noninterest expenses		2,809		2,373
Income before income taxes		579		393
Income tax expense		148		99
Net income	$	431	$	294

1	Interest expense is allocated to the mortgage banking segment through borrowings from the community banking segment.

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The mortgage banking segment reported net income of $431,000 for the first quarter of 2025, compared to $294,000 for the same period of 2024, due primarily to:

●

higher gains on sales of loans and higher mortgage banking fee income due to higher volume of mortgage loan originations;

partially offset by:

●

higher variable expenses tied to mortgage loan origination volume such as commissions and bonuses, reported in salaries and employee benefits, and

●

lower reversal of provision for indemnifications.

The following table presents mortgage loan originations and mortgage loans sold for the periods indicated.

TABLE 8: Mortgage Loan Originations


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Mortgage loan originations:
Purchases	$	101,640	$	86,760
Refinancings		12,110		7,586
Total mortgage loan originations¹	$	113,750	$	94,346

Lock-adjusted originations²	$	142,340	$	120,400

Total mortgage loan originations does not include mortgage lender services.

Lock-adjusted originations includes the effect of changes in the volume of mortgage loan applications in process that have not closed, net of an estimated volume not expected to close.

Despite the sustained elevated level of mortgage interest rates, higher home prices and low levels of inventory, mortgage banking segment loan originations increased 20.6 percent for the first quarter of 2025, compared to the same period in 2024. Gains on sales of loans, while driven in part by mortgage loan originations, also includes the effects of changes in locked loan commitments, which reflect the volume of mortgage loan applications that are in process and have not closed. Lock-adjusted originations for the mortgage banking segment increased 18.2 percent for the first quarter of 2025 compared to the same period in 2024. Locked loan commitments were $71.8 million at March 31, 2025 compared to $39.3 million and $55.8 million at December 31, 2024 and March 31, 2024, respectively. Mortgage loan segment originations include originations of loans sold to the community banking segment, at prices similar to those paid by third-party investors. All interest expense at the mortgage banking segment is on variable rate borrowings from the community banking segment. These transactions are eliminated to reach consolidated totals.

Through the Lender Solutions division of the mortgage banking segment, mortgage lender services fee income is derived from providing mortgage origination functions to third-party mortgage lenders for a fee. Mortgage lender services fee income increased for the first quarter of 2025, compared to the same period in 2024, due primarily to an increase in fees and the types of services provided.

During the first quarter of 2025, the mortgage banking segment recorded a reversal of provision for indemnification losses of $25,000 compared to a reversal of provision for indemnification losses of $140,000 for the first quarter of 2024. The release of indemnification reserves in 2025 and 2024 was due primarily to lower volume of mortgage loan originations in recent years, improvement in the mortgage banking segment’s assessment of borrower payment performance and other factors affecting expected losses on mortgage loans sold in the secondary market, such as time since origination. Management believes that the indemnification reserve is sufficient to absorb losses related to loans that have been sold in the secondary market.

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The mortgage banking segment onboarded a new team of loan officers on March 31, 2025 who, based on current mortgage market conditions and forecasts, are projected to generate new mortgage loan originations of approximately $100 to $125 million on an annual basis.

Consumer Finance: The following table presents the consumer finance operating results for the periods indicated.

TABLE 9: Consumer Finance Segment Operating Results


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Interest income	$	12,123	$	12,025
Interest expense		—		—
Net interest income before allocation		12,123		12,025
Net interest allocation¹		(5,682)		(5,803)
Net interest income		6,441		6,222
Provision for credit losses		2,900		3,000
Net interest income after provision for credit losses		3,541		3,222
Noninterest income		177		255
Noninterest expense:
Salaries and employee benefits		1,977		2,144
Occupancy expense		150		157
Data processing		290		340
Professional fees		91		87
Insurance expense		45		39
Marketing and advertising expenses		5		14
Loan processing and collection expenses		411		396
Other expenses		436		383
Total noninterest expenses		3,405		3,560
Income before income taxes		313		(83)
Income tax expense		87		(20)
Net income	$	226	$	(63)

1	Interest expense is allocated to the consumer finance segment through borrowings from the community banking segment.

The consumer finance segment reported net income of $226,000 for the first quarter of 2025, compared to a net loss of $63,000 for the same period in 2024. The increase in consumer finance segment net income was due primarily to:

●

lower interest expense allocation on borrowings from the community banking segment as a result of lower average balances of borrowings;

●

lower salaries and employee benefits expense due to an effort to reduce overhead costs; and

●

higher interest income resulting from the effects of higher interest rates on loan yields, partially offset by lower average balances of loans.

Net interest income for the consumer finance segment increased by $219,000 to $6.4 million for the first quarter of 2025, compared to the same period in 2024 due primarily to higher net interest margin, partially offset by lower average balances of loans. Average loans decreased $8.3 million, or 1.8 percent, for the first quarter of 2025, compared to the same period in 2024. All interest expense at the consumer finance segment is on fixed and variable rate borrowings from the community banking segment. These transactions are eliminated to reach consolidated totals.

The consumer finance segment recorded $2.9 million in provision for credit losses for the first quarter of 2025, compared to $3.0 million for the same period of 2024 due primarily to lower average loan balances, partially offset by an increase in net charge-offs. Net charge-offs increased due primarily to an increase in delinquent loans, repossessions and the average

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amount charged-off when a loan was uncollectable. If loan performance deteriorates, resulting in further elevated delinquencies or net charge-offs, the provision for credit losses may increase in future periods.

ASSET QUALITY

Allowance and Provision for Credit Losses

Commercial and consumer loans are assigned loan classification ratings based on their credit quality and risk of loss. These loan ratings are reviewed on a quarterly basis and updated as new information becomes available. The characteristics of these loan ratings are as follows:

●

Pass rated loans are to persons or business entities with an acceptable financial condition, appropriate collateral margins, appropriate cash flow to service the existing loan, and an appropriate leverage ratio. The borrower has paid all obligations as agreed and it is expected that this type of payment history will continue. When necessary, acceptable personal guarantors support the loan.

●

Special mention loans have a specific, identified weakness in the borrower’s operations and in the borrower’s ability to generate positive cash flow on a sustained basis. The borrower’s recent payment history may be characterized by late payments. The Corporation’s risk exposure is mitigated by collateral supporting the loan. The collateral is considered to be well-margined, well maintained, accessible and readily marketable.

●

Substandard loans are considered to have specific and well-defined weaknesses that jeopardize the viability of the Corporation’s credit extension. The payment history for the loan has been inconsistent and the expected or projected primary repayment source may be inadequate to service the loan. The estimated net liquidation value of the collateral pledged and/or ability of the personal guarantor(s) to pay the loan may not adequately protect the Corporation. There is a distinct possibility that the Corporation will sustain some loss if the deficiencies associated with the loan are not corrected in the near term. A substandard loan would not automatically meet the Corporation’s definition of impaired unless the loan is significantly past due and the borrower’s performance and financial condition provide evidence that it is probable that the Corporation will be unable to collect all amounts due.

●

Substandard nonaccrual loans have the same characteristics as substandard loans; however, they have a nonaccrual classification because it is probable that the Corporation will not be able to collect all amounts due.

●

Doubtful rated loans have all the weaknesses inherent in a loan that is classified substandard but 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. The possibility of loss is extremely high.

●

Loss rated loans are not considered collectible under normal circumstances and there is no realistic expectation for any future payment on the loan. Loss rated loans are fully charged off.

The Corporation monitors the consumer finance loan portfolio by past due status and by credit rating at the time of origination, which the Corporation believes serves as a relevant indicator of aggregate credit quality and risk of loan defaults in the portfolio based upon the use of Fair Isaac Corporation (FICO) Scores over time for loan approval decisions and through experience analyzing loss patterns. The characteristics of these credit ratings and our thresholds are as follows:

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●

Very Good (>739) and Good (670-739) credit rated borrowers are near or above the average FICO Score of consumers. Borrowers generally have limited to no prior credit difficulties or have shown extensive creditworthiness over a recent period of time.

