Blue Ridge Bankshares(US:BRBS) ZACKS·2026-02-03 16:26Core Viewpoint - Blue Ridge Bankshares, Inc. (BRBS) has shown a return to profitability in Q4 2025, despite a sequential decline in earnings, and is positioned for growth in the upcoming year following the termination of a regulatory consent order [2][6]. Financial Performance - For Q4 2025, BRBS reported net income of $4.2 million, or $0.04 per diluted share, compared to a net loss of $2 million, or $0.03 per share, in Q4 2024, indicating a year-over-year improvement [2]. - Net interest income for the quarter was $18.1 million, down from $19.1 million in Q4 2024, reflecting lower average interest-earning asset balances [2]. - Noninterest income was $2.7 million, largely unchanged from $2.8 million a year earlier, while noninterest expense decreased by 34% to $16.9 million from $25.6 million in the prior-year quarter [3]. - For the full year, BRBS posted net income of $10.7 million, or $0.11 per diluted share, compared to a net loss of $15.4 million, or $0.31 per share, in 2024 [3]. Asset Quality and Capital Position - Nonperforming loans decreased to $23.8 million, representing 0.98% of total assets as of Dec. 31, 2025, down from $28.6 million, or 1.14%, at the end of the prior quarter [4]. - Total assets decreased to $2.43 billion as of Dec. 31, 2025, from $2.74 billion a year earlier, primarily due to reductions in loans and brokered deposits [5]. - Capital ratios remained strong, with a tangible common equity ratio of 13.2%, despite declines from the prior quarter due to dividend payments and share repurchases [5]. Management Insights - Management described 2025 as a "breakthrough year," highlighting the termination of a regulatory consent order in November 2025, which is expected to lower borrowing costs and provide greater flexibility for capital decisions [6]. - The company reduced headcount by over 30% from year-end 2024 to year-end 2025, transitioning towards a more traditional community banking model [6]. Influencing Factors - The quarterly results were affected by non-recurring items, including a $1.5 million pre-tax recovery of credit losses and $0.4 million of pre-tax income related to the sale of mortgage servicing rights [7]. - The net interest margin declined to 3.04% from 2.80% in Q4 2024, and sequentially from 3.60% in Q3 2025, partly due to the absence of loan fee income [8]. Future Outlook - While BRBS did not provide formal financial guidance, management anticipates mid-single-digit balance sheet growth and positive momentum entering the new year, supported by an improving loan pipeline [10]. Other Developments - During the quarter, BRBS paid a special cash dividend of $0.25 per share, totaling approximately $29.1 million, and continued its share repurchase program, buying back 802,735 common shares for $3.4 million [11]. - Earlier in 2025, BRBS completed the sale of its mortgage division, contributing to the decline in noninterest income from mortgage-related activities [12].