CBNK Continues Strong Growth With Accelerated Investment Underway

Published: 2026-04-27 16:10:04 ET CBNK

Published on 04/27/2026 at 04:10 pm EDT

ROCKVILLE, Md., April 27, 2026 (GLOBE NEWSWIRE) -- Capital Bancorp, Inc. (the "Company") (NASDAQ: CBNK), the holding company for Capital Bank, N.A. (the "Bank"), today reported:

(1) Gross loans represent portfolio loans receivable, net of deferred fees and costs.(2) Customer deposits represents total deposits excluding brokered deposits.(3) As used in this press release, Core net income, Core earnings per share - diluted, Core ROA, Core ROTCE, Tangible Book Value per share are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.

“We are pleased that the sustained organic growth at the Commercial Bank permits us to accommodate an increase in noninterest expenses, while, at the same time, providing our stockholders with reasonable returns and a steadily growing TBV,” said Steven J. Schwartz, Chairman of the Company. “We expect these expenditures to enable technology advancements in customer experience and back office efficiency, and to support the introduction by OpenSky™ of new products. We remain alert to the possibility that the markets in which we operate remain vulnerable to disruption from geopolitical and other developments, but have not yet seen any macroeconomic signs of credit deterioration in our markets.”

First Quarter 2026 Highlights

“We continue to demonstrate our ability to grow across the Company, highlighted by the increase in customer deposits, which positions us for continued balance sheet growth." said Ed Barry, CEO of the Company. "Our investment program is underway across the Commercial and OpenSky™ division, including technology and data initiatives that will improve our competitive position."

Consolidated financial performance

Net income of $12.0 million decreased $3.0 million compared to 4Q 2025, and earnings per share - diluted of $0.73 decreased $0.18 per share from 4Q 2025. Net income decreased $1.9 million, or 13.7%, from $13.9 million, or $0.82 per diluted share, for 1Q 2025. 1Q 2026 Core net income(1) of $12.0 million, or $0.73 per diluted share, decreased $3.0 million, or 20.1%, from 4Q 2025 Core net income of $15.0 million, or $0.91 per diluted share. 1Q 2026 Core net income decreased $2.9 million, or 19.3%, from 1Q 2025 core net income of $14.9 million, or $0.88 per diluted share.

Quarterly net interest income:

Quarterly provision:

Quarterly fee revenue:

_____________________1 As used in this press release, Core net income, and Core noninterest expense, are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of this and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.

Quarterly noninterest expense:

Quarterly income taxes:

Total assets:

Total assets of $3.8 billion at March 31, 2026 increased $202.3 million, or 22.7% (annualized) from December 31, 2025. Total assets growth year-over-year was $458.7 million, or 13.7%. The growth quarter-over-quarter, and year-over-year, was primarily driven by increases in portfolio loans, and cash balances.

Gross Loans:

_____________________1 Fee revenue mix equals fee revenue divided by the sum of fee revenue and net interest income before provision for credit losses

Consolidated financial performance (Continued)

Deposits:

Investment securities:

Liquidity:

The Company maintains stable and diversified sources of contingent liquidity, generally consistent with prior quarter. Total available borrowing capacity as of March 31, 2026 was $809.5 million, compared to $816.9 million as of December 31, 2025, consisting of $705.3 million of available collateralized borrowing capacity, $96.0 million of unsecured lines of credit with other banks, and $8.2 million of unpledged investment securities available to collateralize potential additional borrowings.

_____________________1 Protected deposits includes deposits that are indirectly protected under the product terms.2 Low interest deposits include interest-bearing demand and savings accounts

Consolidated financial performance (Continued)

Capital:

As of March 31, 2026, the Company reported a Common Equity Tier-1 capital ratio of 12.92%, compared to 12.98% at December 31, 2025. At March 31, 2026, the Company and the Bank maintained regulatory capital ratios that exceed all capital adequacy requirements.

Shares repurchased and retired during the three months ended March 31, 2026, as part of the Company's stock repurchase program, totaled 122,757 shares at an average price of $28.89, for a total cost of $3.5 million. The share repurchases consisted of $0.9 million under the Company's previous stock repurchase program, which expired on February 28, 2026, and $2.6 million under the new stock repurchase program. As of March 31, 2026, there was $12.4 million remaining to be repurchased under the current $15.0 million authorization repurchase program, which will expire on December 31, 2026.

