UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 001-39165

BLUE RIDGE BANKSHARES, INC.

(Exact name of registrant as specified in its charter)


Virginia	54-1838100
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1801 Bayberry Court, Suite 101 Richmond, Virginia	23226
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (888) 331-6521

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, no par value

BRBS

NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 1, 2025, the registrant had 91,177,849 shares of common stock, no par value per share, outstanding.


Blue Ridge Bankshares, Inc. Table of Contents
Item		Page

PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements	3

	Consolidated Balance Sheets as of March 31, 2025 (unaudited) and December 31, 2024	3

	Consolidated Statements of Operations for the three months ended March 31, 2025 and 2024 (unaudited)	4

	Consolidated Statements of Comprehensive (Loss) Income for the three months ended March 31, 2025 and 2024 (unaudited)	5

	Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2025 and 2024 (unaudited)	6

	Consolidated Statements of Cash Flows for the three months ended March 31, 2025 and 2024 (unaudited)	7

	Notes to Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	47

Item 4.	Controls and Procedures	47

PART II	OTHER INFORMATION	48

Item 1.	Legal Proceedings	48

Item 1A.	Risk Factors	48

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	48

Item 3.	Defaults Upon Senior Securities	48

Item 4.	Mine Safety Disclosures	48

Item 5.	Other Information	48

Item 6.	Exhibits	48

Signatures		49

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Blue Ridge Bankshares, Inc.

Consolidated Balance Sheets


	(unaudited)
(Dollars in thousands, except share data)	March 31, 2025			December 31, 2024 (1)
ASSETS
Cash and due from banks	$	170,466		$	173,533
Restricted cash		2,167			2,459
Federal funds sold		1,725			838
Securities available for sale, at fair value		325,401			312,035
Restricted equity investments		18,797			19,275
Other equity investments		4,698			4,834
Other investments		20,381			19,405
Loans held for sale		23,624			30,976
Loans held for investment, net of deferred fees and costs		2,059,710			2,111,797
Less: allowance for credit losses		(23,126	)		(23,023	)
Loans held for investment, net		2,036,584			2,088,774
Accrued interest receivable		12,700			12,537
Premises and equipment, net		20,916			21,394
Right-of-use asset		7,597			7,962
Other intangible assets		3,527			3,859
Deferred tax asset, net		26,149			27,312
Other assets		10,352			12,067
Total assets	$	2,685,084		$	2,737,260
LIABILITIES & STOCKHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand	$	452,590		$	452,690
Interest-bearing demand and money market		632,983			598,875
Savings		103,622			100,857
Time		940,282			1,027,020
Total deposits		2,129,477			2,179,442
FHLB borrowings		150,000			150,000
Subordinated notes, net		39,773			39,789
Lease liability		8,280			8,613
Other liabilities		19,265			31,628
Total liabilities		2,346,795			2,409,472
Commitments and contingencies (Note 7)
Stockholders’ Equity:
Common stock, no par value; 150,000,000 shares authorized at March 31, 2025 and December 31, 2024, respectively; 87,777,849 and 84,972,610 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively		329,920			322,791
Additional paid-in capital		29,687			29,687
Retained earnings		17,338			17,772
Accumulated other comprehensive loss, net of tax		(38,656	)		(42,462	)
Total stockholders’ equity		338,289			327,788
Total liabilities and stockholders’ equity	$	2,685,084		$	2,737,260

(1)

Derived from audited December 31, 2024 Consolidated Financial Statements.

See accompanying notes to unaudited consolidated financial statements.

Blue Ridge Bankshares, Inc.

Consolidated Statements of Operations

(unaudited)


	For the three months ended
(Dollars in thousands, except per share data)	March 31, 2025			March 31, 2024
INTEREST INCOME
Interest and fees on loans	$	31,154		$	38,346
Interest on securities, deposit accounts, and federal funds sold		4,196			4,185
Total interest income		35,350			42,531
INTEREST EXPENSE
Interest on deposits		14,192			18,485
Interest on subordinated notes		736			560
Interest on FHLB and FRB borrowings		1,432			3,137
Total interest expense		16,360			22,182
Net interest income		18,990			20,349
Recovery of credit losses - loans		—			—
Recovery of credit losses - unfunded commitments		—			(1,000	)
Total recovery of credit losses		—			(1,000	)
Net interest income after recovery of credit losses		18,990			21,349
NONINTEREST INCOME
Fair value adjustments of other equity investments		(73	)		(7	)
Residential mortgage banking income		956			2,664
Mortgage servicing rights		2			729
Wealth and trust management		454			520
Service charges on deposit accounts		457			361
Increase in cash surrender value of bank owned life insurance		8			337
Bank and purchase card, net		567			242
Other		701			2,942
Total noninterest income		3,072			7,788
NONINTEREST EXPENSE
Salaries and employee benefits		12,610			16,045
Occupancy and equipment		1,381			1,524
Technology and communication		2,784			2,279
Legal and regulatory filings		439			447
Advertising and marketing		191			297
Audit fees		578			1,155
FDIC insurance		1,097			1,377
Intangible amortization		244			287
Other contractual services		595			1,809
Other taxes and assessments		921			943
Regulatory remediation		—			2,644
Other		2,111			3,630
Total noninterest expense		22,951			32,437
Loss before income taxes		(889	)		(3,300	)
Income tax benefit		(455	)		(407	)
Net loss	$	(434	)	$	(2,893	)
Basic and diluted loss per common share	$	(0.01	)	$	(0.15	)

See accompanying notes to unaudited consolidated financial statements.

Blue Ridge Bankshares, Inc.

Consolidated Statements of Comprehensive (Loss) Income

(unaudited)


	For the three months ended
(Dollars in thousands)	March 31, 2025			March 31, 2024
Net loss	$	(434	)	$	(2,893	)
Other comprehensive income (loss):
Gross unrealized gains (losses) on securities available for sale arising during the period		5,223			(2,930	)
Deferred income tax (expense) benefit		(1,417	)		372
Unrealized gains (losses) on securities available for sale arising during the period, net of tax		3,806			(2,558	)
Other comprehensive income (loss), net of tax		3,806			(2,558	)
Comprehensive net income (loss)	$	3,372		$	(5,451	)

See accompanying notes to unaudited consolidated financial statements.

Blue Ridge Bankshares, Inc.

Consolidated Statements of Changes in Stockholders’ Equity

(unaudited)


	For the three months ended March 31, 2025
(Dollars in thousands except share data)	Shares of Common Stock		Common Stock		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive (Loss) Income, net			Total
Balance at beginning of period		84,972,610	$	322,791	$	29,687	$	17,772		$	(42,462	)	$	327,788
Net loss		—		—		—		(434	)		—			(434	)
Other comprehensive income		—		—		—		—			3,806			3,806
Exercises of warrants to purchase common stock		2,762,000		6,905		—		—			—			6,905
Restricted stock awards, net of forfeitures		43,239		224		—		—			—			224
Balance at end of period		87,777,849	$	329,920	$	29,687	$	17,338		$	(38,656	)	$	338,289


	For the three months ended March 31, 2024
(Dollars in thousands except share data)	Shares of Common Stock		Common Stock		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Loss, net			Total
Balance at beginning of period		19,198,379	$	197,636	$	252	$	33,157		$	(45,056	)	$	185,989
Net loss		—		—		—		(2,893	)		—			(2,893	)
Other comprehensive loss		—		—		—		—			(2,558	)		(2,558	)
Restricted stock awards, net of forfeitures		385,661		368		—		—			—			368
Balance at end of period		19,584,040	$	198,004	$	252	$	30,264		$	(47,614	)	$	180,906

See accompanying notes to unaudited consolidated financial statements.

Blue Ridge Bankshares, Inc.

Consolidated Statements of Cash Flows

(unaudited)


	For the three months ended
(Dollars in thousands)	March 31, 2025			March 31, 2024
Cash Flows From Operating Activities
Net loss from continuing operations	$	(434	)	$	(2,893	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		378			433
Deferred income tax expense (benefit)		1,417			(372	)
Recovery of credit losses - unfunded commitments		—			(1,000	)
Accretion of fair value adjustments (discounts) on acquired loans		(366	)		(329	)
Accretion of fair value adjustments (premiums) on acquired time deposits and subordinated notes		(60	)		(122	)
Fair value adjustments of other equity investments		73			7
Net fair value adjustments attributable to mortgage servicing rights		(2	)		(729	)
Increase in cash surrender value of bank owned life insurance		(8	)		(337	)
Proceeds from sale of mortgage loans held for sale		22,849			63,401
Mortgage loans held for sale, originated		(22,350	)		(59,707	)
Gain on sale of mortgage loans		(508	)		(130	)
Proceeds from sale of guaranteed government loans held for sale		—			1,605
Guaranteed government loans held for sale, originated		—			(293	)
Gain on sale of guaranteed government loans		—			(102	)
Loss (gain) on disposal of premises and equipment, other investments, and other assets		200			(326	)
Investment amortization expense, net		49			136
Amortization of subordinated debt issuance costs		9			8
Intangible amortization		244			287
(Increase) decrease in accrued interest receivable		(163	)		271
Decrease (increase) in other assets		7,780			(2,315	)
Decrease in other liabilities		(12,696	)		(5,011	)
Cash used in operating activities		(3,588	)		(7,518	)
Cash Flows From Investing Activities
Purchases of securities available for sale		(12,388	)		—
Proceeds from calls, sales, paydowns, and maturities of securities available for sale		4,196			3,621
Net increase in federal funds sold		(887	)		(2,398	)
Proceeds from sale of premises and equipment, other investments, and other assets		25			5,204
Capital calls of SBIC funds and other investments		(892	)		(1,237	)
Nonincome distributions from limited liability companies		—			220
Net decrease in loans held for investment		52,556			42,988
Proceeds from surrender of bank owned life insurance policies		212			—
Net change in restricted equity and other investments		457			(3,621	)
Purchases of premises and equipment		(25	)		(53	)
Cash provided by investing activities		43,254			44,724
Cash Flows From Financing Activities
Net increase (decrease) in demand, savings, and other interest-bearing deposits		36,773			(164,181	)
Net (decrease) increase in time deposits		(86,703	)		64,022
FHLB advances		—			350,000
FHLB repayments		—			(280,000	)
Exercises of warrants to purchase common stock		6,905			—
Cash used in financing activities		(43,025	)		(30,159	)
Net (decrease) increase in cash and due from banks		(3,359	)		7,047
Cash and due from banks and restricted cash at beginning of period		175,992			121,151
Cash and due from banks and restricted cash at end of period	$	172,633		$	128,198
Supplemental Schedule of Cash Flow Information
Cash paid for:
Interest	$	18,265		$	20,786
Income taxes	$	1,000		$	—
Non-cash investing and financing activities:
Unrealized gains (losses) on securities available for sale	$	5,223		$	(2,930	)
Restricted stock awards, net of forfeitures	$	224		$	368

See accompanying notes to unaudited consolidated financial statements.

Notes to Consolidated Financial Statements (Unaudited)

Note 1 – Organization and Basis of Presentation

Blue Ridge Bankshares, Inc. (the “Company”) conducts its business activities primarily through its wholly-owned subsidiary bank, Blue Ridge Bank, National Association (the “Bank”) and its wealth and trust management subsidiary, BRB Financial Group, Inc. (the “Financial Group”). The Company exists primarily for the purposes of holding the stock of its subsidiaries, the Bank and the Financial Group.

The accompanying unaudited consolidated financial statements of the Company include the accounts of the Bank and the Financial Group and were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and general practices within the banking industry. All significant intercompany balances and transactions have been eliminated in consolidation. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).

The Company's significant accounting policies are disclosed in Note 2 of the audited financial statements for the year ended December 31, 2024 included in the 2024 Form 10-K. There have been no significant changes to the application of significant accounting policies since December 31, 2024.

Certain amounts presented in the consolidated financial statements of prior periods have been reclassified to conform to current year presentations. The reclassifications had no effect on net income, net income per share, total assets, total liabilities, or stockholders’ equity as previously reported.

Sale of Mortgage Division

On March 19, 2025 the Company announced the sale of its mortgage division operating as Monarch Mortgage to an unrelated third-party mortgage company. The sale, which was completed on March 27, 2025, included the transfer of certain assets and leases, resulted in a $0.2 million loss, reported in other noninterest income.

This transaction did not meet the criteria for classification as a discontinued operation under Accounting Standards Codification ("ASC") 205-20, Presentation of Financial Statements – Discontinued Operations, and is therefore reported within continuing operations as of and for all periods stated herein.

Private Placements

In the second quarter of 2024, the Company closed private placements in which it issued and sold shares of its common and preferred stock for gross proceeds of $161.6 million (collectively, the "Private Placements"). At a special meeting of shareholders held June 20, 2024, the Company’s shareholders approved the Private Placements and an amendment to the Company's articles of incorporation authorizing the issuance of additional shares of common stock, thus enabling the conversion of the preferred shares issued in the Private Placements into shares of the Company’s common stock. On June 28, 2024 and November 7, 2024, all outstanding shares of the Company’s Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series B and Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series C (together the “preferred stock”), were converted or exchanged for shares of the Company’s common stock. Capital proceeds received, net of issuance costs, from the Private Placements totaled $152.1 million.

The Private Placements also included the issuance of warrants to purchase common stock and the preferred stock. Warrants for the preferred stock converted to warrants for common stock upon the conversion or exchange of the preferred stock to common stock.

The table below presents information pertaining to warrants to purchase the Company’s common stock as of and for the period stated.


	As of and for the three months ended March 31, 2025
	Warrants with an Exercise Price of $2.50 per Share			Warrants with an Exercise Price of $2.36 per Share		Total Warrants Outstanding
Balance at beginning of period		29,027,999			2,424,000		31,451,999
Warrants exercised during the period		(2,762,000	)		—		(2,762,000	)
Balance at end of period		26,265,999			2,424,000		28,689,999
Remaining exercise term (years)		4.01			4.20

Regulatory Matters

The Bank entered into a consent order with the Office of the Comptroller of the Currency (the "OCC") on January 24, 2024 (the "Consent Order"), which generally incorporates the provisions of the formal written agreement (the "Written Agreement") entered into between the Bank and the OCC on August 29, 2022, as well as adding new provisions. The Written Agreement principally concerned the Bank’s fintech operations and required the Bank to continue enhancing its controls for assessing and managing the third-party, Bank Secrecy Act/Anti-Money Laundering, and information technology risks stemming from its fintech partnerships. The Consent Order adds time frames by which certain of the directives are required, requires the Bank to submit a strategic plan and a capital plan, and places further restrictions on the Company’s fintech operations. The Consent Order also requires the Bank to maintain a leverage ratio of 10.0% and a total capital ratio of 13.0%, referred to as minimum capital ratios. As of March 31, 2025 and December 31, 2024, the Bank’s capital ratios exceeded these minimum capital ratios. The Company believes it has made significant progress towards meeting the requirements of the Consent Order. Complete copies of the Written Agreement and the Consent Order are included as Exhibits 10.9 and 10.10, respectively, to the 2024 Form 10-K.

Recent Accounting Pronouncements (Issued But Not Adopted)

Improvements to Income Tax Disclosures. In December 2023, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2023-09–Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure of disaggregated income taxes paid, prescribes standard categories for components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. This standard is effective for annual periods beginning after December 15, 2024, with early adoption permitted. The ASU requires prospective application by providing the revised disclosures for the period ending December 31, 2025, and continuing to provide the pre-ASU disclosures for the prior periods, or alternately applying the amendments retrospectively by providing the revised disclosures for all periods presented. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements, but it will result in expanded income tax-related disclosures beginning with its 2025 Form 10-K.

Note 2 – Investment Securities and Other Investments

Investment securities classified as available for sale ("AFS") are carried at fair value in the consolidated balance sheets. The following tables present amortized cost, fair values, and gross unrealized gains and losses of investment securities AFS as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available for sale
Mortgage backed securities	$	208,094	$	64	$	(32,850	)	$	175,308
U.S. Treasury and agencies		79,081		—		(8,465	)		70,616
State and municipal		50,073		—		(6,372	)		43,701
Corporate bonds		38,464		7		(2,695	)		35,776
Total investment securities	$	375,712	$	71	$	(50,382	)	$	325,401


	December 31, 2024
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Available for sale
Mortgage backed securities	$	199,453	$	—	$	(35,015	)	$	164,438
U.S. Treasury and agencies		79,430		—		(9,975	)		69,455
State and municipal		50,233		—		(7,296	)		42,937
Corporate bonds		38,453		—		(3,248	)		35,205
Total investment securities	$	367,569	$	—	$	(55,534	)	$	312,035

As of March 31, 2025 and December 31, 2024, securities with a fair value of $174.5 million and $268.9 million, respectively, were pledged to secure the Bank’s borrowings facility with the Federal Home Loan Bank of Atlanta ("FHLB").

