August 13, 2026 - 10-Q: Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2026


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-42621

GBANK FINANCIAL HOLDINGS INC.

(Exact Name of Registrant as Specified in its Charter)


Nevada	82-3869786
( State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
9115 W. Russell Rd., Ste. 110 Las Vegas, Nevada	89148
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (702) 851-4200

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, $0.0001 par value

     GBFH

     The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 7, 2026 the registrant had 14,516,457 shares of common stock, $0.0001 par value per share, outstanding.

Table of Contents


		Page

PART I.	FINANCIAL INFORMATION	1

Item 1.	Financial Statements	1
	Consolidated Balance Sheets (Unaudited)	1
	Consolidated Statements of Income (Unaudited)	2
	Consolidated Statements of Comprehensive Income (Unaudited)	3
	Consolidated Statements of Stockholders’ Equity (Unaudited)	4
	Consolidated Statements of Cash Flows (Unaudited)	5
	Notes to Consolidated Financial Statements (Unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	44
Item 4.	Controls and Procedures	44

PART II.	OTHER INFORMATION	45

Item 1.	Legal Proceedings	45
Item 1A.	Risk Factors	45
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	45
Item 3.	Defaults Upon Senior Securities	45
Item 4.	Mine Safety Disclosures	45
Item 5.	Other Information	45
Item 6.	Exhibits	46
Signatures		47

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q for the three and six months ended June 30, 2026 (this “Form 10-Q”) may contain certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which may be identified by the use of such words as “may,” “believe,” “expect,” “anticipate,” “consider,” “should,” “plan,” “estimate,” “predict,” “continue,” “probable,” and “potential” or the negative of these terms or other comparable terminology. Examples of forward-looking statements include, but are not limited to, estimates with respect to the financial condition, results of operations and business of GBank Financial Holdings Inc. (the “Company”) and its wholly-owned subsidiary GBank (the “Bank”), and the Company’s strategies, plans, objectives, expectations and intentions, and other statements contained in this Form 10-Q that are not historical facts. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors that are difficult to predict and are generally beyond our control and that may cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Factors that may cause actual results to differ from those results expressed or implied include those factors listed under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K, filed by the Company with the U.S. Securities and Exchange Commission (“SEC”) on March 27, 2026 and in this Form 10-Q. In addition, these factors include but are not limited to:

•

a failure to successfully manage our credit risk and the sufficiency of our allowance for credit losses;

•

changes in loan demand and declines in real estate values in the Company’s market area, which may adversely affect our loan production;

•

increased competition for deposits and related changes in deposit customer behavior;

•

borrower and depositor concentrations (e.g., by geographic area and by industry);

•

our ability to navigate the uncertain impacts of the current and future governmental monetary and fiscal policies, including the current and future interest rate policies of the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and other regulatory bodies as a result of initiatives of the current U.S. presidential administration;

•

general economic conditions, including changes in unemployment rates, and potential recession, either nationally or locally, including the related effects on our borrowers and other clients, such as adverse changes to credit quality, and on our financial condition and results of operations;

•

the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the U.S. and our market areas, and its impact on market interest rates, the economy and credit quality;

•

an unanticipated loss of key personnel or existing clients, or an inability to attract key employees;

•

cybersecurity risk, including the risk of system failures or cybersecurity breaches of our information technology infrastructure and/or confidential information, or those of the Company’s third-party vendors and other service providers or those of our non-bank financial service clients for which we provide global payments infrastructure, including as a result of a cyber-attack, which could impact the Company’s reputation, increase regulatory oversight, and impact the financial results of the Company;

•

failure to maintain current technologies or technological changes and enhancements that may be more difficult or expensive to implement than anticipated, and failure to successfully implement future information technology enhancements;

•

emerging issues related to the development and use of artificial intelligence that could give rise to legal or regulatory action, damage our reputation or otherwise materially harm our business or clients;

•

the timely and efficient development of new products and services offered by the Company, as well as risks (including reputational and litigation) attendant thereto, and the perceived overall value and acceptance of these products and services by clients;

•

the successful implementation or consummation of new business initiatives, which may be more difficult or expensive than anticipated;

•

an unexpected adverse financial, regulatory, legal or bankruptcy event experienced by our financial service clients;

•

unexpected increases in our expenses;

•

changes in liquidity, including funding sources, deposit flows and the size and composition of our deposit portfolio, and the percentage of uninsured deposits in the portfolio;

•

an unexpected deterioration in the performance of our loan or securities portfolios and our inability to absorb the amount of actual losses inherent in the portfolio;

•

increased capital requirements imposed by banking regulators, which may require us to raise capital at a time when capital is not available on favorable terms or at all;

•

our ability to maintain adequate liquidity and to raise necessary capital to fund our acquisition strategy and operations or to meet increased minimum regulatory capital levels;

•

difficulties associated with achieving or predicting expected future financial results;

•

different than anticipated growth and our ability to manage our growth;

•

increases in competitive pressures among financial institutions or from non-financial institutions which may result in unanticipated changes in our loan or deposit rates;

•

unexpected adverse impact of future acquisitions or divestitures;

•

impacts related to or resulting from regional and community bank failures and stresses to regional banks, or conditions in the securities markets or the banking industry being less favorable than currently anticipated;

•

changes in accounting principles, policies or guidelines may cause the Company’s financial condition or results of operation to be reported or perceived differently;

•

employee error, fraudulent activity by employees or customers and inaccurate or incomplete information about our customers and counterparties;

•

a deterioration of the credit rating for U.S. long-term sovereign debt or uncertainty regarding U.S. fiscal debt, deficit and budget matters;

•

the impacts of tariffs, sanctions and other trade policies of the U.S. and its global trading counterparts and the resulting impact on the Company and its customers;

