Executive Summary

Q1 2025 delivered improving core banking metrics but negative earnings: net interest margin expanded to 2.70% (+28 bps q/q, +43 bps y/y), deposits rose 4.2% q/q, and borrowings fell 60% q/q; however, a higher provision for credit losses and elevated compensation costs drove a net loss to common of $(1.201)M and diluted EPS of $(0.14) .
Credit quality remains generally strong despite one new non‑accrual loan; non‑performing assets were 0.07% of total assets, and the ACL increased to $8.8M .
Funding mix improved materially: total deposits increased by $31.1M q/q to $776.5M, while borrowings dropped by $117.5M q/q to $158.8M, reducing cost of funds to 2.67% (from 3.23% in Q4) .
No formal quantitative guidance was provided; management emphasized investment in people and operational capabilities and expressed optimism about executing strategic goals and improving profitability while serving low‑to‑moderate income communities .
Potential stock reaction catalysts: visible NIM expansion from lower borrowing costs and improved loan yields, strong deposit growth, and reduced leverage; offset by higher opex and increased provisioning tied to a single borrower .

What Went Well and What Went Wrong

What Went Well

Net interest margin expanded to 2.70% (vs. 2.42% in Q4 2024; 2.27% in Q1 2024), driven by higher yields on loans and lower cost of funds .
Deposits grew 4.2% q/q (+$31.1M) and 11.7% y/y (+$81.0M); borrowings reduced by $117.5M q/q to $158.8M, materially lowering funding costs .
CEO tone constructive: “We reduced borrowing costs which resulted in lower cost of funds… net interest margin was 2.70%” and reaffirmed focus on growth and profitability in service of mission communities .

What Went Wrong

Earnings were negative: net loss attributable to common stockholders $(1.201)M; diluted EPS $(0.14), pressured by a $689k provision tied to a single borrower moving to non‑accrual and higher compensation (incl. $122k severance) .
Non‑interest expense rose 5.7% y/y (+$444k), primarily due to +$1.0M compensation and benefits despite a $710k decline in professional services .
Asset balances declined $73.7M q/q, with reductions in cash, AFS securities, and loans, partially offset by other assets; uninsured deposits rose to 34% of total deposits (from 32% in Q4) .

Financial Results

Metric	Q3 2024	Q4 2024	Q1 2025
Total Interest Income ($USD Millions)	$16.166	$15.762	$14.374
Net Interest Income ($USD Millions)	$8.330	$7.997	$8.045
Non-interest Income ($USD Millions)	$0.416	$0.560	$0.288
Net Income Attributable to Common ($USD Millions)	$(0.228)	$0.550	$(1.201)
Diluted EPS ($USD)	$(0.03)	$0.06	$(0.14)
Net Interest Margin %	2.49%	2.42%	2.70%
Yield on Interest‑Earning Assets %	4.82%	4.78%	4.82%
Cost of Funds %	3.23%	3.23%	2.67%

KPIs

KPI	Q3 2024	Q4 2024	Q1 2025
Deposits ($USD Millions)	$672.2	$745.4	$776.5
Total Borrowings ($USD Millions)	$398.4	$262.1	$158.8
Non‑accrual Loans ($USD Millions)	$0.291	$0.264	$0.860
Non‑performing Assets / Total Assets %	0.02%	0.02%	0.07%
Uninsured Deposits % of Total	34%	32%	34%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Company Guidance	FY/Q1 2025	Not provided	Not provided	Maintained (no formal quantitative guidance)

Management emphasized operational investments and improving profitability but did not issue numerical revenue, margin, opex, tax, or dividend guidance .

Earnings Call Themes & Trends

No earnings call transcript was available for Q1 2025. Themes below reflect management commentary from press releases across periods.