As of March 31, 2025 and December 31, 2024, securities with fair values of $0 and $16.3 million, respectively, were pledged to secure borrowing capacity through the Federal Reserve Bank of Richmond ("FRB") Discount Window, of which there were no outstanding advances as of either date.

The following table presents the amortized cost and fair value of securities available for sale by contractual maturity as of the date stated. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	March 31, 2025
(Dollars in thousands)	Amortized Cost		Fair Value
Due in one year or less	$	601	$	602
Due after one year through five years		55,279		51,887
Due after five years through ten years		113,467		100,194
Due after ten years		206,365		172,718
Total	$	375,712	$	325,401

The following tables present fair value and gross unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates stated. The reference point for determining when securities are in an unrealized loss position is period-end; therefore, it is possible that a security's market value exceeded its amortized cost on other days during the past twelve-month period. Excluded from

the tables below were securities whose amortized cost equaled their fair value or were in an unrealized gain position as of the dates stated totaling $15.9 million and $1.1 million, as of March 31, 2025 and December 31, 2024, respectively.


			March 31, 2025
			Less than 12 Months					12 Months or Greater					Total
(Dollars in thousands)	Number of Securities		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage backed securities		84	$	11,008	$	(53	)	$	151,569	$	(32,797	)	$	162,577	$	(32,850	)
U.S. Treasury and agencies		29		—		—			70,615		(8,465	)		70,615		(8,465	)
State and municipal		69		1,686		(10	)		41,430		(6,362	)		43,116		(6,372	)
Corporate bonds		40		1,756		(2	)		31,434		(2,693	)		33,190		(2,695	)
Total		222	$	14,450	$	(65	)	$	295,048	$	(50,317	)	$	309,498	$	(50,382	)


			December 31, 2024
			Less than 12 Months					12 Months or Greater					Total
(Dollars in thousands)	Number of Securities		Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Mortgage backed securities		85	$	11,637	$	(107	)	$	152,802	$	(34,908	)	$	164,439	$	(35,015	)
U.S. Treasury and agencies		29		—		—			69,453		(9,975	)		69,453		(9,975	)
State and municipal		70		2,040		(42	)		40,531		(7,254	)		42,571		(7,296	)
Corporate bonds		42		3,803		(21	)		30,653		(3,227	)		34,456		(3,248	)
Total		226	$	17,480	$	(170	)	$	293,439	$	(55,364	)	$	310,919	$	(55,534	)

At March 31, 2025 and December 31, 2024, the majority of securities in an unrealized loss position were of investment grade; however, a portion of the portfolio does not have a third-party investment grade available (securities with fair values of $27.9 million and $29.3 million, respectively). These securities were primarily subordinated debt instruments issued by bank holding companies and are classified as corporate bonds in the tables above. The Company evaluated the issuers of these individually, observing that each issuer had strong capital ratios and profitability, thereby indicating limited exposure to asset quality or liquidity issues and resulted in no identifiable credit losses. Contractual cash flows for mortgage backed securities and U.S. Treasury and agencies are guaranteed and/or funded by the U.S. government and government agencies. State and municipal securities showed no indication that the contractual cash flows would not be received when due. The Company does not intend to sell, nor does it believe that it will be required to sell, any of its impaired securities prior to the recovery of the amortized cost. As of March 31, 2025 and December 31, 2024, there was no allowance for credit losses ("ACL") for the Company's securities AFS portfolio. Any impairment that has not been recorded through an ACL is recognized in accumulated other comprehensive income (loss).

Restricted equity investments consisted of stock in the FHLB (carrying value of $9.1 million and $9.4 million as of March 31, 2025 and December 31, 2024, respectively), FRB stock (carrying value of $9.2 million and $9.4 million at March 31, 2025 and December 31, 2024, respectively), and stock in the Company’s correspondent bank (carrying value of $468 thousand at both March 31, 2025 and December 31, 2024). Restricted equity investments are carried at cost.

The Company has various other equity investments, including an investment in a fintech company and limited partnerships, totaling $4.7 million and $4.8 million as of March 31, 2025 and December 31, 2024, respectively.

The Company also holds other investments, primarily in early-stage focused investment funds, which totaled $20.4 million and $19.4 million as of March 31, 2025 and December 31, 2024, respectively, and are reported in other investments on the consolidated balance sheets.

Note 3 – Loans and ACL

The following table presents the amortized cost of loans held for investment as of the dates stated.


(Dollars in thousands)	March 31, 2025		December 31, 2024
Commercial and industrial	$	340,099	$	354,904
Real estate – construction, commercial		103,006		114,491
Real estate – construction, residential		53,498		51,807
Real estate – commercial		834,223		847,842
Real estate – residential		683,946		692,253
Real estate – farmland		4,748		5,520
Consumer		39,761		43,938
Gross loans held for investment		2,059,281		2,110,755
Deferred costs, net of loan fees		429		1,042
Total	$	2,059,710	$	2,111,797

The Company has pledged certain commercial and residential mortgage loans as collateral for borrowings with the FHLB. Loans totaling $772.4 million and $797.7 million were pledged with the FHLB as of March 31, 2025 and December 31, 2024, respectively. Additionally, the Company has pledged certain construction, and commercial and industrial loans totaling $68.5 million and $91.6 million as of March 31, 2025 and December 31, 2024, respectively, as collateral for borrowings with the FRB Discount Window.

The following tables present the aging of the recorded investment of loans held for investment by loan category as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Current Loans		30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due & Accruing		Nonaccrual		Total Loans
Commercial and industrial	$	325,702	$	1,456	$	874	$	2,316	$	9,751	$	340,099
Real estate – construction, commercial		102,788		—		—		—		218		103,006
Real estate – construction, residential		53,498		—		—		—		—		53,498
Real estate – commercial		826,279		3,651		119		—		4,174		834,223
Real estate – residential		664,685		11,252		519		70		7,420		683,946
Real estate – farmland		4,748		—		—		—		—		4,748
Consumer		37,748		889		192		222		710		39,761
Deferred costs, net of loan fees		429		—		—		—		—		429
Total	$	2,015,877	$	17,248	$	1,704	$	2,608	$	22,273	$	2,059,710


	December 31, 2024
(Dollars in thousands)	Current Loans		30-59 Days Past Due		60-89 Days Past Due		Greater than 90 Days Past Due & Accruing		Nonaccrual		Total Loans
Commercial and industrial	$	339,893	$	1,335	$	1,232	$	2,259	$	10,185	$	354,904
Real estate – construction, commercial		114,238		—		33		—		220		114,491
Real estate – construction, residential		51,807		—		—		—		—		51,807
Real estate – commercial		842,982		625		—		—		4,235		847,842
Real estate – residential		680,406		3,874		476		—		7,497		692,253
Real estate – farmland		5,520		—		—		—		—		5,520
Consumer		41,295		1,296		300		227		820		43,938
Deferred costs, net of loan fees		1,042		—		—		—		—		1,042
Total	$	2,077,183	$	7,130	$	2,041	$	2,486	$	22,957	$	2,111,797

The following tables present the recorded investment of nonaccrual loans held for investment with and without an ACL by loan category as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Nonaccrual Loans with No ACL		Nonaccrual Loans with an ACL		Total Nonaccrual Loans
Commercial and industrial	$	—	$	9,751	$	9,751
Real estate – construction, commercial		—		218		218
Real estate – commercial		—		4,174		4,174
Real estate – residential		1,052		6,368		7,420
Consumer		—		710		710
Total	$	1,052	$	21,221	$	22,273


	December 31, 2024
(Dollars in thousands)	Nonaccrual Loans with No ACL		Nonaccrual Loans with an ACL		Total Nonaccrual Loans
Commercial and industrial	$	778	$	9,407	$	10,185
Real estate – construction, commercial		—		220		220
Real estate – commercial		—		4,235		4,235
Real estate – residential		1,669		5,828		7,497
Consumer		—		820		820
Total	$	2,447	$	20,510	$	22,957

The Company recognized $118 thousand and $65 thousand of interest income on nonaccrual loans during the three months ended March 31, 2025 and 2024, respectively.

The following table presents accrued interest receivable by loan type reversed from interest income associated with loans held for investment that were placed on nonaccrual status for the periods stated.


	For the three months ended March 31,
(Dollars in thousands)	2025		2024
Commercial and industrial	$	70	$	57
Real estate – construction, commercial		—		25
Real estate – commercial		4		51
Real estate – residential		36		10
Consumer		7		5
Total	$	117	$	148

Credit Quality Indicators

The Company segments loans held for investment into risk categories based on relevant information about the expected ability of borrowers to repay debt, such as current financial information, historical payment performance, experience, collateral adequacy, credit documentation, and current economic trends, among other factors. Management assigns loan risk grades by a numerical system as an indication of credit quality of its portfolio of loans held for investment. The Company uses the following definitions for loan risk ratings and periodically evaluates the appropriateness of these ratings across its loan portfolio. Independent third-party loan reviews are performed periodically on the Company's loan portfolio and such reviews validate management's determination of loan risk grades. Bank regulatory agencies also periodically review the Company's loan portfolio, including loan risk grades and may, on occasion, change a grade based on their judgment of the facts at the time of review.

Risk Grade 1 – Strong: This grade is for the strongest of loans. These loans are extended to individuals or businesses where the probability of default is extremely low to the Bank and secured with liquid collateral where the loss given default is unlikely because of the source of repayment such as a lien on a deposit account held at the Bank. Character, credit history, and ability of individuals or company principals are excellent. High liquidity, minimum risk, strong ratios, and low servicing cost are present.

Risk Grade 2 – Minimal: This grade is for loans deemed exceptionally strong. These loans are within established guidelines and where the borrowers have documented significant overall financial strength with consistent and predictable cash flows. These loans have excellent sources of repayment, significant balance sheet liquidity, no significant identifiable risk of collection, and conform in all respects to policy, underwriting standards, and federal and state regulations (no exceptions of any kind). In addition, guarantor support, when provided, is deemed as excellent.

Risk Grade 3 – Acceptable: This grade is for loans deemed strong. These loans have adequate sources of repayment, with a minimal identifiable risk of collection. Generally, loans assigned this risk grade will demonstrate the following characteristics: (1) conformity in all respects with policy, guidelines, underwriting standards, and federal and state regulations (no exceptions of any kind), (2) documented historical cash flow that meets or exceeds required minimum guidelines, or that can be supplemented with verifiable cash flow from other sources, and (3) adequate secondary sources to liquidate the debt. In addition, guarantor support, when provided, is deemed strong.

Risk Grade 4 – Satisfactory: This grade is for satisfactory loans containing more but deemed acceptable risk, and where the borrower is deemed as sound. These loans have adequate sources of repayment, with minimal identifiable risk of collection. Loans assigned with this risk grade will demonstrate the following characteristics: (1) general conformity to the Bank's underwriting requirements, with limited exceptions to policy, product, or underwriting guidelines, and all exceptions noted have documented mitigating factors that offset any additional risk associated with the exceptions noted, (2) documented historical cash flow that meets or exceeds required minimum guidelines, or that can be supplemented with verifiable cash flow from other sources, and (3) adequate secondary sources to liquidate the debt. In addition, guarantor support, when provided, is deemed as satisfactory.

Risk Grade 5 – Watch: This grade is for satisfactory loans containing acceptable but elevated risk. These loans are characterized by borrowers who exhibit signs of financial stress or are experiencing unstable or unfavorable change(s) adversely impacting the current or expected financial condition. The borrower's management is considered to be satisfactory; however, the collateral securing the loan may have decreased in value, the debt service coverage ratio is inconsistent or breakeven but mostly positive, and/or guarantor support, if any, is deemed limited or marginal. Loans classified as Watch warrant additional monitoring by management.

Risk Grade 6 – Special Mention: This grade is for loans that have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the Bank's credit position potentially at a future date. Special Mention loans are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. Special Mention credits typically do not conform to established guidelines and/or exceptions without mitigating factors, or have emerging weaknesses that may or may not be remedied with the passage of time.

Risk Grade 7 – Substandard: This grade is for loans inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. The probability of default is highly likely and may have already occurred. Loans in this category are characterized by deterioration in quality exhibited by any number of well-defined weaknesses requiring corrective action. The weaknesses may include, but are not limited to: (1) current or expected unprofitable operations, (2) inadequate debt service coverage, (3) declining or inadequate liquidity, (4) improper loan structure, (5) questionable or weak repayment sources, and (6) lack of well-defined secondary repayment source. There is a distinct possibility of loss and the Bank will sustain loss if the deficiencies remain uncorrected.

Risk Grade 8 – Doubtful: Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values highly questionable and improbable. However, these loans are not yet rated as loss because certain events may occur which would salvage the Bank's position, which can include, but not limited to (1) an injection of capital, (2) alternative financing, and (3) liquidation of assets or the pledging of additional collateral. Doubtful is a temporary grade, where the Bank expects a loss but is presently not quantified with any degree of accuracy. Once the loss position is determined, the amount is recorded and charged off against the ACL.

Risk Grade 9 – Loss: Loans classified Loss are deemed uncollectible and of such little value that continuance as assets held for investment is no longer warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer charging off the worthless loan, even though partial recovery may occur in the future. Probable loss amounts, either principal or interest, deemed uncollectible are charged off promptly against the ACL.

The following table presents the recorded investment of loans held for investment by internal loan risk grade by year of origination as of March 31, 2025. There were no loans classified as loss (risk grade 9) as of the same date. Also presented are current period gross charge-offs by loan type for the three months ended March 31, 2025.


	Term Loans Recorded Investment Basis by Origination Year
(Dollars in thousands)	2025		2024		2023		2022		2021		Prior		Revolving Loans		Total
Commercial and industrial
Risk Grades 1 - 4	$	5,226	$	10,508	$	13,830	$	52,822	$	12,525	$	28,927	$	103,283	$	227,121
Risk Grades 5 - 6		—		397		23,880		38,796		6,939		6,209		11,460		87,681
Risk Grade 7		—		861		342		5,421		13,053		1,811		1,804		23,292
Risk Grade 8		—		—		—		—		2,005		—		—		2,005
Total		5,226		11,766		38,052		97,039		34,522		36,947		116,547		340,099
Current period gross charge-offs		—		23		30		1,937		—		83		50		2,123

Real estate – construction, commercial
Risk Grades 1 - 4		180		6,341		3,694		46,453		6,593		9,641		399		73,301
Risk Grades 5 - 6		—		—		1,086		18,000		714		9,584		—		29,384
Risk Grade 7		—		—		115		—		19		187		—		321
Total		180		6,341		4,895		64,453		7,326		19,412		399		103,006
Current period gross charge-offs		—		—		—		—		—		—		—		—

Real estate – construction, residential
Risk Grades 1 - 4		4,919		17,829		7,558		3,352		—		55		739		34,452
Risk Grades 5 - 6		86		—		215		—		18,278		—		—		18,579
Risk Grade 7		—		—		—		467		—		—		—		467
Total		5,005		17,829		7,773		3,819		18,278		55		739		53,498
Current period gross charge-offs		—		—		—		—		—		—		—		—

Real estate – commercial
Risk Grades 1 - 4		5,924		4,663		37,221		217,275		114,002		259,122		19,007		657,214
Risk Grades 5 - 6		—		532		3,393		87,068		10,375		47,782		4,383		153,533
Risk Grade 7		—		1,560		—		10,192		8,190		2,170		25		22,137
Risk Grade 8		—		—		—		—		1,339		—		—		1,339
Total		5,924		6,755		40,614		314,535		133,906		309,074		23,415		834,223
Current period gross charge-offs		—		—		—		—		—		63		—		63

Real estate – residential
Risk Grades 1 - 4		1,016		2,199		65,597		225,464		112,936		198,552		56,971		662,735
Risk Grades 5 - 6		—		909		—		998		2,182		4,692		98		8,879
Risk Grade 7		141		—		1,104		2,165		1,723		6,702		497		12,332
Total		1,157		3,108		66,701		228,627		116,841		209,946		57,566		683,946
Current period gross charge-offs		—		—		—		—		—		16		—		16

Real estate – farmland
Risk Grades 1 - 4		—		146		—		995		1,225		2,005		148		4,519
Risk Grades 5 - 6		—		—		132		—		97		—		—		229
Total		—		146		132		995		1,322		2,005		148		4,748
Current period gross charge-offs		—		—		—		—		—		—		—		—

Consumer
Risk Grades 1 - 4		965		5,063		15,346		7,683		1,314		1,102		6,680		38,153
Risk Grades 5 - 6		—		101		173		294		76		29		—		673
Risk Grade 7		—		56		256		361		180		75		—		928
Risk Grade 8		—		—		7		—		—		—		—		7
Total		965		5,220		15,782		8,338		1,570		1,206		6,680		39,761
Current period gross charge-offs		—		302		55		220		6		4		—		587

Total Loans
Risk Grades 1 - 4	$	18,230	$	46,749	$	143,246	$	554,044	$	248,595	$	499,404	$	187,227	$	1,697,495
Risk Grades 5 - 6		86		1,939		28,879		145,156		38,661		68,296		15,941		298,958
Risk Grade 7		141		2,477		1,817		18,606		23,165		10,945		2,326		59,477
Risk Grade 8		—		—		7		—		3,344		—		—		3,351
Total	$	18,457	$	51,165	$	173,949	$	717,806	$	313,765	$	578,645	$	205,494	$	2,059,281
Total current period gross charge-offs	$	—	$	325	$	85	$	2,157	$	6	$	166	$	50	$	2,789

The following table presents the recorded investment of loans held for investment by internal loan risk grade by year of origination as of December 31, 2024. There were no loans classified as loss (risk grade 9) as of the same date.