•

delays in origination and sales of U.S. Small Business Administration loans due to U.S. federal government temporary shutdowns;

•

legislative, tax or regulatory changes or actions, including changes and the potential for changes to regulatory policy and the promulgation of new laws and regulations may adversely affect the Company’s business;

•

unanticipated increases in FDIC insurance premiums or future assessments;

•

the costs, including the possible incurrence of fines, penalties, or other negative effects (including reputational harm) of any adverse judicial, administrative, or arbitral rulings or proceedings, regulatory enforcement actions, or other legal actions to which we or any of our subsidiaries are a party, and which may adversely affect our results; and

•

the current or the potential impact on the Company’s operations, financial condition, and clients resulting from natural or man-made disasters, severe weather, acts of god, wars, military conflict, acts of terrorism, geopolitical instability, cyberattacks, public health outbreaks (such as coronavirus), other international or domestic calamities, and other events beyond our control, including as a result of the policies of the current U.S. presidential administration or Congress.

The Company’s ability to predict results or the actual effects of its plans or strategies is inherently uncertain. As such, forward-looking statements can be affected by inaccurate assumptions made, or by known or unknown risks and uncertainties. Because of these risks and other uncertainties, our actual future results, performance or achievements, or industry results, may be materially different from the results indicated by the forward-looking statements in this Form 10-Q. In addition, our past results of operations are not necessarily indicative of our future results. Consequently, no forward-looking statement can be guaranteed. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect conditions only as of the date of this filing. Forward-looking statements speak only as of the date of this document. The Company undertakes no obligation (and expressly disclaims any obligation) to publicly release the results of any revisions which may be made to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements, except as required by applicable law.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

GBank Financial Holdings Inc. and Subsidiary

Consolidated Balance Sheets (Unaudited)


(Dollars in thousands, except per share data)
ASSETS	June 30, 2026			December 31, 2025
Cash and due from banks	$	6,726		$	5,326
Interest-bearing deposits with other financial institutions		134,603			192,538
Total cash and cash equivalents		141,329			197,864

Investment securities:
Available for sale, at fair value (amortized cost of $117,538 at June 30, 2026 and $71,061 at December 31, 2025)		115,018			71,038
Loans held for sale		50,848			46,009
Loans, net of deferred fees and costs		1,047,352			959,269
Less: Allowance for credit losses		(12,418	)		(9,890	)
Loans, net		1,034,934			949,379

Premises and equipment, net		1,346			1,094
Operating lease right-of-use asset		4,857			5,297
Bank-owned life insurance		30,614			30,004
Loan servicing assets, net		12,270			11,140
Federal Home Loan Bank stock, at cost		5,797			5,513
Other real estate owned		5,663			4,401
Other assets		29,026			37,752
Total Assets	$	1,431,702		$	1,359,491

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand	$	233,444		$	214,127
Interest-bearing demand		65,995			70,966
Savings		353,065			289,038
Time		553,227			568,564
Total deposits		1,205,731			1,142,695

Short-term borrowings		-			371
Subordinated debt		30,328			26,163
Operating lease liability		5,382			5,757
Other liabilities		17,451			18,750
Total liabilities		1,258,892			1,193,736

Commitments and Contingencies (Note 10)

Stockholders' Equity:
Common stock, par value $0.0001; 80,000,000 shares authorized; 14,470,352 shares issued and outstanding at June 30, 2026 and 14,385,226 shares issued and outstanding at December 31, 2025		1			1
Additional paid-in capital		82,606			80,405
Retained earnings		92,143			85,366
Accumulated other comprehensive loss		(1,940	)		(17	)
Total Stockholders' Equity		172,810			165,755
Total Liabilities and Stockholders' Equity	$	1,431,702		$	1,359,491

See Notes to Consolidated Financial Statements (Unaudited).

GBank Financial Holdings Inc. and Subsidiary

Consolidated Statements of Income (Unaudited)


(Dollars in thousands, except per share data)	Three Months Ended June 30,						Six Months Ended June 30,
INTEREST INCOME	2026			2025			2026			2025
Interest and fees on loans	$	20,093		$	17,659		$	39,051		$	34,495
Interest on deposits with other financial institutions		1,296			1,365			2,553			2,557
Taxable interest on investment securities		1,326			1,414			2,428			2,695
Other interest bearing balances		14			117			291			217
Total interest income		22,729			20,555			44,323			39,964

INTEREST EXPENSE
Interest on deposits		9,509			7,905			18,402			15,135
Interest on subordinated debt		419			262			929			547
Total interest expense		9,928			8,167			19,331			15,682
Net interest income		12,801			12,388			24,992			24,282
PROVISION FOR CREDIT LOSSES		2,844			1,092			5,137			1,813
Net interest income after provision for credit losses		9,957			11,296			19,855			22,469

NONINTEREST INCOME
Gain on sale of loans		5,544			2,593			9,334			5,130
Loan servicing income		1,248			750			2,246			1,453
Service charges and fees		86			54			144			111
Net interchange fees		1,823			1,535			4,014			3,538
Other income		448			452			865			615
Total noninterest income		9,149			5,384			16,603			10,847

NONINTEREST EXPENSE
Salaries and employee benefits		6,808			6,235			13,558			12,635
Data processing		1,530			1,333			3,419			2,738
Occupancy expense		399			400			809			792
Legal and professional fees		631			571			1,002			1,271
Loan related costs		953			330			1,412			714
Audits and exams		492			397			690			894
Advertising and marketing		397			371			1,227			735
FDIC insurance		155			129			312			251
Credit card fraud loss		51			-			4,265			-
Other		582			630			1,180			1,273
Total noninterest expense		11,998			10,396			27,874			21,303
INCOME BEFORE PROVISION FOR INCOME TAXES		7,108			6,284			8,584			12,013
Provision for income taxes		1,625			1,486			1,764			2,710
NET INCOME BEFORE EQUITY INVESTMENT LOSS		5,483			4,798			6,820			9,303
Net loss attributable to equity investment		(21	)		(43	)		(43	)		(78	)
NET INCOME	$	5,462		$	4,755		$	6,777		$	9,225

