For the past 54 years, cannabis has been categorized as a Schedule I controlled substance under the Controlled Substances Act. Schedule I drugs, substances or chemicals are defined as drugs with no currently accepted medical use and a high potential for abuse. First and foremost, the reclassification does not make marijuana legal, as it remains an illegal substance under federal law. From a banking perspective, the compliance requirements under the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) regu ...

GOLDEN, Colo., July 09, 2024 (GLOBE NEWSWIRE) -- SHF Holdings, Inc., d/b/a/ Safe Harbor Financial ("Safe Harbor" or the "Company") (NASDAQ: SHFS), a leader in facilitating financial services and credit facilities to the regulated cannabis industry, announced today that it successfully exited a $3.1 million loan that was previously in default. In addition to the full repayment of the principal, Safe Harbor received $202,175 in accrued interest, all of which will be reallocated into its lending and credit lin ...

GOLDEN, Colo., June 05, 2024 (GLOBE NEWSWIRE) -- SHF Holdings, Inc., d/b/a/ Safe Harbor Financial ("Safe Harbor" or the "Company") (NASDAQ:SHFS), a leader in facilitating financial services and credit facilities to the regulated cannabis industry, announced today the formal launch of its new small business line of credit program with the origination of new loans to three Colorado-based operators which are long-standing clients of Safe Harbor. "We're pleased to be able to offer our longstanding clients acces ...

DATE: June 5th TIME: 2:30 pm Eastern LINK: https://bit.ly/3QVIu08 If attendees are not able to join the event live on the day of the conference, an archived webcast will also be made available after the event. It is recommended that online investors pre-register and run the online system check to expedite participation and receive event updates. Learn more about the event at www.virtualinvestorconferences.com. Recent Company Highlights GOLDEN, Colo., May 30, 2024 (GLOBE NEWSWIRE) -- SHF Holdings, Inc., d/b/ ...

SHF Holdings Inc. (NASDAQ:SHFS) Q1 2024 Earnings Conference Call May 13, 2024 4:30 PM ET Company Participants Erika Kay - KCSA Strategic Communications Sundie Seefried - Founder and CEO James Dennedy - CFO Conference Call Participants Operator Thank you for standing by. My name is Benjamin and I will be your conference operator today. At this time, I would like to welcome everyone to Safe Harbor Financial First Quarter 2024 Earnings Call. All lines have been placed on mute to prevent any background noise. A ...

Exhibit 99.1 Safe Harbor Financial Announces First Quarter 2024 Results —Net Income increased 245% year-over-year to approximately $2.0 million in the first quarter of 2024 —Adjusted EBITDA increased 165.3% to approximately $1.1 million —Operating Expenses decreased 35.8% versus the same period in 2023 GOLDEN, Colo., May 13, 2024 — SHF Holdings, Inc., d/b/a/ Safe Harbor Financial ("Safe Harbor" or the "Company") (NASDAQ: SHFS), a leader in facilitating financial services and credit facilities to the regulat ...

