GBank Financial Holdings Inc.
For the period ended Jun 30, 2025. Filed Aug 12, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 12, 2025
GBFH$15.88+2.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-28.
0000950170-25-078361
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-12.
0000950170-25-107361
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 134 previous paragraphs and 141 current paragraphs.
64 unchanged; 50 reworded; 27 added; 20 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (27)
Current report
General
Current report
Recent Events
Current report
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into law by President Trump, which includes a broad range of tax reform provisions affecting businesses, including extending and modifying certain key provisions from the Tax Cuts and Jobs Act of 2017 and expanding certain incentives from the Inflation Reduction Act of 2022 while accelerating the phase-out of others. The Company continues to evaluate the OBBBA but does not anticipate that the OBBBA will have a material impact on the Company’s Consolidated Financial Statements. As the legislation was signed into law after the close of the second quarter of 2025, the impacts are not included in the Company’s operating results for the three and six months ended June 30, 2025.
Current report
Available Information
Current report
The Company maintains an Internet web site at www.gbankfinancialholdings.com. The Company makes available, free of charge, on its web site (under www.gbankfinancialholdings.com/secfilings) the Company’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or Section 15(d) of the Exchange Act as soon as reasonably practicable after the Company files such material with, or furnishes it to, the SEC. The Company also makes available, free of charge, through its web site (under www.gbankfinancialholdings.com/corporate-governance) links to the Company’s Code of Ethics Policy and the charters for its board committees. In addition, the SEC maintains an Internet site (at www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
Current report
The Company routinely posts important information for investors on its web site (at www.gbankfinancialholdings.com and, more specifically, under the News & Media tab at www.gbankfinancialholdings.com/press-releases). The Company intends to use its web site as a means of disclosing material non-public information and for complying with its disclosure obligations under SEC Regulation FD (Fair Disclosure). Accordingly, investors should monitor the Company’s web site, in addition to following the Company’s press releases, SEC filings, public conference calls, presentations and webcasts.
Current report
The information contained on, or that may be accessed through, the Company’s web site is not incorporated by reference into, and is not a part of, this Form 10-Q.
Current report
Loan growth of $55.6 million, or 7% since December 31, 2024.
Current report
Net interchange fees of $1.5 million compared to $146 thousand during the second quarter of 2024.
Current report
For the three months ended June 30, 2025 and 2024, the average balance of loans, net includes average non-accrual loan balances of $20.5 million and $6.2 million, respectively.
Current report
Annualized on an actual/actual basis.
Current report
For the six months ended June 30, 2025 and 2024, the average balance of loans, net includes average non-accrual loan balances of $19.1 million and $5.0 million, respectively.
Current report
Annualized on an actual/actual basis.
Current report
For the six months ended June 30, 2025, interest income was $40.0 million, an increase of $4.1 million compared to $35.9 million for the six months ended June 30, 2024. For the three months ended June 30, 2025, interest income was $20.6 million, an increase of $2.1 million compared to $18.5 million for the three months ended June 30, 2024. The increases in interest income when comparing the three- and six-month periods ended June 30, 2025 to the same periods in 2024 are primarily due to increases in average interest-earning assets, partially offset by yield reductions on adjustable-rate loans, securities, and other liquid assets as a result of the 100 basis point decrease in the target federal funds rate by the Federal Reserve during the second half of 2024.
Current report
Interest expense was $15.7 million for the six months ended June 30, 2025, an increase of $2.0 million compared to $13.7 million for the six months ended June 30, 2024. Interest expense was $8.2 million for the three months ended June 30, 2025, an increase of $1.1 million compared to $7.1 million for the three months ended June 30, 2024. The increase in interest expense when comparing the three and six months ended June 30, 2025 to the same periods in 2024 was driven by increases in average interest-bearing liabilities to fund asset growth.
Current report
For the second quarter of 2025, the Company’s net interest margin decreased to 4.31%, compared to 4.82% for the second quarter of 2024. For the six months ended June 30, 2025, the Company's net interest margin decreased to 4.39%, compared to 4.83% for the six months ended June 30, 2024. The decrease in net interest margin for the three and six months ended June 30, 2025 when compared to the same periods in 2024 is reflective of the lower market interest rate environment as explained in the above paragraphs.
Current report
Provision for Credit Losses
Current report
The provision for credit losses in each period is reflected as a reduction in earnings for that period and includes amounts related to funded loans and unfunded loan commitments. The provision is equal to the amount required to maintain the ACL at a level that is adequate to absorb estimated lifetime credit losses inherent in the loan portfolio based on remaining contractual maturity, adjusted for estimated prepayments as of each period end. The Company's CECL models incorporate historical experience, current conditions, and reasonable and supportable forecasts in measuring expected credit losses. For the three and six months ended June 30, 2025, the Company recorded a provision for credit losses of $1.1 million and $1.8 million, respectively, compared to $295 thousand and $315 thousand for the three and six months ended June 30, 2024, respectively. The provision for credit losses for the three and six months ended June 30, 2025 is primarily reflective of net charge-offs of $870 thousand and $1.7 million, respectively, and loan growth.