PER COMMON SHARE DATA
Basic earnings per common share	$	0.38		$	0.33		$	0.47		$	0.65
Diluted earnings per common share	$	0.38		$	0.33		$	0.47		$	0.63
Weighted-average basic shares outstanding		14,470,352			14,273,433			14,442,745			14,264,794
Weighted-average diluted shares outstanding		14,543,745			14,551,123			14,510,939			14,535,891

See Notes to Consolidated Financial Statements (Unaudited).

GBank Financial Holdings Inc. and Subsidiary

Consolidated Statements of Comprehensive Income (Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars in thousands)	2026			2025			2026			2025
Net income	$	5,462		$	4,755		$	6,777		$	9,225
Other comprehensive (loss) income, before tax:
Unrealized (losses) gains on securities available for sale		(1,145	)		(255	)		(2,497	)		135
Income tax benefit (expense) related to unrealized
(losses) gains on securities available for sale		263			59			574			(31	)
Total other comprehensive (loss) income, net of tax		(881	)		(196	)		(1,923	)		104
Comprehensive income	$	4,581		$	4,559		$	4,854		$	9,329

See Notes to Consolidated Financial Statements (Unaudited).

GBank Financial Holdings Inc. and Subsidiary

Consolidated Statements of Stockholders’ Equity (Unaudited)


									Accumulated
					Additional				Other
	Common Stock				Paid-In		Retained		Comprehensive
(Dollars in thousands)	Shares		Amount		Capital		Earnings		Income (Loss)			Total
Balance, December 31, 2024		14,252,435	$	1	$	77,571	$	64,437	$	(1,309	)	$	140,700

Net income		-		-		-		4,470		-			4,470
Other comprehensive income, net of tax		-		-		-		-		300			300
Exercise of stock options		16,000		-		24		-		-			24
Director Compensation Plan		2,477		-		91		-		-			91
Other stock-based compensation		-		-		483		-		-			483
Stock option loan activity		-		-		548		-		-			548
Balance, March 31, 2025		14,270,912	$	1	$	78,717	$	68,907	$	(1,009	)	$	146,616

Net income		-		-		-		4,755		-			4,755
Other comprehensive loss, net of tax		-		-		-		-		(196	)		(196	)
Director Compensation Plan		2,607		-		84		-		-			84
Other stock-based compensation		-		-		490		-		-			490
Balance, June 30, 2025		14,273,519	$	1	$	79,291	$	73,662	$	(1,205	)	$	151,749


									Accumulated
					Additional				Other
	Common Stock				Paid-In		Retained		Comprehensive
(Dollars in thousands)	Shares		Amount		Capital		Earnings		Income (Loss)			Total
Balance, December 31, 2025		14,385,226	$	1	$	80,405	$	85,366	$	(17	)	$	165,755

Net income		-		-		-		1,315		-			1,315
Other comprehensive loss, net of tax		-		-		-		-		(1,042	)		(1,042	)
Exercise of stock options		82,766		-		930		-		-			930
Director Compensation Plan		2,360		-		75		-		-			75
Other stock-based compensation		-		-		589		-		-			589
Balance, March 31, 2026		14,470,352	$	1	$	81,999	$	86,681	$	(1,059	)	$	167,622

Net income		-		-		-		5,462		-			5,462
Other comprehensive loss, net of tax		-		-		-		-		(881	)		(881	)
Director Compensation Plan		-		-		85		-		-			85
Other stock-based compensation		-		-		522		-		-			522
Balance, June 30, 2026		14,470,352	$	1	$	82,606	$	92,143	$	(1,940	)	$	172,810

See Notes to Consolidated Financial Statements (Unaudited).

GBank Financial Holdings Inc. and Subsidiary

Consolidated Statements of Cash Flows (Unaudited)


	Six Months Ended
(Dollars in thousands)	June 30, 2026			June 30, 2025
Cash flows from operating activities:
Net income	$	6,777		$	9,225
Adjustments to reconcile net income to net cash used in operating activities:
Provision for credit losses		5,137			1,813
Depreciation		132			116
Amortization and writeoff of loan servicing assets		3,037			2,640
Amortization of operating lease right of use assets		440			436
Amortization of subordinated debt issuance costs		50			38
Credit card fraud loss		4,265			-
Investment securities amortization and accretion, net		(797	)		(368	)
Stock compensation expense		1,272			1,148
Gain on sale of loans		(9,334	)		(5,130	)
Gross originations of loans held for sale		(204,205	)		(171,804	)
Proceeds from sale of loans held for sale		203,627			160,941
Income from bank owned life insurance		(610	)		(210	)
Net change in deferred income taxes		(200	)		32
Decrease (increase) in other assets		9,501			(3,635	)
Net change in operating lease liability		(375	)		(372	)
Increase (decrease) in accrued interest payable and other liabilities		(1,300	)		307
Net cash provided by (used in) operating activities		17,417			(4,823	)

Cash flows from investing activities:
Purchases of premises and equipment		(385	)		(51	)
Purchase of securities available for sale		(51,929	)		(21,903	)
Maturities and repayments of investment securities available for sale		6,248			5,152
Maturities and repayments of investment securities held to maturity		-			1,031
Purchase of FHLB stock		(284	)		(861	)
Net change in loans		(95,312	)		(57,394	)
Net cash used in investing activities		(141,662	)		(74,026	)