PART I – FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company's unaudited statements show a shift from a net loss to a net income in Q1 2024 Condensed Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | **Revenue** | **$4,050,799** | **$4,180,379** | | Total operating expenses | $3,725,858 | $5,802,048 | | **Operating income/ (loss)** | **$324,941** | **($1,621,669)** | | **Net income/ (loss)** | **$2,049,676** | **($1,413,447)** | | Diluted income/ (loss) per share | $0.04 | ($0.06) | Condensed Consolidated Balance Sheet Highlights | Metric | March 31, 2024 (Unaudited) | December 31, 2023 | | :--- | :--- | :--- | | Total Assets | $67,702,471 | $67,860,909 | | Total Liabilities | $30,735,154 | $33,505,598 | | Total Stockholders' Equity | $36,967,317 | $34,355,311 | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $1,475,123 | ($232,040) | | Net cash provided by investing activities | $3,014 | $470,597 | | Net cash used in financing activities | ($740,544) | $0 | | **Net increase in cash and cash equivalents** | **$737,593** | **$238,557** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, a 'going concern' warning, and significant related-party transactions - The company generates income by providing services to financial institutions that serve the cannabis industry, including compliance, account servicing, and loan administration[25](index=25&type=chunk) - Management has concluded there is **substantial doubt about the Company's ability to continue as a going concern** for at least twelve months, despite positive results in the current quarter[32](index=32&type=chunk) Disaggregated Revenue by Type | Revenue Type | Three months ended March 31, 2024 | Three months ended March 31, 2023 | | :--- | :--- | :--- | | Deposit, activity, onboarding income | $1,620,994 | $2,245,831 | | Safe Harbor Program income | $19,230 | $51,103 | | Investment income | $773,819 | $1,417,152 | | Loan interest income | $1,636,756 | $466,293 | | **Total Revenue** | **$4,050,799** | **$4,180,379** | - On April 5, 2024, the company received a notice from Nasdaq for failing to maintain a minimum closing bid price of $1,00 per share and has until October 2, 2024, to regain compliance[188](index=188&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=43&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management analyzes improved Q1 2024 profitability driven by lower expenses despite a slight revenue decrease - The company provides a financial services platform for financial institutions serving cannabis-related businesses (CRBs), offering compliance, deposit services, and commercial lending[191](index=191&type=chunk)[193](index=193&type=chunk) Reconciliation of Net Income to Adjusted EBITDA (Non-GAAP) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net income/(loss) | $2,049,676 | ($1,413,447) | | **EBITDA** | **$1,960,672** | **($983,150)** | | **Adjusted EBITDA** | **$1,087,360** | **$409,918** | - Total revenue **decreased by 3.1% YoY**, nearly offset by a **251% increase in loan interest income** as the company expanded its lending activities[217](index=217&type=chunk)[221](index=221&type=chunk) - Total operating expenses **decreased by 35.8% YoY**, primarily due to a **37.7% reduction in compensation** and a **36.0% decrease in general and administrative expenses**[222](index=222&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exempt from market risk disclosures as a smaller reporting company - As a smaller reporting company, SHF Holdings, Inc, is exempt from providing quantitative and qualitative disclosures about market risk[258](index=258&type=chunk) [Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were deemed ineffective due to two outstanding material weaknesses in financial reporting - The CEO and CFO concluded that **disclosure controls and procedures were not effective** as of March 31, 2024[260](index=260&type=chunk)[264](index=264&type=chunk) - **Two material weaknesses remain outstanding** related to Revenue Recognition and the accounting for Complex Financial Instruments[266](index=266&type=chunk)[268](index=268&type=chunk) - A material weakness related to the provision for credit losses was **successfully remediated** by March 31, 2024[265](index=265&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=60&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no legal proceedings for the period - There are no legal proceedings to report[275](index=275&type=chunk) [Risk Factors](index=60&type=section&id=Item%201A.%20Risk%20Factors) A material risk arises from non-compliance with Nasdaq's minimum bid price requirement - The company received a notice from Nasdaq on April 5, 2024, for **failing to maintain a minimum closing bid price of $1.00 per share**[276](index=276&type=chunk)[277](index=277&type=chunk) - The company has until **October 2, 2024**, to regain compliance by having its stock close at or above $1.00 for at least 10 consecutive business days[277](index=277&type=chunk)[278](index=278&type=chunk) - **Failure to regain compliance could result in delisting** from Nasdaq, which would adversely impact trading, liquidity, and market price[276](index=276&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=60&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales or repurchases of equity securities - There were no unregistered sales of equity securities during the quarter[281](index=281&type=chunk) [Defaults Upon Senior Securities](index=60&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - None[284](index=284&type=chunk) [Other Information](index=60&type=section&id=Item%205.%20Other%20Information) No other information was required to be disclosed - None[285](index=285&type=chunk) [Exhibits](index=62&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the report, including agreements and officer certifications - A list of exhibits filed with the report is provided, including merger agreements, the Commercial Alliance Agreement with PCCU, and required officer certifications[288](index=288&type=chunk)[289](index=289&type=chunk)