Current report
For the three months ended June 30, 2025, noninterest income totaled $5.4 million compared to noninterest income $4.2 million for the three months ended June 30, 2024. For the six months ended June 30, 2025, noninterest income totaled $10.8 million compared to noninterest income $6.6 million for the six months ended June 30, 2024.
Current report
Gain on sale of loans totaled $2.6 million for the second quarter of 2025 compared to $3.2 million for the second quarter of 2024. Gain on sale of loans totaled $5.1 million for the six months ended June 30, 2025 compared to $5.2 million for the same period in 2024. The decrease in gain on sale of loans for the three- and six-month periods ended June 30, 2025 was due to less favorable secondary market pricing during the six months ended June 30, 2025 compared to the same period of 2024.
Current report
For the three months ended June 30, 2025, noninterest expense increased 14% to $10.4 million, compared to $9.1 million for the three months ended June 30, 2024. For the six months ended June 30, 2025, noninterest expense increased 22% to $21.3 million, compared to $17.5 million for the six months ended June 30, 2024.
Current report
Salaries and employee benefits expense totaled $6.2 million for the three months ended June 30, 2025, an increase of $483 thousand or 8% when compared to $5.7 million for the second quarter of 2024. Salaries and benefits expense totaled $12.6 million for the six months ended June 30, 2025, an increase of $1.6 million or 14% when compared to $11.0 million for the six months ended June 30, 2024. These increases are attributable to both (i) increases in employee salaries and benefits expenses resulting from an increase in full-time equivalent employees from 155 at June 30, 2024 to 188 at June 30, 2025, and (ii) higher stock-based compensation expense due to increases in grant date fair value of recent stock awards.
Current report
Audits and exams expense totaled $397 thousand for the three months ended June 30, 2025, an increase of $244 thousand when compared to $153 thousand for the second quarter of 2024. Audits and exams expense totaled $894 thousand for the six months ended June 30, 2025, an increase of $656 thousand when compared to $238 thousand during the same period of 2024. The increases in audits and exams expense reflects certain non-recurring professional, legal and audit fees associated with the preparation of filings made with the U.S. Securities and Exchange Commission for the registration of its shares of common stock and listing on the Nasdaq Capital Market, which totaled $290 thousand and $1.0 million for the three and six months ended June 30, 2025, respectively.
Current report
Advertising and marketing expense increased $287 thousand to $371 thousand during the second quarter of 2025, compared to $84 thousand during the second quarter of 2025. Advertising and marketing expense increased $522 thousand to $735 thousand during the six months ended June 30, 2025, compared to $213 thousand during the same period in 2024. The increase in advertising and marketing expense was largely attributable to advertising, marketing, and referral campaigns associated with the credit card program.
Current report
The effective tax rate for the three and six months ended June 30, 2025 was 23.6% and 22.6%, respectively compared to 23.2% and 23.1% for the three and six months ended June 30, 2024, respectively. The fluctuations in the effective tax rate are largely driven by the timing and volume of certain stock-based compensation transactions resulting in tax benefits to the Company, as well as the timing and volume of state tax adjustments.
Current report
Under the final rule, if a qualifying community banking organization opts into the CBLR framework and meets all requirements under the framework, it will be considered to have met the well-capitalized ratio requirements under the “prompt corrective action” regulations described above and will not be required to report or calculate risk-based capital.
Current report
The Company also has unsecured lines of credit with other correspondent banks totaling $40.0 million at June 30, 2025. No draws have been made on these lines of credit and no balances were outstanding as of June 30, 2025 and December 31, 2024.
Removed paragraphs (20)
Previous report
The Company has experienced strong balance sheet growth, primarily driven by increases in commercial real estate loans (due to both organic growth and the repurchase of the guaranteed portion of certain SBA loans previously sold) and interest-bearing deposits. The Company also experienced favorable volume and rate-driven increases in net interest income, which was partially offset by higher funding costs.
Previous report
Net interest margin of 4.47%
Previous report
Loan growth of $27.4 million, or 3%
Previous report
Gain on sale of loans of $2.5 million, an increase of $454 thousand or 22% compared to $2.1 million of gain on sale of loans for the three months ended March 31, 2024
Previous report
Balances of non-accrual loans of $19.2 million at March 31, 2025 and $6.1 million at March 31, 2024 are included in the average loan balances for each year, respectively.
Previous report
Net interest income increased $1.1 million or 10% to $11.9 million for the three months ended March 31, 2025, compared to $10.8 million for the three months ended March 31, 2024.
Previous report
Interest income increased $2.0 million due to a $184.0 million increase in average interest-earning assets over the twelve month period ending March 31, 2025. This increase was partially offset by lower loan yields driven by both (i) yield reductions on adjustable-rate loans, securities, and other liquid assets driven by a 100 basis point decrease in the federal funds rate enacted during the second half of 2024 by the Federal Open Market Committee ("FOMC"), and (ii) certain non-recurring interest income adjustments relating to nonaccrual loans totaling $100 thousand during the three months ended March 31, 2025.