Cash flows from financing activities:
Net increase in deposits		63,036			97,384
Net change in short-term borrowings		(371	)		-
Subordinated debt advances		10,509			-
Subordinated debt redemption		(6,394	)	-
Proceeds from repayment of stock option loans		-			548
Net proceeds from issuance of common stock		930			24
Net cash provided by financing activities		67,710			97,956

Net (decrease) increase in cash and cash equivalents		(56,535	)		19,107
Cash and cash equivalents beginning of period		197,864			124,122
Cash and cash equivalents end of period	$	141,329		$	143,229

Supplemental disclosures of cash flow information:
Cash payments for interest	$	18,999		$	15,796
Cash payments for income tax		256			1,543

Supplemental schedule of noncash investing and financing activities
Right of use asset and lease liabilities	$	-		$	1,654
Loans transferred to other real estate owned		1,262			3,400
Loans held for sale transferred to held for investment		10,256			-
Credit card fraud losses		4,265			-

See Notes to Consolidated Financial Statements (Unaudited).

GBank Financial Holdings Inc.

Notes to Unaudited Consolidated Financial Statements

Note 1 - Nature of Business

Basis of Presentation

These unaudited interim financial statements are prepared on a consolidated basis for GBank Financial Holdings Inc. (“GBFH”) and its wholly owned subsidiary, GBank (the “Bank”). References herein to the “Company” refer to the consolidated entity and its financial statements. The Company has prepared these unaudited consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information, SEC rules that permit reduced disclosure for interim periods, and Rule 8-03 of Regulation S-X. In the opinion of management, all adjustments (all of which are of a normal recurring nature) that are necessary for a fair statement are reflected in the unaudited consolidated financial statements. There have been no material changes to the Company's significant accounting policies for the three and six months ended June 30, 2026. The December 31, 2025 consolidated balance sheet information contained in this Quarterly Report on Form 10-Q was derived from the Company's 2025 audited consolidated financial statements. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025, including the notes thereto, included in the Company’s Annual Report on Form 10-K. Operating results for the three and six months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the year ending December 31, 2026. All significant intercompany transactions and accounts have been eliminated.

The Company has one reportable segment. The Company’s chief operating decision maker (“CODM”) evaluates the operations of the Company using consolidated information for purposes of allocating resources and assessing performance. See Note 13 - Segment Reporting for more information.

In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 855, “Subsequent Events,” the Company’s management has evaluated subsequent events for potential recognition or disclosure through the date of the issuance of these consolidated financial statements. No subsequent events were identified that would have required a change to the consolidated financial statements or disclosure in the notes to the consolidated financial statements.

To prepare financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ.

Nature of Operations

GBFH is a registered bank holding company whose wholly-owned banking subsidiary, GBank, provides banking services to commercial and consumer customers. GBank’s business is concentrated in the Las Vegas, Nevada area and is subject to the general economic conditions of that area. GBank’s primary market for deposit customers is in Las Vegas and Clark County, Nevada, although GBank accepts deposits from deposit listing services as needed to support its funding needs. GBank’s lending operations are carried out in both (i) its local market area, comprised of Nevada, California, Utah, and Arizona, and (ii) across the United States primarily through the origination, sale, and servicing of U.S. Small Business Administration (“SBA”) and U.S. Department of Agriculture (“USDA”) loans.

Accounting Policies

The significant accounting and reporting policies followed by the Company are in accordance with GAAP and are presented in the Company's Annual Report on Form 10-K filed with the SEC on March 27, 2026. The Company reports the following update to its significant accounting policies:

Credit Card Fraud Losses: Credit card fraud losses are recognized in the period in which fraudulent activity is identified and the related loss is considered probable and reasonably estimable. First-party credit card fraud losses (fraudulent transactions initiated by the cardholder) are recognized within the allowance for credit losses. The Company maintains reserves for estimated first-party credit card fraud losses based on recent transaction trends, portfolio risk characteristics, and current economic and fraud environment conditions. Third-party fraud losses (fraudulent transactions initiated by someone other than the cardholder) are recognized within noninterest expense.

Recent Accounting Pronouncements Adopted

No accounting pronouncements were adopted by the Company during the six months of 2026.

Recent Accounting Pronouncements Pending Adoption

The following reflect accounting pronouncements pending adoption by the Company:

ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) – Disaggregation of Income Statement Expenses (“ASU 2024-03”) was issued in November 2024 and requires additional disclosure about specified categories of expenses included in relevant expense captions presented on the face of the consolidated statements of income. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The amendments may be applied either prospectively to consolidated financial statements issued for reporting periods after the effective date of ASU 2024-03, or retrospectively to all prior periods presented in the consolidated financial statements. The Company is currently evaluating the impact that ASU 2024-03 will have on its disclosures.

ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity (“ASU 2025-03”) was issued in May 2025 and amends guidance to improve consistency in identifying the accounting acquirer in transactions involving the acquisition of a variable interest entity that meets the definition of a business. The amendments are effective for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact of the adoption of this guidance on its consolidated financial statements and related disclosures.