Financial Metrics

Net Interest Margin:

NIM of 5.71% for 1Q 2026, decreased 23 bps compared to the prior quarter, and decreased 34 bps year-over-year. Core NIM(1) of 4.15% decreased 4 bps (but decreased 7 bps when excluding PAA) compared to the prior quarter, and decreased 21 bps year-over-year. Net PAA for 1Q 2026 was 5 bps for NIM and 5 bps for Core NIM(1).

Credit Metrics and Asset Quality:

Nonperforming assets were $59.3 million or 1.56% of total assets at March 31, 2026, an increase of $1.0 million but a decrease of 6 bps compared to December 31, 2025. The increase in nonperforming assets from 4Q 2025 was primarily driven by a $0.8 million increase from the legacy CBNK portfolio and a $0.2 million increase from the acquired IFH portfolio. Nonperforming assets increased $16.3 million or 28 bps year-over-year, mainly due to the $15.9 million increase during 3Q 2025 from two loan relationships acquired as part of the IFH transaction. At March 31, 2026, substandard loans totaled $71.8 million, or 2.4% of total portfolio loans, compared to $58.5 million, or 2.0% of total portfolio loans, at December 31, 2025 and $45.7 million, or 1.7% of total portfolio loans, at March 31, 2025. The increase from December 31, 2025 of $13.3 million was primarily driven by one legacy bank loan relationship, with three loans accounting for $9.7 million of the increase quarter-over-quarter. The $26.1 million year-over-year increase in substandard loans was primarily driven by $15.9 million from the two loan relationships acquired as part of the IFH transaction, and the one legacy bank relationship accounting for $9.7 million. At March 31, 2026, special mention loans totaled $60.3 million, or 2.0% of total portfolio loans, compared to $57.9 million, or 2.0% of total portfolio loans, at December 31, 2025, and $63.0 million, or 2.4% of total portfolio loans, at March 31, 2025.

Efficiency Ratio:

The efficiency ratio was 69.6% for 1Q 2026, compared to 62.3% for 4Q 2025 and 64.9% for 1Q 2025. The core efficiency ratio(1) was 69.6% for 1Q 2026, which increased from 62.3% compared to the prior quarter, and increased from 62.8% for 1Q 2025.

_____________________1 As used in this press release, Core NIM, Core Loan Yield, and Core efficiency ratio are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.

Financial Metrics (Continued)

Returns:

ROA was 1.33% for 1Q 2026, compared to 1.71% for 4Q 2025, and 1.75% for 1Q 2025. Core ROA(1) for 1Q 2026 was 1.33%, compared to 1.71% for 4Q 2025, and 1.87% for 1Q 2025.

Book Value:

Book value per common share of $25.10 at March 31, 2026, increased $0.57 when compared to December 31, 2025, and increased $2.91 when compared to March 31, 2025. Tangible book value per common share(1) increased $0.57, or 2.6% (not annualized), to $22.62 at March 31, 2026 when compared to December 31, 2025, and increased $2.81, or 14.2%, when compared to March 31, 2025.

_____________________1 As used in this press release, Core ROA, Core ROE, ROTCE, Core ROTCE, and Tangible Book Value are non-GAAP financial measures. These non-GAAP financial metrics exclude the impact of merger-related expenses and certain other pre-tax adjustments which are not indicative of operating performance and the tax impacts of such adjustments. Reconciliations of these and other non–GAAP measures to their comparable GAAP measures are set forth in the Appendix at the end of this press release.

Reportable Segments

Commercial Bank

Loan Growth – Portfolio loans(1) increased $73.0 million at March 31, 2026 compared to December 31, 2025, driven by $32.3 million from C&I, $29.7 million from residential real estate, and $6.1 million from construction real estate. Portfolio loans increased $330.6 million at March 31, 2026 compared to March 31, 2025, driven by $136.2 million from C&I, $101.9 million from residential real estate, and $46.1 million from CRE. Historical gross portfolio loan balances are disclosed in the Composition of Loans table within the Historical Financial Highlights.

Net Interest Income – Interest income of $52.7 million increased $0.7 million from the prior quarter, $0.5 million of which was due to growth in the Commercial Bank loan portfolio and $0.2 million of which was from higher loan PAA. Interest expense of $18.5 million increased $0.2 million, primarily due to a mix shift in the deposit portfolio.

Credit Metrics – Nonperforming assets decreased 7 bps to 1.64% of total assets at March 31, 2026 compared to December 31, 2025. Total nonaccrual loans at March 31, 2026 were $55.4 million, an increase of $1.0 million or 1.8% compared to $54.4 million at December 31, 2025.