Previous report
Investment securities yielded 4.94% during the first quarter of 2025, compared to 4.16% for the first quarter of 2024. The increase in investment yield when comparing 2025 to 2024 was the result of the purchase of $72.9 million of investment securities during the previous twelve months to replace certain lower-yielding U.S. Treasury securities that matured during the year ended December 31, 2024.
Previous report
Net interest income was also impacted by an increase in interest expense from $6.6 million for the three months ended March 31, 2024 to $7.5 million for the three months ended March 31, 2025. The increase in interest expense was driven by both higher funding costs to maintain competitive pricing, and growth in average interest-bearing liabilities to fund interest-earning asset growth.
Previous report
For the first quarter of 2025, the Company’s net interest margin decreased to 4.47%, compared to 4.85% for the first quarter of 2024. The decrease in net interest margin when compared to the first quarter of 2024 is reflective of the 100 basis point decrease in the federal funds rate on variable rate loans, investment securities, and interest bearing cash balances and interest income reversals relating to loans placed on nonaccrual status during the quarter.
Previous report
Provision Expense and Allowance for Credit Losses - Loans
Previous report
The provision for credit losses on loans totaled $710 thousand for the first quarter of 2025. No provision for credit losses on loans was recorded during the first quarter of 2024. The allowance for credit losses was $9.0 million at March 31, 2025, compared to $9.1 million at December 31, 2024. The allowance for credit losses to total net loans was 1.07% at March 31, 2025, compared to 1.12% at December 31, 2024.
Previous report
Net loan charge-offs of $828 thousand were recorded during the three months ended March 31, 2025. No loan charge-offs were recorded during during the first quarter of 2024. The net charge-offs recorded during the first quarter of 2025 were comprised of $624 thousand of charge-offs related to three commercial real estate – non-owner occupied loan relationship, $162 thousand of charge-offs related to two commercial and industrial loans, as well as $41 thousand of credit card charge-offs.
Previous report
Non-interest income was $5.5 million for the first quarter of 2025, compared to $2.4 million for the first quarter of 2024.
Previous report
Gain on sale of loans increased 22% to $2.5 million for the three months ended March 31, 2025, compared to $2.1 million during the three months ended March 31, 2024. The increase in gain on sale of loans was driven by improved loan sale pricing, as the average pretax gain on loan sales as a percentage of the loan originated increased to 3.69% for the three months ended March 31, 2025, compared to 3.04% for the same period of 2024.
Previous report
For the three months ended March 31, 2025, noninterest expense increased 30% to $10.9 million, compared to $8.4 million for the three months ended March 31, 2024.
Previous report
For the three months ended March 31, 2025, salaries and employee benefits increased 21% to $6.4 million, compared to $5.3 million for the three months ended March 31, 2024. The increase was driven by (i) an increase in full-time equivalent employees to 175 at March 31, 2025, compared to 150 for the same period of 2024, and (ii) increased bonuses and commissions commensurate with loan originations and sales volume.
Previous report
For the three months ended March 31, 2025, legal and professional fees totaled $700 thousand, an increase of 76% or $303 thousand when compared to $397 thousand for the three months ended March 31, 2024. Audits and exam expense totaled $497 thousand, an increase of over 400% or $412 thousand when compared to $85 thousand for the three months ended March 31, 2024. The increases in these categories reflects extraordinary legal, professional and audit fees associated with the preparation and filing of the registration statement with the Securities and Exchange Commission on Forms S-1 and S-1/A during the first quarter of 2025.
Previous report
Other noninterest expense totaled $880 thousand during the three months ended March 31, 2025, an increase of $206 thousand or 31% compared to $674 thousand during the three months ended March 31, 2024. The year-over-year increase was the result of growth within the organization, with increases reflected across several categories of expense.
Previous report
Qualifying community banking organizations that elect to use the community bank leverage ratio framework and that maintain a leverage ratio of greater than 9 percent are considered to have satisfied the risk-based and leverage capital requirements in the agencies’ generally applicable capital rule. Additionally, such insured depository institutions are considered to have met the well-capitalized ratio requirements for purposes of section 38 of the Federal Deposit Insurance Act.
Reworded paragraphs (50)
Previous wording
The Company generates the majority of its revenue through net interest income, calculated as the difference between interest earned on loans and investments and interest paid on deposits and borrowings. Growth in net interest income is dependent upon balance sheet growth and maintaining or increasing the net interest margin, which is calculated as net interest income as a percentage of average interest-earning assets. The Company also generates revenue through fees earned on the various services and products offered to its customers and through gains on sales of assets, generally the guaranteed portion of SBA and USDA loans. Offsetting these revenue sources are provisions for credit losses, non-interest expenses and income taxes.
Current wording
The Company generates the majority of its revenue through net interest income, calculated as the difference between interest earned on loans and investments and interest paid on deposits and borrowings. Growth in net interest income is dependent upon balance sheet growth and maintaining or increasing the net interest margin, which is calculated as net interest income as a percentage of average interest-earning assets. The Company also generates revenue through gains on sales of assets, generally the guaranteed portion of SBA and USDA loans, net interchange fees earned on its credit card product, and fees earned on the various services and products offered to its customers. Offsetting these revenue sources are provisions for credit losses, non-interest expenses and income taxes.