Topic	Previous Mentions (Q3 2024)	Previous Mentions (Q4 2024)	Current Period (Q1 2025)	Trend
Funding mix & cost of funds	Cost of funds 3.23%; higher borrowings and deposit costs constrained NIM	Cost of funds 3.23% in Q4; shift from borrowings to lower‑cost deposits highlighted	Cost of funds fell to 2.67% with reduced borrowings and deposit growth	Improving
Net interest margin	2.49% NIM; modest improvement y/y	2.42% NIM; stable q/q	2.70% NIM; significant expansion q/q and y/y	Improving
Credit quality	One non‑accrual loan (~$291k); ACL up with loan growth	One non‑accrual loan ($264k) at year‑end	Three non‑accrual loans ($860k); provision up due to single borrower; NPA/TA 0.07%	Slight deterioration but still strong
Deposits	Deposits down ytd; ICS up; uninsured deposits 34%	Deposits +$62.8M y/y; uninsured 32%	Deposits +$31.1M q/q; uninsured deposits 34%	Improving balances; uninsured steady‑to‑higher
Borrowings	Total borrowings ~$398.4M	Borrowings down to $262.1M (BTFP repaid)	Borrowings down to $158.8M (–$117.5M FHLB)	Deleveraging
Operating investment & controls	Higher professional fees from control remediation	Professional services down; added senior hires	Compensation +$1.0M; continued investment in people (incl. $122k severance)	Near‑term cost pressure to support long‑term execution
Securities AFS & rates	AFS appreciated; lower rates aiding OCI	AFS appreciated (+$3.2M) amid Fed cuts	AFS and cash balances declined q/q as balance sheet repositioned	Portfolio reshaping

Management Commentary

“Deposits grew by 4.2%… and 11.7% since March of last year. In addition, we reduced borrowing costs which resulted in lower cost of funds. The net interest margin was 2.70%…” — Brian Argrett, CEO .
“Results… were adversely affected by the provision for credit losses due to one borrower… changing to non‑accrual… although we are working with the borrower for a healthier resolution.” .
“Our first quarter financial results were negatively impacted by our investments in people… to improve our control environment, improve our efficiency, and promote our continued growth.” .
Broader mission and stakeholder focus: optimism in executing strategic goals while serving low‑to‑moderate income communities .

Q&A Highlights

No Q1 2025 earnings call transcript was available; therefore no Q&A themes or clarifications could be assessed this quarter [ListDocuments: earnings-call-transcript returned none].

Estimates Context

Metric	Q1 2025 Actual	Wall Street Consensus	Surprise
Diluted EPS ($USD)	$(0.14)	N/A (insufficient coverage)*	N/A
Total Interest Income ($USD Millions)	$14.374	N/A (insufficient coverage)*	N/A
Non‑interest Income ($USD Millions)	$0.288	N/A (insufficient coverage)*	N/A

*Values retrieved from S&P Global. BYFC appears to have limited analyst coverage; no consensus EPS or revenue estimates were available for Q1 2025 via S&P Global.

Implications: With consensus absent, near‑term estimate revisions are unlikely to drive trading; focus shifts to observed NIM expansion, deposit trends, credit provisioning, and opex trajectory .

Key Takeaways for Investors

NIM expansion and sharply lower cost of funds signal improving core earnings power as borrowings are replaced with deposits; watch sustainability of 2.70% NIM amid rate moves and loan mix .
Deposit growth (+$31.1M q/q) and deleveraging (borrowings to $158.8M) are tangible positives that should support margin and liquidity metrics in 2025 .
Credit provisioning was the principal earnings headwind (provision $689k) tied to one borrower; despite a higher non‑accrual balance ($860k), NPA/TA remains low at 0.07%—monitor resolution and any follow‑on impacts .
Operating expense elevation (+$1.0M compensation; $122k severance) reflects investment in people and controls; medium‑term thesis depends on operating leverage as efficiency improves and professional services remain contained .
Uninsured deposits at 34% require ongoing vigilance; continued utilization of IntraFi programs for insurance can mitigate concentration risk, but investor focus will remain on deposit stability and cost .
With limited sell‑side coverage, narrative catalysts will be company‑specific: continued deposit growth, further borrowings reduction, and maintenance of strong credit metrics could drive sentiment more than estimates .
Near‑term trading implications: constructive on margin trajectory and funding mix; cautious on opex and provisioning until evidence of normalization; look for next quarter to validate NIM durability and expense discipline .

BROADWAY FINANCIAL CORP \DE\ (BYFC)·Q1 2025 Earnings Summary