	Term Loans Recorded Investment Basis by Origination Year
(Dollars in thousands)	2024		2023		2022		2021		2020		Prior		Revolving Loans		Total
Commercial and industrial
Risk Grades 1 - 4	$	13,883	$	13,559	$	64,530	$	14,600	$	17,405	$	15,760	$	98,867	$	238,604
Risk Grades 5 - 6		672		24,430		37,503		10,201		5,183		979		15,092		94,060
Risk Grade 7		944		2,248		5,173		10,462		562		1,247		1,521		22,157
Risk Grade 8		—		—		—		82		—		1		—		83
Total		15,499		40,237		107,206		35,345		23,150		17,987		115,480		354,904

Real estate – construction, commercial
Risk Grades 1 - 4		6,219		6,277		65,560		7,776		5,405		4,792		399		96,428
Risk Grades 5 - 6		—		1,090		—		7,567		4,770		4,235		—		17,662
Risk Grade 7		—		116		—		24		—		261		—		401
Total		6,219		7,483		65,560		15,367		10,175		9,288		399		114,491

Real estate – construction, residential
Risk Grades 1 - 4		19,574		8,861		7,837		13,971		—		57		990		51,290
Risk Grades 5 - 6		193		—		—		—		—		—		—		193
Risk Grade 7		—		169		155		—		—		—		—		324
Total		19,767		9,030		7,992		13,971		—		57		990		51,807

Real estate – commercial
Risk Grades 1 - 4		4,747		34,698		245,563		118,435		142,211		133,856		21,323		700,833
Risk Grades 5 - 6		535		5,092		64,677		7,002		14,604		23,104		4,184		119,198
Risk Grade 7		1,565		—		9,970		10,380		2,945		1,355		25		26,240
Risk Grade 8		—		—		—		1,379		—		192		—		1,571
Total		6,847		39,790		320,210		137,196		159,760		158,507		25,532		847,842

Real estate – residential
Risk Grades 1 - 4		2,815		66,780		225,159		114,682		64,548		143,002		53,498		670,484
Risk Grades 5 - 6		853		—		2,303		1,295		318		2,378		95		7,242
Risk Grade 7		—		736		2,153		2,113		1,454		5,822		2,249		14,527
Total		3,668		67,516		229,615		118,090		66,320		151,202		55,842		692,253

Real estate – farmland
Risk Grades 1 - 4		147		—		997		1,239		—		2,753		149		5,285
Risk Grades 5 - 6		—		135		—		100		—		—		—		235
Total		147		135		997		1,339		—		2,753		149		5,520

Consumer
Risk Grades 1 - 4		5,944		17,211		8,716		1,650		1,034		486		7,283		42,324
Risk Grades 5 - 6		74		133		225		99		32		3		—		566
Risk Grade 7		87		330		332		184		63		24		28		1,048
Total		6,105		17,674		9,273		1,933		1,129		513		7,311		43,938

Total Loans
Risk Grades 1 - 4	$	53,329	$	147,386	$	618,362	$	272,353	$	230,603	$	300,706	$	182,509	$	1,805,248
Risk Grades 5 - 6		2,327		30,880		104,708		26,264		24,907		30,699		19,371		239,156
Risk Grade 7		2,596		3,599		17,783		23,163		5,024		8,709		3,823		64,697
Risk Grade 8		—		—		—		1,461		—		193		—		1,654
Total	$	58,252	$	181,865	$	740,853	$	323,241	$	260,534	$	340,307	$	205,703	$	2,110,755

The following tables present an analysis of the change in the ACL by loan segment for the periods stated.


	For the three months ended March 31, 2025
(Dollars in thousands)	Commercial and industrial			Real estate – construction, commercial			Real estate – construction, residential			Real estate – commercial			Real estate – residential			Real estate – farmland		Consumer			Total
ACL, beginning of period	$	5,767		$	2,057		$	540		$	5,963		$	7,933		$	18	$	745		$	23,023
(Recovery of) provision for credit losses - loans		(189	)		(65	)		12			(240	)		253			—		229			—
Charge-offs		(2,123	)		—			—			(63	)		(16	)		—		(587	)		(2,789	)
Recoveries		2,271			—			—			338			1			—		282			2,892
Net recoveries (charge-offs)		148			—			—			275			(15	)		—		(305	)		103
ACL, end of period	$	5,726		$	1,992		$	552		$	5,998		$	8,171		$	18	$	669		$	23,126

	For the three months ended March 31, 2024
(Dollars in thousands)	Commercial and industrial			Real estate – construction, commercial			Real estate – construction, residential			Real estate – commercial			Real estate – residential			Real estate – farmland		Consumer			Total
ACL, beginning of period	$	13,787		$	4,024		$	1,094		$	9,929		$	6,286		$	15	$	758		$	35,893
Provision for (recovery of) credit losses - loans		257			(428	)		(175	)		(97	)		39			3		401			—
Charge-offs		(1,957	)		—			—			—			—			—		(745	)		(2,702	)
Recoveries		1,532			—			—			—			13			—		289			1,834
Net (charge-offs) recoveries		(425	)		—			—			—			13			—		(456	)		(868	)
ACL, end of period	$	13,619		$	3,596		$	919		$	9,832		$	6,338		$	18	$	703		$	35,025

There were no material changes to the assumptions, loss factors (both quantitative and qualitative), or reasonable and supportable forecasts used in the estimation of the ACL and the provision for (recovery of) credit losses for loans held for investment as of and for the three months ended March 31, 2025.

Excluded from the ACL as of both March 31, 2025 and December 31, 2024 was $10.7 million of accrued interest attributable to loans held for investment, which is included in accrued interest receivable on the consolidated balance sheet.

The following table presents the amortized cost of collateral-dependent loans that are individually evaluated for credit losses as of the dates stated.


(Dollars in thousands)	March 31, 2025		December 31, 2024
Commercial and industrial	$	22,560	$	42,723
Real estate – construction, commercial		115		116
Real estate – commercial		25,250		26,994
Real estate – residential		6,301		9,586
Total collateral-dependent loans	$	54,226	$	79,419

Acquired Loans

As of March 31, 2025 and December 31, 2024, the amortized cost of purchased credit deteriorated ("PCD") loans totaled $39.5 million and $43.8 million, respectively, with an estimated ACL of $255 thousand and $262 thousand, respectively. The remaining non-credit discount on PCD loans was $2.8 million and $3.0 million as of March 31, 2025 and December 31, 2024, respectively.

Troubled Loan Modifications

The Company closely monitors the performance of borrowers experiencing financial difficulty and grants certain loan modifications it would otherwise not consider. The Company refers to such loan modifications as troubled loan modifications ("TLMs").

The following table presents the amortized cost of TLMs, categorized by loan type and type of concession granted, for the periods stated.


	For the three months ended March 31,
	2025							2024
(Dollars in thousands)	Number of Loans		Recorded Investment		% of Recorded Investment to Gross Loans by Category			Number of Loans		Recorded Investment		% of Recorded Investment to Gross Loans by Category
Combined - term extension and deferral
Commercial and industrial		1	$	2,024		0.60	%		—	$	—		0.00	%
Total combined - term extension and deferral		1	$	2,024					—	$	—

Interest forgiveness
Real estate – residential		1	$	141		0.02	%		—	$	—		0.00	%
Total interest forgiveness		1	$	141					—	$	—

Total		2	$	2,165					—	$	—

For the three months ended March 31, 2025, the borrower of a commercial and industrial loan, which has been on nonaccrual status since the second quarter of 2024, was granted an 18-month term extension and principal deferral, extending the loan's maturity to a total of 72 months. Interest-only payments are due through the extended term, with a principal balloon payment due at the revised maturity date of June 2027. Also in the first quarter of 2025, three loans partially charged off in 2024 to a single borrower were refinanced into a single residential mortgage loan, which included the forgiveness of $40 thousand of accrued interest.

The following tables present an aging analysis of the amortized cost of TLMs as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Current Loans		30-89 Days Past Due		Greater than 90 Days Past Due & Accruing		Nonaccrual		Total
Commercial and industrial	$	734	$	—	$	—	$	4,513	$	5,247
Real estate – construction, residential		154		—		—		—		154
Real estate – commercial		1,764		—		—		2,997		4,761
Real estate – residential		192		141		—		493		826
Consumer loans		—		—		—		9		9
Total modified loans	$	2,844	$	141	$	—	$	8,012	$	10,997


	December 31, 2024
(Dollars in thousands)	Current Loans		30-89 Days Past Due		Greater than 90 Days Past Due & Accruing		Nonaccrual		Total
Commercial and industrial	$	554	$	—	$	—	$	2,745	$	3,299
Real estate – construction, residential		155		—		—		—		155
Real estate – commercial		1,773		—		—		2,999		4,772
Real estate – residential		194		—		—		500		694
Consumer loans		—		—		—		10		10
Total modified loans	$	2,676	$	—	$	—	$	6,254	$	8,930

As of March 31, 2025 and December 31, 2024, there were no unfunded commitments to borrowers with TLMs.

The following table presents the amortized cost of TLMs that were modified in the preceding twelve months and had a payment default during the periods stated.


	For the three months ended March 31,
	2025							2024
(Dollars in thousands)	Number of Loans		Amortized Cost		% of Amortized Cost to Gross Loans by Category			Number of Loans		Amortized Cost		% of Amortized Cost to Gross Loans by Category
Combined - term extension and deferral
Commercial and industrial		—	$	—		0.00	%	1		$	2,548		0.52	%
Total combined - term extension and deferral		—	$	—				1		$	2,548

Interest forgiveness
Real estate – residential	1		$	141		0.02	%		—	$	—		0.00	%
Total interest forgiveness	1		$	141					—	$	—

Payment deferral 6-9 months
Real estate – residential	1		$	493		0.07	%	1		$	565		0.08	%
Consumer	1			9		0.02	%		—		—		0.00	%
Total payment deferral	2		$	502				1		$	565

Total	3		$	643				2		$	3,113

As of March 31, 2025, five residential mortgage loans with a total amortized cost of $755 thousand were in the process of foreclosure.

Note 4 – Borrowings

FHLB Borrowings

The Bank has a borrowing facility from the FHLB secured by pledged qualifying commercial and residential mortgage loans and securities. At March 31, 2025 and December 31, 2024, the secured facility totaled $588.5 million and $696.0 million, respectively, based on pledged collateral. The FHLB will lend up to 30% of the Bank’s total assets as of the prior quarter end, subject to certain eligibility requirements, including adequate collateral. The Bank had borrowings from the FHLB totaling $150.0 million at both March 31, 2025 and December 31, 2024. The FHLB borrowings required the Bank to hold $9.1 million and $9.4 million of FHLB stock at March 31, 2025 and December 31, 2024, respectively, which is included in restricted equity investments on the consolidated balance sheets.

At both March 31, 2025 and December 31, 2024, the Bank also had letters of credit outstanding with the FHLB in the amount of $51.2 million, of which $50.0 million was for the purpose of collateral for public deposits with the Treasury Board of the Commonwealth of Virginia as of the same dates. Outstanding letters of credit reduce the available balance of the borrowing facility with the FHLB. Available balances on the FHLB credit facility were $387.3 million and $494.9 million as of March 31, 2025 and December 31, 2024, respectively. The decline in the secured facility and the availability of the FHLB credit facility in the first quarter of 2025 primarily reflects the release of securities held as collateral.

The following table presents information regarding FHLB advances outstanding as of both March 31, 2025 and December 31, 2024.


(Dollars in thousands)	Balance		Origination Date	Stated Interest Rate			Maturity Date
Fixed rate credit	$	50,000	3/15/2023		4.07	%	3/15/2027
Fixed rate credit		50,000	5/2/2023		3.87	%	5/3/2027
Fixed rate credit		50,000	5/4/2023		3.52	%	5/4/2028
Total FHLB borrowings	$	150,000

At March 31, 2025, 1-4 family residential loans, multi-family residential loans, and commercial real estate loans classified as held for investment with a lendable value of $422.8 million and securities with a lendable value of $165.7 million were pledged for the borrowing facility with the FHLB.

FRB Borrowings

The Company may obtain advances from the FRB through its Discount Window. Advances through the FRB Discount Window are secured by qualifying pledged construction and commercial and industrial loans, which had a lendable value of $68.5 million as of March 31, 2025. The Company had secured borrowing capacity through the FRB Discount Window of $68.5 million and $105.7 million as of March 31, 2025 and December 31, 2024, respectively, of which the Company had no outstanding advances as of either date.

Other Borrowings

The Company had an unsecured line of credit with a correspondent bank available for overnight borrowing, which totaled $10.0 million as of both March 31, 2025 and December 31, 2024. This line bears interest at the prevailing rates for such loans and is cancelable any time by the correspondent bank. As of both March 31, 2025 and December 31, 2024, the Company had no outstanding advances on this secured line.

Subordinated Notes

The Company had $39.8 million of subordinated notes, net, outstanding as of both March 31, 2025 and December 31, 2024. The Company's subordinated notes are comprised of a $25 million issuance in October 2019 maturing October 15, 2029 (the “2029 Notes”) and a $15 million issuance in May 2020 maturing June 1, 2030 (the “2030 Note”).

The 2029 Notes bore interest at 5.625% per annum, through October 14, 2024, payable semi-annually in arrears. From October 15, 2024 through October 15, 2029, or up to an early redemption date, the interest rate resets quarterly to an interest rate per annum equal to the then current three-month Secured Overnight Funding Rate ("SOFR") plus 433.5 basis points, payable quarterly in arrears. As of March 31, 2025, the 2029 Notes bore an annual interest rate of 8.64%. As of March 31, 2025, the net carrying amount of the 2029 Notes was $25.0 million, inclusive of a $453 thousand purchase accounting adjustment (premium). For the three months ended March 31, 2025 and 2024, the effective interest rate on the 2029 Notes was 8.05% and 5.22%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium).

The 2030 Note bears interest at the rate of 6.00% per annum until June 1, 2025, at which date the rate will reset quarterly, equal to the three-month SOFR determined on the date of the applicable interest period plus 587 basis points. Interest on the 2030 Note is payable semi-annually in arrears. As of March 31, 2025, the 2030 Note bore an annual interest rate of 6.00%. As of March 31, 2025, the net carrying amount of the 2030 Note, including capitalized, unamortized debt issuance costs, was $14.8 million. For the three months ended March 31, 2025 and 2024, the effective interest rate on the 2030 Note was 6.31% and 6.32%, respectively.

Note 5 – Fair Value

The fair value of a financial instrument is the current amount that would be exchanged between willing parties in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques.

The three levels of input that may be used to measure fair value are as follows:


Level 1 –		Valuation is based on quoted prices in active markets for identical assets and liabilities.
Level 2 –		Valuation is based on observable inputs including quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets and liabilities in less active markets, and model-based valuation techniques for which significant assumptions can be derived primarily from or corroborated by observable data in the market.
Level 3 –		Valuation is based on model-based techniques that use one or more significant inputs or assumptions that are unobservable in the market.