Previous wording
The following table presents a summary of the Company's earnings and selected performance ratios:
Current wording
The following table presents a summary of the Company's earnings and selected performance ratios for the three- and six-month periods presented:
Previous wording
Net income of $4.5 million and diluted earnings per share of $0.31
Current wording
Net income of $4.8 million and diluted earnings per share of $0.33, compared to $4.7 million and diluted earnings per share of $0.36 for the second quarter of 2024.
Previous wording
Principal balances of loans sold of $68.7 million compared to principal balances of loans sold of $68.6 million of during the three months ended March 31, 2024
Current wording
Principal balances of loans sold of $82.1 million compared to principal balances of loans sold of $77.9 million of during the three months ended June 30, 2024.
Previous wording
On-balance sheet guaranteed loans totaled $245.6 million as of March 31, 2025 compared to $233.9 million at December 31, 2024
Current wording
On-balance sheet guaranteed loans totaled $237.6 million as of June 30, 2025 compared to $233.9 million at December 31, 2024.
Previous wording
Non-performing assets of $20.4 million at March 31, 2025 representing 1.71% of total assets compared to $14.2 million of non-performing assets at December 31, 2024
Current wording
Non-performing assets of $18.4 million at June 30, 2025 representing 1.49% of total assets compared to $14.2 million of non-performing assets at December 31, 2024, representing 1.26% of total assets.
Previous wording
Although we are still evaluating the JOBS Act, we may take advantage of some of the reduced regulatory and reporting requirements that are available to it so long as we qualify as an emerging growth company, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation, and exemptions from the requirements of holding non-binding advisory votes on executive compensation and golden parachute payments.
Current wording
We may take advantage of some of the reduced regulatory and reporting requirements that are available to it so long as we qualify as an emerging growth company, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation, and exemptions from the requirements of holding non-binding advisory votes on executive compensation and golden parachute payments.
Previous wording
Average balances, interest income or expense, and the interest yield or rate for the Company’s interest-sensitive assets and liabilities are presented in the table below. Average balances are calculated on a daily basis. The Company had no tax equivalent adjustments for the three months ended March 31, 2025 and 2024.
Current wording
Average balances, interest income or expense, and the interest yield or rate for the Company’s interest-sensitive assets and liabilities are presented in the tables below for the three- and six-month periods presented. Average balances are calculated on a daily basis. The Company had no tax equivalent adjustments for the three and six months ended June 30, 2025 and 2024.
Previous wording
The following table presents the effects of changing rates and volumes on net interest income for the periods indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated to volume.
Current wording
The following table presents the effects of changing rates and volumes on net interest income for the three- and six-month periods indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated to volume.
Previous wording
Net interchange fees totaled $2.0 million for the three months ended March 31, 2025 compared to $20 thousand for the three months ended March 31, 2024. The increase in net interchange fees is attributable to transaction volume growth within GBank’s Visa Signature® Card product.
Current wording
Net interchange fees totaled $1.5 million for the three months ended June 30, 2025 compared to $146 thousand for the three months ended June 30, 2024. Net interchange fees totaled $3.5 million for the six months ended June 30, 2025, compared to $167 thousand for the same period in 2024. The increase in net interchange fees when comparing the three months and six months ended June 30, 2025 to the same periods in 2024 was attributable to transaction volume growth within GBank’s Visa Signature® Card product.
Previous wording
For the three months ended March 31, 2025, loan servicing income increased to $703 thousand, compared to $60 thousand for the three months ended March 31, 2024 due to both (i) an increase in the principal balance of loans serviced during the twelve months since March 31, 2024, and (ii) the first quarter of 2024 reflecting the write-off of certain loan servicing assets totaling $401 thousand relating to the repurchase of the guaranteed portion of previously sold loans.
Current wording
Loan servicing income increased $216 thousand from $534 thousand for the three months ended June 30, 2024 to $750 thousand for the three months ended June 30, 2025. Loan servicing income increased $859 thousand from $594 thousand for the six months ended June 30, 2025 to $1.5 million for the six months ended June 30, 2025. The increase in loan servicing income when comparing the three and six months ended June 30, 2025 to the same periods in 2024 was the result of both (i) higher average balances of loans serviced by GBank during 2025, and (ii) the first quarter of 2024 reflecting loan servicing asset writeoffs of $401 thousand due to the repurchase of the guaranteed portion of previously sold SBA loans.
Previous wording
The following table presents the components of total noninterest expense.
Current wording
The following tables present the components of total noninterest expense.
Previous wording
Data processing expense increased $572 thousand, or 69%, from $833 thousand for the three months ended March 31, 2024 to $1.4 million for the three months ended March 31, 2025. This increase reflects higher costs from transactional-based charges given the volume increases in loans and deposits over the last twelve months.
Current wording
Data processing expense increased $627 thousand, or 89%, from $706 thousand for the three months ended June 30, 2024 to $1.3 million for the three months ended June 30, 2025. Data processing expense increased $1.2 million, or 78%, from $1.5 million for the six months ended June 30, 2024 to $2.7 million for the six months ended June 30, 2025. The year over year increases were due to both (i) higher costs from transactional-based charges given the volume increases in loans and deposits over the last twelve months, and (ii) investments to enhance data management and security capabilities responsive to both the larger company profile and the increasing complexity of information technology management.
