Blue Ridge Bankshares Restarts Loan Growth After 13-Quarter Pause
Loans held for investment rose $19.6 million, a 4% annualized rate, as pre-tax, pre-provision income excluding severance reached $2.9 million.
Blue Ridge Bankshares, Inc. (BRBS), the holding company of Blue Ridge Bank, National Association, reported a net loss of $0.2 million, or $0.00 a share, for the quarter ended June 30, 2026, after net income of $0.8 million, or $0.01 a share, in the first quarter.
The loss included an after-tax $2.1 million provision for credit losses and $0.3 million of after-tax severance tied to previously announced executive transitions. Excluding severance, pre-tax, pre-provision income was $2.9 million, up 30% from $2.2 million in the first quarter.
The operating turn was concentrated in loans. Loans held for investment rose $19.6 million, or a 4% annualized rate, the first growth in 13 quarters, reversing a $31.8 million contraction in the prior quarter. The company said the increase was driven primarily by commercial and residential mortgage loans. Interim president and chief executive officer Harry Golliday said the bank had spent a couple of years de-risking the balance sheet and returning focus to community banking customers.
Net interest income declined to $16.5 million from $16.9 million. Average loans held for investment fell $14.7 million, and loans held for sale went to zero after the exit of indirect fintech lending partnerships. Yields on loans held for investment were 5.54%. Net interest margin expanded 1 basis point to 2.91% from 2.90%. Cost of deposits fell 2 basis points to 2.25%. Interest expense declined $0.2 million as average brokered deposits fell $23.0 million.
Credit quality deteriorated on a single out-of-market relationship. Loans totaling $11.4 million, originated prior to 2024 by the former government-guaranteed lending team, were placed on nonaccrual at June 30. A $1.5 million reserve was established. Nonperforming loans rose to $31.2 million, or 1.34% of total assets, from $21.0 million, or 0.87%. The company said the credit issues were unique and not systemic to the overall portfolio. Net loan charge-offs were $0.6 million. The allowance for credit losses was 1.11% of loans held for investment. A $0.6 million provision for unfunded commitments reflected higher committed lines to commercial construction borrowers.
Noninterest expense fell $2.8 million to $15.9 million. Salaries and employee benefits declined $2.0 million, including $1.2 million of lower severance. Headcount was 269 at June 30, compared with 281 at March 31. Golliday said results of the quarter’s expense-reduction actions would be realized in the second half of 2026.
Noninterest income was $1.8 million, including a $0.6 million loss on the liquidation of an equity-method investment made in 2022.
Total assets fell to $2.33 billion from $2.41 billion after the April 27 payment of a $0.60 a share special cash dividend totaling about $54.1 million. Brokered deposits of $21.4 million were paid off at maturity, leaving $185.8 million, or 10.0% of total deposits. Excluding brokered deposits, total deposits decreased $9.3 million. Noninterest-bearing demand deposits were 21.3% of total deposits.
Tangible common equity to tangible assets was 11.8%. The bank’s common equity tier 1 and tier 1 risk-based capital ratios were 15.16%. On July 15, 2026, the company redeemed the remaining $14.7 million of 2029 subordinated notes, leaving no outstanding subordinated notes.
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