Classified and Criticized Loans – At March 31, 2026, special mention loans totaled $60.3 million, or 2.0% of total portfolio loans, compared to $57.9 million, or 2.0% of total portfolio loans, at December 31, 2025. At March 31, 2026, substandard loans totaled $71.8 million, or 2.4% of total portfolio loans, compared to $58.5 million, or 2.0% of total portfolio loans, at December 31, 2025.

_____________________(1) Portfolio loans represents portfolio loans receivable excluding deferred origination fees, net.

OpenSky™

Accounts – During 1Q 2026, credit card accounts grew to 588.2 thousand, increasing 2.7 thousand, or 0.5% (not annualized) from December 31, 2025, and increasing 24.5 thousand, or 4.3% year-over-year.

Loan and Deposit Balances – Secured and unsecured loan balances, net of reserves for interest and fees, of $134.8 million at March 31, 2026 decreased by $7.6 million, or 5.3% (not annualized), compared to December 31, 2025 and increased $16.1 million, or 13.5%, year-over-year. Deposit balances of $165.5 million at March 31, 2026 increased $2.3 million compared to December 31, 2025 and decreased $3.3 million, or 1.9% year-over-year. Gross unsecured loan balances of $46.6 million at March 31, 2026 decreased $0.6 million, or 1.2% (not annualized), compared to $47.1 million at December 31, 2025, and increased $19.9 million year-over-year. Gross secured loan balances of $90.0 million at March 31, 2026 decreased $7.3 million, or 7.5% (not annualized), compared to $97.3 million at December 31, 2025, and decreased $3.5 million, or 3.8% (not annualized) year-over-year.

Net Interest Income – Interest income of $15.1 million decreased $1.3 million compared to 4Q 2025. Average OpenSky™ credit card loan balances, net of reserves and deferred fees of $133.7 million for 1Q 2026, decreased $0.1 million, or 0.1% (not annualized), compared to 4Q 2025.

Fee Revenue – Total fee revenue of $4.7 million decreased $0.1 million from the prior quarter primarily driven by lower interchange and other credit-card related fees.

Noninterest Expense – Total noninterest expense of $16.2 million increased $1.6 million compared to 4Q 2025, driven by professional fees associated with the legacy and unsecured products, investment in headcount for initiatives, the acceleration of depreciation of capitalized assets related to OpenSky™ technology, and data processing costs.

OpenSky™ Credit – Portfolio credit metrics continued to be consistent with modeled expectations during 1Q 2026. The provision for credit losses of $2.7 million increased $1.4 million when compared to the prior quarter, primarily due to a $2.0 million credit in 4Q 2025 to the allowance for credit losses that was made to reflect the debt sale. Excluding this item in 4Q 2025, the provision for credit losses would have decreased $0.6 million primarily due to lower balances in the loan portfolio. OpenSky's™ unsecured loan product is offered exclusively to current and former secured card customers. Unsecured loans have been offered by OpenSky™ since the fourth quarter of 2021 and have generally performed in alignment with management expectations over that time period.

Capital Bank Home Loans

Originations of loans held for sale totaled $72.9 million during 1Q 2026, with $52.4 million of mortgage loans sold resulting in a gain on sale of loans of $1.5 million, representing a 2.85% gain on sale as a percentage of total loans sold. Originations of loans held for sale totaled $107.3 million during 4Q 2025, with $83.0 million of mortgage loans sold resulting in a gain on sale of loans of $2.1 million, representing a 2.58% gain on sale as a percentage of total loans sold.

Windsor Advantage™

Gross government loan servicing revenue totaled $5.6 million, including $1.3 million of Capital Bank related servicing fees, during 1Q 2026. Gross government loan servicing revenue totaled $5.0 million, including $1.0 million of Capital Bank related servicing fees, during 4Q 2025. Windsor's™ total servicing portfolio was $3.2 billion at March 31, 2026, and $3.1 billion at December 31, 2025.

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(1) Refer to Appendix for reconciliation of non-GAAP measures.

______________

(1) Refer to Appendix for reconciliation of non-GAAP measures.(2) Loans are reflected net of deferred fees and costs.

The following tables show the average outstanding balance of each principal category of our assets, liabilities and stockholders’ equity, together with the average yields on our assets and the average costs of our liabilities for the periods indicated. Such yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period.