Previous wording
Income tax expense was $1.2 million for the three months ended March 31, 2025, an increase of 10% or $112 thousand compared to $1.1 million for the three months ended March 31, 2024. The increase in income tax expense was primarily due to higher pre-tax earnings. The effective tax rate for the three months ended March 31, 2025 was 21.4% compared to 23.1% for the three months ended March 31, 2024. The decrease in the effective tax rate is attributable to the timing and volume of certain favorable discrete items related to excess tax benefits from stock-based compensation.
Current wording
Income tax expense was $1.5 million for the three months ended June 30, 2025, an increase of 5% or $75 thousand compared to $1.4 million for the three months ended June 30, 2024. Income tax expense was $2.7 million for the six months ended June 30, 2025, an increase of 7% or $187 thousand compared to $2.5 million for the six months ended June 30, 2024. The increase in income tax expense during the three and six months ended June 30, 2025 was primarily due to higher pre-tax earnings.
Previous wording
Total assets increased 6% to $1.190 billion at March 31, 2025 compared to $1.122 million at December 31, 2024 primarily due to increases in net loans of $27.4 million as well as cash and equivalents of $22.8 million.
Current wording
Total assets increased 10% to $1.23 billion at June 30, 2025 compared to $1.12 billion at December 31, 2024, primarily due to increases in net loans of $55.7 million as well as cash and equivalents of $19.1 million.
Previous wording
Cash and cash equivalents increased 18% from $124.1 million at December 31, 2024 to $147.0 million at March 31, 2025 as cash inflows from deposit growth more than offset cash outflows to fund loan growth during the first quarter of 2025.
Current wording
Cash and cash equivalents increased 15% from $124.1 million at December 31, 2024 to $143.2 million at June 30, 2025 as cash inflows from deposit growth more than offset cash outflows to fund loan growth during the first six months of 2025.
Previous wording
The investment security portfolio is comprised of held-to-maturity securities recorded at amortized cost and available for sale securities recorded at fair value. Held-to-maturity securities decreased $666 thousand to $39.9 million as of March 31, 2025, as compared to $40.6 million as of December 31, 2024. Available-for-sale securities increased $5.9 million from $65.6 million at December 31, 2024 to $71.5 million at March 31, 2025.
Current wording
The investment security portfolio is comprised of held to maturity securities recorded at amortized cost and available for sale securities recorded at fair value. Held to maturity securities decreased by $1.1 million to $39.5 million as of June 30, 2025, as compared to $40.6 million as of December 31, 2024. Available for sale securities increased $17.3 million from $65.6 million at December 31, 2024 to $82.9 million at June 30, 2025.
Previous wording
Total loans, net of deferred loan costs and unamortized discounts, increased 3% to $843.4 million at March 31, 2025, compared to $816.0 million at December 31, 2024. Loan originations, including government guaranteed and non-guaranteed commercial loans, totaled $133.0 million during the first quarter of 2025, compared to $136.6 million for the same period in 2024.
Current wording
Total loans, net of deferred loan costs and unamortized discounts, increased 7% to $871.6 million at June 30, 2025, compared to $816.0 million at December 31, 2024. Loan originations, including government guaranteed and non-guaranteed commercial loans, totaled $293.5 million during the first six months of 2025, compared to $263.6 million for the same period in 2024.
Previous wording
The following table presents the ending balance of gross loans outstanding, by type.
Current wording
The following table presents the ending balance of loans outstanding, by type, as of the dates indicated.
Previous wording
Beginning in the third quarter of 2023, and continuing into the first quarter 2024, the Company repurchased previously sold guaranteed SBA loans by initiating a change in loan terms with certain borrowers, at the borrowers’ option, to convert variable loans to five-year fixed rate loans at lower current interest rates. The repurchase program was initiated in response to a rapid rise in the Wall Street Journal Prime Rate which has the potential to significantly impact our borrowers, the majority of whom are in variable rate loans. The Prime Rate increased from 3.25% to 8.50% between March 2022 and July 2023, an increase of 525 basis points. The Company received requests from borrowers due to the higher payments affecting borrowers’ cash flow and operations. Given the predicted economic outlook and anticipated interest rate reductions likely being delayed until late 2024, the Company decided to evaluate converting the variable rate structure to a fixed-rate based on a current credit evaluation. In response, the Bank reached out to request annual tax returns and updated financial information from borrowers. The Company began to repurchase previously sold guaranteed SBA loans by initiating a change in loan terms with certain borrowers, at the borrowers’ option, to convert variable loans to five-year fixed rate loans at the current market terms.