●

Fairly Good (625-669) and Fair (580-624) credit rated borrowers are approaching or slightly below the average FICO Score of consumers but typically have a credit profile acceptable to most lenders. Borrowers may have experienced minor credit difficulties or have a relatively limited credit history.

●

Marginal (<580) credit rated borrowers are well below the average FICO Score of consumers. Borrowers may have limited access to traditional financing due to having experienced prior credit difficulties or have a limited credit history. The risk of future charge-offs is higher.

The allowance for credit losses represents an amount that, in our judgment, reduces the recorded investment in loans to the net amount expected to be collected. The provision for credit losses increases the allowance, and loans charged off, net of recoveries, reduce the allowance.

The following tables present the Corporation’s credit loss experience for the periods indicated.

TABLE 10: Allowance for Credit Losses

Consumer

(Dollars in thousands)

Commercial

Consumer¹

Finance

Total

For the three months ended March 31, 2025:

Balance at December 31, 2024

13,347

4,032

22,708

40,087

Provision charged to operations

2,900

3,050

Loans charged off

—

(61)

(4,073)

(4,134)

Recoveries of loans previously charged off

997

1,040

Balance at March 31, 2025

13,425

4,086

22,532

40,043

Average loans²

1,088,690

380,535

465,526

1,934,751

Ratio of annualized net (recoveries) charge-offs to average loans

(0.00)

0.03

2.64

0.64

1Consumer loans includes provision, charge-offs and recoveries related to demand deposit overdrafts.

2Average loans does not include loans held for sale at the mortgage banking segment.


							Consumer
(Dollars in thousands)	Commercial			Consumer¹			Finance			Total
For the three months ended March 31, 2024:
Balance at December 31, 2023	$	12,315		$	3,758		$	23,578		$	39,651
Provision charged to operations		535			65			3,000			3,600
Loans charged off		—			(101)			(4,103)			(4,204)
Recoveries of loans previously charged off		9			53			1,091			1,153
Balance at March 31, 2024	$	12,859		$	3,775		$	23,566		$	40,200

Average loans²	$	946,621		$	357,796		$	473,848		$	1,778,265
Ratio of annualized net (recoveries) charge-offs to average loans		(0.00)	%		0.05	%		2.54	%		0.69	%

1Consumer loans includes provision, charge-offs and recoveries related to demand deposit overdrafts.

2Average loans does not include loans held for sale at the mortgage banking segment.

For further information regarding the adequacy of our allowance for credit losses, refer to “Table 16: Nonperforming Assets” and the accompanying disclosure below.

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The allocation of the allowance for credit losses and the ratio of corresponding outstanding loan balances to total loans are as follows as of the dates indicated.

TABLE 11: Allocation of Allowance for Credit Losses


	March 31,			December 31,
(Dollars in thousands)	2025			2024
Allocation of allowance for credit losses:
Commercial	$	13,425		$	13,347
Consumer		4,086			4,032
Consumer Finance		22,532			22,708
Total allowance for credit losses	$	40,043		$	40,087
Ratio of loans to total period-end loans:
Commercial		56	%		55	%
Consumer		20			20
Consumer Finance		24			25
		100	%		100	%

Loans are required to be measured at amortized cost and to be presented at the net amount expected to be collected. Credit losses on available for sale debt securities are accounted for as an allowance for credit losses, which is a valuation account that is deducted from the amortized cost basis of the financial asset to present the net carrying value and the amount expected to be collected on the financial asset. Off balance sheet credit exposures, including loan commitments, are not recorded on balance sheet, but expected credit losses arising from off balance sheet credit exposures are recorded as a reserve for unfunded commitments and reported in Other Liabilities. The following table presents the Corporation’s reserve for unfunded commitments for the periods indicated.

TABLE 12: Reserve for Unfunded Commitments


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Balance at the beginning of period	$	1,800	$	1,650
Provision charged to operations		(50)		(100)
Balance at the end of period	$	1,750	$	1,550

The allowance for credit losses on loans and available for sale debt securities and the reserve for unfunded commitments are established through a provision for credit losses charged against earnings. The following table presents a breakdown of the provision for credit losses for the periods indicated:

TABLE 13: Provision for Credit Losses


	Three Months Ended March 31,
(Dollars in thousands)	2025		2024
Provision for credit losses:
Provision for loans	$	3,050	$	3,600
Provision for unfunded commitments		(50)		(100)
Total	$	3,000	$	3,500

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TABLE 14: Credit Quality Indicators

Loans by credit quality indicators as of March 31, 2025 were as follows:


			Special				Substandard
(Dollars in thousands)	Pass		Mention		Substandard		Nonaccrual		Total¹
Commercial real estate	$	757,373	$	937	$	—	$	—	$	758,310
Commercial business		106,844		—		—		—		106,844
Construction - commercial real estate		121,140		—		—		—		121,140
Land acquisition and development		46,042		—		—		—		46,042
Builder lines		42,720		—		—		—		42,720
Construction - consumer real estate		21,188		—		—		—		21,188
Residential mortgage		306,725		465		170		1,189		308,549
Equity lines		66,357		—		83		—		66,440
Other consumer		9,957		—		—		—		9,957
	$	1,478,346	$	1,402	$	253	$	1,189	$	1,481,190

(Dollars in thousands)

Very Good

Good

Fairly Good

Fair

Marginal

Total

Consumer finance - automobiles

43,752

108,172

134,031

89,130

21,505

396,590

Consumer finance - marine and recreational vehicles

44,699

20,376

471

—

65,546

88,451

128,548

134,502

89,130

21,505

462,136

1At March 31, 2025, the Corporation did not have any loans classified as Doubtful or Loss.

Loans by credit quality indicators as of December 31, 2024 were as follows:


			Special				Substandard
(Dollars in thousands)	Pass		Mention		Substandard		Nonaccrual		Total¹
Commercial real estate	$	733,242	$	940	$	—	$	—	$	734,182
Commercial business		104,947		—		—		—		104,947
Construction - commercial real estate		132,717		—		—		—		132,717
Land acquisition and development		46,072		—		—		—		46,072
Builder lines		35,605		—		—		—		35,605
Construction - consumer real estate		18,799		—		—		—		18,799
Residential mortgage		306,877		1,427		172		333		308,809
Equity lines		62,042		76		86		—		62,204
Other consumer		10,270		—		—		—		10,270
	$	1,450,571	$	2,443	$	258	$	333	$	1,453,605



(Dollars in thousands)	Very Good		Good		Fairly Good		Fair		Marginal		Total
Consumer finance - automobiles	$	43,033	$	106,791	$	135,175	$	90,581	$	23,071	$	398,651
Consumer finance - marine and recreational vehicles		46,761		20,902		479		—		—		68,142
	$	89,794	$	127,693	$	135,654	$	90,581	$	23,071	$	466,793

1	At December 31, 2024, the Corporation did not have any loans classified as Doubtful or Loss.

Table 15 summarizes the Corporation’s credit ratios on a consolidated basis and Table 16 summarizes nonperforming assets by principal business segment as of March 31, 2025 and December 31, 2024. The mortgage banking segment did not have any nonperforming assets as March 31, 2025 or December 31, 2024.

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TABLE 15: Consolidated Credit Ratios


	March 31,			December 31,
(Dollars in thousands)	2025			2024
Total loans¹	$	1,943,326		$	1,920,398
Nonaccrual loans	$	2,164		$	947
Allowance for credit losses (ACL)	$	40,043		$	40,087
Nonaccrual loans to total loans		0.11	%		0.05	%
ACL to total loans		2.06	%		2.09	%
ACL to nonaccrual loans		1,850.42	%		4,233.05	%

1Total loans does not include loans held for sale at the mortgage banking segment.