The following tables present the balances of financial assets measured at fair value on a recurring basis as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Total		Level 1		Level 2		Level 3
Securities available for sale
Mortgage backed securities	$	175,308	$	—	$	175,308	$	—
U.S. Treasury and agencies		70,616		—		70,616		—
State and municipals		43,701		—		43,701		—
Corporate bonds		35,776		—		35,026		750
Total securities available for sale	$	325,401	$	—	$	324,651	$	750
Other assets
Mortgage servicing rights assets	$	388	$	—	$	—	$	388
Rabbi trust assets		586		586		—		—
Mortgage derivative asset		278		—		278		—
Interest rate swap asset		73		—		73		—
Other liabilities
Mortgage derivative liability	$	4	$	—	$	4	$	—
Interest rate swap liability		73		—		73		—


	December 31, 2024
(Dollars in thousands)	Total		Level 1		Level 2		Level 3
Securities available for sale
Mortgage backed securities	$	164,438	$	—	$	164,438	$	—
U.S. Treasury and agencies		69,455		—		69,455		—
State and municipals		42,937		—		42,937		—
Corporate bonds		35,205		—		34,455		750
Total securities available for sale	$	312,035	$	—	$	311,285	$	750
Other assets
Mortgage servicing rights assets	$	386	$	—	$	—	$	386
Rabbi trust assets		600		600		—		—
Mortgage derivative asset		140		—		140		—
Interest rate swap asset		95		—		95		—
Other liabilities
Interest rate swap liability	$	95	$	—	$	95	$	—

As of both March 31, 2025 and December 31, 2024, two corporate bonds totaling $750 thousand were reported at their respective amortized cost basis and as Level 3 assets in the fair value hierarchy, as there were no observable market prices for similar investments.

The following tables summarize assets that were measured at fair value on a nonrecurring basis as of the dates stated.


	March 31, 2025
(Dollars in thousands)	Total		Level 1		Level 2		Level 3
Other equity investments	$	4,698	$	—	$	1,692	$	3,006
Collateral-dependent loans		6,586		—		—		6,586
Loans held for sale		23,624		—		23,624		—
Other real estate owned ("OREO") (1)		279		—		—		279

(1) Included in other assets on the consolidated balance sheets.


	December 31, 2024
(Dollars in thousands)	Total		Level 1		Level 2		Level 3
Other equity investments	$	4,834	$	—	$	1,828	$	3,006
Collateral-dependent loans		6,954		—		—		6,954
Loans held for sale		30,976		—		30,976		—
OREO (1)		279		—		—		279

(1) Included in other assets on the consolidated balance sheets.

The following tables present quantitative information about Level 3 fair value measurements of assets measured on a nonrecurring basis as of the dates stated.


(Dollars in thousands)	Balance as of March 31, 2025		Unobservable Input	Range
Other equity investments
Probability weighted expected return technique	$	3,006	Discount Rate		20	%
Collateral-dependent loans
Discounted appraised value technique		6,586	Selling Costs	5% - 10%
OREO (1)
Discounted sales price technique		279	Selling Costs		7	%

(1) Included in other assets on the consolidated balance sheets.


(Dollars in thousands)	Balance as of December 31, 2024		Unobservable Input	Range
Other equity investments
Probability weighted expected return technique	$	3,006	Discount Rate		20	%
Collateral-dependent loans
Discounted appraised value technique		6,954	Selling Costs	7% - 15%
OREO (1)
Discounted sales price technique		279	Selling Costs		7	%

(1) Included in other assets on the consolidated balance sheets.

The following tables present the estimated fair values, related carrying amounts, and valuation level of the financial instruments as of the dates stated.


	March 31, 2025
					Fair Value Measurements
(Dollars in thousands)	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Financial Assets
Cash and due from banks	$	170,466	$	170,466	$	170,466	$	—	$	—
Restricted cash		2,167		2,167		2,167		—		—
Federal funds sold		1,725		1,725		1,725		—		—
Securities available for sale		325,401		325,401		—		324,651		750
Restricted equity investments		18,797		18,797		—		18,797		—
Other equity investments		4,698		4,698		—		1,692		3,006
Other investments		20,381		20,381		—		—		20,381
Loans held for sale		23,624		23,624		—		23,624		—
Loans held for investment, net		2,036,584		1,958,679		—		—		1,958,679
Accrued interest receivable		12,700		12,700		—		12,700		—
Bank owned life insurance		879		879		—		879		—
MSR assets		388		388		—		—		388
Financial Liabilities
Noninterest-bearing demand	$	452,590	$	452,590	$	452,590	$	—	$	—
Interest-bearing demand and money market		632,983		632,983		—		632,983		—
Savings		103,622		103,622		—		103,622		—
Time		940,282		942,108		—		—		942,108
FHLB borrowings		150,000		151,371		—		151,371		—
Subordinated notes, net		39,773		38,847		—		—		38,847


	December 31, 2024
					Fair Value Measurements
(Dollars in thousands)	Carrying Value		Fair Value		Level 1		Level 2		Level 3
Financial Assets
Cash and due from banks	$	173,533	$	173,533	$	173,533	$	—	$	—
Restricted cash		2,459		2,459		2,459		—		—
Federal funds sold		838		838		838		—		—
Securities available for sale		312,035		312,035		—		311,285		750
Restricted equity investments		19,275		19,275		—		19,275		—
Other equity investments		4,834		4,834		—		1,828		3,006
Other investments		19,405		19,405		—		—		19,405
Loans held for sale		30,976		30,976		—		30,976		—
Loans held for investment, net		2,088,774		1,998,668		—		—		1,998,668
Accrued interest receivable		12,537		12,537		—		12,537		—
Bank owned life insurance		1,083		1,083		—		1,083		—
MSR assets		386		386		—		—		386
Financial Liabilities
Noninterest-bearing demand	$	452,690	$	452,690	$	452,690	$	—	$	—
Interest-bearing demand and money market		598,875		598,875		—		598,875		—
Savings		100,857		100,857		—		100,857		—
Time		1,027,020		1,029,199		—		—		1,029,199
FHLB borrowings		150,000		152,782		—		152,782		—
Subordinated notes, net		39,789		38,765		—		—		38,765

Note 6 – Minimum Regulatory Capital Requirements

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, financial institutions must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance sheet items as calculated under regulatory accounting practices. A financial institution's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

Pursuant to the final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks, banks must hold a capital conservation buffer of 2.50% above the adequately capitalized risk-based capital ratios for all ratios, except the tier 1 leverage ratio. If a banking organization dips into its capital conservation buffer, it is subject to limitations on certain activities, including payment of dividends, share repurchases, and discretionary compensation to certain officers. Federal and state banking regulations place certain restrictions on dividends paid by the Company. The total amount of dividends that may be paid at any date is generally limited to retained earnings of the Company.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized; although, these terms are not used to represent overall financial condition. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.

In addition to the foregoing capital requirements, the Bank is subject to minimum capital ratios set forth in the Consent Order that are higher than those required for capital adequacy purposes generally. The Bank is required to maintain a leverage ratio of 10.00% and a total capital ratio of 13.00%. As of March 31, 2025 and December 31, 2024, the Bank met these minimum capital ratios. Until the Consent Order has been lifted, the Bank is deemed to be less than well capitalized, thus adequately capitalized.

The Company adopted ASC 326, Financial Instruments - Credit Losses (referred to herein as "current expected credit losses" or "CECL") effective January 1, 2023. Federal and state banking regulations allow financial institutions to irrevocably elect to phase-in the after-tax cumulative effect adjustment to retained earnings (the "CECL Transitional Amount") over a three-year period. The three-year phase-in of the CECL Transitional Amount to regulatory capital was 25% and 50% in 2023 and 2024, respectively, and is 25% in 2025. The Bank made this irrevocable election effective with its first quarter 2023 call report.

The following tables present the capital ratios to which banks are subject to be adequately and well capitalized, as well as the capital and capital ratios for the Bank as of the dates stated. Adequately capitalized ratios include the conservation buffer, if applicable. The following table also includes the capital adequacy ratios to which bank holding companies are subject. Also presented are the minimum capital ratios set forth in the Consent Order for the Bank and the related capital amounts for both the leverage ratio and the total capital ratio. The CECL Transitional Amount was

$8.1 million, of which $6.1 million and $4.1 million reduced the regulatory capital amounts and capital ratios as of March 31, 2025 and December 31, 2024, respectively.


	March 31, 2025
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized					Minimum Capital Ratios
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	360,244		17.93	%	$	210,943		10.50	%	$	200,898		10.00	%	$	261,167		13.00	%
Blue Ridge Bankshares, Inc.	$	421,913		20.83	%	$	162,048		8.00	%	n/a		n/a			n/a		n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	339,061		16.88	%	$	170,763		8.50	%	$	160,718		8.00	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	365,857		18.06	%	$	121,536		6.00	%	n/a		n/a			n/a		n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	339,061		16.88	%	$	140,628		7.00	%	$	130,583		6.50	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	365,857		18.06	%	$	91,152		4.50	%	n/a		n/a			n/a		n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.	$	339,061		12.33	%	$	110,013		4.00	%	$	137,517		5.00	%	$	275,033		10.00	%
Blue Ridge Bankshares, Inc.	$	365,857		13.23	%	$	110,641		4.00	%	n/a		n/a			n/a		n/a


	December 31, 2024
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized					Minimum Capital Ratios
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	358,848		17.26	%	$	218,260		10.50	%	$	207,866		10.00	%	$	270,226		13.00	%
Blue Ridge Bankshares, Inc.	$	414,284		19.79	%	$	167,444		8.00	%	n/a		n/a			n/a		n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	340,386		16.38	%	$	176,687		8.50	%	$	166,293		8.00	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	360,933		17.24	%	$	125,583		6.00	%	n/a		n/a			n/a		n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	340,386		16.38	%	$	145,507		7.00	%	$	135,113		6.50	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	360,933		17.24	%	$	94,187		4.50	%	n/a		n/a			n/a		n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.	$	340,386		11.80	%	$	115,364		4.00	%	$	144,204		5.00	%	$	288,409		10.00	%
Blue Ridge Bankshares, Inc.	$	360,933		12.43	%	$	116,169		4.00	%	n/a		n/a			n/a		n/a

Note 7 – Commitments and Contingencies

In the ordinary course of operations, the Company offers various financial products to its customers to meet their credit and liquidity needs. These instruments involve elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and stand-by letters of credit written is represented by the contractual amount of these instruments. The Company uses the same credit policies in making commitments and conditional commitments as it does for on-balance sheet commitments.

Subject to its normal credit standards and risk monitoring procedures, the Company makes contractual commitments to extend credit. Commitments generally have fixed expiration dates or other termination clauses and may require the payment of a fee. Since many of the commitments may expire without being completely drawn upon, the total commitment amounts do not necessarily represent future cash requirements. As of March 31, 2025 and December 31, 2024, the Company had outstanding loan commitments of $274.3 million and $283.2 million, respectively. Of these amounts, $110.6 million and $108.4 million were unconditionally cancelable at the sole discretion of the Company as of the same respective dates.

Conditional commitments are issued by the Company in the form of financial stand-by letters of credit, which guarantee payment to the underlying beneficiary (i.e., third party) if the customer fails to meet its designated financial obligation. As of March 31, 2025 and December 31, 2024, commitments under outstanding financial stand-by letters of credit totaled $11.3 million and $12.5 million, respectively. The credit risk of issuing stand-by letters of credit can be greater than the risk involved in extending loans to customers.

For the three months ended March 31, 2025 and March 31, 2024, the Company recorded a recovery of credit losses for unfunded commitments of $0 and $1.0 million, respectively, and which for the prior year period was primarily attributable to lower balances of loan commitments. The reserve for unfunded commitments, which is included in other liabilities on the consolidated balance sheets, was $0.9 million as of both March 31, 2025 and December 31, 2024.

As part of the sale of substantially all of its mortgage servicing rights assets ("MSR") portfolio during 2024, the Company recorded a reserve for estimated putbacks, transition costs, and unearned sales proceeds. The putbacks relate to industry-standard items, including prepayments or early delinquencies of the underlying mortgages, all of which are subject to term limits per the respective sales agreements. The reserve for unearned sales proceeds relates to the Company providing certain documentation to the buyers. As of March 31, 2025 and December 31, 2024, the reserve was $1.7 million and $1.8 million, respectively, and was included in other liabilities on the consolidated balance sheet.

The Company has investments in various partnerships and limited liability companies. Pursuant to these investments, the Company commits to an investment amount that may be fulfilled in future periods. At March 31, 2025, the Company had future commitments outstanding totaling $6.2 million related to these investments.

Note 8 – Earnings Per Share

The following table shows the calculation of basic and diluted earnings per share ("EPS") and the weighted average number of shares outstanding used in computing EPS and the effect on the weighted average number of shares outstanding of dilutive potential common stock for the periods stated. For the three months ended March 31, 2025 and 2024, all outstanding stock options, performance-based stock awards ("PSAs"), and warrants relating to the Company’s common stock were considered anti-dilutive, as applicable, and excluded from the computation of diluted EPS, due to the net loss in the respective periods.


	For the three months ended March 31,
(Dollars in thousands, except per share data)	2025			2024
Net loss	$	(434	)	$	(2,893	)

Weighted average common shares outstanding, basic		86,003,226			19,178,332
Effect of dilutive securities		—			—
Weighted average common shares outstanding, dilutive		86,003,226			19,178,332

Basic and diluted loss per common share	$	(0.01	)	$	(0.15	)

Note 9 – Segment Reporting

The CODM evaluates each of the Company's segments based on net income (loss), using segment financial information compiled utilizing the accounting policies listed in Note 2 of the 2024 Form 10-K. The profitability of the segment helps the CODM evaluate staffing levels, assess available cash for allocation to projects and resources, and make informed decisions on whether the segment's activities should be modified to align with the Company’s overall near- and long-term strategies.

Until March 2025, the Company operated through three reportable business segments: commercial banking, mortgage banking, and holding company activities. The commercial banking business segment makes loans to and generates deposits from individuals and businesses, while offering a wide array of general financial services to its customers. The mortgage banking segment, which operated as Monarch Mortgage and focused on residential mortgage origination and sales activities, was sold in March 2025; however, it is presented as a reportable segment for all periods

stated for comparative purposes. Activities at the holding company or parent level are primarily associated with investments, borrowings, and certain noninterest expenses.

Information about reportable segments, and reconciliation of such information to the consolidated financial statements follows, as of the dates and periods stated.


	As of and for the three months ended March 31, 2025
(Dollars in thousands)	Commercial Banking		Mortgage Banking			Parent Only			Eliminations			Blue Ridge Bankshares, Inc. Consolidated
NET INTEREST INCOME
Interest income	$	35,224	$	126		$	—		$	—		$	35,350
Interest expense		15,584		40			736			—			16,360
Net interest income		19,640		86			(736	)		—			18,990
NONINTEREST INCOME
Fair value adjustments of other equity investments		—		—			(73	)		—			(73	)
Residential mortgage banking income		306		650			—			—			956
Mortgage servicing rights		—		2			—			—			2
Other		2,283		—			—			(96	)		2,187
Total noninterest income		2,589		652			(73	)		(96	)		3,072
NONINTEREST EXPENSE
Salaries and employee benefits		11,542		1,068			—			—			12,610
Occupancy and equipment		1,330		51			—			—			1,381
Technology and communication		2,364		420			—			—			2,784
Other		5,638		336			298			(96	)		6,176
Total noninterest expense		20,874		1,875			298			(96	)		22,951
Income (loss) before income tax expense		1,355		(1,137	)		(1,107	)		—			(889	)
Income tax expense (benefit)		30		(253	)		(232	)		—			(455	)
Net income (loss)	$	1,325	$	(884	)	$	(875	)	$	—		$	(434	)
Total assets	$	2,642,160	$	26,528		$	379,167		$	(362,771	)	$	2,685,084


	As of and for the three months ended March 31, 2024
(Dollars in thousands)	Commercial Banking			Mortgage Banking		Parent Only			Eliminations			Blue Ridge Bankshares, Inc. Consolidated
NET INTEREST INCOME
Interest income	$	42,199		$	332	$	—		$	—		$	42,531
Interest expense		21,476			146		560			—			22,182
Net interest income		20,723			186		(560	)		—			20,349
Recovery of credit losses		(1,000	)		—		—			—			(1,000	)
Net interest income after recovery for credit losses		21,723			186		(560	)		—			21,349
NONINTEREST INCOME
Fair value adjustments of other equity investments		—			—		(7	)		—			(7	)
Residential mortgage banking income		—			2,664		—			—			2,664
Mortgage servicing rights		—			729		—			—			729
Other		4,484			—		17			(99	)		4,402
Total noninterest income		4,484			3,393		10			(99	)		7,788
NONINTEREST EXPENSE
Salaries and employee benefits		14,201			1,844		—			—			16,045
Occupancy and equipment		1,389			135		—			—			1,524
Technology and communication		1,960			319		—			—			2,279
Regulatory remediation		2,644			—		—			—			2,644
Other		9,017			758		269			(99	)		9,945
Total noninterest expense		29,211			3,056		269			(99	)		32,437
(Loss) income before income tax expense		(3,004	)		523		(819	)		—			(3,300	)
Income tax (benefit) expense		(321	)		86		(172	)		—			(407	)
Net (loss) income	$	(2,683	)	$	437	$	(647	)	$	—		$	(2,893	)
Total assets	$	3,024,935		$	36,343	$	228,544		$	(213,635	)	$	3,076,187

Included in other expenses are costs for legal and regulatory filings, audit fees, other contractual services, and other miscellaneous expenses.