Current wording
Beginning in the third quarter of 2023, and continuing into the first quarter 2024, the Company repurchased previously sold guaranteed SBA loans by initiating a change in loan terms with certain borrowers, at the borrowers’ option, to convert variable loans to five-year fixed rate loans at lower current interest rates. The repurchase program was initiated in response to a rapid rise in the Wall Street Journal Prime Rate which has the potential to significantly impact our borrowers, the majority of whom are in variable rate loans. The Prime Rate increased from 3.25% to 8.50% between March 2022 and July 2023, an increase of 525 basis points. The Company received requests from borrowers due to the higher payments affecting borrowers’ cash flow and operations. Given the predicted economic outlook and anticipated interest rate reductions likely being delayed until late 2024, the Company decided to evaluate converting the variable rate structure to a fixed-rate based on a current credit evaluation. In response, GBank reached out to request annual tax returns and updated financial information from borrowers. The Company began to repurchase previously sold guaranteed SBA loans by initiating a change in loan terms with certain borrowers, at the borrowers’ option, to convert variable loans to five-year fixed rate loans at the current market terms.
Previous wording
The process for evaluating, approving, and submitting repurchase packages to SBA was consistent with SOP 50 57 (3) and Section 7.6 of the Agreement. Updated financials from each borrower were reviewed to assess the viability of the business before preparing an interest rate modification document. Once the interest rate modification was approved internally, GBank sought approval for modifications, and submitted requests to the SBA to repurchase these SBA loans. According to the SOP, SBA shall review the repurchase request package, and based on the financial and other information provided determine whether an emergency repurchase of the SBA loan is appropriate for that specific borrower. This activity resulted in the repurchase of $106.1 million of United States government guaranteed loan balances within the commercial and industrial and commercial real estate segments during the year ended December 31, 2023. This program continued through the end of the first quarter of 2024, during which $44.2 million of the guaranteed portion of previously sold loans was repurchased in the three-month period ending March 31, 2024. The balance of guaranteed loans at March 31, 2025 was $245.6 million, representing 24.2% of loans. Comparatively, at December 31, 2024, the Company had $233.9 million of guaranteed loan balances representing 24.7% of loans. Given the stabilization of the interest rate environment the Company is not anticipating any material repurchases in the foreseeable future.
Current wording
The process for evaluating, approving, and submitting repurchase packages to the SBA was consistent with SOP 50 57 (3) and Section 7.6 of the Secondary Participation Guaranty Agreement. Updated financials from each borrower were reviewed to assess the viability of the business before preparing an interest rate modification document. Once the interest rate modification was approved internally, GBank sought approval for modifications, and submitted requests to the SBA to repurchase these SBA loans. According to the SOP, SBA shall review the repurchase request package, and based on the financial and other information provided determine whether an emergency repurchase of the SBA loan is appropriate for that specific borrower. This activity resulted in the repurchase of $106.1 million of United States government guaranteed loan balances within the commercial and industrial and commercial real estate segments during the year ended December 31, 2023. This program continued through the end of the first quarter of 2024, during which $44.2 million of the guaranteed portion of previously sold loans were repurchased. The balance of guaranteed loans at June 30, 2025 was $237.6 million, representing 22.1% of loans. Comparatively, at December 31, 2024, the Company had $233.9 million of guaranteed loan balances representing 24.7% of loans. Given the stabilization of the interest rate environment the Company is not anticipating any material repurchases in the foreseeable future.
Previous wording
Net deferred loan costs totaled $9.1 million at March 31, 2025 and $8.2 million at December 31, 2024. Net deferred loan costs represent the costs incurred to originate loans, net of fees paid by the borrower, which are measured and recorded at the date the loan is originated. Unamortized discount totaled $9.2 million at March 31, 2025 and $8.9 million at December 31, 2024. The unamortized discount relates to the retained portion of government guaranteed loans and is based on the relative fair value of the retained loan as calculated by an independent consulting firm. Loan costs and discount are amortized over the life of the loan and are recorded as an adjustment to interest income on the loan.
Current wording
Net deferred loan costs totaled $9.5 million at June 30, 2025 and $8.2 million at December 31, 2024. Net deferred loan costs represent the costs incurred to originate loans, net of fees paid by the borrower, which are measured and recorded at the date the loan is originated. Unamortized discount totaled $9.6 million at June 30, 2025 and $8.9 million at December 31, 2024. The unamortized discount relates to the retained portion of government guaranteed loans and is based on the relative fair value of the retained loan as calculated by an independent consulting firm. Loan costs and discount are amortized over the life of the loan and are recorded as an adjustment to interest income on the loan.
Previous wording
Loans held for sale totaled $41.3 million at March 31, 2025 and consisted of commercial real estate – non-owner occupied, commercial real estate – owner occupied, and commercial and industrial loans. Loans held for sale totaled $32.6 million at December 31, 2024 and consisted of commercial real estate – non-owner occupied, commercial real estate – owner occupied, and commercial and industrial loans. The balance of unguaranteed portions to be retained are reported as held for investment.
Current wording
Loans held for sale totaled $45.2 million at June 30, 2025 and consisted of commercial real estate – non-owner occupied, commercial real estate – owner occupied, and commercial and industrial loans. Loans held for sale totaled $32.6 million at December 31, 2024 and consisted of commercial real estate – non-owner occupied, commercial real estate – owner occupied, and commercial and industrial loans. The balance of unguaranteed portions to be retained are reported as held for investment.