TABLE 16: Nonperforming Assets

Community Banking Segment


	March 31,			December 31,
(Dollars in thousands)	2025			2024
Total loans	$	1,481,190		$	1,453,605
Nonaccrual loans	$	1,189		$	333
ACL	$	17,511		$	17,379
Nonaccrual loans to total loans		0.08	%		0.02	%
ACL to total loans		1.18	%		1.20	%
ACL to nonaccrual loans		1,472.75	%		5,218.92	%
Annualized year-to-date net charge-offs to average total loans		0.01	%		0.01	%

Consumer Finance Segment


	March 31,			December 31,
(Dollars in thousands)	2025			2024
Total loans	$	462,136		$	466,793
Nonaccrual loans	$	975		$	614
Repossessed assets	$	976		$	779
ACL	$	22,532		$	22,708
Nonaccrual loans to total loans		0.21	%		0.13	%
ACL to total loans		4.88	%		4.86	%
ACL to nonaccrual loans		2,310.97	%		3,698.37	%
Annualized year-to-date net charge-offs to average total loans		2.64	%		2.62	%

The community banking segment’s nonaccrual loans were $1.2 million at March 31, 2025 compared to $333,000 at December 31, 2024. The increase in nonaccrual loans compared to December 31, 2024 is due primarily to the downgrade

of one residential mortgage relationship in the first quarter of 2025. The community banking segment recorded $100,000 in provision for credit losses for the first quarter of 2025, compared to $500,000 for the same period of 2024. At March 31, 2025, the allowance for credit losses increased to $17.5 million, compared to an allowance for credit losses of $17.4 million at December 31, 2024, due primarily to growth in the loan portfolio and increased macroeconomic uncertainties. The allowance for credit losses as a percentage of total loans decreased to 1.18 percent at March 31, 2025 from 1.20 percent at December 31, 2024, due primarily to growth in loans with shorter expected lives, which resulted in lower estimated losses over the life of the loan. Management believes that the level of the allowance for credit losses is adequate to reflect the net amount expected to be collected.

Nonaccrual loans at the consumer finance segment were $975,000 at March 31, 2025 compared to $614,000 at December 31, 2024. Nonaccrual consumer finance loans remain low relative to the allowance for credit losses and the total consumer finance loan portfolio because the consumer finance segment generally initiates repossession of loan collateral once a loan becomes more than 60 days delinquent. Repossessed vehicles of the consumer finance segment are classified

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as other assets and consist only of vehicles the Corporation has the legal right to sell. Prior to the reclassification from loans to repossessed vehicles, the difference between the carrying amount of each loan and the fair value of each vehicle (i.e. the deficiency) is charged against the allowance for credit losses. At March 31, 2025, repossessed vehicles available for sale totaled $976,000 compared to $779,000 at December 31, 2024.

The consumer finance segment experienced net charge-offs at an annualized rate of 2.64 percent of average total loans for the first quarter of 2025, compared to 2.54 percent for the same period of 2024, due primarily to an increase in the number of delinquent loans, the number of repossessions and the average amount charged-off when a loan was uncollectable. At March 31, 2025, total delinquent loans as a percentage of total loans was 3.05 percent compared to 3.90 percent at December 31, 2024 and 2.78 percent at March 31, 2024. The allowance for credit losses was $22.5 million at March 31, 2025 and $22.7 million at December 31, 2024. The allowance for credit losses as a percentage of total loans increased to 4.88 percent at March 31, 2025, compared to 4.86 percent at December 31, 2024.

The consumer finance segment at times offers payment deferrals to borrowers as a portfolio management technique to achieve higher ultimate cash collections on select loan accounts. A significant reliance on deferrals as a means of managing collections may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the portfolio. Average amounts of payment deferrals of automobile loans on a monthly basis, which are not included in delinquent loans, were 1.75 percent, 1.62 percent and 2.11 percent as a percentage of average automobile loans outstanding for the first quarter of 2025, the first quarter of 2024 and the fourth quarter of 2024, respectively.

The consumer finance segment is an indirect lender that provides automobile financing through lending programs that are designed to serve customers in both the “prime” and “non-prime” markets, including those who may have limited access to traditional automobile financing due to having experienced prior credit difficulties. The preferred automobile is a later model, low mileage used vehicle because the value of new vehicles typically depreciates rapidly. In addition to automobile financing, marine and RV loan contracts are also purchased on an indirect basis through a referral program administered by a third party. The marine and RV loan contracts are for “prime” loans averaging less than $50,000 made to individuals with higher credit scores.

The consumer finance segment’s focus has included “non-prime” borrowers and, therefore, the anticipated rates of delinquencies, defaults, repossessions and losses on the consumer finance loans are higher than those experienced in the general automobile finance industry and could be more dramatically affected by changes in general economic conditions. Changes in economic conditions may also affect consumer demand for used automobiles and values of automobiles securing outstanding loans, due to changes in demand or changes in levels of inventory of used automobiles, which may directly affect the amount of a loss incurred by the consumer finance segment in the event of default. While we manage the higher risk inherent in loans made to “non-prime” borrowers through the underwriting criteria, portfolio management and collection methods employed by the consumer finance segment, we cannot guarantee that these criteria or methods will afford adequate protection against these risks. With the consumer finance segment’s scorecard model for purchasing loan contracts, the credit-worthiness of borrowers at origination has improved for automobile loans purchased and the level of credit losses experienced has decreased relative to long-term historical averages. We cannot provide any assurance that the consumer finance segment’s net charge-off ratio will not increase in future periods. However, we believe that the current allowance for credit losses is adequate to reflect the net amount expected to be collected on existing consumer finance segment loans that may become uncollectible. If factors influencing the consumer finance segment result in higher net charge-off ratios in future periods, the consumer finance segment may need to increase the level of its allowance for credit losses through additional provisions for credit losses, which could negatively affect future earnings of the consumer finance segment.

FINANCIAL CONDITION

At March 31, 2025, the Corporation had total assets of $2.6 billion, an increase of $49.2 million since December 31, 2024. The increase was attributable primarily to growth in loans held for investment, available for sale securities, interest-bearing deposits in other banks and loans held for sale, funded by growth in deposits. The significant components of the Corporation’s Consolidated Balance Sheets are discussed below.

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Loan Portfolio

Tables 17, 18 and 19 present information pertaining to the composition of loans held for investment, the composition of commercial real estate and construction commercial real estate loans, and the maturity/repricing of certain loans held for investment, respectively.

TABLE 17: Summary of Loans Held for Investment


	March 31, 2025				December 31, 2024
(Dollars in thousands)	Amount		Percent		Amount		Percent
Commercial real estate	$	758,310	39	%	$	734,182	38	%
Commercial business		106,844	6			104,947	5
Construction - commercial real estate		121,140	6			132,717	7
Land acquisition and development		46,042	2			46,072	2
Builder lines		42,720	2			35,605	2
Construction - consumer real estate		21,188	1			18,799	1
Residential mortgage		308,549	16			308,809	16
Equity lines		66,440	3			62,204	3
Other consumer		9,957	1			10,270	1
Consumer finance - automobiles		396,590	21			398,651	21
Consumer finance - marine and recreational vehicles		65,546	3			68,142	4
Subtotal		1,943,326	100	%		1,920,398	100	%
Less allowance for credit losses		(40,043)				(40,087)
Loans, net	$	1,903,283			$	1,880,311

During the first quarter of 2025, loans held for investment increased $22.9 million to $1.94 billion at March 31, 2025 due primarily to growth in commercial real estate loans, builder lines and equity lines at the community banking segment, partially offset by a decrease in commercial real estate construction loans at the community banking segment and a decrease in loans at the consumer finance segment.

