Earnings

BayFirst Narrows Third-Quarter Loss After Asset-Resolution Quarter

The Tip Desk · November 10, 2026 · 3 min read

The Tampa Bay lender posted a third-quarter 2026 net loss of $0.7 million, or $0.04 a share, as net interest margin reached 4.07% and community loans excluding government-guaranteed paper grew 25% annualized.

BayFirst Financial Corp. (BAFN), parent of BayFirst National Bank, reported a net loss of $0.7 million, or $0.04 a share, for the third quarter of 2026, compared with a $32.7 million loss, or $8.05 a share, in the second quarter. Net interest income rose to $10.6 million from $9.4 million. The company said the improvement was primarily the result of $41.5 million of expense in the second quarter related to its asset resolution plan.

Chief Executive Officer Al Rogers said the second-quarter steps under that plan were beginning to show through in the third-quarter results. The bank still lost money, but the operating picture shifted on margin, loans, deposits and credit.

Net interest margin was 4.07%, up 59 basis points from 3.48% in the second quarter. Net interest income rose $1.2 million to $10.6 million from $9.4 million, mainly from a $1.1 million increase in loan interest income including fees.

Total loans held for investment increased $20.1 million, or 2.3%, to $903.0 million, reversing a $41.4 million, or 4.5%, decline in the second quarter. Community bank loans excluding the government guaranteed portfolio grew $41.9 million, or 25% annualized, versus the prior quarter. Rogers called that growth a key highlight reflecting demand and customer trust.

Deposits increased $25.3 million, or 2.6%, to $1.01 billion, reversing a $97.0 million, or 8.9%, decline in the second quarter. Management said deposit growth outpaced loan growth for the first time in nearly three years. Savings and money market accounts rose $22.6 million, interest-bearing transaction accounts $6.9 million, and noninterest-bearing accounts $4.4 million; time deposits fell $8.7 million.

The provision for credit losses was negative $0.1 million after $29.0 million of provision in the second quarter. The second quarter included $30.5 million of expense related to the asset resolution plan. Net charge-offs fell to $3.2 million from $4.5 million; annualized net charge-offs were 1.52% of average loans held for investment at amortized cost versus 2.08% in the second quarter. Nonperforming assets declined to 1.29% of total assets from 1.75% at June 30, 2026. Nonperforming assets excluding government guaranteed loan balances were 1.21% of total assets versus 1.32% at June 30.

Noninterest income swung to $1.1 million from negative $6.8 million in the second quarter, primarily a 99.41% decrease in government guaranteed loan fair value losses of $6.4 million and the absence of a $1.5 million nonmarketable equity securities loss. Noninterest expense fell to $12.8 million from $17.7 million, after $1.7 million of asset-resolution expenses and $2.3 million of one-time change-in-control and vendor write-off costs in the prior quarter.

On July 14, 2026, the company obtained shareholder approval to increase authorized common shares from 15 million to 100 million and exchanged Series D and Series E preferred stock for 22,856,000 common shares. On August 13 it redeemed Series A and Series B preferred shares. Book value was $3.64 a share at September 30, 2026, down from $4.83 at June 30; tangible book value was $3.64, down from $4.82.

The Bank’s Tier 1 leverage ratio was 8.79% at September 30, 2026, versus 8.30% at June 30. CET1 and Tier 1 capital to risk-weighted assets were 11.15%, and total capital to risk-weighted assets 12.44%. The Bank met all regulatory requirements to be well-capitalized. On October 8, 2026, the company sold 4,107,908 common shares at $3.50 in a rights offering for $14.4 million of gross proceeds, which it said will be used to improve capital levels of the company and the Bank and support continued growth.

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