Note 2. Investment Securities

The amortized cost, unrealized gains and losses, allowance for credit losses, and estimated fair values of investment securities are summarized as follows as of the dates indicated:


	June 30, 2026
(Dollars in thousands)	Amortized		Unrealized		Unrealized			Allowance for		Fair
	Cost		Gains		Losses			Credit Losses		Value
Available for sale securities:
Mortgage-backed U.S. government agencies	$	113,068	$	123	$	(2,497	)	$	-	$	110,694
Other mortgage-backed securities		4,470		-		(146	)		-		4,324
Total	$	117,538	$	123	$	(2,643	)	$	-	$	115,018


	December 31, 2025
(Dollars in thousands)	Amortized		Unrealized		Unrealized			Allowance for		Fair
	Cost		Gains		Losses			Credit Losses		Value
Available for sale securities:
Mortgage-backed U.S. government agencies	$	66,440	$	624	$	(646	)	$	-	$	66,418
Other mortgage-backed securities		4,621		-		(1	)		-		4,620
Total	$	71,061	$	624	$	(647	)	$	-	$	71,038

Accrued interest receivable is excluded from the estimate of credit losses for available for sale securities. At June 30, 2026, accrued interest receivable totaled $285 thousand for available for sale securities, and was reported in other assets on the Company’s consolidated balance sheets. At December 31, 2025, accrued interest receivable totaled $189 thousand for available for sale securities, and was reported in accrued interest receivable on the Company’s consolidated balance sheets.

There were no gross realized gains or losses from the sale of available for sale securities during the three or six months ended June 30, 2026 or 2025.

The fair value of investment securities pledged as collateral for potential borrowing purposes (see Note 7) totaled $110.7 million at June 30, 2026 and $66.5 million at December 31, 2025.

The table below illustrates the maturity distribution of investment securities at amortized cost and fair value as of June 30, 2026:


(Dollars in thousands)	June 30, 2026
	Available for Sale
	Amortized Cost		Fair Value
Due in one year or less	$	-	$	-
Due after one but within five years		-		-
Due after five years but within ten years		-		-
Due after ten years		-		-
Mortgage-backed securities		117,538		115,018
Total	$	117,538	$	115,018

The actual maturities of mortgage-backed securities may differ from their contractual maturities because the loans underlying the securities may be repaid without any penalties. Therefore, maturity schedules are not presented for mortgage-backed securities.

The following tables present gross unrealized losses and fair value of debt security investments aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of the dates indicated.


	June 30, 2026
	Less Than 12 Months					12 Months or More					Total
(Dollars in thousands)	Number of Securities	Fair Value		Gross Unrealized Losses		Number of Securities	Fair Value		Gross Unrealized Losses		Number of Securities	Fair Value		Gross Unrealized Losses
Available for sale securities:
Mortgage-backed U.S. government agencies	21	$	87,015	$	2,028	11	$	8,326	$	469	32	$	95,341	$	2,497
Other mortgage-backed securities	1		88		1	1		4,236		145	2		4,324		146
Available for sale securities with gross unrealized losses	22	$	87,103	$	2,029	12	$	12,562	$	614	34	$	99,665	$	2,643


	December 31, 2025
	Less Than 12 Months					12 Months or More					Total
	Number of Securities	Fair Value		Gross Unrealized Losses		Number of Securities	Fair Value		Gross Unrealized Losses		Number of Securities	Fair Value		Gross Unrealized Losses
Available for sale securities:
Mortgage-backed U.S. government agencies	7	$	20,493	$	130	9	$	13,157	$	437	16	$	33,650	$	567
Other mortgage-backed securities	0		-		-	2		4,515		80	2		4,515		80
Available for sale securities with gross unrealized losses	7	$	20,493	$	130	9	$	17,672	$	517	16	$	38,165	$	647

Management believes the unrealized losses related to available for sale securities as of June 30, 2026 relate primarily to a continuation of the elevated market interest rate environment. The principal and interest payments on agency-guaranteed debt is backed by the U.S. government. Government-sponsored enterprises similarly guaranteed principal and interest payments and securities backed by government-sponsored enterprises carry an implicit guarantee from the U.S. Department of Treasury. In analyzing an issuer’s financial condition, Management considers whether downgrades by bond rating agencies have occurred and reviews various industry analysis reports. There were no Company securities downgraded during each of the three or six-month periods ended June 30, 2026 or 2025. Management currently has no near-term intentions to sell the available for sale securities in an unrealized loss position, and management believes the unrealized losses are due to non-credit-related factors, including changes in market interest rates and other market factors, and therefore no allowance for credit losses was recorded related to available for sale securities as of June 30, 2026 or December 31, 2025.

Note 3. Loans and Allowance for Credit Losses - Loans

Loans Held for Sale

Loans held for sale consisted of commercial real estate and commercial and industrial loans as of both June 30, 2026 and December 31, 2025. The balance of unguaranteed held for sale loans to be retained are reported as held for investment. The principal balances of loans held for sale are listed below as of the dates indicated:


(Dollars in thousands)	June 30, 2026		December 31, 2025
Gross loan balances	$	67,918	$	61,027
Less: Unguaranteed portions to be retained		17,070		15,018
Amounts held for sale, net	$	50,848	$	46,009

Loans Held for Investment

The amortized cost of loans held for investment are listed below. In accordance with ASC 326, GBank has segregated its held for investment loan portfolio into segments characterized by similar risk characteristics, primarily the collateral supporting the loan, as reflected in the table below as of the dates indicated.


(Dollars in thousands)
	June 30, 2026			December 31, 2025
Commercial and industrial	$	80,766		$	80,216
Commercial real estate - non-owner occupied		849,634			750,565
Commercial real estate - owner occupied		88,216			94,576
Construction and land development		2,254			2,288
Multifamily		18,836			18,950
Single Family Sr. Lien		720			726
Single Family Jr. Lien		190			131
Single Family HELOC		375			459
Consumer		6,361			11,358
Loans, net		1,047,352			959,269
Allowance for credit losses		(12,418	)		(9,890	)
Loans, net of allowance	$	1,034,934		$	949,379

Accrued interest receivable is not included in the amortized cost basis of the Company’s loans. Accrued interest receivable for loans totaled $8.5 million and $7.5 million as of June 30, 2026 and December 31, 2025, respectively, and was reported in other assets on the Company’s consolidated balance sheets.

