Broadway Financial Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income attributable to common stockholders was $392 thousand ($0.04 per diluted share) for Q3 2026, compared to $218 thousand ($0.02 per diluted share) in Q2 2026 and a net loss of $24.6 million ($2.86 per diluted share) in Q3 2025.
• Consolidated net income before preferred dividends for Q3 2026 was $1.1 million ($0.13 per diluted share), compared to $968 thousand ($0.11 per diluted share) in Q2 2026 and $2.0 million ($0.23 per diluted share) in Q3 2025.
• For the first nine months of 2026, consolidated net income was $1.0 million ($0.11 per diluted share), a significant improvement from a net loss of $28.1 million ($3.27 per diluted share) in the same period of 2025.
• Net interest income totaled $9.9 million in Q3 2026, an increase of 4.3% from Q2 2026, driven by higher loan and securities balances.
• Net interest margin was 2.64% in Q3 2026, stable from 2.65% in Q2 2026 but down from 2.72% in Q3 2025.
• Provision for credit losses was $668 thousand in Q3 2026, down from $1.5 million in Q2 2026, primarily due to partial charge-offs of previously reserved loans.
• Non-interest income was $496 thousand in Q3 2026, a 47.8% decrease from Q2 2026, largely due to the absence of a $450 thousand fee from a New Markets Tax Credit transaction earned in the prior quarter.
• Non-interest expense was $8.3 million in Q3 2026, an 11.4% increase from Q2 2026, driven by higher compensation, information services, and supervisory costs.
• For the first nine months of 2026, non-interest expense was $23.8 million, a 51.6% decrease from $49.2 million in 2025, primarily due to a $25.9 million goodwill impairment charge recorded in 2025.
• Total assets increased to $1.56 billion at September 30, 2026, from $1.35 billion at December 31, 2025.
• Stockholders' equity was $255.5 million at September 30, 2026, compared to $262.8 million at December 31, 2025.
• Book value per share was $11.37 at September 30, 2026, down from $12.28 at December 31, 2025.
• Tangible book value per share was $11.24 at September 30, 2026, compared to $12.12 at December 31, 2025.

Guidance and Future Outlook:

• Management remains focused on optimizing the balance sheet, enhancing profitability, and delivering long-term value for stockholders.
• The Company intends to continue operating with a disciplined approach to risk management and underwriting while navigating an evolving economic environment.
• Future strategies include focusing on loan repricing opportunities, optimizing deposit mix, and disciplined balance sheet management to offset funding cost pressures.

Business Segments and Product Lines:

• Net loans increased by $116.2 million (11.4%) during the first nine months of 2026, driven by organic growth and the purchase of government-guaranteed loans.
• Total deposits increased by $192.4 million (21.0%) to $1.1 billion during the first nine months of 2026.
• Deposit growth was driven by increases in savings deposits ($157.9 million), certificates of deposit ($33.4 million), and liquid deposits ($8.5 million), partially offset by decreases in CDARS ($4.4 million) and ICS deposits ($3.0 million).
• Securities available-for-sale increased by $48.6 million, attributed to purchases of securities.
• Cash and cash equivalents increased by $38.8 million.
• Total borrowings increased by $27.0 million to $99.0 million, primarily due to additional FHLB advances used for liquidity management and supporting loan growth.
• Non-interest income for the first nine months of 2026 was $2.0 million, up 91.1% from 2025, driven by earnings on bank-owned life insurance and the New Markets Tax Credit fee.

Market and Competitive Landscape:

• The Company operates as a mission-driven bank serving low-to-moderate income communities in Southern California and the Washington, D.C. market.
• Broadway Financial Corporation is a Community Development Financial Institution (CDFI), Minority Depository Institution, Certified B Corp, and a member of the Global Alliance of Banking on Values.
• The Company leverages a partnership with IntraFi Deposit Solutions to offer deposit insurance for accounts exceeding the FDIC limit, with uninsured deposits representing 34% of total deposits.

Risks and Challenges:

• Credit quality remained stable with non-accrual loans at 1.20% of gross loans and non-performing assets at 0.88% of total assets as of September 30, 2026.
• Non-performing assets increased to $13.8 million at September 30, 2026, from $11.2 million at December 31, 2025.
• The allowance for credit losses increased to $10.0 million at September 30, 2026, from $9.4 million at December 31, 2025.
• Book value per share decline was attributed to unrealized losses within the securities portfolio resulting from interest rate movements.
• Elevated funding costs associated with the higher interest rate environment continue to present pressure on net interest margins.

Management Commentary and Tone:

• CEO Brian Argrett stated that third-quarter results reflect disciplined execution of strategic priorities, resulting in strong growth in loans and deposits while maintaining solid capital levels.
• Management emphasized a continued focus on investments in personnel, technology, and operational infrastructure to support business growth and enhance client service capabilities.
• The tone indicates confidence in the Company's ability to navigate an evolving economic environment through disciplined risk management.

Other Key Points:

• The Company reported a Community Bank Leverage Ratio of 12.83% at September 30, 2026, compared to 14.09% at December 31, 2025, remaining above regulatory well-capitalized thresholds.
• Preferred dividends totaled $750 thousand per quarter, or $2.3 million for the first nine months of 2026.
• The decrease in efficiency ratio for the first nine months of 2026 (78.17%) compared to 2025 (193.22%) was primarily due to the exclusion of the 2025 goodwill impairment charge.
• The effective tax rate was 20.03% for Q3 2026, compared to 22.25% in Q2 2026.
• The Company maintains sufficient liquidity and borrowing capacity to support customer needs while preserving financial flexibility.