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TABLE 18: Commercial Real Estate and Construction Commercial Real Estate Loans


	March 31, 2025
(Dollars in thousands)	Amount		% of Commercial Real Estate and Construction Commercial Real Estate Loans			% of Total
Multifamily	$	168,590		19.2	%		8.7	%
Retail		154,554		17.6			8.0
Office		119,293		13.6			6.1
Industrial/warehouse		95,687		10.9			4.9
Hotels		88,627		10.1			4.6
1-4 family investment properties		86,929		9.9			4.5
Mini-storage		44,849		5.1			2.3
Medical office		40,959		4.7			2.1
Other		79,962		8.9			4.1
	$	879,450		100	%		45.3	%


	December 31, 2024
(Dollars in thousands)	Amount		% of Commercial Real Estate and Construction Commercial Real Estate Loans			% of Total
Multifamily	$	172,574		19.9	%		9.0	%
Retail		153,227		17.7			8.0
Office		120,412		13.9			6.3
Industrial/warehouse		94,100		10.9			4.9
Hotels		84,936		9.8			4.4
1-4 family investment properties		80,950		9.3			4.2
Mini-storage		39,368		4.5			2.1
Medical office		40,335		4.7			2.1
Other		80,997		9.3			4.1
	$	866,899		100	%		45.1	%

TABLE 19: Maturity/Repricing Schedule of Loans Held for Investment

March 31, 2025

(Dollars in thousands)

Commercial

Consumer

Consumer Finance

Total

Variable Rate:

Within 1 year

300,481

67,594

—

368,075

1 to 5 years

103,994

1,168

—

105,162

5 to 15 years

8,420

—

8,420

After 15 years

—

Fixed Rate:

Within 1 year

128,018

9,030

4,980

142,028

1 to 5 years

281,393

85,790

241,706

608,889

5 to 15 years

259,895

181,449

215,450

656,794

After 15 years

14,043

39,915

—

53,958

1,096,244

384,946

462,136

1,943,326

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Securities

The investment portfolio plays a primary role in the management of the Corporation’s interest rate sensitivity. In addition, the portfolio serves as a source of liquidity and is used as needed to meet collateral requirements. The investment portfolio consists of securities available for sale, which may be sold in response to changes in market interest rates, changes in prepayment risk, increases in loan demand, general liquidity needs and other similar factors. These securities are carried at estimated fair value. At March 31, 2025 and December 31, 2024, all debt securities in the Corporation’s investment portfolio were classified as available for sale.

The following table sets forth the composition of the Corporation’s securities available for sale in dollar amounts at fair value and as a percentage of the Corporation’s total securities available for sale at the dates indicated.

TABLE 20: Securities Available for Sale


	March 31, 2025				December 31, 2024
(Dollars in thousands)	Amount		Percent		Amount		Percent
U.S. Treasury securities	$	4,769	1	%	$	10,700	3	%
U.S. government agencies and corporations		61,919	14			60,659	14
Mortgage-backed securities		199,397	46			182,436	44
Obligations of states and political subdivisions		143,496	34			143,610	34
Corporate and other debt securities		21,932	5			21,220	5
Total available for sale securities at fair value	$	431,513	100	%	$	418,625	100	%

During the first quarter of 2025, securities available for sale increased $12.9 million to $431.5 million at March 31, 2025 due primarily to increases in mortgage-backed securities offset by decreases in U.S. treasury securities. Net unrealized losses in the market value of securities available for sale decreased to $24.2 million at March 31, 2025, compared to $30.0 million at December 31, 2024.

For more information about the Corporation’s securities available for sale, including information about securities in an unrealized loss position at March 31, 2025 and December 31, 2024, see Part I, Item 1, “Financial Statements” under the heading “Note 2: Securities” in this Quarterly Report on Form 10-Q.

The following table presents additional information pertaining to the composition of the securities portfolio at amortized cost, by the earlier of contractual maturity or expected maturity. Expected maturities will differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties. The total effective duration of the investment portfolio is 3.9 years as of March 31, 2025.

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TABLE 21: Maturity of Securities



	March 31, 2025
			Weighted
	Amortized		Average
(Dollars in thousands)	Cost		Yield¹
U.S. Treasury securities:
Maturing after 1 year, but within 5 years	$	4,989	1.38	%
Total U.S. Treasury securities		4,989	1.38
U.S. government agencies and corporations:
Maturing within 1 year		10,171	1.01
Maturing after 1 year, but within 5 years		31,016	1.37
Maturing after 5 years, but within 10 years		21,486	1.78
Maturing after 10 years		6,100	2.16
Total U.S. government agencies and corporations		68,773	1.52
Mortgage-backed securities:
Maturing within 1 year		30,040	2.41
Maturing after 1 year, but within 5 years		89,133	2.49
Maturing after 5 years, but within 10 years		63,067	2.84
Maturing after 10 years		28,759	4.27
Total mortgage-backed securities		210,999	2.83
States and municipals:¹
Maturing within 1 year		22,856	3.98
Maturing after 1 year, but within 5 years		41,174	2.16
Maturing after 5 years, but within 10 years		47,978	3.94
Maturing after 10 years		35,248	4.49
Total states and municipals		147,256	3.58
Corporate and other debt securities:
Maturing within 1 year		4,652	3.87
Maturing after 1 year, but within 5 years		13,500	4.27
Maturing after 5 years, but within 10 years		5,500	4.58
Total corporate and other debt securities		23,652	4.26
Total securities:
Maturing within 1 year		67,719	2.83
Maturing after 1 year, but within 5 years		179,812	2.32
Maturing after 5 years, but within 10 years		138,031	3.13
Maturing after 10 years		70,107	4.20
Total securities	$	455,669	2.93

1.	Yields on tax-exempt securities have been computed on a taxable-equivalent basis using the federal corporate income tax rate of 21 percent. The weighted average yield is calculated based on the relative amortized costs of the securities.

Deposits

The Corporation’s predominant source of funds is depository accounts, which are comprised of demand deposits, savings and money market accounts and time deposits. The Corporation’s deposits are principally provided by individuals and businesses located within the communities served.

During the first quarter of 2025, deposits increased $45.8 million to $2.22 billion at March 31, 2025. Noninterest bearing demand deposits increased $53.6 million, savings, money markets and interest-bearing demand deposits decreased $17.0 million and time deposits increased $9.2 million during the same period. The decrease in savings, money market and interest-bearing demand deposits was due in part to a shift in balances toward time deposits amid a higher interest rate environment and to seasonal factors related to municipal deposits, which tend to increase with tax collections primarily in the fourth quarter of each year and decline with spending thereafter. The Corporation had $125.1 million in municipal deposits at March 31, 2025 compared to $163.4 million at December 31, 2024.

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The Corporation had $25.0 million in brokered money market and time deposits outstanding at both March 31, 2025 and December 31, 2024. The Corporation may continue to use brokered deposits on a limited basis as a means of maintaining and diversifying liquidity and funding sources.

Borrowings

During the first quarter of 2025, borrowings decreased $3.1 million to $119.5 million at March 31, 2025 due primarily to fluctuations in balances with commercial deposit customers with repurchase agreements.

Liquidity

The objective of the Corporation’s liquidity management is to ensure the continuous availability of funds to satisfy the credit needs of our customers and the demands of our depositors, creditors and investors. Stable core deposits and a strong capital position are the components of a solid foundation for the Corporation’s liquidity position. Additional sources of liquidity available to the Corporation include cash flows from operations, loan payments and payoffs, deposit growth, maturities, calls and sales of securities, the issuance of brokered certificates of deposit and the capacity to borrow additional funds. Depending on the Corporation’s liquidity levels, conditions in the capital markets and other factors, the Corporation may from time to time consider the issuance of debt, equity or other securities, the proceeds of which could provide additional liquidity for our operations.