Deferred loan costs of $9.5 million and $10.0 million are included in the balance of net loans as of June 30, 2026 and December 31, 2025, respectively. Loan costs represent the costs incurred to originate the loans, net of fees paid by the borrower, which are measured and recorded at the date the loan is originated. Loan discount of $12.5 million and $10.9 million are included in the balance of net loans as of June 30, 2026 and December 31, 2025, respectively. The discount represents the discount on the retained portion of the government guaranteed loans and is measured at the date the guaranteed portion of the loan is sold, based on the relative fair value of the retained loan as calculated by an independent consulting firm. Loan costs and discount are amortized over the life of the loan and are recorded as an adjustment to interest income on the loan.

As of June 30, 2026 and December 31, 2025, Company loans with a carrying value of $652.2 million and $658.9 million, respectively, were pledged as collateral for potential borrowing purposes (see Note 7).

The portion of loans guaranteed by the U.S. government and held for investment totaled $175.0 million and $183.7 million as of June 30, 2026 and December 31, 2025, respectively, and are included in the commercial and industrial, commercial real estate - non-owner occupied, and commercial real estate - owner occupied loan segments.

Past Due and Non-accrual Loans

The performance and credit quality of the loan portfolio is monitored by analyzing the age of the loans receivable as determined by the length of time a recorded payment is past due. A loan’s past due or delinquent status is based on the contractual term specified in each loan agreement. The segments of the loan portfolio summarized by the past due status are summarized as follows as of the dates indicated:


	June 30, 2026
(Dollars in thousands)					Past Due 90				Total
	30-59 Days		60-89 Days		Days or More				Past Due and
	Past Due		Past Due		and Accruing		Nonaccrual		Nonaccrual		Current		Total
Commercial and industrial	$	-	$	-	$	-	$	4,713	$	4,713	$	76,053	$	80,766
Commercial real estate - non-owner occupied		4,625		-		-		38,996		43,621		806,013		849,634
Commercial real estate - owner occupied		-		-		-		7,939		7,939		80,277		88,216
Construction and land development		-		-		-		-		-		2,254		2,254
Multifamily		7,265		-		-		-		7,265		11,571		18,836
Single Family Sr. Lien		-		-		-		-		-		720		720
Single Family Jr. Lien		-		-		-		-		-		190		190
Single Family HELOC		-		-		-		-		-		375		375
Consumer		158		154		868		-		1,180		5,181		6,361
Total	$	12,048	$	154	$	868	$	51,648	$	64,718	$	982,634	$	1,047,352


	December 31, 2025
(Dollars in thousands)					Past Due 90				Total
	30-59 Days		60-89 Days		Days or More				Past Due and
	Past Due		Past Due		and Accruing		Nonaccrual		Nonaccrual		Current		Total
Commercial and industrial	$	344	$	-	$	-	$	372	$	716	$	79,500	$	80,216
Commercial real estate - non-owner occupied		1,008		3,622		-		30,789		35,419		715,146		750,565
Commercial real estate - owner occupied		3,148		-		-		980		4,128		90,448		94,576
Construction and land development		-		-		-		-		-		2,288		2,288
Multifamily		-		-		-		-		-		18,950		18,950
Single Family Sr. Lien		-		-		-		-		-		726		726
Single Family Jr. Lien		-		-		-		-		-		131		131
Single Family HELOC		-		-		-		-		-		459		459
Consumer		908		813		854		-		2,575		8,783		11,358
Total	$	5,408	$	4,435	$	854	$	32,141	$	42,838	$	916,431	$	959,269

There were no residential loans for which formal foreclosure proceedings were in place at June 30, 2026 or December 31, 2025.

Loans are placed on nonaccrual status when management determines that the full repayment of principal and collection of interest according to contractual terms is no longer likely, generally when the loan becomes 90 days or more past due. No interest income was recognized on nonaccrual loans during the three or six months ended June 30, 2026 or 2025.

Credit Quality Indicators

Management reviews the Company’s loan portfolio at least monthly to determine whether any assets require classification in accordance with the Company’s policy and applicable regulations. The grading analysis estimates the capability of the borrower to repay the contractual obligations of the loan agreements. The Company’s internal credit risk-grading system is based on experiences with similarly graded loans.

The Company’s internally assigned grades are as follows:

•

Pass: Loans that are protected by the current net worth and paying capacity of the obligor or by the value of the underlying collateral. Loans in this grade are further broken down into sub-grades ranging from A to E in order to provide for additional granularity in the analyses that are performed.

•

Special Mention: Loans where a potential weakness or risk exists that could cause a more serious problem if not corrected.

•

Substandard: Loans that have a well-defined weakness based on objective evidence and can be characterized by the distinct possibility that the Company will sustain some loss if the deficiencies are not corrected.

•

Doubtful: Loans classified as doubtful have all the weaknesses inherent in a substandard asset. In addition, these weaknesses make full collection or liquidation highly questionable and improbable, based upon the existing circumstances.

•

Loss: Loans classified as a loss are considered uncollectible, or of such value that continuance as an asset is not warranted.

The following tables present the amortized cost of loans receivable, by year of origination (for term loans) and by risk grade within each portfolio segment as of June 30, 2026 and December 31, 2025. Current period originations may include modifications, extensions and renewals. The Company had no loans rated doubtful or loss as of June 30, 2026 and December 31, 2025.