_______________

(1) Annualized.(2) Includes nonaccrual loans.(3) For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, collectively, Core Loan Yield was 6.93%, 6.95% and 7.14%, respectively.(4) For the three months ended March 31, 2026, December 31, 2025, and March 31, 2025, collectively, Core Net Interest Margin was 4.15%, 4.19% and 4.36%, respectively.

The Company’s reportable segments represent business units with discrete financial information whose results are regularly reviewed by management. The four segments include Commercial Banking, OpenSky™ (the Company’s credit card division), Windsor Advantage™ and Capital Bank Home Loans (the Company’s mortgage loan division).

The following schedules reported internally for performance assessment by the chief operating decision maker presents financial information for each reportable segment for the periods indicated. Total assets are presented as of March 31, 2026, December 31, 2025, and March 31, 2025.

________________________(1) Gross government loan servicing revenue totaled $5.6 million, including $1.3 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended March 31, 2026.

________________________(1) Gross government loan servicing revenue totaled $5.0 million, including $1.0 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended December 31, 2025.

________________________(1) Gross government loan servicing revenue totaled $4.6 million, including $1.0 million of servicing fees earned from the Commercial Bank by Windsor™, for the three months ended March 31, 2025.

_______________(1) Annualized.(2) Refer to Appendix for reconciliation of non-GAAP measures.

_______________

(3) Credit card loans are presented net of reserve for interest and fees.(4) Gain on sale percentage is calculated as gain on sale of loans divided by mortgage loans sold.

Appendix

Reconciliation of Non-GAAP Measures

The Company has presented the following non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Company evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Company’s industry. Investors should recognize that the Company’s presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Company strongly encourages a review of its condensed consolidated financial statements in their entirety.

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(1) Annualized.(2) The efficiency ratio is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income).

ABOUT CAPITAL BANCORP, INC.

Capital Bancorp, Inc., Rockville, Maryland is a registered bank holding company incorporated under the laws of Maryland. Capital Bancorp has been providing financial services since 1999 and now operates bank branches in four locations in the Washington, D.C., Baltimore, other Maryland markets, one bank branch in Fort Lauderdale, Florida, one bank branch in Chicago, Illinois and one bank branch in Raleigh, North Carolina. Capital Bancorp had assets of approximately $3.8 billion at March 31, 2026 and its common stock is traded in the NASDAQ Global Market under the symbol “CBNK.” More information can be found at the Company's website www.CapitalBankMD.com under its investor relations page.

FORWARD-LOOKING STATEMENTS

This earnings release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” "optimistic," “intends” and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements. Accordingly, we caution you that any such forward-looking statements are not a guarantee of future performance and that actual results may prove to be materially different from the results expressed or implied by the forward-looking statements due to a number of factors. For details on some of the factors that could affect these expectations, see risk factors and other cautionary language included in the Company's Annual Report on Form 10-K and other periodic and current reports filed with the Securities and Exchange Commission.

While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ materially from those contained or implied in the forward-looking statements: the strength of the United States (“U.S.”) economy in general and the strength of the local economies inwhich we conduct operations; geopolitical concerns, including acts or threats of terrorism and the ongoing wars in Israel, Iran and Ukraine; uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market, and monetary fluctuations; volatility and disruptions in global capital and credit markets; changes in U.S. trade policies, including the implementation of tariffs and other protectionist trade policies; the effects of federal government shutdowns, debt ceiling standoff, or other fiscal policy uncertainty; competitive pressures on product pricing and services; success, impact, and timing of our business strategies, including market acceptance of any new products or services; the impact of changes in financial services policies, laws, and regulations, including those concerning taxes, banking, securities, and insurance, and the application thereof by regulatory bodies; cybersecurity threats and the cost of defending against them; climate change, and other catastrophic disasters; the effectiveness of the Company's internal control over financial reporting and disclosure controls and procedures; the Company’s ability to remediate the material weakness in the Company’s internal control over financial reporting; the effect of the IFH acquisition or any other acquisitions we have made or may make, including, without limitation, the failure to achieve the expected revenue growth and/or expense savings from such acquisitions, and/or the failure to effectively integrate an acquisition target into our operations, including the planned growth of Windsor Advantage™; and other factors that may affect our future results.

These forward-looking statements are made as of the date of this communication, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by law.

FINANCIAL CONTACT: Jake Dalaya (301) 637-5118

MEDIA CONTACT: Ed Barry (240) 283-1912

WEB SITE: www.CapitalBankMD.com