Executive Summary

Q1 2025 delivered solid top line with net revenue of $17.4M, net income of $4.5M, and diluted EPS of $0.31; noninterest income rose 127% YoY to $5.5M driven by credit card interchange, while net interest margin compressed to 4.47% due to lower loan yields after the late-2024 Fed cut .
EPS missed S&P Global consensus ($0.31 vs $0.36)*, primarily owing to ~$1.0M extraordinary SEC uplift/legal/audit and tech costs in Q1; gain-on-sale declined vs Q4 on seasonality and softer margins, partially offset by interchange doubling sequentially . Values retrieved from S&P Global.
Strategic catalysts: SEC Form S‑1 declared effective April 16; shares uplisted and began trading on Nasdaq Capital Market on April 30, positioning the company for broader index eligibility and liquidity .
Gaming FinTech momentum: credit card charge transactions surged to $105.6M (from $51.7M in Q4), net interchange hit $2.0M; management plans a near-term marketing pause to complete internal app/customer service builds, then larger campaigns and a secured card in Q3 .
Asset quality mixed: nonperforming assets increased to $20.4M (1.71% of assets) with $14.7M SBA guaranteed; net charge-offs were $828K, still modest vs capital and reserves, while Tier 1 leverage ratio rose to 14.2% after $15M downstream to the bank .

What Went Well and What Went Wrong

What Went Well

Noninterest income growth and payments monetization: “Our other income… in the fourth quarter we had $5.7M… in the first quarter, $5.4M… reason, of course, is interchange. Our interchange went from $1M… to $2M in Q1” (Executive Chairman) .
Credit card scale and engagement: Net interchange reached $2.0M on $105.6M spend in Q1, vs $1.1M on ~$52M in Q4 and $20K on $1.1M in Q1 2024; >90% of spend is gaming, a high-transactor cohort .
Capital and liquidity strength: Tier 1 leverage ratio rose to 14.2% after a $15M downstream; deposits hit ~$996M (+23.4% YoY), with ~$488M available borrowing capacity and loans-to-deposits improved to 84.7% .

What Went Wrong

EPS miss and expense pressure: ~$800K SEC uplift and ~$200K tech added ~$1.0M one‑time costs; efficiency ratio rose to 62.8% vs 55.4% in Q4 .
Margin compression and gain‑on‑sale: NIM fell to 4.47% (from 4.53% in Q4; 4.85% in Q1 2024) due to the 50 bps Fed cut impacting variable-rate SBA loans; gain-on-sale fell 36.5% QoQ to $2.5M as margins softened and volumes normalized .
Asset quality normalization: NPAs rose to $20.4M (1.71% of assets) including $14.7M guaranteed; net charge-offs increased to $828K, with one repurchase contributing ~$3.6M to nonperformers; management remains comfortable given guarantees and reserves .

Financial Results

Metric	Q1 2024	Q4 2024	Q1 2025
Net revenue ($USD Millions)	$13.2	$17.6	$17.4
Net income ($USD Millions)	$3.7	$5.2	$4.5
Diluted EPS ($USD)	$0.29	$0.37	$0.31
Noninterest income ($USD Millions)	$2.4	$5.8	$5.5
Net interest margin (%)	4.85%	4.53%	4.47%
Efficiency ratio (%)	63.4%	55.4%	62.8%
ROAA (%)	1.59%	1.93%	1.61%
ROAE (%)	14.67%	15.13%	12.59%

Segment performance and KPIs:

Segment / KPI	Q1 2024	Q4 2024	Q1 2025
SBA & Commercial originations ($USD Millions)	$136.6	$120.0	$133.0
Loans sold ($USD Millions)	$68.6	$98.5	$68.7
Gain on sale ($USD Millions)	$2.1	$4.0	$2.5
Pretax gain margin (%)	3.04%	4.06%	3.69%
Credit card charge transactions ($USD Millions)	$1.1	$51.7	$105.6
Net interchange fees ($USD Millions)	$0.02	$1.1	$2.0
Gaming FinTech deposits avg ($USD Millions)	—	$30.5	$37.1
Credit card balances ($USD Millions)	$0.542	$1.6	$2.3

KPI	Q1 2024	Q4 2024	Q1 2025
Total loans, net ($USD Millions)	$733.6	$816.0	$843.4
Deposits ($USD Millions)	$806.9	$935.1	$996.0
Loan-to-deposit ratio (%)	90.9%	87.3%	84.7%
ACL ($USD Millions)	$7.1	$9.1	$9.0
ACL / total loans (%)	0.97%	1.12%	1.07%
ACL / loans excl. guaranteed (%)	1.38%	1.48%	1.41%
Nonperforming assets ($USD Millions)	$6.1	$14.2	$20.4
NPA / assets (%)	0.64%	1.26%	1.71%
NPA excl. guaranteed / assets (%)	0.16%	0.43%	0.48%
Net loan charge-offs ($USD Thousands)	$0	$157	$828
Stockholders’ equity ($USD Millions)	$102.6	$140.7	$146.6
Book value per share ($USD)	$8.00	$9.87	$10.27
Tier 1 leverage ratio (%)	13.0%	12.9%	14.2%
Investment securities yield (%)	4.16%	4.74%	4.94%