As of and for the six months ended June 30, 2026	Term Loans Amortized Cost Basis by Origination Year																	Revolving Loans
(Dollars in thousands)	2026		2025			2024			2023			2022			Prior			Amortized Cost Basis		Total
Commercial and industrial
Risk rating
Pass	$	5,129	$	32,565		$	8,169		$	4,971		$	3,855		$	1,609		$	19,177	$	75,475
Special mention		-		-			-			146			-			-			-		146
Substandard		-		722			1,740			2,462			221			-			-		5,145
Total	$	5,129	$	33,287		$	9,909		$	7,579		$	4,076		$	1,609		$	19,177	$	80,766
Current period gross charge offs	$	-	$	118		$	-		$	-		$	-		$	-		$	-	$	118
Current period gross recoveries	$	-	$	-		$	-		$	-		$	-		$	-		$	-	$	-
Commercial real estate - non-owner occupied
Risk rating
Pass	$	120,186	$	170,159		$	173,654		$	136,628		$	69,931		$	135,388		$	-	$	805,946
Special mention		-		-			-			-			647			1,024			-		1,671
Substandard		-		1,442			764			6,219			8,033			25,559			-		42,017
Total	$	120,186	$	171,601		$	174,418		$	142,847		$	78,611		$	161,971		$	-	$	849,634
Current period gross charge offs			$	-		$	-		$	-		$	1,014		$	29		$	-	$	1,043
Current period gross recoveries			$	-		$	-		$	-		$	-		$	2		$	-	$	2
Commercial real estate - owner occupied
Risk rating
Pass	$	3,859	$	29,016		$	2,126		$	7,372		$	11,692		$	24,017		$	-	$	78,082
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			1,381			1,770			-			6,983			-		10,134
Total	$	3,859	$	29,016		$	3,507		$	9,142		$	11,692		$	31,000		$	-	$	88,216
Current period gross charge offs	$	-	$	-		$	-		$	-		$	-		$	-		$	-	$	-
Construction and land development
Risk rating
Pass	$	-	$	1,865		$	-		$	-		$	389		$	-		$	-	$	2,254
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	1,865		$	-		$	-		$	389		$	-		$	-	$	2,254
Multifamily
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	18,836		$	-	$	18,836
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	18,836		$	-	$	18,836
Single family Sr. Lien
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	162		$	558	$	720
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	162		$	558	$	720
Single family Jr. Lien
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	190	$	190
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	190	$	190
Single family HELOC
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	375	$	375
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	375	$	375
Consumer
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	6,361	$	6,361
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	6,361	$	6,361
Current period gross charge offs	$	-	$	-		$	-		$	-		$	-		$	-		$	1,469	$	1,469
Current period gross recoveries	$	-	$	-		$	-		$	-		$	-		$	-		$	4	$	4
Total Loans
Risk rating
Pass	$	129,174	$	233,605	-	$	183,949	-	$	148,971		$	85,867	-	$	180,012	-	$	26,661	$	988,239
Special mention		-		-	-		-	-		146	-		647	-		1,024	-		-		1,817
Substandard		-		2,164	-		3,885	-		10,451	-		8,254	-		32,542	-		-		57,296
Total	$	129,174	$	235,769		$	187,834		$	159,568		$	94,768		$	213,578		$	26,661	$	1,047,352


As of December 31, 2025	Term Loans Amortized Cost Basis by Origination Year																	Revolving Loans
(Dollars in thousands)	2025		2024			2023			2021			2020			Prior			Amortized Cost Basis		Total
Commercial and industrial
Risk rating
Pass	$	34,205	$	9,660		$	6,291		$	4,682		$	391		$	1,677		$	22,137	$	79,043
Special mention		-		311			490			-			-			-			-		801
Substandard		372		-			-			-			-			-			-		372
Total	$	34,577	$	9,971		$	6,781		$	4,682		$	391		$	1,677		$	22,137	$	80,216
Current period gross charge offs	$	124	$	241		$	116		$	46		$	-		$	-		$	-	$	527
Current period gross recoveries	$	-	$	16		$	-		$	18		$	-		$	-		$	-	$	34
Commercial real estate - non-owner occupied
Risk rating
Pass	$	169,580	$	169,501		$	147,399		$	76,061		$	52,361		$	95,284		$	-	$	710,186
Special mention		-		764			-			650			238			1,671			-		3,323
Substandard		-		-			3,951			12,489			9,297			11,319			-		37,056
Total	$	169,580	$	170,265		$	151,350		$	89,200		$	61,896		$	108,274		$	-	$	750,565
Current period gross charge offs	$	-	$	-		$	-		$	649		$	741		$	620		$	-	$	2,010
Current period gross recoveries	$	-	$	-		$	-		$	-		$	24		$	80		$	-	$	104
Commercial real estate - owner occupied
Risk rating
Pass	$	29,330	$	3,076		$	9,416		$	12,672		$	18,435		$	17,540		$	-	$	90,469
Special mention		-		-			3,127			-			-			-			-		3,127
Substandard		-		486			494			-			-			-			-		980
Total	$	29,330	$	3,562		$	13,037		$	12,672		$	18,435		$	17,540		$	-	$	94,576
Current period gross charge offs	$	-	$	138		$	-		$	-		$	174		$	-		$	-	$	312
Construction and land development
Risk rating
Pass	$	1,898	$	-		$	-		$	390		$	-		$	-		$	-	$	2,288
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	1,898	$	-		$	-		$	390		$	-		$	-		$	-	$	2,288
Multifamily
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	18,950		$	-	$	18,950
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	18,950		$	-	$	18,950
Single family Sr. Lien
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	164		$	562	$	726
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	164		$	562	$	726
Single family Jr. Lien
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	131	$	131
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	131	$	131
Single family HELOC
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	459	$	459
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			-		-
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	459	$	459
Consumer
Risk rating
Pass	$	-	$	-		$	-		$	-		$	-		$	-		$	10,504	$	10,504
Special mention		-		-			-			-			-			-			-		-
Substandard		-		-			-			-			-			-			854		854
Total	$	-	$	-		$	-		$	-		$	-		$	-		$	11,358	$	11,358
Current period gross charge offs	$	-	$	-		$	-		$	-		$	-		$	-		$	384	$	384
Current period gross recoveries	$	-	$	-		$	-		$	-		$	-		$	-		$	5	$	5
Total Loans
Risk rating
Pass	$	235,013	$	182,237	-	$	163,106	-	$	93,805		$	71,187	-	$	133,615	-	$	33,793	$	912,756
Special mention		-		1,075	-		3,617	-		650	-		238	-		1,671	-		-		7,251
Substandard		372		486	-		4,445	-		12,489	-		9,297	-		11,319	-		854		39,262
Total	$	235,385	$	183,798		$	171,168		$	106,944		$	80,722		$	146,605		$	34,647	$	959,269