Financial Data and Key Metrics Changes - For the full year 2023, total revenue increased by 85.3% to $17.56 million, up from $9.48 million in 2022 [13][18] - Total loan interest income for 2023 was $2.97 million, representing a 163% increase from $1.13 million in 2022 [7][18] - Investment income increased by 176% to $5.84 million in 2023, compared to $2.1 million in 2022 [18][36] - Operating expenses for the fourth quarter of 2023 decreased by approximately 17% to $6.2 million, compared to $7.4 million in the same period last year [19] - The company reported a net income of $2.5 million in the fourth quarter of 2023, compared to a loss of $37 million in the prior year period [21] Business Line Data and Key Metrics Changes - Deposits activity and onboarding income increased by 42% to $8.6 million in 2023, up from $6.1 million in 2022 [18][52] - The average monthly fee revenue per account increased by 35% year-over-year to $8,298, up from $6,154 for the same period in 2022 [27] - The loan book size increased to $55.66 million at the end of December 31, 2023, compared to $18.9 million at the end of December 31, 2022, representing a 194% increase year-over-year [34] Market Data and Key Metrics Changes - The total number of clients decreased from 1,040 as of March 30, 2023, to 721 as of December 31, 2023, due to the termination of a partnership with Central Bank [25] - The company facilitated approximately $4.2 billion in deposits in 2023, representing an increase of approximately 16.67% compared to $3.6 billion in 2022 [51] Company Strategy and Development Direction - The company aims to strengthen its fintech platform with more sophisticated products and services to create additional revenue channels and improved margins [38] - Safe Harbor is focused on diversifying its income streams, which has allowed it to remain competitive in the cannabis banking sector [30][31] - The company is actively engaged with potential new financial partners eager to enter the high-growth cannabis banking industry [26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued growth in 2024 and beyond, citing potential regulatory changes such as the Safer Banking Act [9] - The company believes its expertise in compliance management will set it apart as the cannabis industry expands [9] - Management highlighted the importance of maintaining rigorous compliance standards despite regulatory changes [39] Other Important Information - The company reported cash and cash equivalents of $4.9 million as of December 31, 2023, down from $8.4 million at the end of 2022 [40] - The net working capital deficit improved to $135,000 from $39.3 million at the end of 2022 [42] Q&A Session Summary - No specific questions were recorded during the Q&A session, and the call concluded with management expressing gratitude for the participants' interest in Safe Harbor Financial [10][16]

Financial Performance - For the fiscal year ending December 31, 2023, the Company reported a total revenue of $17,562,903, an increase of 85.29% compared to $9,478,819 in 2022[199]. - The Company recognized an Adjusted EBITDA of $3,626,411 for 2023, a significant increase from $1,302,093 in 2022[182]. - Operating expenses surged to $38,275,222 in 2023, a 227.79% increase from $11,676,659 in 2022, primarily due to higher compensation and employee benefits[204]. - The Company reported total revenue of $13,836,703 for the year ended December 31, 2023, compared to $8,823,608 for the year ended December 31, 2022, reflecting a significant increase[242]. - Loan interest income grew to $2,972,434 in 2023, a 163.01% increase from $1,130,178 in 2022[199]. - The Company incurred an operating loss of $20,712,319 for the year ended December 31, 2023, with cash used in operations amounting to $832,144, compared to cash provided by operations of $1,697,380 in 2022[213][210]. Banking Services and Operations - The Company provides a range of banking services to Cannabis Related Businesses (CRBs), including business checking and savings accounts, cash management accounts, and commercial lending[160]. - The Company’s proprietary platform enhances financial insight for CRBs, allowing them to operate more efficiently in a cash-intensive industry[160]. - The Company serviced 22 loans in 2023, up from 11 loans in 2022, indicating a focus on expanding its lending operations[202]. - The Company anticipates continued growth in account activity and lending as it focuses on enhancing its lending platform[192]. - The Company’s capacity for CRB related loans at 60% of PCCU's net worth was $77,610,599 as of December 31, 2023, down from $96,683,385 in 2022[242]. Strategic Agreements - The Company entered into a Commercial Alliance Agreement with PCCU on March 29, 2023, to govern lending-related and account-related services[170]. - Under the Commercial Alliance Agreement, the Company is obligated to remit 25% of investment hosting fees to PCCU based on incremental revenue of $549,000 recognized in Q4 2023[240]. - The Commercial Alliance Agreement includes a fee structure where SHF-serviced loans incur a yearly fee of 0.25% and loans financed and serviced by PCCU incur a fee of 0.35%[238]. - The Commercial Alliance Agreement has an initial term of two years with a one-year automatic renewal unless terminated with 120 days' notice[239]. Financial Position and Capital - As of December 31, 2023, the company reported cash and cash equivalents totaling $4,888,769, a decrease from $8,390,195 as of December 31, 2022[209]. - The company reported a net working capital deficit of $135,355 as of December 31, 2023, raising concerns about its ability to continue as a going concern for at least twelve months[213][214]. - CRB related deposits decreased from $161,138,975 on December 31, 2022, to $129,350,998 on December 31, 2023, indicating a decline in available capital[242]. - The Company’s net worth decreased from $133,231,565 on December 31, 2022, to $81,087,746 on December 31, 2023, reflecting a significant reduction in financial strength[242]. Compliance and Internal Controls - The Company has successfully navigated 16 state and federal banking exams, ensuring compliance in a highly regulated environment[161]. - The Company has identified three material weaknesses in internal controls related to Revenue Recognition, Complex Financial Instruments, and Credit Losses as of December 31, 2023[232]. Impairments and Adjustments - The impairment of goodwill and long-lived intangible assets amounted to $18,907,739 in 2023, reflecting a 100% increase from zero in 2022[204]. - The company recognized a goodwill impairment of $13.2 million and impairments of $1,865,668 for market-related intangible assets and $1,814,795 for customer relationships during the interim assessment[226]. - The forward purchase agreement's receivable value decreased from $37.9 million to $4.6 million due to a reset price adjustment influenced by stock trading values[224]. - The company has adopted the modified retrospective method for credit loss provisioning, resulting in a decrease in provisions[208]. Revenue Recognition Changes - A strategic change in Q4 2023 led to an additional $549,000 in revenue due to a new method for calculating interest on customer deposit balances[218]. - The Company has adopted Federal Reserve's interest rates for customer deposits, leading to a strategic shift in revenue recognition starting from Q4 2023[240].

[Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) This section summarizes Safe Harbor Financial's key financial and operational achievements for the full year 2023 [Full-Year 2023 Financial & Operational Highlights](index=1&type=section&id=Full-Year%202023%20Financial%20%26%20Operational%20Highlights) Safe Harbor Financial achieved record 2023 performance with 85.3% revenue growth to $17.6M, 194.2% loan book growth to $55.6M, and 176.9% Adjusted EBITDA increase to $3.6M Full-Year 2023 Key Financial Metrics | Metric | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $17.6 million | $9.5 million | +85.3% | | Loan Book Value | $55.6 million | $18.9 million | +194.2% | | Adjusted EBITDA | $3.6 million | $1.3 million | +176.9% | | Deposit activity and onboarding income | $8.6 million | $6.1 million | +42% | - Since its inception, the company has facilitated over **$21.5 billion** in deposit activity across 41 states, underscoring its significant role in providing financial services to the regulated cannabis industry[1](index=1&type=chunk) [Management Discussion](index=1&type=section&id=Management%20Discussion) This section provides insights from management regarding the company's strategic initiatives and performance in 2023 [CEO's Remarks](index=1&type=section&id=CEO%27s%20Remarks) CEO Sundie Seefried emphasized 2023 revenue diversification through new lending and deposit products, despite a Central Bank agreement termination, anticipating 2024 deposit growth - The company's strategic focus in 2023 was on broadening its financial service offerings with new lending and deposit products to create a more diversified and high-margin revenue mix[3](index=3&type=chunk) - A mutual agreement to terminate a partnership with Central Bank resulted in a significant loss of deposit accounts in the second half of 2023[3](index=3&type=chunk) - Management expresses confidence in increasing deposit activity in 2024 and beyond, citing strong interest from other national financial institutions and cannabis-related businesses[3](index=3&type=chunk) [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) This section presents a detailed breakdown of the company's financial performance for the fourth quarter and full year 2023 [Fourth Quarter 2023 Financial Results](index=2&type=section&id=Fourth%20Quarter%202023%20Financial%20Results) Q4 2023 revenue rose 25% to $4.5M, driven by loan interest and retroactive adjustments, while operating expenses decreased 16.2% to $6.2M, leading to a $2.5M net income Fourth Quarter 2023 Key Financial Metrics | Metric | Q4 2023 | Q4 2022 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $4.5 million | $3.6 million | +25% | | Operating Expenses | $6.2 million | $7.4 million | -16.2% | | Net Income/(Loss) | $2.5 million | ($37.0 million) | N/A | - A strategic shift in how the company applies earned interest to client deposits resulted in an additional **$549,000** of revenue being recognized in Q4 2023, applied retroactively from the beginning of the year[6](index=6&type=chunk)[8](index=8&type=chunk) - Operating expenses included a **$2 million** impairment charge for developed technology during the fourth quarter of 2023[7](index=7&type=chunk) [Full-Year 2023 Financial Results](index=2&type=section&id=Full-Year%202023%20Financial%20Results) FY 2023 revenue grew 85% to $17.6M, but operating expenses surged to $38.3M due to impairments, resulting in a $17.3M net loss, an improvement from prior year Full-Year 2023 Key Financial Metrics | Metric | FY 2023 | FY 2022 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue | $17.6 million | $9.5 million | +85% | | Operating Expenses | $38.3 million | $11.7 million | +227% | | Net Loss | ($17.3 million) | ($35.1 million) | -50.7% | | Cash and cash equivalents | $4.9 million | $8.4 million | -41.7% | - The substantial increase in **2023 operating expenses** was primarily driven by **goodwill and other impairment charges**, expenses related to restructuring the Abaca transaction, and stock-based compensation[10](index=10&type=chunk)[11](index=11&type=chunk) [Key Operational Events](index=2&type=section&id=Key%20Operational%20Events) This section outlines significant