GBank Financial Holdings Inc.

The related Q3 earnings press release was filed with the U.S. Securities and Exchange Commission on Tuesday, October 28, 2025, and is available on the news and media section of our website, gbankfinancialholdings.com. Before we begin, I'd like to remind everyone that any forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those anticipated future results. Please see our safe harbor statements in our earnings press release. All comments expressed or implied made during today's call are subject to the safe harbor statements. Any forward-looking statements made during this call are made only as of today's date, and we do not undertake any duty to update such forward-looking statements except as required by law. Additionally, during today's call, we may discuss certain non-GAAP financial measures, which we believe are useful in evaluating our performance. A reconciliation of these non-GAAP financial measures to the most comparable GAAP financial measures can also be found in our earnings release. I'll now turn the call over to Edward M. Nigro, our Chairman and Chief Executive Officer.

Well, good morning. I'm Ed Nigro, Chairman and Chief Executive Officer of G-Bank Financial Holdings and G-Bank. And I'd like to welcome all of you, our shareholders, our employees, guests, to our quarterly third quarter earnings call for G-Bank Financial Holdings. And here today, Jeff is going to, Jeff Wicker, who is our Chief Financial Officer, and I will be giving you our verbal presentation. And I wanted to advise you that we changed the format quite a bit for this particular call. Jeff's going to go through some salient numbers how they were developed, why they occurred the way they did in a more brief assessment, rather than going through and repeating the earnings per share and everything that you've seen. But we will also have questions on Jeff's comments later. Then I will then take over from Jeff and talk about expenses that we have. But so right now, I'd like to turn it over to Jeff to discuss some of the more salient numbers that you have before you.