Previous wording
The following table sets forth the dispersion of loan principal balances with amounts and the percentage of the total balances in the states with five percent of total gross loans:
Current wording
The following table sets forth the dispersion of loan principal balances with amounts and the percentage of the total balances in the states with five percent of total loans as of June 30, 2025:
Previous wording
The following table presents the allowance for credit loss as a percentage of total loans:
Current wording
The following table presents the allowance for credit loss as a percentage of total loans as of the dates indicated:
Previous wording
The allowance for credit losses decreased from $9.1 million at December 31, 2024 to $9.0 million at March 31, 2025. The allowance as a percentage of loan balances decreased from 1.12% at December 31, 2024 to 1.07% at March 31, 2025.
Current wording
The allowance for credit losses increased from $9.1 million at December 31, 2024 to $9.2 million at June 30, 2025. The allowance as a percentage of loan balances decreased from 1.12% at December 31, 2024 to 1.06% at June 30, 2025. The Company continues to closely monitor credit quality in light of the ongoing economic uncertainty caused by, among other factors, the prolonged elevated interest rate environment, stronger than expected employment data in recent periods, continued uncertainty regarding U.S. trade and tariff policy and the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and our market areas. Accordingly, additional provisions for credit losses may be necessary in future periods.
Previous wording
The Company had $20.4 million of non-performing loans as of March 31, 2025, compared to $14.2 million of non-performing loans as of December 31, 2024. As of March 31, 2025, the balance of non-performing loans was comprised of certain commercial real estate – non-owner occupied, commercial real estate – owner occupied, commercial and industrial loans, and consumer loans totaling $20.4 million, of which $14.7 million is guaranteed by the SBA. Included in the balance of non-performing assets as of March 31, 2025 are $10.2 million of individually evaluated loans with specific credit loss reserves of $927 thousand assigned. As of December 31, 2024, the balance of non-performing loans was comprised of certain commercial real estate – non-owner occupied, commercial real estate – owner occupied, commercial and industrial loans, and consumer loans totaling $14.2 million, of which $9.3 million is guaranteed by the SBA. Included in the balance of non-performing assets as of December 31, 2024 are $12.5 million of individually evaluated loans with specific credit loss reserves of $1.4 million assigned.
Current wording
The Company had $18.4 million of non-performing loans as of June 30, 2025, compared to $14.2 million of non-performing loans as of December 31, 2024. As of June 30, 2025, the balance of non-performing loans was comprised of certain commercial real estate – non-owner occupied, commercial real estate – owner occupied, commercial and industrial loans, and consumer loans, of which $13.8 million is guaranteed by the SBA. Included in the balance of non-performing assets as of June 30, 2025 are $6.8 million of individually evaluated loans with specific credit loss reserves of $784 thousand assigned. As of December 31, 2024, the balance of non-performing loans was comprised of certain commercial real estate – non-owner occupied, commercial real estate – owner occupied, commercial and industrial loans, and consumer loans totaling $14.2 million, of which $9.3 million is guaranteed by the SBA. Included in the balance of non-performing assets as of December 31, 2024 are $12.5 million of individually evaluated loans with specific credit loss reserves of $1.4 million assigned.
Previous wording
The operating lease right of use asset increased $1.4 million from $4.5 million at December 31, 2024 to $6.0 million at March 31, 2025 due to the modification of two leased locations resulting in a five year extensions of the lease terms.
Current wording
The operating lease right of use asset increased $1.2 million from $4.5 million at December 31, 2024 to $5.7 million at June 30, 2025, due to the modification of two leased locations during the first quarter of 2025 resulting in a five year extensions of the lease terms.
Previous wording
Loan servicing assets increased $255 thousand from $9.0 million at December 31, 2024 to $9.2 million at March 31, 2025 primarily due the addition of servicing rights of $1.5 million relating to loans sold during the three months ended March 31, 2025. This increase was partially offset by loan servicing asset amortization of $1.3 million during the quarter.
Current wording
Loan servicing assets increased $760 thousand from $9.0 million at December 31, 2024 to $9.7 million at June 30, 2025, primarily due the addition of servicing rights of $3.4 million relating to loans sold during the six months ended June 30, 2025. This increase was partially offset by loan servicing asset amortization of $2.6 million during the quarter.
Previous wording
Federal Home Loan Bank (“FHLB”) stock was $4.7 million as of both March 31, 2025 and December 31, 2024. As a member of the FHLB, GBank is required to hold capital stock with this balance dependent upon GBank’s borrowing capacity with the FHLB.
Current wording
FHLB stock increased $861 thousand from $4.7 million at December 31, 2024 to $5.5 million at June 30, 2025. As a member of the FHLB, GBank is required to hold capital stock with this balance dependent upon GBank’s borrowing capacity with the FHLB.
Previous wording
Other assets totaled $21.0 million at March 31, 2025, an increase of $1.6 million or 9% when compared to $19.4 million at December 31, 2024, with this increase largely attributable to growth of the organization driving increases in other miscellaneous receivables.
Current wording
Other assets totaled $22.9 million at June 30, 2025, an increase of $3.6 million, or 18%, when compared to $19.4 million at December 31, 2024, with this increase largely attributable to growth of the organization driving increases in other miscellaneous receivables.