operational activities and achievements during and after the fourth quarter of 2023 [Fourth Quarter 2023 and Subsequent Operational Highlights](index=2&type=section&id=Fourth%20Quarter%202023%20and%20Subsequent%20Operational%20Highlights) Safe Harbor engaged in key Q4 2023 and subsequent operational activities, including Abaca acquisition restructuring and originating over $17.7M in secured loans for cannabis operators - Key activities included: - Restructuring deferred consideration obligations related to the 2022 Abaca acquisition - Originating a **$3M** secured loan for a cannabis industrial building in California - Originating a **$1.17M** secured loan for a new cannabis retail store in Connecticut - Originating a **$9M** secured loan for a cultivation facility in Colorado (Jan 2024) - Originating a **$4.6M** secured credit facility for a Michigan cannabis operator (Mar 2024)[13](index=13&type=chunk) [Consolidated Financial Statements](index=3&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's consolidated balance sheets, statements of operations, and cash flows [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of Dec 31, 2023, total assets decreased to $67.9M, liabilities to $33.5M, while stockholders' equity significantly increased to $34.4M due to goodwill reduction Consolidated Balance Sheets as of December 31 | Balance Sheet Item | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Cash and cash equivalents | $4.9 million | $8.4 million | | Goodwill | $6.1 million | $19.3 million | | Total Assets | $67.9 million | $99.5 million | | Total Liabilities | $33.5 million | $94.3 million | | Total Stockholders' Equity | $34.4 million | $5.1 million | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) FY 2023 revenue grew to $17.6M, but operating expenses, including $18.9M in impairments, led to a $20.7M operating loss and a $17.3M net loss, an improvement from 2022 Consolidated Statements of Operations for the Year Ended December 31 | Income Statement Item | FY 2023 ($) | FY 2022 ($) | | :--- | :--- | :--- | | Revenue | 17,562,903 | 9,478,819 | | Total operating expenses | 38,275,222 | 11,676,659 | | Impairment of goodwill & assets | 18,907,739 | 0 | | Operating loss | (20,712,319) | (2,197,840) | | Net loss | (17,279,847) | (35,128,083) | | Diluted net loss per share | (0.41) | (1.85) | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) FY 2023 saw a net cash outflow of $3.5M, with $0.8M used in operations and $2.2M in investing, ending the year with $4.9M cash Consolidated Statements of Cash Flows for the Year Ended December 31 | Cash Flow Item | Year ended Dec 31, 2023 ($) | Year ended Dec 31, 2022 ($) | | :--- | :--- | :--- | | Net cash (used in)/provided by operating activities | (832,144) | 1,697,380 | | Net cash used in investing activities | (2,180,448) | (2,897,429) | | Net cash (used in)/provided by financing activities | (488,834) | 4,094,339 | | Net (decrease)/increase in cash | (3,501,426) | 2,894,290 | | Cash and cash equivalents - end of period | 4,888,769 | 8,390,195 | [Non-GAAP Financial Measures Reconciliation](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) This section provides a reconciliation of non-GAAP financial measures to their most directly comparable GAAP measures [Reconciliation of Net Loss to Adjusted EBITDA](index=9&type=section&id=Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA) Net loss of $17.3M was reconciled to Adjusted EBITDA of $3.6M for 2023, a 176.9% increase, driven by higher income from deposits and Abaca acquisition activity Reconciliation of Net Loss to Adjusted EBITDA | Reconciliation Item | Year Ended Dec 31, 2023 ($) | Year Ended Dec 31, 2022 ($) | | :--- | :--- | :--- | | Net loss | (17,279,847) | (35,128,083) | | EBITDA | (16,622,375) | (43,486,497) | | Goodwill and long-lived intangible assets impairment | 18,907,739 | 0 | | Stock based compensation | 3,739,156 | 2,806,336 | | **Adjusted EBITDA** | **3,626,411** | **1,302,093** | - The increase in **Adjusted EBITDA** is attributed to a rise in **deposits and activity income**, significantly influenced by the growth in account numbers following the Abaca acquisition[25](index=25&type=chunk)