BayFirst Incurs Loss in Q3, Exits SBA Lending Amid Shakeup

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BAFN have declined 10.8% since the company reported its earnings for the quarter ended Sept. 30, 2025. This compares to the S&P 500 index’s 0.4% decline over the same time frame. Over the past month, the stock has gained 16.8% compared with the S&P 500’s 2.1% growth, reflecting investor concern following a materially negative earnings surprise and strategic shift in the business model.BayFirst incurred a net loss of $4.66 per share for the third quarter of 2025 against a net income of 18 cents per share in the year-ago quarter. This deterioration was driven by higher provisions for credit losses and significant one-time charges totaling $12.4 million, largely tied to the company's decision to exit its SBA 7(a) lending operations.Total revenues, reflected by net interest income, rose 19.4% year over year to $11.3 million from $9.4 million.BayFirst incurred a net loss of $18.9 million against a net income of $1.1 million in the year-ago quarter.BayFirst Financial Corp. Price, Consensus and EPS SurpriseBayFirst Financial Corp. price-consensus-eps-surprise-chart | BayFirst Financial Corp. QuoteNet interest margin (NIM) in the third quarter was 3.61%, up 27 basis points from 3.34% in the same period last year.Noninterest income turned negative at $1 million compared to $12.3 million in the third quarter of 2024. The unfavorable swing was due to a $5.1 million fair value adjustment on held-for-sale loans and a drop in government guaranteed loan fair value gains. These changes reflect the impact of discontinuing SBA-related operations.On the expense front, noninterest expenses surged to $25.2 million from $17.1 million in the prior year’s third quarter, driven by a $7.3 million restructuring charge. Loan origination and collection expenses also rose by $1.3 million year over year.CEO Thomas Zernick described the quarter as one of “significant strategic transformation,” highlighting the company’s decision to exit the SBA 7(a) lending business as a critical move to derisk the balance sheet and realign focus on core community banking. Management emphasized that while current profitability fell short, the restructuring positions the company for long-term growth and a targeted return to profitability in 2026, aiming for a return on assets of 40-70 basis points.Executive VP & CFO Scott McKim noted that the $5.1 million loss on held-for-sale SBA loans sold to Banesco USA represented 97% of their balances, and stated that the company expects to sell additional SBA loan balances in future quarters. Robin Oliver, President and COO, added that BayFirst will redirect focus toward consumer and residential mortgage lending in the Tampa Bay region.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P Futures6,762.00 +14.50 (+0.21%)Dow Futures47,104.00 +76.00 (+0.16%)Nasdaq Futures25,319.25 +75.00 (+0.30%)Russell 2000 Futures2,435.60 +8.20 (+0.34%)VIX19.50 +1.49 (+8.27%)Gold4,002.50 +11.50 (+0.29%)PortfolioSign in to access your portfolioSign inTop gainersHAE Haemonetics Corporation 67.11 +16.39 (+32.31%)APPN Appian Corporation 38.36 +9.03 (+30.79%)LFST LifeStance Health Group, Inc. 6.25 +1.44 (+29.94%)BHF Brighthouse Financial, Inc. 65.70 +13.90 (+26.83%)DDOG Datadog, Inc. 190.82 +35.84 (+23.13%)Top losersELF e.l.f. 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