Previous wording
The Company’s total liabilities increased $61.7 million or 6% to $1.043 billion at March 31, 2025 compared to $981.7 million at December 31, 2024. The increase in total liabilities was primarily attributable to an increase in total deposits of $60.9 million with the largest increases within time deposits and savings accounts.
Current wording
The Company’s total liabilities increased $99.0 million, or 10%, to $1.08 billion at June 30, 2025 compared to $981.7 million at December 31, 2024. The increase in total liabilities was primarily attributable to an increase in total deposits of $97.4 million with the largest increases within time deposits and savings accounts.
Previous wording
Total deposits increased 7% to $995.9 million at March 31, 2025, compared to $935.1 million at December 31, 2024. The year-to-date decrease in interest bearing demand deposits was offset by increases in time deposits, savings deposits, and non-interest bearing demand deposits. The increase in time deposit was partially offset by a net decrease of approximately $6.1 million of brokered deposits since December 31, 2024.
Current wording
Total deposits increased 10% to $1.03 billion at June 30, 2025, compared to $935.1 million at December 31, 2024. The year-to-date decreases in non-interest bearing and interest bearing demand deposits were offset by increases in time deposits and savings deposits. Contributing to the increase in time deposits was a net increase of $8.0 million of brokered deposits since December 31, 2024.
Previous wording
The following table presents the average balances of deposits by type and the related average interest rates for the periods presented:
Current wording
The following table presents the average balances of deposits by type and the related average interest rates for the three months ended June 30, 2025 and 2024:
Previous wording
Federal Deposit Insurance Corporation (“FDIC”) deposit insurance covers $250 thousand per depositor, per FDIC-insured bank, for each account ownership category. As of March 31, 2025, uninsured deposits were approximately $395.8 million compared to $385.7 million as of December 31, 2024.
Current wording
Federal Deposit Insurance Corporation (“FDIC”) deposit insurance covers $250 thousand per depositor, per FDIC-insured bank, for each account ownership category. As of June 30, 2025, uninsured deposits were approximately $402.3 million, or 38.9% of total deposits, compared to $385.7 million, or 41.2% of total deposits, as of December 31, 2024.
Previous wording
The maturities of time deposits over $250 thousand were as follows:
Current wording
As of June 30, 2025 the maturities of time deposits having balances over $250 thousand were as follows:
Previous wording
Operating lease liability increased $1.5 million, from $4.8 million at December 31, 2024 to $6.3 million at March 31, 2025 reflecting the modification of two leased locations resulting in five year extensions of the lease terms.
Current wording
Operating lease liability increased $1.3 million, from $4.8 million at December 31, 2024 to $6.1 million at June 30, 2025 reflecting the modification of two leased locations during the first quarter of 2025 resulting in five year extensions of the lease terms.
Previous wording
Other liabilities totaled $15.0 million at March 31, 2025, a decrease of $609 thousand or 4% when compared to $15.7 million at December 31, 2024. This decrease was driven by a reduction in accrued interest payable due to an overall decline in the cost of interest-bearing deposits during the first quarter of 2025.
Current wording
Other liabilities totaled $16.0 million at June 30, 2025, an increase of $307 thousand, or 2%, when compared to $15.7 million at December 31, 2024. This decrease was driven by a reduction in accrued interest payable due to an overall decline in the cost of interest-bearing deposits during the first six months of 2025.
Previous wording
Stockholders' equity increased 4% to $146.6 million at March 31, 2025 compared to $140.7 million at December 31, 2024 with this increase driven primarily by the net income generated during the first quarter of 2025.
Current wording
Stockholders' equity increased 8% to $151.7 million at June 30, 2025 compared to $140.7 million at December 31, 2024 with this increase driven primarily by the net income generated during the six months of 2025.
Previous wording
On November 4, 2019, the federal banking agencies jointly issued a final rule that provides for an optional, simplified measure of capital adequacy, the community bank leverage ratio (“CBLR”) framework, for qualifying community banking organizations, consistent with Section 201 of the Economic Growth, Regulatory Relief, and Consumer Protection Act. The final rule was effective on January 1, 2020 and allows qualifying community banking organizations to calculate a leverage ratio to measure capital adequacy. Banks opting into the CBLR framework are not required to calculate or report risk-based capital. The Company adopted the CBLR standards with its Call Report filed with the federal banking agencies for the quarter ended September 30, 2020.
Current wording
On September 17, 2019, the federal banking agencies jointly finalized a rule that became effective July 1, 2020 and was intended to provide for an optional, simplified measure of capital adequacy, the community bank leverage ratio (“CBLR”) framework, for qualifying community banking organizations, consistent with Section 201 of the Economic Growth, Regulatory Relief, and Consumer Protection Act. The final rule was effective on January 1, 2020 and allows qualifying community banking organizations to calculate a leverage ratio to measure capital adequacy beginning with their March 31, 2020 Call Reports. . The Company opted into the CBLR framework with its Call Report filed with the federal banking agencies for the quarter ended September 30, 2020.
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