The Company had no transactions with a single customer that in the aggregate resulted in revenues exceeding 10% of consolidated total revenues for the three months ended March 31, 2025 and 2024.

Note 10 – Changes to Accumulated Other Comprehensive Income (Loss), net

The following tables present components of accumulated other comprehensive income (loss) for the periods stated.


	For the three months ended March 31, 2025
(Dollars in thousands)	Net Unrealized (Losses) Gains on Available for Sale Securities			Transfer of Securities Held to Maturity to Available For Sale		Accumulated Other Comprehensive (Loss) Gain, net
Balance as of December 31, 2024	$	(42,887	)	$	425	$	(42,462	)
Change in net unrealized holding losses on securities available for sale, net of deferred tax expense of $1,417		3,806			—		3,806
Balance as of March 31, 2025	$	(39,081	)	$	425	$	(38,656	)


	For the three months ended March 31, 2024
(Dollars in thousands)	Net Unrealized (Losses) Gains on Available for Sale Securities			Transfer of Securities Held to Maturity to Available For Sale		Accumulated Other Comprehensive Loss, net
Balance as of December 31, 2023	$	(45,481	)	$	425	$	(45,056	)
Change in net unrealized holding losses on securities available for sale, net of deferred tax benefit of $372		(2,558	)		—		(2,558	)
Balance as of March 31, 2024	$	(48,039	)	$	425	$	(47,614	)

Note 11 – Legal Matters

In the ordinary course of operations, the Company is party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, in the aggregate and excluding those noted below, will not have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows.

On December 20, 2024, a former Deputy Bank Secrecy Act Officer and manager at the Bank filed suit against the Company and the Company’s and the Bank’s Chief Executive Officer, in the Circuit Court of the City of Richmond (Virginia) alleging that she was retaliated against and constructively discharged in violation of the Virginia Whistleblower Protection Act, Va. Code § 40.1-27.3, and Bowman v. State Bank of Keysville, 331 S.E.2d 797 (Va. 1985). On December 30, 2024, the Company removed the matter to the United States District Court for the Eastern District of Virginia, where it subsequently filed a motion to dismiss, which has since been fully briefed and is awaiting decision by the court. There is no specified time by which the court’s decision must be rendered. The Company believes the plaintiff’s claims are without merit and will defend itself vigorously in the matter. The case caption is Porter v. Blue Ridge Bankshares, Inc. (No. 3:24-cv-909 (E.D. Va.)).

On December 5, 2023, an alleged shareholder of the Company commenced a putative class action in the U.S. District Court for the Eastern District of New York (No. 1:23-cv-08944) (Russell Hunter v. Blue Ridge Bankshares, Inc., et al.) on behalf of himself and any persons or entities who purchased the publicly traded stock of the Company between February 3, 2023, and October 31, 2023, both dates inclusive (the “Action”). The complaint alleges violations of federal securities laws against the Company and certain of its current and former officers based on alleged material misstatements and omissions related to accounting judgments in the Company’s filings with the Securities and Exchange Commission. The complaint seeks certification of a class action, unspecified damages, and attorney’s fees. The putative class representative filed an amended complaint, and the Company filed a letter seeking permission to file a motion to dismiss. The parties engaged in non-binding mediation on December 5, 2024, during which the parties agreed in principle to settlement terms for $2.5 million. On February 4, 2025, the plaintiff filed an unopposed motion for preliminary approval of the proposed class action settlement, which, if granted, will settle the Action and any claims related to the Action or that could have been brought in the Action by the parties, the parties’ counsel, or settlement class members (the “Motion”). The Motion expressly disclaims any fault, liability, or wrongdoing on the part of the

Company. The Company’s outside legal counsel has effected service, pursuant to 28 U.S.C. § 1715, of the Motion and related court filings to the Company’s federal and state regulators as well as to Attorneys General for all U.S. states and territories. The court has not yet ruled on the Motion. The Company submitted an insurance claim for this amount, less a deductible that was expensed in 2024.

Note 12 – Subsequent Events

Subsequent to March 31, 2025, the Company provided a notice of redemption to the holder of the 2030 Note to redeem the note at its initial redemption date, June 1, 2025.

Subsequent to March 31, 2025, the Company granted PSAs totaling 3,400,000 shares of common stock to certain executive officers. The vesting of these awards is contingent upon the Company achieving specified profitability thresholds over three one-year performance measurement periods.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following presents management’s discussion and analysis of the Company’s consolidated financial condition and the results of the Company's operations. This discussion should be read in conjunction with the unaudited consolidated financial statements and the notes thereto included in this Form 10-Q and the audited consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”). Results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results of operations for the balance of 2025, or for any other period. As used in this report, the terms “the Company,” “we,” “us,” and “our” refer to Blue Ridge Bankshares, Inc. and its consolidated subsidiaries. The term “Bank” refers to Blue Ridge Bank, National Association.

Cautionary Note About Forward-Looking Statements

The Company makes certain forward-looking statements in this Form 10-Q that are subject to risks and uncertainties. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections, and statements of management’s beliefs concerning future events, business plans, objectives, expected operating results, and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate, or imply future results, performance or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “expect,” “aim,” “intend,” “plan,” or words or phases of similar meaning. The Company cautions that the forward-looking statements are based largely on management’s expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond its control. Actual results, performance, or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements.

The following factors, among others, could cause the Company’s financial performance to differ materially from that expressed in such forward-looking statements:

•

the strength of the United States economy in general and the strength of the local economies in which the Company conducts operations;

•

the effects of, and changes in, the macroeconomic environment and financial market conditions, including monetary and fiscal policies, interest rates, and inflation;

•

the impact of, and the ability to comply with, the terms of the Consent Order, as defined below, with the Office of the Comptroller of the Currency ("OCC"), including the heightened capital requirements and other restrictions therein, and other regulatory directives;

•

the imposition of additional regulatory actions or restrictions for noncompliance with the Consent Order or otherwise;

•

the Company’s involvement in, and the outcome of, any litigation, legal proceedings, or enforcement actions that may be instituted against the Company;

•

reputational risk and potential adverse reactions of the Company’s customers, suppliers, employees, or other business partners;

•

the Company’s ability to manage its fintech relationships, including implementing enhanced controls, complying with the OCC directives and applicable laws and regulations, and managing the final phases of the wind down of these partnerships;

•

the quality and composition of the Company’s loan and investment portfolios, including changes in the level of the Company’s nonperforming assets and charge-offs;

•

the Company’s management of risks inherent in its loan portfolio, the credit quality of its borrowers, and the risk of a prolonged downturn in the real estate market, which could impair the value of the Company’s collateral and its ability to sell collateral upon any foreclosure;

•

the ability to maintain adequate liquidity by growing and retaining deposits and secondary funding sources, especially if the Company's or its industry's reputation become damaged;

•

the ability to maintain capital levels adequate to support the Company's business and to comply with the Consent Order directives;

•

the ability of the Company to implement cost-saving initiatives and efficiency measures, as well as increase earning assets, in order to yield acceptable levels of profitability;

•

the ability to generate sufficient future taxable income for the Company to realize its deferred tax assets, including the net operating loss carryforward;

•

the timely development of competitive products and services and the acceptance of these products and services by new and existing customers;

•

changes in consumer spending and savings habits;

•

the willingness of users to substitute competitors’ products and services for the Company’s products and services;

•

the impact of unanticipated outflows of deposits;

•

technological and social media changes;

•

potential exposure to fraud, negligence, computer theft, and cyber-crime;

•

adverse developments in the financial industry generally, such as bank failures, responsive measures to mitigate and manage such developments, supervisory and regulatory actions and costs, and related impacts on customer and client behavior;

•

changing bank regulatory conditions, policies or programs, whether arising as new legislation or regulatory initiatives, that could lead to restrictions on activities of banks generally, or the Bank in particular, more restrictive regulatory capital requirements, increased costs, including deposit insurance premiums, regulation or prohibition of certain income producing activities or changes in the secondary market for loans and other products;

•

the impact of changes in financial services policies, laws, and regulations, including laws, regulations, and policies concerning taxes, banking, securities, real estate and insurance, the application thereof by bank regulatory bodies, and the three branches of the federal government;

•

the effect of changes in accounting standards, policies, and practices as may be adopted from time to time;

•

estimates of the fair value and other accounting values, subject to impairment assessments, of certain of the Company’s assets and liabilities;

•

geopolitical conditions, including acts or threats of terrorism and/or military conflicts, or actions taken by the United States or other governments in response to acts or threats of terrorism and/or military conflicts, which could impact business and economic conditions in the United States and abroad;

•

the economic impact of duties, tariffs, or other barriers or restrictions on trade, any retaliatory counter measures, and the volatility and uncertainty arising therefrom;

•

the occurrence or continuation of widespread health emergencies or pandemics, significant natural disasters, severe weather conditions, floods, and other catastrophic events;

•

other risks and factors identified in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections and elsewhere in the 2024 Form 10-K and in this Form 10-Q and in filings the Company makes from time to time with the Securities and Exchange Commission (“SEC”).

The foregoing factors should not be considered exhaustive and should be read together with other cautionary statements that are included in the 2024 Form 10-K and this Form 10-Q, including those discussed in the section entitled "Risk Factors" in those filings. If one or more of the factors affecting forward-looking information and statements proves incorrect, then actual results, performance, or achievements could differ materially from those expressed in, or implied by, forward-looking information and statements contained in this Form 10-Q. Therefore, the Company cautions not to place undue reliance on its forward-looking information and statements. The Company will not update the forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking statements. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how these risks and uncertainties will affect it.

Sale of Mortgage Division

The Company’s previously announced sale of its mortgage division operating as Monarch Mortgage to an unrelated third-party mortgage company was completed on March 27, 2025. The sale, which included the transfer of certain assets and leases, resulted in a $0.2 million loss, primarily due to the write-off of fixed assets and lease impairment, and is reported in other noninterest income. The Company has continued to fulfill its obligations to borrowers with respect to loans in process and will manage such loans toward closing and funding in the ordinary course of business.

Regulatory Matters

On January 24, 2024, the Bank consented to the issuance of the Consent Order by the OCC ("Consent Order"). The Consent Order generally incorporates the provisions of the formal written agreement (the "Written Agreement") entered into between the Bank and the OCC on August 29, 2022, as well as adding new provisions. The Written Agreement principally concerned the Bank’s fintech operations and required the Bank to continue enhancing its controls for assessing and managing the third-party, Bank Secrecy Act/Anti-Money Laundering ("BSA/AML"), and information technology risks stemming from its fintech partnerships. The Consent Order adds time frames by which certain of the directives are required, requires the Bank to submit a strategic plan and a capital plan, and places further restrictions on the Company’s fintech operations. The Consent Order also requires the Bank to maintain a leverage ratio of 10.0% and a total capital ratio of 13.0%, referred to as minimum capital ratios. As of March 31, 2025 and December 31, 2024, the Bank’s capital ratios exceeded these minimum capital ratios. The Company believes it has made significant progress towards meeting the requirements of the Consent Order. Complete copies of the Written Agreement and the Consent Order are included as Exhibits 10.9 and 10.10, respectively, of the 2024 Form 10-K.

Private Placements

In the second quarter of 2024, the Company closed private placements in which it issued and sold shares of its common and preferred stock for gross proceeds of $161.6 million (collectively, the "Private Placements"). At a special meeting of shareholders held June 20, 2024, the Company’s shareholders approved the Private Placements and an amendment to the Company's articles of incorporation authorizing the issuance of additional shares of common stock, thus enabling the conversion of the preferred shares issued in the Private Placements into shares of the Company’s common stock. On June 28, 2024, and November 7, 2024, all outstanding shares of the Company’s Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series B and Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series C (together the "preferred stock"), were converted or exchanged for shares of the Company’s common stock. Capital proceeds received, net of issuance costs, from the Private Placements totaled $152.1 million.

The Private Placements also included the issuance of warrants to purchase common stock and the preferred stock. Warrants for the preferred stock were converted to warrants for common stock upon the conversion or exchange of the preferred stock to common stock.

The table below presents information pertaining to warrants to purchase the Company’s common stock as of and for the period stated.


	As of and for the three months ended March 31, 2025
	Warrants with an Exercise Price of $2.50 per Share			Warrants with an Exercise Price of $2.36 per Share		Total Warrants Outstanding
Balance at beginning of period		29,027,999			2,424,000		31,451,999
Warrants exercised during the period		(2,762,000	)		—		(2,762,000	)
Balance at end of period		26,265,999			2,424,000		28,689,999
Remaining exercise term (years)		4.01			4.20

General

There were no changes to the Critical Accounting Policies disclosed in Item 7 of the 2024 Form 10-K.

Comparison of Financial Condition as of March 31, 2025 and December 31, 2024

Total assets were $2.69 billion as of March 31, 2025, a decrease of $52.2 million from $2.74 billion as of December 31, 2024. Most of this decrease was attributable to a decline in loans held for investment, which decreased $52.1 million to $2.06 billion as of March 31, 2025, from $2.11 billion as of December 31, 2024. The decline in loans held for investment was partially due to a continuation of the Company purposefully and selectively reducing balances of loans where borrowers did not represent in-market relationships. The allowance for credit losses ("ACL") was $23.1 million and $23.0 million as of March 31, 2025 and December 31, 2024, respectively.

Total deposits were $2.13 billion as of March 31, 2025, a net decrease of $50.0 million from December 31, 2024. The decline in the first three months of 2025 was primarily due to a $63.4 million decrease in brokered time deposits.

Total stockholders’ equity increased by $10.5 million to $338.3 million as of March 31, 2025, compared to $327.8 million at December 31, 2024, primarily due to additional capital of $6.9 million from the exercise of warrants to purchase common stock and a $3.8 million decrease in after-tax unrealized losses in the Company’s portfolio of securities available for sale.

Comparison of Results of Operations for the Three Months Ended March 31, 2025 and 2024

For the three months ended March 31, 2025, the Company reported a net loss of $0.4 million, or $0.01 per diluted common share, compared to a net loss of $2.9 million, or $0.15 per diluted common share, for the three months ended March 31, 2024. Net loss for the first quarter of 2025 included after-tax severance costs of $0.5 million and an after-tax $0.2 million loss on the sale of the mortgage division. After-tax regulatory remediation expenses in connection with the Consent Order for the first quarter of 2025 were $0, compared to $2.1 million for first quarter of 2024. Net interest income for the three months ended March 31, 2025 was $19.0 million, a decline of $1.4 million from the same period in 2024, primarily due a decline in average loan balances.

Net Interest Income. Net interest income is the excess of interest earned on loans, investments, and other interest-earning assets less the interest paid on deposits and borrowings and is the Company’s primary revenue source. Net interest income is thereby affected by overall balance sheet size, changes in interest rates, and changes in the mix of investments, loans, deposits, and borrowings.

The following table presents the average balance sheets for the three months ended March 31, 2025 and 2024. Also shown are the amounts of interest earned on interest-earning assets, with related tax-equivalent yields, and interest expense on interest-bearing liabilities, with related rates, as well as a volume and rate analysis of changes in net interest income for the periods stated.