Liquid assets, which include cash and due from banks, interest-bearing deposits at other banks and nonpledged securities available for sale, totaled $315.0 million at March 31, 2025 compared to $288.1 million at December 31, 2024. The Corporation’s funding sources, including capacity, amount outstanding and amount available at March 31, 2025 are presented in Table 22. The Corporation’s capacity and amount available both decreased $7.5 million from December 31, 2024 due primarily to fluctuations in loans pledged to the FHLB.

TABLE 22: Funding Sources


	March 31, 2025
(Dollars in thousands)	Capacity		Outstanding		Available
Unsecured federal funds agreements	$	75,000	$	—	$	75,000
Borrowings from FHLB		248,508		40,000		208,508
Borrowings from FRB		315,221		—		315,221
Total	$	638,729	$	40,000	$	598,729


	December 31, 2024
(Dollars in thousands)	Capacity		Outstanding		Available
Unsecured federal funds agreements	$	75,000	$	—	$	75,000
Borrowings from FHLB		257,734		40,000		217,734
Borrowings from FRB		313,499		—		313,499
Total	$	646,233	$	40,000	$	606,233

We have no reason to believe these arrangements will not be renewed at maturity. Additional loans and securities are available that can be pledged as collateral for future borrowings from the FHLB and FRB above the current lendable collateral value. Our ability to maintain sufficient liquidity may be affected by numerous factors, including economic conditions nationally and in our markets. Depending on our liquidity levels, our capital position, conditions in the capital markets, our business operations and initiatives, and other factors, we may from time to time consider the issuance of debt, equity or other securities or other possible capital market transactions, the proceeds of which could provide additional liquidity for our operations.

Uninsured deposits represent an estimate of amounts above the Federal Deposit Insurance Corporation (FDIC) insurance coverage limit of $250,000. As of March 31, 2025, the Corporation’s uninsured deposits were approximately $644.4 million, or 29.1 percent of total deposits. Excluding intercompany cash holdings and municipal deposits which are secured with pledged securities, amounts uninsured were approximately $496.6 million, or 22.4 percent of total deposits as of

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March 31, 2025, compared to $455.2 million, or 21.0 percent of total deposits as of December 31, 2024. The Corporation’s liquid assets and borrowing availability as of March 31, 2025 totaled $913.7 million, exceeding uninsured deposits, excluding intercompany cash holdings and secured municipal deposits, by $417.1 million.

The Corporation’s internal policy limits brokered deposits to 20 percent of total deposits, representing approximately $418.3 million of additional net availability for additional brokered deposits as of March 31, 2025.

In the ordinary course of business, the Corporation has entered into contractual obligations and has made other commitments to make future payments. For further information concerning the Corporation’s expected timing of such payments refer to “Item 8. Financial Statements and Supplementary Data,” under the headings “Note 9: Leases,” “Note 11: Borrowings,” and “Note 18: Commitments and Contingent Liabilities” in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024.

As a result of the Corporation’s management of liquid assets and the ability to generate liquidity through liability funding, management believes that the Corporation maintains overall liquidity sufficient to satisfy its operational requirements and contractual obligations.

Capital Resources

The assessment of capital adequacy depends on such factors as asset quality, liquidity, earnings performance, and changing competitive conditions and economic forces. We regularly review the adequacy of the Corporation’s and the Bank’s capital. We maintain a structure that will assure an adequate level of capital to support anticipated asset growth and to absorb potential losses. While we will continue to look for opportunities to invest capital in profitable growth, share repurchases are another tool that facilitates improving shareholder return, as measured by ROE and earnings per share.

The disclosure below presents the Corporation’s and the Bank’s actual capital amounts and ratios under currently applicable regulatory capital standards. Under the small bank holding company policy statement of the Federal Reserve Board, which applies to certain bank holding companies with consolidated total assets of less than $3 billion, the Corporation is not subject to regulatory capital requirements. The table below reflects the Corporation’s consolidated capital as determined under regulations that apply to bank holding companies that are not small bank holding companies and minimum capital requirements that would apply to the Corporation if it were not a small bank holding company. Although the minimum regulatory capital requirements are not applicable to the Corporation, the Corporation calculates these ratios for its own planning and monitoring purposes. Total risk-weighted assets at March 31, 2025 for the Corporation were $2.15 billion and for the Bank were $2.12 billion. Total risk-weighted assets at December 31, 2024 for the Corporation were $2.13 billion and for the Bank were $2.10 billion. As of March 31, 2025, the Bank met all capital adequacy requirements to which it is subject.

TABLE 23: Regulatory Capital

March 31, 2025

Minimum Capital

Well Capitalized

Actual

Requirements

(Dollars in thousands)

Amount

Ratio

Amount

Ratio

Amount

Ratio

The Corporation

Total risk-based capital ratio

303,432

14.1

171,896

8.0

N/A

Tier 1 risk-based capital ratio

256,397

11.9

128,922

6.0

N/A

Common Equity Tier 1 capital ratio

231,397

10.8

96,692

4.5

N/A

Tier 1 leverage ratio

256,397

9.9

103,621

4.0

N/A

The Bank

Total risk-based capital ratio

290,920

13.7

169,850

8.0

212,313

10.0

Tier 1 risk-based capital ratio

264,201

12.4

127,388

6.0

169,850

8.0

Common Equity Tier 1 capital ratio

264,201

12.4

95,541

4.5

138,003

6.5

Tier 1 leverage ratio

264,201

10.3

102,806

4.0

128,507

5.0

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	December 31, 2024
					Minimum Capital				Well Capitalized
	Actual				Requirements				Requirements
(Dollars in thousands)	Amount		Ratio		Amount		Ratio		Amount		Ratio
The Corporation
Total risk-based capital ratio	$	299,157	14.1	%	$	170,256	8.0	%	$	N/A	N/A	%
Tier 1 risk-based capital ratio		252,373	11.9			127,692	6.0			N/A	N/A
Common Equity Tier 1 capital ratio		227,373	10.7			95,769	4.5			N/A	N/A
Tier 1 leverage ratio		252,373	9.8			102,645	4.0			N/A	N/A

The Bank
Total risk-based capital ratio	$	284,550	13.5	%	$	168,233	8.0	%	$	210,291	10.0	%
Tier 1 risk-based capital ratio		258,078	12.3			126,175	6.0			168,233	8.0
Common Equity Tier 1 capital ratio		258,078	12.3			94,631	4.5			136,689	6.5
Tier 1 leverage ratio		258,078	10.1			101,805	4.0			127,256	5.0

The regulatory risk-based capital amounts presented above include: (1) common equity tier 1 capital (CET1) which consists principally of common stock (including surplus) and retained earnings with adjustments for goodwill and intangible assets; (2) Tier 1 capital which consists principally of CET1 plus the Corporation’s “grandfathered” trust preferred securities; and (3) Tier 2 capital which consists principally of Tier 1 capital plus a limited amount of the allowance for credit losses and $20.0 million of outstanding subordinated notes of the Corporation. The Total Capital ratio, Tier 1 Capital ratio and CET1 ratio are calculated as a percentage of risk-weighted assets. The Tier 1 Leverage ratio is calculated as a percentage of average tangible assets. In addition, the Corporation has made the one-time irrevocable election to continue treating accumulated other comprehensive income (AOCI) under regulatory standards that were in place prior to the Basel III Final Rule in order to eliminate volatility of regulatory capital that can result from fluctuations in AOCI and the inclusion of AOCI in regulatory capital, as would otherwise be required under the Basel III Capital Rule. As a result of this election, changes in AOCI, including unrealized losses on securities available for sale, do not affect regulatory capital amounts shown in the table above for the Corporation or the Bank. For additional information about the Basel III Final Rules, see “Item 1. Business” under the heading “Regulation and Supervision” and “Item 8. Financial Statements and Supplementary Data,” under the heading “Note 17: Regulatory Requirements and Restrictions” in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024.

