Executive Summary

Core results solid despite a deliberate securities repositioning: adjusted diluted EPS was $0.74 vs $0.55 a year ago and $0.74 in Q2; GAAP diluted EPS was $(1.07) due to an $11.8M pre-tax loss on securities sales as part of balance sheet realignment . Net interest margin expanded to 3.64% from 3.54% in Q2 and 3.11% a year ago on higher earning-asset yields and lower cost of funds .
Street context: S&P Global consensus EPS was $0.65 vs reported $0.74 (beat) and revenue estimate was $13.9M vs GAAP operating revenue of $2.16M (miss on GAAP due to securities loss). On an adjusted basis, operating revenue was $14.17M (above consensus). Coverage is thin (2 EPS estimates; 1 revenue estimate). Values retrieved from S&P Global.*
Positive credit and balance sheet trends: loans +2.9% QoQ (+7.3% YoY), core deposit growth, NPLs/loans at 0.19%, ACL/loans 0.89%, and tangible book value per share up to $28.56 .
Strategic catalysts: (1) Securities repositioning expected to add ~19 bps to NIM and ~$0.40 annual EPS; (2) Specialty Treasury Payments & Services rollout by YE25 to drive ~$60M of deposits by 4Q25; (3) New $5M stock repurchase authorization and $0.26 dividend declared .

What Went Well and What Went Wrong

What Went Well
- Margin and core earnings improved: NIM rose to 3.64% (+10 bps QoQ; +53 bps YoY) and adjusted PPNR increased to $4.99M vs $4.72M in Q2 .
- Core noninterest income growth: excluding securities gains/losses and one-offs, noninterest income rose to $1.075M vs $0.850M YoY (+26.5%) on higher service fees and hedge-related income .
- Management execution and tone: “We anticipate an approximate 19 basis point increase to our net interest margin and an estimated $0.40 increase in annual earnings per share,” highlighting long-term accretion from the repositioning and active balance sheet management .
What Went Wrong
- GAAP loss from repositioning: reported a GAAP net loss of $(5.7)M (EPS $(1.07)) on an $11.8M pre-tax loss on securities; GAAP efficiency ratio ballooned given negative GAAP operating revenue .
- Higher operating expenses: noninterest expense increased to $9.2M (+$0.4M YoY; +$0.4M QoQ) on professional fees and salaries/benefits tied to Treasury buildout .
- Deposit costs still elevated vs pre-2024: cost of interest-bearing deposits at 2.26% (vs 2.94% a year ago, but still above 2022-23 levels), requiring continued mix-shift and disciplined pricing in a falling Fed funds environment .

Financial Results

Quarterly results (absolute values; commentary below provides QoQ/YoY comparisons)

Metric	Q3 2024	Q2 2025	Q3 2025
Net Interest & Dividend Income ($M)	11.474	12.540	13.099
Noninterest (Loss) Income ($M)	1.233	0.931	(10.677)
Operating Revenue (GAAP) ($M)	12.707	13.471	2.422
Net Provision (Recovery) for Credit Losses ($M)	(0.041)	0.008	0.259
Net (Loss) Income ($M)	3.219	3.949	(5.696)
Diluted EPS (GAAP) ($)	0.60	0.74	(1.07)
Adjusted Diluted EPS (Non-GAAP) ($)	0.55	0.74	0.74
Net Interest Margin (%)	3.11	3.54	3.64
Efficiency Ratio (GAAP) (%)	69.11	64.94	379.15

QoQ and YoY: NIM 3.64% vs 3.54% (Q2) and 3.11% (Q3’24); Net interest income up to $13.1M vs $12.5M (Q2) and $11.5M (Q3’24); GAAP EPS impacted by $(11.8)M securities loss; adjusted EPS steady at $0.74 .

Estimates vs actuals (S&P Global consensus; thin coverage)

Metric	Consensus	Actual (GAAP)	Actual (Adjusted)
Primary EPS ($)	0.65*	(1.07)	0.74
Revenue ($M)	13.9*	2.16†	14.17‡

Notes: Values retrieved from S&P Global.* †S&P “actual revenue” reference aligns with GAAP operating revenue, which was $2.422M by company calculation; S&P reported $2.159M, likely a definitional/timing difference. ‡Adjusted operating revenue (Non-GAAP) per company reconciliation was $14.174M, excluding the securities loss and other items .

KPIs and balance sheet

KPI	Q3 2024	Q2 2025	Q3 2025
Total Assets ($B)	1.562	1.518	1.546
Total Loans ($B)	1.066	1.111	1.143
Total Deposits ($B)	1.354	1.309	1.334
NPLs/Total Loans (%)	0.19	0.16	0.19
ACL/Total Loans (%)	0.89	0.88	0.89
ROAA (GAAP, %)	0.84	1.06	(1.50)
ROAE (GAAP, %)	8.80	10.76	(15.15)
Book Value/Share ($)	29.07	29.84	30.50
Tangible Book Value/Share ($)	27.16	27.88	28.56

Loan mix snapshot (9/30/25): CRE 47.2%, Residential 29.2%, C&I 12.6%, Construction 3.4%, Consumer 4.3%, Other 3.3% .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Interest Margin impact	Forward (post-repositioning)	—	~+19 bps to NIM expected	New
EPS impact	Annual run-rate	—	~+$0.40 annual EPS expected	New
Treasury deposits generation	By end of 4Q25	—	~+$60M deposits expected	New
Quarterly dividend/share	Q4 2025 pay	$0.26 (Q2’25 raised)	$0.26 declared for Nov 28, 2025	Maintained
Share repurchase	Through 9/30/26	—	Up to $5M authorization (≈3.1% of shares)	New

Management did not provide traditional numeric revenue or margin guidance ranges; directional “repositioning accretion” and treasury program targets were provided .