	Average Balances, Income and Expense, Yields and Rates
	For the three months ended March 31,
	2025								2024								Total Increase/			Increase/(Decrease) Due to
(Dollars in thousands)	Average Balance			Interest		Yield/ Rate (1)			Average Balance			Interest		Yield/ Rate (1)			(Decrease)			Volume (2)			Rate (2)
Average Assets
Taxable securities	$	325,076		$	2,420		2.98	%	$	337,839		$	2,438		2.89	%	$	(18	)	$	(92	)	$	74
Tax-exempt securities (3)		12,475			81		2.60	%		12,621			77		2.44	%		4			(1	)		5
Total securities		337,551			2,501		2.96	%		350,460			2,515		2.87	%		(14	)		(93	)		79
Interest-earning deposits in other banks		162,771			1,698		4.17	%		129,366			1,557		4.81	%		141			402			(261	)
Federal funds sold		1,385			15		4.33	%		9,668			130		5.38	%		(115	)		(111	)		(4	)
Loans held for sale		29,455			1,366		18.55	%		57,646			1,920		13.32	%		(554	)		(939	)		385
Loans held for investment (4,5,6)		2,089,563			29,788		5.70	%		2,419,351			36,426		6.02	%		(6,638	)		(4,965	)		(1,673	)
Total average interest-earning assets		2,620,725			35,368		5.40	%		2,966,491			42,548		5.74	%		(7,180	)		(5,706	)		(1,474	)
Less: allowance for credit losses		(22,747	)							(35,874	)
Total noninterest-earning assets		123,736								234,315
Total average assets	$	2,721,714							$	3,164,932
Average Liabilities and Stockholders’ Equity:
Interest-bearing demand, money market, and savings	$	720,034		$	3,350		1.86	%	$	1,112,060		$	7,667		2.76	%	$	(4,317	)	$	(2,703	)	$	(1,614	)
Time (7)		989,486			10,842		4.38	%		970,952			10,818		4.46	%		24			206			(182	)
Total interest-bearing deposits		1,709,520			14,192		3.32	%		2,083,012			18,485		3.55	%		(4,293	)		(2,497	)		(1,796	)
FHLB borrowings		150,000			1,432		3.82	%		223,824			2,369		4.23	%		(937	)		(781	)		(156	)
FRB borrowings		—			—		—			65,000			768		4.73	%		(768	)		(768	)		—
Subordinated notes and other borrowings (8)		39,794			736		7.40	%		39,847			560		5.62	%		176			(1	)		177
Total average interest-bearing liabilities		1,899,314			16,360		3.45	%		2,411,683			22,182		3.68	%		(5,822	)		(4,047	)		(1,775	)
Noninterest-bearing demand deposits		458,157								515,486
Other noninterest-bearing liabilities		34,559								53,862
Stockholders' equity		329,684								183,901
Total average liabilities and stockholders’ equity	$	2,721,714							$	3,164,932
Net interest income and margin (9)				$	19,008		2.90	%				$	20,366		2.75	%	$	(1,358	)	$	(1,659	)	$	301
Cost of funds (10)							2.78	%							3.03	%
Net interest spread (11)							1.95	%							2.06	%

(1) Annualized.
(2) Change in income/expense due to both volume and rate has been allocated in proportion to the absolute dollar amounts of the change in each.
(3) Computed on a fully taxable equivalent basis assuming a 22.32% and 22.35% income tax rate for the three months ended March 31, 2025 and 2024, respectively.
(4) Includes deferred loan fees/costs.
(5) Non-accrual loans have been included in the computations of average loan balances.
(6) Includes accretion of fair value adjustments (discounts) on acquired loans of $366 thousand and $329 thousand for the three months ended March 31, 2025 and 2024, respectively.
(7) Includes amortization of fair value adjustments (premiums) on assumed time deposits of $35 thousand and $97 thousand for the three months ended March 31, 2025 and 2024, respectively.
(8) Includes amortization of fair value adjustments (premiums) on assumed subordinated notes of $25 thousand for both the three months ended March 31, 2025 and 2024, respectively.
(9) Net interest margin is net interest income divided by average interest-earning assets.
(10) Cost of funds is total interest expense divided by total interest-bearing liabilities and non-interest bearing demand deposits.
(11) Net interest spread is the yield on average interest-earning assets less the cost of average interest-bearing liabilities.

Average balances of interest-earning assets decreased $345.8 million to $2.62 billion for the first quarter of 2025 compared to $2.97 billion for the same period of 2024. Relative to the year-ago period, this decrease reflected primarily lower average balances of loans held for investment. The yield on average loans held for investment was 5.70% for the first quarter of 2025 compared to 6.02% for the first quarter of 2024. The decline in loan yield was primarily driven by the purposeful and selective exit of higher-rate loans to borrowers that did not represent in-market relationships. Interest income for the three months ended March 31, 2025 and 2024 included accretion of discounts on acquired loans of $366 thousand and $329 thousand, respectively.

Average balances of interest-bearing liabilities decreased $512.4 million to $1.90 billion for the three months ended March 31, 2025 compared to $2.41 billion for the same period of 2024. The decline relative to the comparative periods

was primarily due to the exit of fintech Banking-as-a-Service ("BaaS") deposit operations and the payoff of wholesale funding.

Cost of funds was 2.78% for the first quarter of 2025 compared to 3.03% for the first quarter of 2024, while cost of deposits was 2.62% and 2.84%, for the same respective periods. Lower cost of funds in the first quarter of 2025 was primarily due to the exit of higher cost fintech BaaS deposit operations and lower average balances of wholesale funding, relative to the year-ago period, partially offset by the higher variable cost of $25.0 million of the Company’s subordinated debt, which increased the cost of funds by 3 basis points. Cost of deposits, excluding wholesale deposits, was 1.34% for the first quarter of 2025 compared to 2.52% for the first quarter of 2024. The first quarter of 2025 decline from the comparative period of 2024 was primarily due to lower average balances of higher cost fintech-related deposits.

Net interest income (on a taxable equivalent basis) for the three months ended March 31, 2025 was $19.0 million compared to $20.4 million for the same period in 2024. The decline in the first quarter of 2025 compared to the first quarter of 2024 was primarily attributable to lower interest and fee income on loans due to lower average balances. This decline was partially offset by lower average balances and rates paid on interest-bearing demand accounts and lower average balances of wholesale funding. The majority of fintech BaaS deposits were in interest-bearing demand accounts. Net interest margin was 2.90% and 2.75% for the first quarter of 2025 and 2024, respectively. Accretion and amortization of purchase accounting adjustments had a 6 basis point positive effect on net interest margin for both respective periods.

Provision for Credit Losses. No provision for credit losses was reported for the first quarter of 2025 compared to a recovery of credit losses of $1.0 million for the first quarter of 2024. Lower allowance for credit losses ("ACL") needs due to loan portfolio balance reductions were offset by higher reserve needs on pooled loans, primarily due to marginal changes in certain qualitative risk factors, resulting in no provision for the 2025 period. The recovery of credit losses in the 2024 period was attributable to lower balances of unfunded loan commitments.

Noninterest Income. The following table presents a summary of noninterest income and the dollar and percentage change for the periods presented.


	For the three months ended
(Dollars in thousands)	March 31, 2025			March 31, 2024			Change $			Change %
Fair value adjustments of other equity investments	$	(73	)	$	(7	)	$	(66	)		942.9	%
Residential mortgage banking income		956			2,664			(1,708	)		(64.1	%)
Mortgage servicing rights		2			729			(727	)		(99.7	%)
Wealth and trust management		454			520			(66	)		(12.7	%)
Service charges on deposit accounts		457			361			96			26.6	%
Increase in cash surrender value of bank owned life insurance		8			337			(329	)		(97.6	%)
Bank and purchase card, net		567			242			325			134.3	%
Other		701			2,942			(2,241	)		(76.2	%)
Total noninterest income	$	3,072		$	7,788		$	(4,716	)		(60.6	%)

The decline in mortgage banking income in the first quarter of 2025 compared to the same period of 2024 was due to a combination of lower mortgage volumes and lower servicing income, with the latter attributable to the sale of the majority of mortgage servicing rights assets ("MSR") portfolio in the third and fourth quarters of 2024. The decline in other noninterest income was driven by the decrease in the number of fintech indirect lending relationships, which contributed $0.2 million and $1.4 million of noninterest income in the first quarters of 2025 and 2024, respectively. Additionally, other noninterest income in the 2025 period included a $0.2 million loss on the sale of the mortgage division. A recently completed review of the Bank’s deposit products and services led to a more streamlined and competitive offering, which the Company expects will result in higher service charges on deposit accounts in the subsequent periods.

Noninterest Expense. The following table presents a summary of noninterest expense and the dollar and percentage change for the periods stated.


	For the three months ended
(Dollars in thousands)	March 31, 2025		March 31, 2024		Change $			Change %
Salaries and employee benefits	$	12,610	$	16,045	$	(3,435	)		(21.4	%)
Occupancy and equipment		1,381		1,524		(143	)		(9.4	%)
Technology and communication		2,784		2,279		505			22.2	%
Legal and regulatory filings		439		447		(8	)		(1.8	%)
Advertising and marketing		191		297		(106	)		(35.7	%)
Audit fees		578		1,155		(577	)		(50.0	%)
FDIC insurance		1,097		1,377		(280	)		(20.3	%)
Intangible amortization		244		287		(43	)		(15.0	%)
Other contractual services		595		1,809		(1,214	)		(67.1	%)
Other taxes and assessments		921		943		(22	)		(2.3	%)
Regulatory remediation		—		2,644		(2,644	)		(100.0	%)
Other		2,111		3,630		(1,519	)		(41.8	%)
Total noninterest expense	$	22,951	$	32,437	$	(9,486	)		(29.2	%)

Excluding regulatory remediation, noninterest expense decreased $6.8 million for the three months ended March 31, 2025 compared to the same period of 2024. The decline relative to the prior period was primarily due to lower expenses for salaries and employee benefits. The decline in salaries and employee benefits in the first quarter of 2025 reflected a reduction in headcount as the Company continues to right-size its workforce, as it completes certain regulatory directives and transitions to a more traditional community banking model. As of March 31, 2025 and 2024, the Company had 351 and 519 employees, respectively. Also included in salaries and employee benefits expense were severance costs of $0.7 million and $0, for the 2025 and 2024 periods, respectively. Lower regulatory remediation costs and contractual services and audit fees in the 2025 period reflect a reduction in the use of outside consulting services, also due to the completion of certain regulatory directives.

Income Tax Expense. Income tax benefit for the three months ended March 31, 2025 was $0.5 million compared to an income tax benefit of $0.4 million for the same period of 2024, resulting in effective income tax rates of 51.2% and 12.3%, respectively. The higher effective income tax rate in the 2025 period was primarily driven by a $0.3 million favorable adjustment related to a change in the state tax rate applied to the accumulated unrealized loss on the available for sale securities portfolio. Excluding this adjustment, the effective income tax rate for the quarter was 22.7%. The lower effective income tax rate in the 2024 period was primarily attributable to tax-exempt income, primarily from bank owned life insurance and tax-exempt securities and loans, relative to income subject to statutory tax rates.

Analysis of Financial Condition

Loan Portfolio. The Company makes loans to commercial entities and to individuals. Loan terms vary as to interest rate, repayment, and collateral requirements based on the type of loan and the creditworthiness of the borrower. Credit risk tends to be geographically concentrated in that a majority of the loans are to borrowers located in the markets served by the Company. All loans are underwritten within specific lending policy guidelines that are designed to maximize the Company’s profitability within an acceptable level of business risk.

The following table presents the Company’s loan portfolio by category of loan and the percentage of loans in each category to total loans as of the dates stated.


	March 31, 2025						December 31, 2024
(Dollars in thousands)	Amount			Percent			Amount			Percent
Commercial and industrial	$	340,099			16.5	%	$	354,904			16.8	%
Real estate – construction, commercial		103,006			5.0	%		114,491			5.4	%
Real estate – construction, residential		53,498			2.6	%		51,807			2.4	%
Real estate – commercial		834,223			40.6	%		847,842			40.2	%
Real estate – residential		683,946			33.2	%		692,253			32.8	%
Real estate – farmland		4,748			0.2	%		5,520			0.3	%
Consumer		39,761			1.9	%		43,938			2.1	%
Gross loans held for investment		2,059,281			100.0	%		2,110,755			100.0	%
Deferred costs, net of loan fees		429						1,042
Gross loans held for investment, net of deferred costs		2,059,710						2,111,797
Less: allowance for credit losses		(23,126	)					(23,023	)
Net loans	$	2,036,584					$	2,088,774
Loans held for sale (not included in totals above)	$	23,624					$	30,976

The following table presents the Company’s portfolio of commercial real estate loans by property type as of the dates stated.


	March 31, 2025					December 31, 2024
(Dollars in thousands)	Amount		Percent			Amount		Percent
Commercial real estate – owner occupied	$	194,979		23.4	%	$	193,608		22.8	%
Commercial real estate – non-owner occupied
Hospitality		120,069		14.4	%		186,619		22.0	%
Multi-family		180,383		21.6	%		120,910		14.3	%
Retail		103,695		12.5	%		104,363		12.3	%
Office		73,441		8.8	%		73,871		8.7	%
Mixed use		49,515		5.9	%		49,666		5.9	%
Warehouse and industrial		39,452		4.7	%		39,830		4.7	%
Other		72,689		8.7	%		78,975		9.3	%
Total real estate – commercial	$	834,223		100.0	%	$	847,842		100.0	%

The current lending environment for commercial real estate (“CRE”) loans has heightened risk due to a higher interest rate environment. Potential negative impacts include higher debt service burdens for floating rate loans and fixed rate loans that mature and require renewal or refinancing. As these loans mature, they may be repriced at significantly higher interest rates, leading to increased debt service costs that can strain borrowers' ability to meet payment obligations. In some cases, the higher cost of refinancing may lead to loan defaults, particularly if property cash flows have not increased proportionally.

Additionally, collateral values overall may be impaired by higher capitalization rates, further complicating refinancing efforts and increasing credit risk to the Bank. Certain CRE collateral types have experienced declining occupancy, demand, and rental rates, which could potentially lead to material declines in property level economics and further weaken borrowers' ability to service their debt.

In response to the heightened risk, in 2024, the Bank’s credit policy and risk committee conducted a targeted review of certain of the Bank’s loan types, including office loans, to confirm its internal risk ratings. In addition, the Bank’s credit administration department led by its Chief Credit Officer performs a periodic analysis of emerging trends by geography where the Bank has the largest concentrations by CRE property type. The analysis includes all real estate property types and geographic markets represented in the loan portfolio. This analysis is provided to the Bank's board of directors to assess whether the CRE lending strategy and risk appetite continue to be appropriate, considering changes in local market conditions and the Bank’s exposure to collateral type concentrations. Also, concentration limits by real

estate collateral type are approved and monitored by the board of directors. As of March 31, 2025, all limits are in compliance.

The following table presents the remaining maturities, based on contractual maturity, by loan type and by rate type (variable or fixed), as of March 31, 2025.


					Variable rate								Fixed rate
(Dollars in thousands)	Total Maturities		One Year or Less		Total		1-5 years		5-15 years		More than 15 years		Total		1-5 years		5-15 years		More than 15 years
Commercial and industrial	$	340,099	$	98,796	$	122,607	$	92,318	$	28,854	$	1,435	$	118,696	$	47,858	$	52,528	$	18,310
Real estate – construction, commercial		103,006		18,429		70,474		10,398		14,617		45,459		14,103		13,152		894		57
Real estate – construction, residential		53,498		43,100		728		361		55		312		9,670		1,086		—		8,584
Real estate – commercial		834,223		97,529		451,519		116,606		168,330		166,583		285,175		176,098		99,941		9,136
Real estate – residential		683,946		15,258		395,776		15,799		75,261		304,716		272,912		30,881		31,226		210,805
Real estate – farmland		4,748		—		2,026		148		229		1,649		2,722		1,873		132		717
Consumer loans		39,761		2,122		5,928		5,835		93		—		31,711		27,165		4,546		—
Gross loans	$	2,059,281	$	275,234	$	1,049,058	$	241,465	$	287,439	$	520,154	$	734,989	$	298,113	$	189,267	$	247,609

Allowance for Credit Losses. In determining the adequacy of the Company’s ACL, management makes estimates based on facts available at the time the ACL is determined. Such estimation requires significant judgment at the time made. Management believes that the Company’s ACL was adequate as of March 31, 2025 and December 31, 2024. There can be no assurance, however, that adjustments to the ACL will not be required in the future. Changes in the economic assumptions underlying management’s estimates and judgments, adverse developments in the economy, on a national basis or in the Company’s market area, and changes in the circumstances of particular borrowers are criteria, among others, that could increase the level of the ACL required, resulting in charges to the provision for credit losses for loans. In addition, bank regulatory agencies periodically review the Bank's ACL and may, on occasion, require an increase in the ACL or the recognition of further loan charge-offs, based on their judgment of the facts at the time of their review that may differ than that of management.