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
SEC registration-related expenses ($)	Q2 2025	~$300K incurred in Q4 for SEC/S‑1 costs	Budget up to $1.0M in Q2 (may be less)	Raised
Credit card transaction growth	Q2 2025	Ramp underway through Q4; breakeven achieved	Marketing pause; expect flat transactions in Q2 as internal app/customer service are built	Lowered near-term growth
Credit card application/customer service enhancements	Q2–Q3 2025	n/a	30–60 days to complete internal builds; then major marketing	New initiative
Secured credit card	Q3 2025	n/a	Expected in market going into Q3	New product
Slot program (BoltBetz) launch	Q2 2025	Hoped to go live by Q1 (delays in Q4/Q1)	Expected to launch Q2; deposits ramp in Q3	Timeline extended

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024)	Current Period (Q1 2025)	Trend
Credit card interchange	Breakeven achieved; $51.7M spend; ~$1.1M net interchange	$105.6M spend; $2.0M net interchange; pause Q2, larger campaigns post-build	Strong growth; temporary pause then accelerate
SEC/Nasdaq uplift	Began SEC process; ~$300K in Q4 costs	Uplisted to Nasdaq on Apr 30; ~$800K SEC uplift + ~$200K tech in Q1; Q2 budget up to $1.0M	Listing achieved; costs higher near term
SBA pipeline/premia	Record 2024; GAAP gain low 4%; pipeline strong	Pipeline >$300M (SBA ~$250M); premia remain soft; long-term hospitality GAAP gain ~4.5–5% over time	Demand resilient; pricing soft
Slot program (Gaming FinTech)	Hoped Q1 launch; live testing with Konami; RTP implementation	Expected Q2 launch; deposits increase in Q3; watched by clients	Near launch
Funding/NIM	Called brokered CDs; repricing down maturities; NIM compression	NIM 4.47%; lower loan yields from Fed cut; lower funding costs; securities yield improving	Mixed: margin headwinds, funding tailwinds
Asset quality	NPAs $14.2M at YE; at-risk $4.8M; minimal charge-offs	NPAs $20.4M; net charge-offs $828K; majority guaranteed; comfortable coverage	Higher NPAs, still manageable

Management Commentary

“Our results reflect a continuation of strong earnings, with Company revenues absorbing elevated one-time costs, including SEC related audit, accounting, and legal expenses, which have now totaled approximately $1.1 million to date.” – T. Ryan Sullivan, President/CEO .
“Our interchange went from $1 million contribution in the fourth quarter to $2 million contribution in quarter 1 from our transactions on our credit card.” – Executive Chairman Edward Nigro .
“On a bank peer comparison, we expect to remain in the top decile for net interest margin.” – T. Ryan Sullivan .
“We may see some slowdown in our growth in our credit cards for the next quarters, but… major marketing efforts are going to be starting in about 30 to 60 days.” – Edward Nigro .
“Our SBA and commercial pipeline remains quite strong at an expanded pipeline of more than $300 million.” – T. Ryan Sullivan .

Q&A Highlights

SEC cost outlook: Q2 budget of ~$1.0M (may be less), after ~$800K in Q1 and ~$300K in Q4; investors should expect elevated G&A near-term for listing/registration .
Credit card traction: Expect flat daily transaction volume in Q2 during internal build; larger marketing to follow; board-approved max credit line up to $50K; secured card planned for Q3 .
Slot program timing: Launch targeted for Q2, deposits likely ramp in Q3; integrated with bank PPA/PCA, RTP, and card rails; credit card is a key enabler for slot players .
SBA demand and premiums: Pipeline slightly above $300M (SBA ~$250M); premiums remain soft; management expects hospitality GAAP gain to trend back toward high 4s–5% over time .

Estimates Context

EPS vs consensus: Q1 2025 diluted EPS was $0.31 vs S&P Global consensus $0.36*, a miss of $0.05, driven largely by ~$1.0M extraordinary SEC/tech costs and gain-on-sale seasonality/soft margins . Values retrieved from S&P Global.
Revenue consensus: S&P Global revenue consensus was unavailable for Q1; only one EPS estimate was recorded (limiting statistical significance)*. Values retrieved from S&P Global.

Metric	Q1 2025 Actual	Q1 2025 S&P Global Consensus	Surprise
Diluted EPS ($)	$0.31	$0.36*	-$0.05 (Miss)

Values retrieved from S&P Global.

Key Takeaways for Investors

Payments flywheel is accelerating: interchange doubled sequentially to $2.0M on $105.6M spend; expect a brief Q2 pause for internalization, then renewed growth with secured card and marketing in Q3 .
Near-term margin/expense headwinds: NIM impact from Fed cut and variable-rate loans plus elevated SEC/Nasdaq costs; watch efficiency ratio normalization post-uplisting .
SBA engine resilient: originations $133.0M, pipeline >$300M; gain-on-sale margins soft but expected to improve over time; monitor premium trends and seasonality .
Asset quality watchpoints: NPAs rose to $20.4M (majority guaranteed), net charge-offs modest; coverage and guarantees provide buffer; track at-risk nonperformers vs capital/reserves .
Capital strength supports growth: Tier 1 leverage at 14.2%, deposits up 23% YoY; ample borrowing capacity for scaling cards and FinTech programs .
Catalysts: Nasdaq uplisting and S‑1 effectiveness broaden visibility; BoltBetz slot program expected to launch Q2 with deposit/usage ramp in Q3 .
Estimate adjustments likely: Given the Q1 EPS miss and disclosed Q2 expense budget, near-term Street EPS may move lower; upside later in 2025 from payments monetization as marketing restarts and secured card launches .

Notes: Q3 2024 primary documents were unavailable due to database issues; Q4 2024 call commentary indicates Q3 was part of a three‑quarter streak of record earnings/revenue, but specific Q3 figures could not be retrieved .

GBank Financial Holdings Inc. (GBFH)·Q1 2025 Earnings Summary