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USCB FINANCIAL HOLDINGS, INC. (USCB)·Q3 2025 Earnings Summary

Executive Summary

  • Third consecutive record EPS: diluted EPS $0.45 (+28.6% YoY), net income $8.9M, ROAA 1.27%, ROAE 15.74%. Management highlighted consistency, resilience and peer‑leading profitability metrics .
  • EPS beat and revenue slight miss vs S&P Global consensus: EPS $0.45 vs $0.42 (+$0.03, +7%); total revenue $24.99M vs $25.03M (−$0.04M, −0.2%). CFO noted pro forma EPS would have been ~$0.49 if the September buyback were effective all quarter * * *.
  • Margin trajectory: NIM was 3.14% in Q3 (down from 3.28% in Q2), but improved to 3.27% in September; management expects Q4 NIM around or slightly above 3.27% on deposit repricing and loan production .
  • Capital actions as catalysts: $40M 7.625% sub debt issuance and repurchase of ~2.0M shares at $17.19; quarterly dividend of $0.10 declared for payment Dec 5, 2025 .
  • Credit quality remains strong: NPLs 0.06%, ACL 1.17% of loans; classified loans fell to 0.22% of loans, no OREO .

What Went Well and What Went Wrong

What Went Well

  • Record profitability and operating leverage: EPS $0.45, ROAA 1.27%, ROAE 15.74%, efficiency ratio 52.28% with NII +17.5% YoY; CEO: “third consecutive quarter of record fully diluted earnings per share… disciplined execution” .
  • Margin tailwinds into Q4: CFO cited September NIM 3.27% and aggressive deposit rate cuts; ALM positioning liability‑sensitive with better‑than‑assumed deposit beta achieved .
  • Strategic capital and TBV/share: $40M sub debt and 2.0M share buyback; tangible book value/share up to $11.55 (+5.9% YoY), despite AOCI drag, reflecting reduced share count .

What Went Wrong

  • Linked‑quarter margin compression: NIM 3.14% vs 3.28% in Q2 due to higher cash balances, sub debt cost, lower DDA, and ~$10M yacht loan prepayments in August impacting yields .
  • Higher operating expenses: non‑interest expense rose to $13.0M (+$0.4M QoQ, +$1.6M YoY), including consulting/legal and IT; efficiency ratio ticked up vs Q2 (51.77% → 52.28%) .
  • Securities portfolio still low‑yielding: average investment yield 3.03% with duration extended to position for lower rates; management sees need/opportunity to lift portfolio yield over time .

Financial Results

Revenue and EPS vs Prior Periods and Estimates

MetricQ3 2024Q2 2025Q3 2025 ActualQ3 2025 Consensus
Total Revenue ($USD Millions)$21.55 $24.40 $24.99 $25.03*
Diluted EPS ($USD)$0.35 $0.40 $0.45 $0.42*

Values marked with * retrieved from S&P Global.

Profitability and Margins

MetricQ3 2024Q2 2025Q3 2025
Net Interest Margin %3.03% 3.28% 3.14%
Efficiency Ratio %53.16% 51.77% 52.28%
ROAA % (annualized)1.11% 1.22% 1.27%
ROAE % (annualized)13.38% 14.29% 15.74%
Non‑interest income / Avg Assets %0.55% 0.50% 0.52%
Non‑interest expense / Avg Assets %1.83% 1.89% 1.85%

Income Statement Highlights

MetricQ3 2024Q2 2025Q3 2025
Net Interest Income ($MM)$18.11 $21.03 $21.27
Non‑interest Income ($MM)$3.44 $3.37 $3.68
Provision for Credit Losses ($MM)$0.93 $1.03 $0.11
Net Income ($MM)$6.95 $8.14 $8.94

Balance Sheet (Period‑End)

MetricQ3 2024Q2 2025Q3 2025
Total Assets ($MM)$2,503.95 $2,719.47 $2,767.95
Total Loans HFI ($MM)$1,931.36 $2,113.32 $2,130.97
Total Deposits ($MM)$2,126.62 $2,335.66 $2,455.61
Total Equity ($MM)$213.92 $231.58 $209.10

Segment Breakdown – Loans by Type (EOP)

Loan Type ($MM)Q3 2024Q2 2025Q3 2025
Residential Real Estate$283.48 $307.02 $316.56
Commercial Real Estate$1,095.11 $1,206.62 $1,226.12
Commercial & Industrial$246.54 $263.97 $269.43
Correspondent Banks$103.82 $110.16 $104.60
Consumer & Other$198.60 $218.43 $207.94

Deposit Mix – Average Balances

Category ($MM)Q3 2024Q2 2025Q3 2025
Non‑interest‑bearing Demand$609.46 $580.12 $569.52
Interest‑bearing Checking$57.93 $46.69 $47.34
Savings & Money Market$1,084.56 $1,211.51 $1,319.86
Time Deposits$325.58 $452.36 $520.35
Total Deposits$2,077.52 $2,290.69 $2,457.07
Deposit Cost (%)2.66% 2.46% 2.53%
Interest‑Bearing Deposit Cost (%)3.76% 3.29% 3.29%