In addition to the regulatory risk-based capital requirements, the Bank must maintain a capital conservation buffer of 2.5 percent of risk-weighted assets as required by the Basel III Final Rule. Including the capital conservation buffer, the minimum ratios are a common equity Tier 1 risk-based capital ratio of 7.0 percent, a Tier 1 risk-based capital ratio of 8.5 percent, and a total risk-based capital ratio of 10.5 percent. The Corporation and the Bank exceeded these ratios at March 31, 2025 and December 31, 2024.

The Corporation’s capital resources are impacted by its share repurchase programs. The Board of Directors authorized a program, effective January 1, 2025 through December 31, 2025, to repurchase up to $5.0 million of the Corporation’s common stock (the 2025 Repurchase Program). Repurchases under the 2025 Repurchase Program may be made through privately negotiated transactions or open market transactions, including pursuant to a trading plan in accordance with Rule 10b5-1 and/or Rule 10b-18 under the Securities Exchange Act of 1934, as amended, (Exchange Act) and shares repurchased will be returned to the status of authorized and unissued shares of common stock. The timing, number and purchase price of shares repurchased under the program will be determined by management in its discretion and will depend on a number of factors, including the market price of the shares, general market and economic conditions, applicable legal requirements and other conditions, and there is no assurance that the Corporation will purchase any shares under the 2025 Repurchase Program. As of March 31, 2025, there was $5.0 million remaining available for repurchases of the Corporation’s common stock under the 2025 Repurchase Program.

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USE OF CERTAIN NON-GAAP FINANCIAL MEASURES

The accounting and reporting policies of the Corporation conform to GAAP in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of the Corporation’s performance. These include net tangible income attributable to the Corporation, ROTCE, tangible book value per share, and the following fully-taxable equivalent (FTE) measures: interest income on loans-FTE, interest income on securities-FTE, total interest income-FTE and net interest income-FTE. Interest on tax-exempt loans and securities is presented on a taxable-equivalent basis (which converts the income on loans and investments for which no income taxes are paid to the equivalent yield as if income taxes were paid) using the federal corporate income tax rate of 21 percent that was applicable for all periods presented.

Management believes that the use of these non-GAAP measures provides meaningful information about operating performance by enhancing comparability with other financial periods, other financial institutions, and between different sources of interest income. The non-GAAP measures used by management enhance comparability by excluding the effects of balances of intangible assets, including goodwill, that vary significantly between institutions, and tax benefits that are not consistent across different opportunities for investment. These non-GAAP financial measures should not be considered an alternative to, or more important than, GAAP-basis financial statements, and other bank holding companies may define or calculate these or similar measures differently. A reconciliation of the non-GAAP financial measures used by the Corporation to evaluate and measure the Corporation’s performance to the most directly comparable GAAP financial measures is presented below.

TABLE 24: Non-GAAP Table


	For The Quarter Ended
	March 31,			March 31,
(Dollars in thousands, except for share and per share data)	2025			2024
Reconciliation of Certain Non-GAAP Financial Measures
Return on Average Tangible Common Equity
Average total equity, as reported	$	230,795		$	217,063
Average goodwill		(25,191)			(25,191)
Average other intangible assets		(1,118)			(1,366)
Average noncontrolling interest		(637)			(649)
Average tangible common equity	$	203,849		$	189,857

Net income	$	5,395		$	3,435
Amortization of intangibles		62			65
Net income attributable to noncontrolling interest		(27)			(34)
Net tangible income attributable to C&F Financial Corporation	$	5,430		$	3,466

Annualized return on average equity, as reported		9.35	%		6.33	%
Annualized return on average tangible common equity		10.65	%		7.30	%

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	For The Quarter Ended
	March 31,		March 31,
(Dollars in thousands, except for share and per share data)	2025		2024
Fully Taxable Equivalent Net Interest Income¹
Interest income on loans	$	32,382	$	29,586
FTE adjustment		46		50
FTE interest income on loans	$	32,428	$	29,636

Interest income on securities	$	3,104	$	2,863
FTE adjustment		242		235
FTE interest income on securities	$	3,346	$	3,098

Total interest income	$	35,988	$	32,708
FTE adjustment		288		285
FTE interest income	$	36,276	$	32,993

Net interest income	$	25,010	$	23,158
FTE adjustment		288		285
FTE net interest income	$	25,298	$	23,443

1	Assuming a tax rate of 21%.


	March 31,		December 31,
(Dollars in thousands except for per share data)	2025		2024
Tangible Book Value Per Share
Equity attributable to C&F Financial Corporation	$	234,634	$	226,360
Goodwill		(25,191)		(25,191)
Other intangible assets		(1,084)		(1,147)
Tangible equity attributable to C&F Financial Corporation	$	208,359	$	200,022

Shares outstanding		3,235,781		3,233,672

Book value per share	$	72.51	$	70.00
Tangible book value per share	$	64.39	$	61.86

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CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS

This report contains statements concerning the Corporation’s expectations, plans, objectives or beliefs regarding future financial performance and other statements that are not historical facts, which may constitute “forward-looking statements” as defined by federal securities laws. Forward-looking statements generally can be identified by the use of words such as “believe,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “might,” “will,” “intend,” “target,” “should,” “could,” or similar expressions, are not statements of historical fact, and are based on management’s beliefs, assumptions and expectations regarding future events or performance as of the date of this report, taking into account all information currently available. These statements may include, but are not limited to: statements regarding expected future operations and financial performance; expected trends in yields on loans; expected future recovery of investments in debt securities; future dividend payments; deposit trends, charge-offs and delinquencies; changes in cost of funds and net interest margin and items affecting net interest margin; changes in interest rates and the effects thereof on net interest income, expected renewal of unsecured federal funds agreements; expected impact of unrealized losses on earnings and regulatory capital of the Corporation or the Bank; expectations regarding the Bank’s regulatory risk-based capital requirement levels; competition, our loan portfolio; our digital services; deposit trends; improving operational efficiencies; retention of qualified loan officers and expectations regarding new mortgage loan originations; higher quality automobile loan contracts, marine and RV lending; strategic business initiatives and the anticipated effects thereof on mortgage loan originations; technology initiatives; our diversified business strategy; asset quality; credit quality; adequacy of allowances for credit losses and the level of future charge-offs; market interest rates and housing inventory and resulting effects in mortgage loan origination volume; sources of liquidity; adequacy of the reserve for indemnification losses related to loans sold in the secondary market; capital levels; the effect of future market and industry trends; the effects of future interest rate levels and fluctuations; cybersecurity risks and inflation. These forward-looking statements are subject to significant risks and uncertainties due to factors that could have a material adverse effect on the operations and future prospects of the Corporation including, but not limited to, changes in:

●

interest rates, such as volatility in short-term interest rates or yields on U.S. Treasury bonds, increases in interest rates following actions by the Federal Reserve and increases or volatility in mortgage interest rates

●general business conditions, as well as conditions within the financial markets

●general economic conditions, including unemployment levels, inflation rates, supply chain disruptions and slowdowns in economic growth

●general market conditions, including disruptions due to pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, political crises, changes in trade policy and the implementation of tariffs, war and other military conflicts or other major events, or the prospect of these events

●average loan yields and securities yields and average costs of interest-bearing deposits and borrowings

●financial services industry conditions, including bank failures or concerns involving liquidity

●labor market conditions, including attracting, hiring, training, motivating and retaining qualified employees

