BAFNHIGH SIGNALOPERATIONAL10-K

BayFirst discontinued its national SBA 7(a) lending division in Q3 2025, fundamentally shifting from a dual-division model to a community banking focus.

This represents a strategic pivot away from BayFirst's national government guaranteed lending business, which previously served as both a revenue driver and customer acquisition tool for the Tampa Bay/Sarasota market. The elimination of this specialized division and its advanced technology platform suggests management is consolidating operations around traditional community banking services. This operational restructuring may impact the bank's ability to cross-sell and expand its customer base beyond its regional footprint.

Comparing 2026-03-27 vs 2025-03-25View on EDGAR →
FINANCIAL ANALYSIS

The financial metrics reflect the operational transition, with operating cash flow declining meaningfully from $390.5M to $285.3M year-over-year. Stockholders' equity decreased 21.1% to $87.6M, while capital expenditures dropped substantially from $1.7M to $300K, consistent with winding down the technology-intensive SBA division. The overall picture suggests a company in transition, with reduced cash generation and equity levels as it refocuses on its core regional banking operations.

FINANCIAL STATEMENT CHANGES
Capital Expenditure
Cash Flow
-82.2%
$1.7M→$300K

Capex reduced 82.2% — investment cycle winding down or capital discipline; may improve near-term free cash flow.

Operating Cash Flow
Cash Flow
-26.9%
$390.5M→$285.3M

Operating cash flow softened — monitor whether temporary working capital timing or structural deterioration.

Stockholders Equity
Balance Sheet
-21.1%
$110.9M→$87.6M

Equity decreased 21.1% — buybacks or losses reducing book value, monitor solvency ratios.

LANGUAGE CHANGES
NEW — 2026-03-27
PRIOR — 2025-03-25
ADDED
BayFirst s primary source of income is from the Bank, which serves a broad spectrum of consumers and small businesses in the Tampa Bay/Sarasota region.
As of December 31, 2025, BayFirst had consolidated total assets of $1.30 billion, total loans held for investment of $963.9 million, total deposits of $1.18 billion, and total shareholders equity of $87.6 million.
The Bank offers its products and services through its community banking centers.
In the third quarter of 2025, the Bank discontinued its SBA 7(a) lending division but continues to provide USDA loans and SBA 404 loans through the community banking centers.
The Bank has been particularly successful in penetrating the small business community.
The Bank continues to offer SBA 504 and USDA loans through the community banking centers .
The USDA guarantees up to 80% of USDA B I loan balances as an incentive for financial institutions to make loans to businesses located in rural areas.
The loans can be priced competitively relative to conventional financing.
Commercial loan decisions are documented as to the borrower s business, loan purpose, the evaluation of the repayment source and associated risks, the evaluation of collateral, loan covenants, loan monitoring requirements, and the risk rating rationale.
These residential mortgage loans are underwritten to meet secondary market standards.
REMOVED
BayFirst s primary source of income is from the Bank, which serves a broad spectrum of consumers and small businesses in the Tampa Bay/Sarasota region and is supported by a national government guaranteed lend ing business.
BayFirst utilizes this national business line to provide financial support for the delivery and expansion of traditional banking services, and to serve as a specialized lead product to introduce the Bank to new customers in the Tampa Bay/Sarasota region.
As of December 31, 2024, BayFirst had consolidated total assets of $1.29 billion, total loans held for investment of $1.07 billion, total deposits of $1.14 billion, and total shareholders equity of $110.9 million.
The Bank offers its products and services through its Community Banking Division and its government guaranteed lending division.
The Bank is a government guaranteed lender with specific expertise in originating SBA 7(a) loans and USDA loans throughout the nation.
The Bank also has an advanced technology platform for our SBA 7(a) Small Loan Program that enables the Bank to utilize and support technology-enabled banking products and services as well as various financial technology applications.
The Bank participates in interbank credit arrangements to permit the Bank to take part in corporate or other business entity loans for amounts which are greater than its lending limits.
Government Guaranteed Lending The Bank originates government guaranteed loans on a nationwide basis, with a particular emphasis on SBA 7(a) loans.
Government guaranteed loans are designed to assist small businesses in obtaining financing.
The Bank s loan origination efforts are targeted to a broad range of industries and geographies, with a focus on building relationships with borrowers.
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