The following table presents an analysis of the change in the ACL by loan type as of and for the periods stated.


	For the three months ended March 31, 2025
(Dollars in thousands)	Commercial and industrial			Real estate – construction, commercial			Real estate – construction, residential			Real estate – commercial			Real estate – residential			Real estate – farmland			Consumer			Total
ACL, beginning of period	$	5,767		$	2,057		$	540		$	5,963		$	7,933		$	18		$	745		$	23,023
(Recovery of) provision for credit losses - loans		(189	)		(65	)		12			(240	)		253			—			229			—
Charge-offs		(2,123	)		—			—			(63	)		(16	)		—			(587	)		(2,789	)
Recoveries		2,271			—			—			338			1			—			282			2,892
Net recoveries (charge-offs)		148			—			—			275			(15	)		—			(305	)		103
ACL, end of period	$	5,726		$	1,992		$	552		$	5,998		$	8,171		$	18		$	669		$	23,126

Ratio of net recoveries (charge-offs) to average loans outstanding		0.16	%		0.00	%		0.00	%		0.14	%		-0.01	%		0.00	%		-2.71	%		0.02	%

	For the three months ended March 31, 2024
(Dollars in thousands)	Commercial and industrial			Real estate – construction, commercial			Real estate – construction, residential			Real estate – commercial			Real estate – residential			Real estate – farmland			Consumer			Total
ACL, beginning of period	$	13,787		$	4,024		$	1,094		$	9,929		$	6,286		$	15		$	758		$	35,893
Provision for (recovery of) credit losses - loans		257			(428	)		(175	)		(97	)		39			3			401			—
Charge-offs		(1,957	)		—			—			—			—			—			(745	)		(2,702	)
Recoveries		1,532			—			—			—			13			—			289			1,834
Net (charge-offs) recoveries		(425	)		—			—			—			13			—			(456	)		(868	)
ACL, end of period	$	13,619		$	3,596		$	919		$	9,832		$	6,338		$	18		$	703		$	35,025

Ratio of net (charge-offs) recoveries to average loans outstanding		-0.33	%		0.00	%		0.00	%		0.00	%		0.01	%		0.00	%		-3.14	%		-0.14	%

The ACL includes specific reserves for individually evaluated loans and a general allowance applicable to all loan categories; however, management has allocated the ACL by loan type to provide an indication of the relative risk characteristics of the loan portfolio. The allocation is an estimate and should not be interpreted as an indication that charge-offs will occur in these amounts, or that the allocation indicates future trends, and does not restrict the usage of

the allowance for any specific loan or category. The following table presents the allocation of the ACL by loan category and the percentage of loans in each category to total loans as of the dates stated.


	March 31, 2025					December 31, 2024
(Dollars in thousands)	ACL Amount		% of Loans			ACL Amount		% of Loans
Commercial and industrial	$	5,726		16.5	%	$	5,767		16.8	%
Real estate – construction, commercial		1,992		5.0	%		2,057		5.4	%
Real estate – construction, residential		552		2.6	%		540		2.4	%
Real estate – commercial		5,998		40.6	%		5,963		40.2	%
Real estate – residential		8,171		33.2	%		7,933		32.8	%
Real estate – farmland		18		0.2	%		18		0.3	%
Consumer		669		1.9	%		745		2.1	%
Total	$	23,126		100.0	%	$	23,023		100.0	%

Nonperforming Assets. The following table presents a summary of nonperforming assets and various measures as of the dates stated.


(Dollars in thousands)	March 31, 2025			December 31, 2024
Nonaccrual loans held for investment	$	22,273		$	22,957
Loans past due 90 days and still accruing		2,608			2,486
Total nonperforming loans	$	24,881		$	25,443
Other real estate owned ("OREO") (1)		279			279
Total nonperforming assets	$	25,160		$	25,722
Loans held for sale	$	23,624		$	30,976
Loans held for investment		2,059,710			2,111,797
Total loans	$	2,083,334		$	2,142,773
Total assets	$	2,685,084		$	2,737,260
ACL on loans held for investment	$	23,126		$	23,023
ACL to loans held for investment		1.12	%		1.09	%
ACL to nonaccrual loans		103.83	%		100.29	%
ACL to nonperforming loans		92.95	%		90.49	%
Nonaccrual loans to loans held for investment		1.08	%		1.09	%
Nonperforming loans to loans held for investment		1.19	%		1.20	%
Nonperforming loans to total assets		0.93	%		0.93	%
Nonperforming assets to total assets		0.94	%		0.94	%

(1) Included in other assets on the consolidated balance sheets.

The 3 basis point increase in the ratio of ACL to loans held for investment in the first quarter of 2025 was primarily attributable to marginal changes to certain qualitative risk factors.

Loans are generally placed into nonaccrual status when they are past due 90 days or more as to either principal or interest or when, in the opinion of management, the collection of principal and/or interest is in doubt. A loan remains in nonaccrual status until the loan is current as to payment of both principal and interest or past due less than 90 days and the borrower demonstrates the ability to pay and remain current. When cash payments are received, they are applied to principal first, then to accrued interest. It is the Company's policy not to record interest income on nonaccrual loans until principal has become current. In certain instances, accruing loans that are past due 90 days or more as to principal or interest may not be placed on nonaccrual status, if the Company determines that the loans are well-secured and are in the process of collection. OREO includes properties that have been substantively repossessed or acquired in complete or partial satisfaction of debt. Such properties, which are held for resale, are initially stated at fair value, including a reduction for the estimated selling expenses, which becomes the carrying value. In subsequent periods, such properties are stated at the lower of the restated carrying value or fair value.

Investment Securities. The investment portfolio is used as a source of interest income, credit risk diversification, and liquidity, as well as to manage interest rate sensitivity and provide collateral for short-term borrowings. Securities in the investment portfolio classified as securities available for sale ("AFS") may be sold in response to changes in market

interest rates, securities’ prepayment risk, liquidity needs, and other similar factors, and are carried at estimated fair value. The fair value of the Company’s AFS investment securities portfolio was $325.4 million as of March 31, 2025, an increase of $13.4 million from $312.0 million at December 31, 2024, of which $12.4 million was due to the purchase of securities in the first quarter of 2025. As a result of elevated market interest rates, the Company’s portfolio of AFS securities had an unrealized loss of approximately $50.3 million as of March 31, 2025, approximately 44.1% of which was related to securities backed by U.S. government agencies.

As of March 31, 2025 and December 31, 2024, the majority of the investment securities portfolio consisted of securities rated investment grade by a leading ratings agency. Investment grade securities are judged to have a low risk of default, to be of the best quality and carry the smallest degree of investment risk. At March 31, 2025 and December 31, 2024, securities with a fair value of $174.5 million and $268.9 million, respectively, were pledged to secure the Bank’s borrowing facility with the Federal Home Loan Bank of Atlanta ("FHLB"). As of March 31, 2025 and December 31, 2024, the Company had pledged securities with a fair value of $0 and $16.3 million, respectively, as collateral for the Federal Reserve Bank of Richmond ("FRB") Discount Window. The decline in pledged securities as of March 31, 2025 from December 31, 2024 at both FHLB and FRB reflects the release of securities held as collateral.

The Company reviews its AFS investment securities portfolio for potential credit losses at least quarterly. AFS investment securities with unrealized losses are generally a result of pricing changes due to changes in the current interest rate environment and not as a result of permanent credit impairment. The Company does not intend to sell nor does it believe that it will be required to sell, any of its impaired securities prior to the recovery of the amortized cost. No ACL has been recognized for AFS securities as of both March 31, 2025 and December 31, 2024.

Restricted equity investments consisted of stock in the FHLB (carrying basis $9.1 million and $9.4 million at March 31, 2025 and December 31, 2024, respectively), FRB stock (carrying value of $9.2 million and $9.4 million at March 31, 2025 and December 31, 2024, respectively), and stock in the Company’s correspondent bank (carrying value of $468 thousand at both March 31, 2025 and December 31, 2024). Restricted equity investments are carried at cost.

The Company also holds investments in early-stage focused investment funds and low-income housing partnerships, which totaled $20.4 million and $19.4 million as of March 31, 2025 and December 31, 2024, respectively, and are reported in other investments on the consolidated balance sheets.

The following table presents the amortized cost of the investment portfolio by contractual maturities, as well as the weighted average yields for each of the maturity ranges as of and for the period stated. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	March 31, 2025
	Within One Year					One to Five Years					Five to Ten Years					Over Ten Years
(Dollars in thousands)	Amortized Cost		Weighted Average Yield			Amortized Cost		Weighted Average Yield			Amortized Cost		Weighted Average Yield			Amortized Cost		Weighted Average Yield			Total Amortized Cost
Securities available for sale
Mortgage backed securities	$	—		—		$	—		—		$	14,857		2.22	%	$	193,237		2.26	%	$	208,094
U. S. Treasury and agencies		1		—			35,210		1.14	%		38,605		2.14	%		5,265		1.91	%		79,081
State and municipal		600		4.44	%		9,694		2.33	%		32,416		2.10	%		7,363		2.58	%		50,073
Corporate bonds		—		—			10,375		7.37	%		27,589		4.42	%		500		4.00	%		38,464
Total	$	601				$	55,279				$	113,467				$	206,365				$	375,712

Deposits. The principal sources of funds for the Company are deposits, including transaction accounts (demand deposits and money market accounts), time deposits, and savings accounts, of customers in the Company’s primary geographic market area. Such customers provide the Bank a source of fee income and cross-marketing opportunities and are generally a lower cost source of funding for the Bank.

In prior years, deposits sourced from fintech partnerships (“fintech-related deposits”), inclusive of fintech BaaS deposits, were a significant source of deposits for the Company. Prior to 2024, deposits sourced from fintech BaaS providers comprised a significant portion of the Company’s fintech-related deposits. In the fourth quarter of 2024, the Company completed the exit of its fintech BaaS deposit operations and substantially reduced its fintech-related deposit exposure to approximately 1.0% of deposits as of December 31, 2024, consisting of corporate accounts of a few companies in the fintech sector. As of March 31, 2025 and December 31, 2024, fintech-related deposits totaled $14.4 million and $21.3 million, respectively, of which fintech BaaS deposits were $0.2 million for both respective periods.

Brokered deposit balances are sourced through intermediaries and are an unsecured source of funding for the Bank. Brokered deposits were added throughout 2023 and early 2024 to enhance liquidity in light of financial industry events that began in March 2023 and in anticipation of the exit of the Company's fintech BaaS deposit operations. Brokered deposits represented approximately 15.9% and 18.5% of total deposits as of March 31, 2025 and December 31, 2024, respectively, and were all time deposits at March 31, 2025. The Bank has a liquidity management program, with oversight of the Bank’s asset and liability committee (the “ALCO”), that sets forth guidelines for the desired maximum level of brokered deposits, which is 20.0% of total deposits. As noted, the Company issued brokered deposits as part of its liquidity management plan, and as a result, the Company's brokered deposit levels have approximated the high-end of the guideline. In recent quarters, the Company has reduced levels of brokered deposits and expects to continue to reduce levels in future periods to a level of 10.0% or less of total deposits. As certain brokered deposits have multiple-year terms, the Company expects brokered deposits to be a funding source for several years.

Total deposits decreased $50.0 million from $2.18 billion as of December 31, 2024 to $2.13 billion as of March 31, 2025, as:

•

Deposits, excluding fintech-related and brokered deposits, increased $20.4 million from approximately $1.76 billion as of December 31, 2024 to approximately $1.78 billion as of March 31, 2025;

•

Brokered deposits decreased $63.4 million from approximately $402.5 million, or 18.5% of total deposits, as of December 31, 2024 to approximately $339.1 million, or 15.9% of total deposits, as of March 31, 2025; and

•

Fintech-related deposits decreased $7.0 million from approximately $21.3 million as of December 31, 2024 to approximately $14.4 million as of March 31, 2025. Of the decline, fintech BaaS deposits decreased $35 thousand from December 31, 2024.

Estimated uninsured deposits totaled approximately $431.2 million as of March 31, 2025, or 19.8% of total deposits, compared to $399.3 million, or 18.0% of total deposits, as of December 31, 2024.

The following table presents a summary of average deposits and the weighted average rate paid for the periods stated.


	March 31, 2025					March 31, 2024
(Dollars in thousands)	Average Balance		Average Rate			Average Balance		Average Rate
Noninterest-bearing demand	$	458,157		—		$	515,486		—
Interest-bearing:
Demand		239,001		0.69	%		582,648		2.52	%
Savings		101,671		3.89	%		115,098		4.98	%
Money market		379,362		2.06	%		414,314		2.48	%
Time		989,486		4.38	%		970,952		4.46	%
Total interest-bearing		1,709,520					2,083,012
Total average deposits	$	2,167,677				$	2,598,498

The following table presents maturities of time deposits for certificate of deposits of $250 thousand or greater as of the dates stated.


(Dollars in thousands)	March 31, 2025		December 31, 2024
Maturing in:
3 months or less	$	38,107	$	38,758
Over 3 months through 6 months		44,246		33,845
Over 6 months through 12 months		42,714		60,308
Over 12 months		26,598		31,117
	$	151,665	$	164,028

Borrowings. The Company uses short-term and long-term borrowings from various sources, including FHLB advances and FRB advances, to fund assets and operations. The following tables present information on the balances and interest rates on borrowings as of and for the periods stated.


	March 31, 2025
(Dollars in thousands)	Period-End Balance		Highest Month-End Balance		Average Balance		Weighted Average Rate
FHLB borrowings	$	150,000	$	150,000	$	150,000		3.82	%

	December 31, 2024
(Dollars in thousands)	Period-End Balance		Highest Month-End Balance		Average Balance		Weighted Average Rate
FHLB borrowings	$	150,000	$	280,000	$	213,003		4.27	%
FRB borrowings		—		65,000		23,087		4.68	%

FHLB advances are secured by collateral consisting of a blanket lien on qualifying pledged loans in the Company’s residential, multi-family, and commercial real estate mortgage loan portfolios, as well as selected investment portfolio securities. FRB advances through the FRB Discount Window are secured by qualifying pledged construction and commercial and industrial loans, as well as selected investment portfolio securities. Total borrowings were $150.0 million as of both March 31, 2025 and December 31, 2024.

Subordinated notes, net, totaled $39.8 million as of both March 31, 2025 and December 31, 2024. The Company's subordinated notes are comprised of a $25 million issuance in October 2019 maturing October 15, 2029 (the “2029 Notes”) and a $15 million issuance in May 2020 maturing June 1, 2030 (the “2030 Note”). The fixed rates on the 2029 Notes transitioned and the 2030 note will transition to variable rates based on the Secured Overnight Funding Rate ("SOFR") roughly five years from issue date. The 2029 Notes can be paid off in whole or in part without penalty at any time and the 2030 Note can be paid off in whole or in part, without penalty, at any time after its initial reset date. Due to the Consent Order, the Company must obtain approval to redeem its subordinated notes. Subsequent to March 31, 2025, the Company received regulatory non-objection to redeem a significant portion of its subordinated debt, which the Company expects will save more than $2 million in interest expense annually.

The 2029 Notes bore interest at 5.625% per annum, through October 14, 2024, payable semi-annually in arrears. On October 15, 2024, the rate on the 2029 Notes began to reset quarterly to the current three-month CME Term SOFR interest rate, which was 4.65%, plus 433.5 basis points at initial reset. As of March 31, 2025, the 2029 Notes bore an annual interest rate of 8.64%. For the three months ended March 31, 2025 and 2024, the effective interest rate on the 2029 Notes was 8.05% and 5.22%, respectively, inclusive of the amortization of the purchase accounting adjustment (premium).

The 2030 Note bears an interest rate of 6.0% per annum until June 1, 2025, at which date the rate will reset quarterly to the current three-month CME Term SOFR interest rate plus 587 basis points. Interest on the 2030 Note is payable semi-annually in arrears. For the three months ended March 31, 2025 and 2024, the effective interest rate on the 2030 Note was 6.31% and 6.32%, respectively. Subsequent to March 31, 2025, the Company provided a notice of redemption to the holder of the 2030 Note to redeem the note at its initial redemption date, June 1, 2025.