●the legislative and regulatory climate, regulatory initiatives with respect to financial institutions, products and services, the Consumer Financial Protection Bureau (the CFPB) and the regulatory and enforcement activities of the CFPB

●monetary and fiscal policies of the U.S. Government, including policies of the FDIC, U.S. Department of the Treasury and the Board of Governors of the Federal Reserve System (the Federal Reserve Board), and the effect of these policies on interest rates and business in our markets

●demand for financial services in the Corporation’s market areas

●the value of securities held in the Corporation’s investment portfolios

●the quality or composition of the loan portfolios and the value of the collateral securing those loans

●the inventory level, demand and fluctuations in the pricing of used automobiles, including sales prices of repossessed vehicles

●the level of automobile loan delinquencies or defaults and our ability to repossess automobiles securing delinquent automobile finance installment contracts

●the level of net charge-offs on loans and the adequacy of our allowance for credit losses

●the level of indemnification losses related to mortgage loans sold

●demand for loan products

●deposit flows

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●the strength of the Corporation’s counterparties

●the availability of lines of credit from the FHLB and other counterparties

●the soundness of other financial institutions and any indirect exposure related to the closing of other financial institutions and their impact on the broader market through other customers, suppliers and partners, or that the conditions which resulted in the liquidity concerns experienced by closed financial institutions may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Corporation has commercial or deposit relationships

●competition from both banks and non-banks, including competition in the automobile finance and marine and recreational vehicle finance markets

●services provided by, or the level of the Corporation’s reliance upon third parties for key services

●the commercial and residential real estate markets, including changes in property values

●the demand for residential mortgages and conditions in the secondary residential mortgage loan markets

●the Corporation’s technology initiatives and other strategic initiatives

●the Corporation’s branch expansion and consolidation plans

●cyber threats, attacks or events

●C&F Bank’s product offerings

●accounting principles, policies and guidelines, and elections made by the Corporation thereunder

These risks and uncertainties, and the risks discussed in more detail in Item 1A. “Risk Factors,” of Part I of the Corporation's Annual Report on Form 10-K for the year ended December 31, 2024 should be considered in evaluating the forward-looking statements contained herein.

Readers should not place undue reliance on any forward-looking statement. There can be no assurance that actual results will not differ materially from historical results or those expressed in or implied by such forward-looking statements, or that the beliefs, assumptions and expectations underlying such forward-looking statements will be proven to be accurate. Forward-looking statements are made as of the date of this report and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances arising after the date on which the statement was made, except as otherwise required by law.

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ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Corporation’s primary component of market risk is interest rate volatility. Fluctuations in interest rates will affect the amount of interest income and expense the Corporation receives or pays on a significant portion of its assets and liabilities and the market value of its interest-earning assets and interest-bearing liabilities, excluding those which have a very short term until maturity. The Corporation does not subject itself to foreign currency exchange rate risk or commodity price risk due to the current nature of its operations. The Corporation has established a comprehensive enterprise risk management program to monitor risks related to its operations, including market risk, and the Corporation’s Chief Risk Officer has primary responsibility for the enterprise risk management program.

The Corporation’s Asset/Liability Committee meets at least quarterly with the primary objective of maximizing current and future net interest income within acceptable levels of interest rate risk while satisfying liquidity and capital requirements. Management recognizes that a certain amount of interest rate risk is inherent and appropriate. Thus the goal of interest rate risk management is to maintain a balance between risk and reward such that net interest income is maximized while risk is maintained at an acceptable level. The objective of the Corporation’s liquidity management is to meet the Corporation’s liquidity requirements by ensuring the continuous availability of funds to satisfy the credit needs of our customers and the demands of our depositors, creditors and investors. Stable core deposits and a strong capital position are the components of a solid foundation for the Corporation’s liquidity position. Management continuously monitors cash flows, including deposit flows, loan fundings and draws, securities payments and borrowing maturities, and the impact of changes in interest rates on these cash flows. Additionally, management tracks uninsured deposits, unpledged securities and unpledged loans among other liquidity metrics.

The Corporation assumes interest rate risk in the normal course of operations. The fair values of most of the Corporation’s financial instruments will change when interest rates change and that change may be either favorable or unfavorable to the Corporation. Management attempts to match maturities and repricing dates of assets and liabilities to the extent believed necessary to balance minimizing interest rate risk and increasing net interest income in current market conditions. However, borrowers with fixed rate obligations are less likely to prepay in a rising rate environment and more likely to prepay in a falling rate environment. Conversely, depositors who are receiving fixed rates are more likely to withdraw funds before maturity in a rising rate environment and less likely to do so in a falling rate environment. Management monitors rates, maturities and repricing dates of assets and liabilities and attempts to manage interest rate risk by adjusting terms of new loans, deposits and borrowings, by investing in securities with terms that manage the Corporation’s overall interest rate risk, and in some cases by using derivative contracts to reduce the Corporation’s overall exposure to changes in interest rates. The Corporation does not enter into interest rate-sensitive instruments for trading purposes.

We use simulation analysis to assess earnings at risk and economic value of equity (EVE) analysis to assess economic value at risk. These methods allow management to regularly monitor both the direction and magnitude of the Corporation’s interest rate risk exposure. These modeling techniques involve assumptions and estimates that inherently cannot be measured with complete precision. Key assumptions in the analyses include maturity and repricing characteristics of both assets and liabilities, prepayments on amortizing assets, other embedded options, non-maturity deposit sensitivity and loan and deposit pricing. These assumptions are inherently uncertain due to the timing, magnitude and frequency of rate changes and changes in market conditions and management strategies, among other factors. However, the analyses are useful in quantifying risk and provide a relative gauge of the Corporation’s interest rate risk position over time.

Simulation analysis evaluates the potential effect of upward and downward changes in market interest rates on future net interest income. The analysis involves changing the interest rates used in determining net interest income over the next twelve months. The resulting percentage change in net interest income in various rate scenarios is an indication of the Corporation’s shorter-term interest rate risk. The analysis utilizes a “static” balance sheet approach, which assumes changes in interest rates without any management response to change the composition of the balance sheet. The measurement date balance sheet composition is maintained over the simulation time period with maturing and repayment dollars being rolled back into like instruments for new terms at current market rates. Additional assumptions are applied to modify volumes and pricing under the various rate scenarios. These assumptions include loan prepayments, time deposit early withdrawals, the sensitivity of deposit repricing to changes in market rates, withdrawal behavior of non-maturing deposits, and other factors that management deems significant.

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The simulation analysis results, based on a measurement date balance sheet as of March 31, 2025, for hypothetical changes in net interest income over the next twelve months are presented in the table below.

One-Year Net Interest Income Simulation (dollars in thousands)

Hypothetical Change in Net

Interest Income

Over the Next Twelve Months

as of

March 31, 2025

December 31, 2024

Assumed Market Interest Rate Shift

Dollars

Percentage

Dollars

Percentage

-300 BP shock

(10,659)

(9.14)

(7,568)

(6.66)

-200 BP shock

(6,760)

(5.80)

(4,687)

(4.12)

-100 BP shock

(3,116)

(2.67)

(2,040)

(1.79)

+100 BP shock

1,179

1.01

228

0.20

+200 BP shock

2,471

2.12

511

0.45

+300 BP shock

3,716

3.19

764

0.67

These results indicate that the Corporation would expect net interest income to decrease over the next twelve months assuming an immediate downward shift in market interest rates of 100 BP to 300 BP and to increase if rates shifted upward to the same degree. The simulation analysis results show the Corporation’s sensitivity to an upward shift in rates relative to a downward shift in rates was less pronounced as of March 31, 2025 compared to the results as of December 31, 2024 due primarily to shifts in the mix of loans and deposits and a lower interest rate environment, particularly lower longer-term market rates.

