GBank Financial Holdings Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income for the third quarter of 2026 was $3.9 million ($0.27 diluted EPS), compared to $5.5 million ($0.38 diluted EPS) in the second quarter of 2026 and $4.3 million ($0.30 diluted EPS) in the third quarter of 2025.
• Adjusted net income for the third quarter of 2026 was $4.3 million ($0.30 adjusted diluted EPS), compared to $5.5 million ($0.38 adjusted diluted EPS) in the prior quarter and $6.3 million ($0.44 adjusted diluted EPS) in the prior year period.
• For the nine months ended September 30, 2026, net income was $10.6 million ($0.73 diluted EPS), compared to $13.5 million ($0.93 diluted EPS) for the same period in 2025. Adjusted net income for the nine months was $14.4 million ($0.99 adjusted diluted EPS), compared to $16.4 million ($1.13 adjusted diluted EPS) in 2025.
• Net interest income totaled $13.6 million for the third quarter, an increase of 6.4% from the prior quarter and 4.7% from the prior year period.
• Net interest margin increased 17 basis points to 3.95% in the third quarter of 2026, compared to 3.78% in the second quarter and 4.35% in the third quarter of 2025.
• Net revenue was $20.3 million for the third quarter, a decrease of 7.3% from the second quarter of 2026, primarily due to lower net interchange fees and fewer loans sold.
• Non-interest income was $6.7 million for the third quarter, down $2.4 million from the prior quarter, driven by a $1.5 million decrease in net interchange fees and a $0.8 million decrease in gain on sale of loans.
• Non-interest expense was $12.8 million for the third quarter, an increase of $0.8 million from the prior quarter, primarily due to a $1.1 million increase in salaries and employee benefits, including $0.5 million in severance expense.
• The efficiency ratio was 63.0% for the third quarter of 2026, compared to 54.7% in the second quarter and 61.1% in the third quarter of 2025.
• Provision for credit losses on loans was $2.6 million for the third quarter, compared to $2.8 million in the prior quarter and $2.2 million in the prior year period.
• Net loan charge-offs were $1.1 million for the third quarter, consistent with the prior quarter's $1.2 million.
• Total assets were $1.5 billion as of September 30, 2026, an 11.9% increase from $1.3 billion as of September 30, 2025.
• Total loans, net of deferred fees and costs, were $1.1 billion as of September 30, 2026, an increase of $24.5 million from the prior quarter and $131.2 million from the prior year period.
• Deposits totaled $1.2 billion as of September 30, 2026, an increase of $71.8 million from the prior year period, driven by $114 million growth in certificates of deposit.
• The allowance for credit losses totaled $13.9 million as of September 30, 2026, compared to $12.4 million as of June 30, 2026, and $10.6 million as of September 30, 2025.
• Stockholders' equity was $175.4 million as of September 30, 2026, compared to $172.8 million as of June 30, 2026, and $158.2 million as of September 30, 2025.
• Book value per share was $12.08 as of September 30, 2026, an increase of 1.1% from the prior quarter and 9.1% from the prior year period.

Guidance and Future Outlook:

• Management expects the impact of the legacy retail credit card portfolio on provision expense to diminish as the portfolio continues to run off.
• The company aims to address items holding back earnings and have them behind by the end of the year, targeting 2027 as a fresh start.
• Gaming fintech initiatives are expected to take hold and contribute to results as the company moves through 2027.
• The company expects to complete team building by the end of the year.
• Guaranteed loans held for sale increased by $19 million from June 30, 2026, with the majority expected to be sold during the fourth quarter.
• BVNKROLL payments infrastructure integration with the AXES digital casino management system is expected to be completed by year-end 2026.
• The LuckyLoads prepaid card is now expected to be launched during the second quarter of 2027.

Business Segments and Product Lines:

• SBA loan originations totaled $171.7 million in the third quarter of 2026, compared to $131.4 million in the prior quarter and $207.7 million in the prior year period.
• Gain on loan sales margin increased to 5.57% in the third quarter of 2026, compared to 5.04% in the prior quarter and 3.24% in the prior year period.
• Gaming and fintech deposits averaged approximately $30.9 million in September, up from $29.9 million in July.
• Gaming-related credit card transaction volume was $19.5 million in the third quarter, compared with $84.2 million in the second quarter.
• Net interchange fee income declined 84.6% to $0.3 million in the third quarter following changes in credit card funding practices by several large sports betting operators.
• Distill Taverns fully launched the BoltBetz application across all nine of its Las Vegas locations in September.
• Terrible's is expected to launch BoltBetz in early November at three locations with a full rollout planned during 2027.

Market and Competitive Landscape:

• The decision by several large sports betting operators to discontinue credit cards as a funding source significantly impacted net interchange fees.
• The company operates two full-service commercial branches in Las Vegas, Nevada, serving Nevada, California, Utah, and Arizona.
• Total assets under management, including $1.2 billion of sold loans for which servicing is retained, totaled $2.7 billion as of September 30, 2026.

Risks and Challenges:

• The legacy non-gaming retail credit card portfolio continues to affect provision expense due to elevated delinquency levels.
• Non-performing assets increased to $54.2 million as of September 30, 2026, from $37.5 million as of September 30, 2025, driven by a $5.3 million increase in other real estate owned.
• Other real estate owned increased to $10.9 million as of September 30, 2026, attributable to the completion of foreclosure proceedings on three commercial real estate properties totaling $6.9 million.
• Non-performing assets, excluding guaranteed portions, increased to $28.8 million (1.97% of total assets) as of September 30, 2026, from $21.3 million (1.49% of total assets) as of June 30, 2026.
• Non-core items for the third quarter of 2026 totaled $0.6 million pre-tax, consisting of $0.5 million in severance expense and $0.1 million in fraud losses.

Management Commentary and Tone:

• Jeff Newgard, President and Chief Executive Officer, stated that despite lower than expected earnings, the core banking franchise performed well with higher net interest income, an improved net interest margin, and strong SBA production.
• Management emphasized that earnings were affected by lower interchange income and one-time or non-core items, but believes underlying performance reflects the strength of the franchise.
• The CEO's focus is on strengthening the core bank, building the team, maintaining strong credit discipline, and executing on opportunities.
• Management expressed confidence that the legacy credit card portfolio impact will diminish and that 2027 will be a fresh start with visible impacts from gaming fintech initiatives.

Other Key Points:

• The company issued $11.0 million of subordinated debt in January 2026 maturing on January 15, 2036.
• The company redeemed $6.5 million of subordinated debt originally issued in 2020.
• The company had $60 million in short-term borrowings as of September 30, 2026, compared to none in the prior quarter and prior year period.
• Available borrowing capacity included approximately $387.6 million from the Federal Reserve Bank of San Francisco, the Federal Home Loan Bank of San Francisco, and fed funds lines of credit.
• The company hosts an earnings call on October 28, 2026, at 2:00 p.m. PST.
• Full-time equivalent employees were 179 as of September 30, 2026, down from 189 in the prior quarter.