Jeff. Thank you, Ed. Welcome, everyone. The company reported quarterly earnings of $4.3 million or $0.30 per diluted share. That's a decrease of $500,000 compared to the prior quarter earnings of $4.8 million. Now included in these quarterly results are approximately 2 million or 14 cents per share in unusual operating expenses. There were four main items that are unusual in nature that explain the quarter-over-quarter increase in non-interest expense and would not be expected in core earnings going forward. These include $900,000 for the resolution of the contract related to the departure of the prior chief executive officer, $728,000 related to the spent on the direct mail marketing campaign that provides a cash back bonus for upfront spend on cards. $258,000 related to a DDOS The goal is to disrupt normal operations, stretch current resources, and create vulnerabilities. And finally, $707,000 related to an attempt to create revolving balance accounts through direct mail campaigns, which were targeted by bad actors who were able to bypass the current detection systems and create accounts that went directly to charge on. This type of marketing has been discontinued, and a more targeted marketing campaign has been developed In response to these findings, the bank has executed several new processes to identify fraud activity and help reduce any impact in the future. These include the following, adoption of the Experian bust-out score, which looks to identify, detect, and prevent bust-out cardholders, which is a form of first-party fraud where individuals build a strong credit profile and then intentionally default on multiple accounts. which is a comprehensive digital identity management platform, PreciseID, which is a comprehensive identity verification and fraud detection platform designed to help authenticate identities, detect fraud, and comply with regulations, and Plaid Identification Verification, which verifies the identity of the applicant by comparing the applicant's ID to a live picture taken by the applicant. Additionally, the bank has implemented a two to four-day hold on ACH payments to prevent customers from running up credit card balances and paying down with unavailable funds. The bank is also in the process of implementing two-way SMS, allowing for cardholders to verify potential fraudulent activities in real time. With the addition of the new application system and additional processes, we believe that the bank's fraud detection systems are now state-of-the-art and will act to ensure This quarter, the bank did experience some significant highlights on the financials, and I would like to point those out. The most important is net revenue growth. The bank delivered solid operating leverage this quarter, with net revenue growing 13.5% to $20.2 million. This high level of growth in revenue quarter over quarter demonstrates how impactful the digital banking programs can be to our earnings going forward. Interest income in the quarter. On balance sheet guaranteed loan balances increased $22.9 million for the quarter to $260.5 million. Net interchange income was up 56.7% over the prior quarter as credit card transaction volume started to rebound with total transaction volume hitting $131 million, which was a 57% increase over the prior quarter. The company has recently launched the new online credit card application drive up future volumes. The gain on sale revenue increased 38.5% over the linked quarter. SBA and commercial lending have continued their banner gear with record loan production in the quarter of 242 million, which is up 82 million over the prior quarter. The GAAP gain on sale pricing increased by 15 basis points in the quarter to 3.24% compared to 3.09% in the linked quarter, with an 84 basis point increase in the month of September as pricing started to rebound and the bank implemented some cost containment measures to improve profitability. In addition, the bank has restructured the current incentive payment structure. The prior structure was built to enhance volume. However, this did not promote originating loans that would lead to a strong net income for the bank. The structure is now in place to align the originators with the interest of the organization and ensure that the bank receives a minimum 4% gap gain on sale going forward. As these measures take effect, we anticipate this income will continue to increase. It's important to note that the government shutdown, if it continues to extend, has the potential to impact SBA's ability to approve loan origination and sales. The bank was able to secure PLP numbers for 19 loans prior has allowed the bank to produce $48 million in loans in October. But additional growth and sales are being delayed pending the opening of the federal government. Looking at the balance sheet, the company generated over $90 million in loan growth, while total assets increased by $69 million, or 5.6% during the quarter. Total assets ended the quarter at over $1.3 billion for the first time in the company history. while shareholders' equity grew 4.2% to $158 million. Average earning assets increased $34 million over the linked quarter as the bank continued to execute on its overall growth strategy. The bank has been funding the significant growth over the last few quarters, mainly with time deposits and interest-bearing money market accounts, which we have been able to successfully do and maintain an above-average net interest margin of well over 4%. The bank monitors both the deposit market and our funding levels very closely, ensuring that we continue to support loan growth appropriately while also adjusting pricing to support margin aspirations and profitability. The bank anticipates being able to quickly reprice these deposits as the Federal Reserve lowers interest rates as they are mostly short-term in nature. In addition, the bank plans to implement programs such as bold bets and significant levels of lower-cost funding and enhanced margins going forward. Non-performing assets increased by $5.8 million to $10.4 million net of the guaranteed balances and now represent a manageable 0.8% of total assets. Additionally, we charged off $836,000 in loans previously reserved for. While these increases can seem large by percent, and then we are moving into a more normal range. The bank's monitoring these credits very closely and is working them out as quickly as we can. The bulk of the increase in MPAs came from seven loans. Four of them are hotel loans and three of them are non-hospitality. All of these loans are diversified across the country and the bank has not recognized any significant trends that would imply additional risk to the portfolio at this time. The bank remains asset sensitive related to the net interest income with a 200 basis point change in short-term rates expected to impact net interest income by roughly 13 basis points. However, the earnings portfolio is almost neutral for the overall earnings at risk in wrapped up scenarios as SBA loan sales provide a natural hedge to the income in a rates down scenario. The bank purchased $7 million in securities during the quarter with an average yield of 4.9%. The overall yield on the securities portfolio remains above 4.69% and is in the top decile of our peer group. In addition, recent changes in rates have resulted in the bank achieving a positive AOCI for the first time in almost a year. Liquidity continues to remain healthy with on-ballot sheet liquidity of $253 million and borrowing capacity of $504 million. In total, the bank had replaced 70% of the on-ballot sheet deposits in under 24 hours. Capital levels remain strong with the Tier 1 capital ratio coming in at 13.37%, down from 13.82% last quarter due to balance sheet growth offset by current earnings. So while we've experienced some hiccups along the way, the overall strategic plan for the bank is continuing to develop. As we continue to move into the digital world, we will continue to see revenues and earnings grow, which will enhance shareholder value. With that, I'll turn it back over to you, Ed.