The EVE analysis provides information on the risk inherent in the balance sheet that might not be taken into account in the simulation analysis due to the shorter time horizon used in that analysis. The EVE of the balance sheet is defined as the discounted present value of expected asset cash flows minus the discounted present value of the expected liability cash flows. The analysis involves changing the interest rates used in determining the expected cash flows and in discounting the cash flows. The resulting percentage change in net present value in various rate scenarios is an indication of the longer term repricing risk and options embedded in the balance sheet.

The EVE analysis results are presented in the table below.

Static EVE Change (dollars in thousands)

Hypothetical Change in EVE

as of

March 31, 2025

December 31, 2024

Assumed Market Interest Rate Shift

Dollars

Percentage

Dollars

Percentage

-300 BP shock

(36,797)

(8.79)

(25,260)

(6.49)

-200 BP shock

(15,724)

(3.75)

(9,335)

(2.40)

-100 BP shock

(2,475)

(0.59)

270

0.07

+100 BP shock

(4,531)

(1.08)

(6,771)

(1.74)

+200 BP shock

(9,071)

(2.17)

(13,022)

(3.34)

+300 BP shock

(14,563)

(3.48)

(20,439)

(5.25)

These results as of March 31, 2025 indicate that the EVE would decrease assuming an immediate downward or upward shift in market interest rates of 100 BP to 300 BP. As of March 31, 2025, the Corporation’s EVE is more sensitive to downward changes in rates and less sensitive to upward changes in rates compared to its position as of December 31, 2024 due primarily to shifts in the mix of earning assets and in the mix of deposits and borrowings, which impacted the overall duration of both assets and liabilities. The lower interest rate environment as of March 31, 2025 compared to December 31, 2024, particularly lower longer-term market rates, increased the prepayment expectations of certain earning assets, which also contributed to the Corporation’s EVE sensitivity to changes in rates.

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Certain shortcomings are inherent in the methodology used in the above interest rate risk analyses. Modeling changes in forecasted cash flows and EVE requires making certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates, and certain assumed scenarios may be impractical to model under different economic circumstances. In a falling rate environment, the analyses assume that rate-sensitive assets are repriced downward, subject to floors on certain loans, while certain deposit rates are not allowed to decrease below zero.

The Corporation uses interest rate swaps to manage select exposures to interest rate risk. Interest rate swaps involve the exchange of fixed and variable rate interest payments between two parties, based on a common notional principal amount and maturity date with no exchange of underlying principal amounts. The Corporation has interest rate swaps that qualify as cash flow hedges. The cash flow hedges effectively modify the Corporation’s exposure to interest rate risk associated with the Corporation’s trust preferred capital notes by converting variable rates of interest on the trust preferred capital notes to fixed rates of interest for periods ending between June 2026 and June 2029. Also, as part of the Corporation’s overall strategy for maximizing net interest income while managing interest rate risk, the Corporation enters into interest rate swaps in connection with originating loans to certain commercial borrowers as a means to offer a fixed-rate instrument to the borrower while effectively retaining a variable-rate exposure.

The mortgage banking segment enters into IRLCs with customers to originate loans for which the interest rates are determined prior to funding. The mortgage banking segment then mitigates interest rate risk on these IRLCs and loans held for sale by entering into forward sales contracts with investors at the time that interest rates are locked for loans to be delivered on a best efforts basis. IRLCs are derivative financial instruments.

We believe that our current interest rate exposure is manageable and within our current interest rate risk guidelines.

ITEM 4.CONTROLS AND PROCEDURES

The Corporation’s management, including the Corporation’s Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness of the Corporation’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the Corporation’s disclosure controls and procedures were effective as of March 31, 2025 to ensure that information required to be disclosed by the Corporation in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to the Corporation’s management, including the Corporation’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that the Corporation’s disclosure controls and procedures will detect or uncover every situation involving the failure of persons within the Corporation or its subsidiary to disclose material information required to be set forth in the Corporation’s periodic reports.

There were no changes in the Corporation’s internal control over financial reporting during the three months ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, the Corporation’s internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1A.RISK FACTORS

There have been no material changes in the risk factors faced by the Corporation from those disclosed in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024.

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ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The Corporation’s Board of Directors authorized a program, effective January 1, 2025 through December 31, 2025, to repurchase up to $5.0 million of the Corporation’s common stock (the 2025 Repurchase Program). Repurchases under the 2025 Repurchase Program may be made through privately negotiated transactions or open market transactions, including pursuant to a trading plan in accordance with Rule 10b5-1 and/or Rule 10b-18 under the Exchange Act and shares repurchased will be returned to the status of authorized and unissued shares of common stock. The timing, number and purchase price of shares repurchased under the 2025 Repurchase Program, if any, will be determined by management in its discretion and will depend on a number of factors including the market price of the shares, general market and economic conditions, applicable legal requirements, and other conditions, and there is no assurance that the Corporation will purchase any shares under the 2025 Repurchase Program. There were no shares repurchased under the 2025 Repurchase Program during the first quarter of 2025.

The following table summarizes repurchases of the Corporation’s common stock that occurred during the three months ended March 31, 2025.


					Maximum Number
					(or Approximate
				Total Number of	Dollar Value) of
				Shares Purchased as	Shares that May Yet
				Part of Publicly	Be Purchased
	Total Number of	Average Price Paid		Announced Plans or	Under the Plans or
	Shares Purchased¹	per Share		Programs	Programs
January 1, 2025 - January 31, 2025	66	$	70.35	—	$	5,000,000
February 1, 2025 - February 28, 2025	1,247	$	80.33	—	$	5,000,000
March 1, 2025 - March 31, 2025	4,044	$	79.43	—	$	5,000,000
Total	5,357	$	79.53	—

1	During the three months ended March 31, 2025, 5,357 shares were withheld upon the vesting of restricted shares granted to employees of the Corporation and its subsidiaries in order to satisfy tax withholding obligations.

ITEM 5. OTHER INFORMATION

During the three months ended March 31, 2025, none of our directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933).

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ITEM 6.EXHIBITS


3.1	Amended and Restated Articles of Incorporation of C&F Financial Corporation, effective March 7, 1994 (incorporated by reference to Exhibit 3.1 to Form 10-Q filed November 8, 2017)

3.1.1	Amendment to Articles of Incorporation of C&F Financial Corporation, effective January 8, 2009 (incorporated by reference to Exhibit 3.1.1 to Form 8-K filed January 14, 2009)

3.2	Amended and Restated Bylaws of C&F Financial Corporation, as adopted December 15, 2020 (incorporated by reference to Exhibit 3.1 to Form 8-K filed December 17, 2020)

31.1	Certification of CEO pursuant to Rule 13a-14(a)

31.2	Certification of CFO pursuant to Rule 13a-14(a)

32	Certification of CEO/CFO pursuant to 18 U.S.C. Section 1350

101	The following financial statements from the Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, formatted in Inline XBRL, filed herewith: (i) the Consolidated Balance Sheets (unaudited), (ii) the Consolidated Statements of Income (unaudited), (iii) the Consolidated Statements of Comprehensive Income (unaudited), (iv) the Consolidated Statements of Equity (unaudited), (v) the Consolidated Statements of Cash Flows (unaudited) and (vi) the Notes to Consolidated Financial Statements (unaudited)

104	The cover page from the Corporation’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, formatted in Inline XBRL (included within Exhibit 101)

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SIGNATURES

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.


		C&F FINANCIAL CORPORATION
			(Registrant)

Date:	May 6, 2025	By:	/s/ Thomas F. Cherry
			Thomas F. Cherry
			President and Chief Executive Officer
			(Principal Executive Officer)

Date:	May 6, 2025		/s/ Jason E. Long
			Jason E. Long
			Executive Vice President, Chief Financial Officer and Secretary
			(Principal Financial and Accounting Officer)