Blue Ridge Bankshares(US:BRBS)2025-11-04 22:01Financial Performance - Net income for the three months ended September 30, 2025, was $5.6 million, or $0.06 per diluted common share, compared to $0.9 million, or $0.01 per diluted common share, for the same period in 2024 [161]. - For the nine months ended September 30, 2025, net income was $6.5 million, or $0.07 per diluted common share, a significant recovery from a net loss of $13.4 million, or ($0.34) per diluted common share, for the same period in 2024 [162]. - Net interest income for the three months ended September 30, 2025, was $21.9 million, a decline of $2.8 million from the same period in 2024 [166]. - Net interest income increased to $60.8 million for the nine months ended September 30, 2025, compared to $59.6 million for the same period in 2024, with a net interest margin of 3.21% [186]. - The effective tax rates for the three and nine months ended September 30, 2025, were 25.3% and 22.9%, respectively, compared to 38.8% and 3.1% for the same periods in 2024 [197]. Asset and Liability Management - Total assets decreased to $2.50 billion as of September 30, 2025, down $240.3 million from $2.74 billion at December 31, 2024, primarily due to a $199.1 million decline in loans held for investment [158]. - Total average assets decreased to $2.54 billion for the three months ended September 30, 2025, from $2.97 billion in the same period of 2024 [176]. - Average balances of interest-earning assets decreased by $358.6 million to $2.44 billion for the three months ended September 30, 2025, compared to $2.80 billion for the same period in 2024 [173]. - Average interest-bearing liabilities decreased by $434.5 million to $1.82 billion for the nine months ended September 30, 2025, compared to $2.25 billion for the same period in 2024 [185]. - The Company reported available liquidity of $808.655 million as of September 30, 2025, including cash, securities, and borrowing capacity [240]. Deposits and Funding - Total deposits were $1.95 billion as of September 30, 2025, reflecting a net decrease of $228.4 million from December 31, 2024, mainly due to a $134.6 million decrease in brokered time deposits [159]. - Brokered deposits represented 13.7% of total deposits as of September 30, 2025, down from 18.5% as of December 31, 2024 [223]. - Estimated uninsured deposits totaled approximately $404.3 million, or 19.8% of total deposits, as of September 30, 2025, compared to $399.3 million, or 18.0%, as of December 31, 2024 [224]. - The Company plans to continue reducing brokered deposits to a level of 10.0% or less of total deposits in future periods [223]. - The Company has reduced fintech-related deposits to approximately $4.7 million as of September 30, 2025, down from $21.3 million as of December 31, 2024 [222]. Credit Quality and Allowance for Credit Losses - The allowance for credit losses was $20.5 million as of September 30, 2025, down from $23.0 million at December 31, 2024 [158]. - The company reported a decrease in the allowance for credit losses to $20.5 million as of September 30, 2025, from $23.0 million as of December 31, 2024 [200]. - The ratio of net charge-offs to average loans outstanding for the nine months ended September 30, 2025, was -1.95% [207]. - The provision for credit losses for loans was a recovery of $2,594,000 for the same period, reflecting improved credit conditions [207]. - Nonperforming loans increased to $28.6 million as of September 30, 2025, up from $25.4 million as of December 31, 2024, primarily due to a $4.7 million multifamily loan placed on nonaccrual status [211]. Stockholder Equity and Share Repurchase - Total stockholders' equity increased by $27.7 million to $355.5 million as of September 30, 2025, primarily due to additional capital from the exercise of warrants and net income for the period [160]. - The Company repurchased 659,949 shares of common stock at a weighted average price of $4.16 per share, totaling $2.8 million during the three months ended September 30, 2025 [150]. Operational Efficiency - The company's noninterest expense decreased by $6.41 million (24.2%) for the three months ended September 30, 2025, compared to the same period in 2024, primarily due to lower salaries and employee benefits, audit fees, and FDIC insurance assessments [192]. - For the three months ended September 30, 2025, the company reported a decline in salaries and employee benefits by $2.55 million (18.3%) compared to the same period in 2024, reflecting a reduction in headcount [192]. - As of September 30, 2025, the company had 311 employees, down from 468 employees in the same period of 2024, indicating a right-sizing of the workforce [194]. Market and Economic Conditions - The Company emphasized the need for ongoing assessment of economic conditions that could impact the adequacy of the ACL in the future [206]. - The asset and liability repricing characteristics will significantly impact the company's future interest rate risk profile [260]. - Under a +400 basis points interest rate shock scenario, the estimated change in net interest income for Year 1 is $6.921 million, representing an increase of 8.8% [259]. - The estimated change in net interest income under a -400 basis points scenario for Year 1 is a decrease of $9.536 million, or -12.1% [259].