Earnings Call Themes & Trends

Note: We did not find a Q3 2025 earnings call transcript in the document set; themes below draw from the Q3 press release and October investor presentation [Search returned none for transcript; press release and investor deck used] .

Topic	Previous Mentions (Q1 & Q2 2025)	Current Period (Q3 2025)	Trend
Treasury & specialized deposits	Building out tech and products; mid-2024 systems investments impacted data processing expenses	“Full deployment expected by end of the year”; near-term OpEx uptick, but revenue and core deposits expected to scale	Execution progressing; revenue and deposit catalysts building
Deposit mix & cost of funds	Cost of IB deposits 2.46% (Q1) → 2.28% (Q2); focus on core mix	Cost of IB deposits 2.26%; core deposits 77% of total; disciplined pricing as Fed cuts filter through	Mix steadily improving; costs easing with rate cuts
Macro/Fed	Tight monetary policy pressures yields; cautious stance	Fed cuts noted; asset yields held up via repositioning; margin tailwinds from new securities	Macro easing offset by portfolio actions
Securities repositioning	—	Realized pre-tax loss $11.8M to rotate from ~2.87% to ~5.4%+ yielding assets; expected NIM/EPS lift and TBV neutral	One-time hit for multi-year accretion
Credit quality	Stable; low NCOs/NPAs	NPLs/loans 0.19%; annualized net recoveries 0.03%	Stable, conservative
Capital return	—	$0.26 dividend; $5M buyback authorized	Enhanced capital return framework

Management Commentary

“We anticipate an approximate 19 basis point increase to our net interest margin and an estimated $0.40 increase in annual earnings per share.” — John H. Montgomery, President & CEO, on the securities portfolio repositioning .
“We replaced low yielding indirect auto and residential mortgage loans with higher yielding, relationship driven, commercial loans… [and] saw a favorable shift in our deposit mix…” .
“Credit quality remains solid, with nonperforming loans representing just 0.19% of total loans and allowance for credit losses covering 433.6% of nonperforming assets at quarter-end.” .

Q&A Highlights

Transcript unavailable: A Q3 2025 earnings call transcript was not found; commentary reflects press release and investor presentation [ListDocuments showed no “earnings-call-transcript”].
Clarifications from materials:
- Securities repositioning: One-time realized after-tax loss ~$9.3M to fund higher-yield assets; expected recovery of realized loss in ~4.2 years per September 2 release; expected EPS/NIM accretion and TBV neutrality .
- Treasury buildout: Full deployment by YE25; near-term expense increase but strategic to drive sticky, low-cost deposits and fee income .

Estimates Context

EPS: S&P Global consensus Primary EPS $0.65 vs reported $0.74 (beat). Note S&P “actual” aligns to non-GAAP “core” EPS in company disclosure, while GAAP EPS was $(1.07) given the realized securities loss. Values retrieved from S&P Global.*
Revenue: S&P Global revenue consensus $13.9M vs S&P “actual” $2.16M; company’s GAAP operating revenue was $2.422M reflecting the $(11.8)M securities loss. On an adjusted basis, operating revenue was $14.174M, exceeding consensus. Values retrieved from S&P Global.*
Coverage depth: 2 EPS estimates; 1 revenue estimate, implying higher dispersion risk around “revenue” definitions for banks. Values retrieved from S&P Global.*

Key Takeaways for Investors

Core beat, GAAP miss: Q3 optics are noisy due to a deliberate repositioning loss; underlying trends (NIM, core EPS/PPNR) improved, and management expects accretion to persist into 2026 .
Margin tailwinds: Repositioned portfolio and deposit mix should support NIM despite Fed cuts; management targets ~+19 bps NIM and ~$0.40 annual EPS accretion from the trade .
Deposits and liquidity: Core deposits grew and now represent ~77% of total; available liquidity covers 250% of uninsured/non-collateralized deposits, reducing funding/contagion risk .
Credit benign: NPLs/loans 0.19%, net recoveries positive; ACL/loans ~0.89%, providing cushion amid macro uncertainty .
Capital return optionality: $5M buyback and $0.26 quarterly dividend add flexibility to capitalize on valuation dislocations while core earnings strengthen .
Watch KPIs into Q4: Evidence of treasury program deposit inflows (~$60M target by YE), continued NIM expansion, and sustained core fee growth would validate the longer-term thesis .
Risk checks: Monitor securities reinvestment execution/timing, deposit pricing competitiveness as rates fall, and any credit normalization in CRE exposure (albeit with conservative LTVs and limited office concentration) .

Footnote: S&P Global consensus and “actual” estimate figures marked with * were retrieved from S&P Global via the GetEstimates tool. Coverage is limited and definitions may differ from company GAAP or non-GAAP presentations.

Citations: Press release and 8-K/investor presentation ; Balance sheet repositioning press release ; Repurchase authorization .

CB Financial Services, Inc. (CBFV)·Q3 2025 Earnings Summary