KPIs

KPIQ3 2024Q2 2025Q3 2025
ACL / Loans %1.19% 1.18% 1.17%
NPLs / Loans %0.14% 0.06% 0.06%
NPA / Assets %0.11% 0.05% 0.05%
Net Charge‑offs / Avg Loans %0.00% 0.14% 0.00%
Loan Yield %6.32% 6.23% 6.21%
TBV / Share ($)$10.90 $11.53 $11.55
TCE / TA %8.54% 8.52% 7.55%
L/D Ratio (EOP)——~87% (company takeaways)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest MarginQ4 2025Not formally guidedCFO: September NIM 3.27%; expects Q4 around or slightly above 3.27% on deposit repricing and loan volume Qualitative raise
Deposit CostsQ4 2025Not formally guidedAggressive money market and CD rate cuts; achieved 70% beta on $1.2B MM book after Sept cut Improvement expected
Loan GrowthQ4 2025Seasonal dip in Q3Pipeline normalizing; strong September production to support Q4 Re‑accelerating
Non‑interest IncomeQ4 2025—Swap fees likely similar to Q2–Q3; SBA sales delayed $0.2M pushed to Q4 Stable to up
ExpensesNear‑term/Q4 2025~$13.0M quarterly; efficiency low‑50sRun‑rate at ~$13.0M, could inch up with new hires and incentives; efficiency ratio low‑50s Maintained/slight up
DividendQ4 2025$0.10 in prior quarter$0.10 declared; payable Dec 5, 2025 Maintained
Capital ActionsNear‑term—528,309 shares remain authorized under repurchase programs Capacity available

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Margin/NIMNIM rose to 3.10% (Q1); 3.28% (Q2) on higher loan yields, lower deposit costs NIM 3.14%; September 3.27% with deposit repricing; Q4 expected ~3.27%+ Improving intra‑quarter; poised to expand
Deposit Beta/CostsDeposit cost fell (Q1/Q2); DDA ~25% of deposits Achieved 70% beta on MM book after Sept cut; total cost up 7bps QoQ on mix; interest‑bearing cost stable Favorable beta; mix headwind
Loan Production & PricingWeighted avg new loan coupons 6.67% (Q1); 7.12% (Q2) New production 6.43% (22bps > portfolio); strong Sept loans; yacht payoffs tempered yield Momentum back; pricing competitive
Securities PortfolioYield improved to 3.06% (Q2); duration extended Yield 3.03%; added longer duration; consider repositioning to lift earnings power Strategic optionality
Capital ActionsNormal dividends (Q1/Q2) $40M sub debt; 2.0M buyback; TBV/share +5.9% YoY Accretive
CreditACL 1.22% (Q1), 1.18% (Q2); NPLs 0.20% (Q1) then 0.06% (Q2) ACL 1.17%; NPLs 0.06%; classified to 0.22% Stable/strong
Vertical GrowthRobust pipelines in deposit‑focused verticals (Q2) HOA/Association banking set to scale; potential to double book in ~18 months Positive

Management Commentary

  • CEO (prepared remarks): “This marks our third consecutive quarter of record fully diluted earnings per share… our profitability ratios place us among the top performing peers… disciplined execution and a continued focus on long‑term value creation.” .
  • CFO: “On a pro forma basis, assuming the repurchase happened on day one of the quarter…the same $8.9 million of earnings would have equated to an EPS amount of $0.49… September NIM was 3.27%… we issued $100 million of brokered CDs and put on an interest rate collar (cap 4.5%, floor 1.88%).” .
  • CCO: “Allowance for credit losses is $25.0 million (1.17% of loans)… non‑performing loans remained at 0.06%… no losses expected from classified or non‑performing loans.” .

Q&A Highlights

  • Margin path and costs: Management expects Q4 NIM ~3.27% or higher; deposit rate cuts already implemented; sub debt costs fully embedded in September .
  • Loan production and pricing: September was a record month; pipeline supports normalized Q4 run‑rate; new production largely priced 6.00–6.50% .
  • Yacht lending impact: About $10M in yacht loan payoffs occurred in August, temporarily depressing loan yields and NIM .
  • Non‑interest revenue: Swap activity elevated with lower rates; SBA sales delayed ~$0.2M shifted into Q4, supporting fee income .
  • Securities portfolio strategy: Repositioning remains “on the table” to lift yield ~100bps over time; recent capital deployed to buyback viewed favorably versus peers .

Estimates Context

  • EPS: USCB reported $0.45 vs S&P Global consensus $0.42 → bold beat (+$0.03); diluted shares 19.76M. Actual EPS from filings; consensus from S&P Global *.
  • Revenue: Total revenue $24.99M vs S&P Global consensus $25.03M → slight miss (−$0.04M). CFO emphasized margin tailwinds into Q4 *.
  • Coverage: EPS estimates (n=5), revenue estimates (n=4); target price consensus $20.75 (n=5)*.
    Values marked with * retrieved from S&P Global.

S&P Global Consensus vs Actual (Q3 2025)

MetricConsensusActual
Diluted EPS ($)0.42*0.45
Total Revenue ($MM)25.03*24.99

Key Takeaways for Investors

  • Bold EPS beat amid slight revenue miss; operating leverage remains strong with efficiency in low‑50s and margin set to expand in Q4 on deposit repricing and resumed loan momentum .
  • Capital deployment is accretive: $40M sub debt funded buyback of ~10% of shares; TBV/share advanced to $11.55; further repurchase capacity remains (528k shares) .
  • Margin drivers: September NIM 3.27% provides a starting point; watch deposit beta execution and loan repricing cadence vs variable‑rate book (62% variable/hybrid; ~40% repricing within a year) .
  • Fee income durability: Elevated swap fees with lower rate environment and SBA sales resuming in Q4 support diversified revenues (non‑interest income ~15% of total) .
  • Credit quality tailwind: NPLs 0.06%, ACL 1.17%; classified loans down to 0.22%—loss content remains minimal, supporting valuation multiples .
  • Securities portfolio optionality: Yield 3.03% with longer duration; potential repositioning or cashflows (~$14.4M in Q4, ~$76.4M in 2026) could lift earnings and reduce funding costs .
  • Verticals as growth engines: Association banking pipeline robust; management believes HOA book can double in ~18 months—supports low‑cost deposits and short‑term C&I lending .

Values marked with * retrieved from S&P Global.