Liquidity. Liquidity is essential to the Company’s business. The Company’s liquidity could be impaired by unforeseen outflows of cash, including deposits, or the inability to access the capital and/or wholesale funding markets. This situation may arise due to circumstances that the Company may be unable to control, such as general market disruption, negative views about the Company or the financial services industry generally, or an operational problem that affects the Company or a third party. The Company’s ability to borrow from other financial institutions on favorable terms or at all could be adversely affected by disruptions in the markets in which they operate or other events.

Deposits are the primary source of the Company’s liquidity. Cash flows from amortizing or maturing assets also provide funding to meet the liquidity needs of the Company. Deposits are sourced from the Bank’s customers and, as needed, through brokered deposit markets. The brokered deposit markets are accessed through brokers or through the IntraFi Network (“IntraFi”), of which the Bank is a member. IntraFi facilitates the Bank attaining brokered deposits via an on-line marketplace. The Bank also utilizes IntraFi's reciprocal deposit services to offer its high-value customers access to Federal Deposit Insurance Corporation ("FDIC") insurance through IntraFi's network of banks.

While subject to the Consent Order, the Bank may not be deemed to be “well capitalized,” which restricts it from accepting, renewing, or rolling over brokered deposits except in compliance with certain applicable restrictions under federal law. During the third quarter of 2024, the Bank received approval from the FDIC allowing it to accept, renew, and rollover brokered deposits. In the fourth quarter of 2024, the Bank received an extension of this approval. Each approval was for a six-month period and in the amount of maturities during this period. The Company expects to continue to seek waivers of this prohibition in the future; however, there is no assurance that such waivers will be approved or that the Company will be able to rely on brokered deposits as a source of funding in the future.

The Company has established a formal liquidity contingency plan that provides guidelines for liquidity management. Pursuant to the Company’s liquidity contingency plan, liquidity needs are forecasted based on anticipated changes in the balance sheet. In this forecast, the Company expects to maintain a liquidity cushion. Management then stress tests the Company’s liquidity position under several different stress scenarios, from moderate to severe. Guidelines for the forecasted liquidity cushion and for liquidity cushions for each stress scenario have been established and are reviewed by the Bank's ALCO. Management also monitors the Company’s liquidity position on a day-to-day basis through daily cash monitoring and short- and long-term cash flow forecasting and believes its sources of liquidity are adequate to conduct the business of the Company.

The following table presents information on the available sources of liquidity as of the date stated.


(Dollars in thousands)	Capacity		Less: Outstanding Borrowings			Available Balance
Cash and due from banks						$	170,465
Fed funds sold							1,725
Unpledged securities available for sale							150,874
Total						$	323,064
Borrowings
FHLB	$	588,470	$	201,160	(1)	$	387,310
FRB		68,460		—			68,460
Unsecured line of credit		10,000		—			10,000
Total	$	666,930	$	201,160		$	465,770
Available liquidity as of March 31, 2025						$	788,834

(1) Outstanding borrowings are comprised of advances of $150.0 million and letters of credit totaling $51.2 million, of which $50.0 million served as collateral for public deposits with the Treasury Board of the Commonwealth of Virginia.

Uninsured deposits at March 31, 2025 were $431.2 million or 19.8% of total deposits. In the unlikely event that uninsured deposit balances leave the Bank over a short period of time, management could more than satisfy the demand with cash on-hand and FHLB borrowing capacity.

Capital. Capital adequacy is an important measure of financial stability and performance. The Company’s objectives are to maintain a level of capitalization that is sufficient to support the Company's strategic objectives.

Banks and bank holding companies are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, financial institutions must meet specific capital guidelines that involve quantitative measures of assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. A financial institution's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors.

Banks must hold a capital conservation buffer of 2.50% above the adequately capitalized risk-based capital ratios for all ratios except the Tier 1 leverage ratio. If a banking organization dips into its capital conservation buffer, it is subject to limitations on certain activities, including payment of dividends, share repurchases, and discretionary compensation to certain officers. Additionally, regulators may place certain restrictions on dividends paid by banks. The total amount of dividends which may be paid at any date is generally limited to retained earnings of banks.

Prompt corrective action regulations provide five classifications: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized; although, these terms are not used to represent overall financial condition. If adequately capitalized, regulatory approval is required to accept brokered deposits. If undercapitalized, capital distributions are limited, as is asset growth and expansion, and capital restoration plans are required.

The Consent Order requires the Bank to achieve and maintain minimum capital requirements that are higher than those required for capital adequacy purposes. Specifically, the Bank is required to maintain a leverage ratio of 10.0% and a total capital ratio of 13.0%. As of March 31, 2025 and December 31, 2024, the Bank met these minimum capital ratios. Until the Bank has been released from the Consent Order, the Bank is deemed to be less than well capitalized, thus adequately capitalized.

Because the Bank may not be deemed to be “well capitalized” while subject to the Consent Order, it could be required to pay higher insurance premiums to the FDIC, obtain approval prior to acquiring branches or opening new lines of business, and be subject to increased regulatory scrutiny such as limitations on asset growth.

The Company adopted ASC 326, Financial Instruments - Credit Losses (referred to herein as "current expected credit losses" or "CECL") effective January 1, 2023. Federal and state banking regulations allow financial institutions to irrevocably elect to phase-in the after-tax cumulative effect adjustment at adoption to retained earnings (“CECL Transitional Amount”) over a three-year period. The three-year phase-in of the CECL Transitional Amount to regulatory capital is 25%, 50%, and 25% in 2023, 2024, and 2025, respectively. The Bank made this irrevocable election effective with its first quarter 2023 call report.

The following tables present the capital ratios to which banks are subject to be adequately and well capitalized, as well as the capital and capital ratios for the Bank as of the dates stated. Adequately capitalized ratios include the conversation buffer, if applicable. The following table also includes the capital adequacy ratios to which bank holding companies are subject. Also presented are the minimum capital ratios set forth in the Consent Order for the Bank with the corresponding capital amounts for both the leverage ratio and the total capital ratio as of both March 31, 2025 and December 31, 2024. The CECL Transitional Amount was $8.1 million, of which $6.1 million and $4.1 million reduced the regulatory capital amounts and capital ratios as of March 31, 2025 and December 31, 2024, respectively.


	March 31, 2025
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized					Minimum Capital Ratios
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	360,244		17.93	%	$	210,943		10.50	%	$	200,898		10.00	%	$	261,167		13.00	%
Blue Ridge Bankshares, Inc.	$	421,913		20.83	%	$	162,048		8.00	%	n/a		n/a			n/a		n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	339,061		16.88	%	$	170,763		8.50	%	$	160,718		8.00	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	365,857		18.06	%	$	121,536		6.00	%	n/a		n/a			n/a		n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	339,061		16.88	%	$	140,628		7.00	%	$	130,583		6.50	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	365,857		18.06	%	$	91,152		4.50	%	n/a		n/a			n/a		n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.	$	339,061		12.33	%	$	110,013		4.00	%	$	137,517		5.00	%	$	275,033		10.00	%
Blue Ridge Bankshares, Inc.	$	365,857		13.23	%	$	110,641		4.00	%	n/a		n/a			n/a		n/a


	December 31, 2024
	Actual					For Capital Adequacy Purposes					To Be Well Capitalized					Minimum Capital Ratios
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio			Amount		Ratio
Total risk based capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	358,848		17.26	%	$	218,260		10.50	%	$	207,866		10.00	%	$	270,226		13.00	%
Blue Ridge Bankshares, Inc.	$	414,284		19.79	%	$	167,444		8.00	%	n/a		n/a			n/a		n/a
Tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	340,386		16.38	%	$	176,687		8.50	%	$	166,293		8.00	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	360,933		17.24	%	$	125,583		6.00	%	n/a		n/a			n/a		n/a
Common equity tier 1 capital (to risk-weighted assets)
Blue Ridge Bank, N.A.	$	340,386		16.38	%	$	145,507		7.00	%	$	135,113		6.50	%	n/a		n/a
Blue Ridge Bankshares, Inc.	$	360,933		17.24	%	$	94,187		4.50	%	n/a		n/a			n/a		n/a
Tier 1 leverage (to average assets)
Blue Ridge Bank, N.A.	$	340,386		11.80	%	$	115,364		4.00	%	$	144,204		5.00	%	$	288,409		10.00	%
Blue Ridge Bankshares, Inc.	$	360,933		12.43	%	$	116,169		4.00	%	n/a		n/a			n/a		n/a

Commitments and Contingencies

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract and involve the same credit risk and evaluation as making a loan to a customer. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit worthiness on a case-by-case basis, in a manner similar to that if underwriting a loan. As of March 31, 2025 and December 31, 2024, the Company had outstanding loan commitments of $274.3 million and $283.2 million, respectively. Of these amounts, $110.6 million and $108.4 million were unconditionally cancelable at the sole discretion of the Company as of the same respective dates.

No provision for credit losses was reported for the quarter ended March 31, 2025 compared to a recovery of credit losses of $1.0 million for the quarter ending March 31, 2024, which was primarily attributable to lower unfunded loan commitments. As of both March 31, 2025 and December 31, 2024, the reserve for unfunded commitments was $0.9 million and is included in other liabilities on the consolidated balance sheets.

As part of the sale of substantially all of its MSR portfolio in 2024, the Company recorded a reserve for estimated putbacks, transition costs, and unearned sales proceeds. The putbacks relate to industry-standard items, including prepayments or early delinquencies of the underlying mortgages, all of which are subject to term limits per the respective sales agreements. The reserve for unearned sales proceeds relates to the Company providing certain documentation to the buyers. As of March 31, 2025 and December 31, 2024, the reserve was $1.7 million and $1.8 million, respectively, and was included in the loss on sale of MSR assets and other liabilities on the consolidated statement of operations and consolidated balance sheet, respectively.

Interest Rate Risk Management

As a financial institution, the Company is exposed to various business risks, including interest rate risk. Interest rate risk is the risk to earnings and value arising from volatility in market interest rates. Interest rate risk arises from timing differences in the repricing and cash flows of interest-earning assets and interest-bearing liabilities, changes in the expected cash flows of assets and liabilities arising from embedded options, such as borrowers' ability to prepay loans and depositors' ability to redeem certificates of deposit before maturity, changes in the shape of the yield curve where interest rates increase or decrease in a nonparallel fashion, and changes in spread relationships between different yield curves, such as U.S. Treasuries and other market-based index rates. The Company’s goal is to maximize net interest

income without incurring excessive interest rate risk. Management of net interest income and interest rate risk must be consistent with the level of capital and liquidity that the Bank maintains. The Company manages interest rate risk through the ALCO comprised of members of management. The ALCO is responsible for monitoring the Company’s interest rate risk in conjunction with liquidity and capital management, pursuant to policy guidelines approved by the board of directors.

The Company employs an independent firm to model its interest rate sensitivity that uses a net interest income simulation model as its primary tool to measure interest rate sensitivity. Assumptions for modeling are developed based on expected activity in the balance sheet. For maturing assets, assumptions are created for the redeployment of these assets. For maturing liabilities, assumptions are developed for the replacement of these funding sources. Assumptions are also developed for assets and liabilities that could reprice during the modeled time period. These assumptions also cover how management expects rates to change on non-maturity deposits, such as interest checking, money market checking, savings accounts, as well as certificates of deposit. Based on inputs that include the current balance sheet, the current level of interest rates, and the developed assumptions, the model produces an expected level of net interest income assuming that market rates remain unchanged. This is considered the base case. The model then simulates what net interest income would be based on specific changes in interest rates. The rate simulations are performed for a two-year period and include rapid rate changes of down 100 basis points to 400 basis points and up 100 basis points to 400 basis points. The results of these simulations are then compared to the base case.

The following tables present the estimated change in net interest income under various rate change scenarios as of the dates presented. The scenarios assume rate changes occur instantaneous and in a parallel manner, which means the changes are the same on all points of the rate curve. Estimated changes set forth below are dependent on material assumptions, such as those previously discussed.


	March 31, 2025
	Instantaneous Parallel Rate Shock Scenario
	Change in Net Interest Income - Year 1					Change in Net Interest Income - Year 2
Change in interest rates:
+400 basis points	$	2,706		3.1	%	$	6,546		6.9	%
+300 basis points		2,976		3.4	%		5,883		6.2	%
+200 basis points		2,662		3.1	%		4,693		4.9	%
+100 basis points		1,698		2.0	%		2,825		3.0	%
Base case
-100 basis points		(2,919	)	(3.4	%)		(4,491	)	(4.7	%)
-200 basis points		(6,458	)	(7.4	%)		(10,299	)	(10.9	%)
-300 basis points		(9,622	)	(11.1	%)		(15,735	)	(16.6	%)
-400 basis points		(12,409	)	(14.3	%)		(20,650	)	(21.8	%)


	December 31, 2024
	Instantaneous Parallel Rate Shock Scenario
	Change in Net Interest Income - Year 1					Change in Net Interest Income - Year 2
Change in interest rates:
+400 basis points	$	3,288		3.8	%	$	6,628		6.7	%
+300 basis points		3,347		3.8	%		5,842		5.9	%
+200 basis points		2,877		3.3	%		4,610		4.7	%
+100 basis points		1,798		2.1	%		2,751		2.8	%
Base case
-100 basis points		(2,978	)	(3.4	%)		(4,205	)	(4.3	%)
-200 basis points		(6,468	)	(7.4	%)		(9,650	)	(9.8	%)
-300 basis points		(9,831	)	(11.2	%)		(15,174	)	(15.4	%)
-400 basis points		(12,664	)	(14.5	%)		(19,666	)	(20.0	%)

Stress testing the balance sheet and net interest income using instantaneous parallel rate shock movements in the yield curve is a regulatory and banking industry practice. However, these stress tests may not represent a realistic forecast of future interest rate movements in the yield curve. In addition, instantaneous parallel rate shock modeling is not a predictor of actual future performance of earnings. It is a financial metric used to manage interest rate risk and track the movement of the Company’s interest rate risk position over a historical time frame for comparison purposes.

The asset and liability repricing characteristics of the Company’s assets and liabilities will have a significant impact on its future interest rate risk profile.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

This information is incorporated herein by reference to the information in section "Interest Rate Risk Management" within Part I, Item 2. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Form 10-Q.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to provide assurance that information required to be disclosed by the Company in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods required by the SEC and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. An evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of March 31, 2025 was carried out under the supervision and with the participation of management, including the Company’s Chief Executive Officer and Chief Financial Officer. Based on and as of the date of such evaluation, the aforementioned officers concluded that the Company’s disclosure controls and procedures were effective.

The Company’s management is also responsible for establishing and maintaining adequate internal control over financial reporting. There were no changes in the Company’s internal control over financial reporting that occurred during the Company’s last fiscal quarter that materially affected, or are reasonably likely to materially affect, internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

In the ordinary course of operations, the Company is party to legal proceedings. Based upon information currently available, management believes that such legal proceedings, in the aggregate, will not have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows.

For information regarding legal proceedings in which the Company is involved, please see Note 11 to the unaudited consolidated financial statements included in this Form 10-Q.

Item 1A. Risk Factors

There have been no material changes to the risk factors disclosed in the 2024 Form 10-K. Additional risks not presently known to the Company, or that are currently deemed immaterial, may also adversely affect the Company's business, financial condition, or results of operations. See also “Cautionary Note About Forward-Looking Statements,” included in Part 1, Item 2, of this Form 10-Q.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

None

Item 5. Other Information

During the fiscal quarter ended March 31, 2025, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934) adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408(a) of Regulation S-K).

Item 6. Exhibits


31.1		Rule 13(a)-14(a) Certification of Chief Executive Officer.

31.2		Rule 13(a)-14(a) Certification of Chief Financial Officer.

32.1		Statement of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350.

101		The following materials from Blue Ridge Bankshares, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, formatted in Inline Extensible Business Reporting Language (XBRL), include: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive (Loss) Income, (iv) Consolidated Statements of Changes in Stockholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) related notes (filed herewith).

104		The cover page from Blue Ridge Bankshares, Inc.’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, formatted in Inline XBRL (included with Exhibit 101).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



	BLUE RIDGE BANKSHARES, INC.

Date: May 7, 2025	By:	/s/ G. William Beale
		G. William Beale
		President and Chief Executive Officer

	By:	/s/ Judy C. Gavant
		Judy C. Gavant
		Executive Vice President and Chief Financial Officer

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