Collateral Dependent Loans

A loan is considered to be collateral-dependent when the debtor is experiencing financial difficulty and repayment is expected to be provided substantially through the sale or operation of the collateral. Collateral-dependent loans do not share risk characteristics with other loans and therefore are individually evaluated for purposes of calculating the allowance for credit losses. The Company has elected to apply the practical expedient under ASC 326 which permits an entity to estimate credit losses based on the fair value of collateral when either applies: (i) the borrower is experiencing financial difficulty, or (ii) repayment is expected to be provided substantially through the sale or operating of the collateral. Fair value estimates for collateral dependent loans are generally based on the current market value or the “as is” value of the collateral derived from recently received and reviewed appraisals from third-party providers. If repayment is dependent on the sale of the collateral, then the fair value used to measure the allowance for credit losses is adjusted for the costs to sell.

The following tables present the amortized cost basis of collateral-dependent loans by collateral type as of the dates indicated:


	Types of Collateral
June 30, 2026			Retail
(Dollars in thousands)			Shopping		Business		Residential
	Hotel / Motel		Center		Assets		Real Estate		Other		Total

Commercial and industrial	$	-	$	-	$	3,337		1,376	$	-	$	4,713
Commercial real estate - non-owner occupied		38,996		-		-				-		38,996
Commercial real estate - owner occupied		-		470		-		6,772		697		7,939
	$	38,996	$	470	$	3,337	$	8,148	$	697	$	51,648


	Types of Collateral
December 31, 2025			Retail
(Dollars in thousands)			Shopping		Business		Residential
	Hotel / Motel		Center		Assets		Real Estate		Other		Total

Commercial and industrial	$	-	$	-	$	372	$	-	$	-	$	372
Commercial real estate - non-owner occupied		27,200		-		3,589		-		-		30,789
Commercial real estate - owner occupied		494		-		-		-		486		980
	$	27,694	$	-	$	3,961	$	-	$	486	$	32,141

The following tables present the amortized cost basis of collateral-dependent loans by loan portfolio segment and the related allowance assigned as of the dates indicated:


June 30, 2026	Collateral Dependent Loans
(Dollars in thousands)	With a Related		Without a Related		Related
	Allowance		Allowance		Allowance

Commercial and industrial	$	3,991	$	722	$	1,138
Commercial real estate - non-owner occupied		15,808		23,188		1,287
Commercial real estate - owner occupied		7,241		698		1,099


December 31, 2025	Collateral Dependent Loans
(Dollars in thousands)	With a Related		Without a Related		Related
	Allowance		Allowance		Allowance

Commercial and industrial	$	-	$	372	$	-
Commercial real estate - non-owner occupied		14,034		16,755		1,161
Commercial real estate - owner occupied		494		486		26

Allowance for Credit Losses

The level of the allowance for credit losses reflects management’s continuing evaluation of product and industry concentrations, specific credit risks, loan loss experience, current loan portfolio quality, present economic, political and regulatory conditions, and unidentified losses expected in the current loan portfolio. Portions of the allowance for credit losses may be allocated for specific credits; however, the entire allowance for credit losses is available for any credit that, in management’s judgment, should be charged off.

The following tables present, by portfolio segment, the changes in the allowance for credit losses for the three- and six-month periods indicated:


	Allowance for Credit Losses
	Balance,													Balance,
(Dollars in thousands)	April 1		Provision for				Amounts				Amounts			June 30,
	2026		Credit Losses				Charged Off				Recovered			2026

Commercial and industrial	$	1,132	$	466		-	$	(118	)	-	$	-	-	$	1,480
Commercial real estate - non-owner occupied		8,556		1,642		-		(1,043	)	-		2	-		9,157
Commercial real estate - owner occupied		624		(50	)	-		-		-		-	-		574
Construction and land development		149		(17	)	-		-		-		-	-		132
Multifamily		36		20		-		-		-		-	-		56
Single Family Sr. Lien		2		(1	)	-		-		-		-	-		1
Single Family Jr. Lien		-		-		-		-		-		-	-		-
Single Family HELOC		4		(2	)	-		-		-		-	-		2
Consumer		252		771		-		(9	)	-		2	-		1,016
	$	10,755	$	2,829			$	(1,170	)		$	4		$	12,418


	Allowance for Credit Losses
	Balance,										Balance,
(Dollars in thousands)	January 1,		Provision for			Amounts			Amounts		June 30,
	2026		Credit Losses			Charged Off			Recovered		2026

Commercial and industrial	$	378	$	1,220		$	(118	)	$	-	$	1,480
Commercial real estate - non-owner occupied		7,214		2,984			(1,043	)		2		9,157
Commercial real estate - owner occupied		628		(54	)		-			-		574
Construction and land development		164		(32	)		-			-		132
Multifamily		42		14			-			-		56
Single Family Sr. Lien		2		(1	)		-			-		1
Single Family Jr. Lien		1		(1	)		-			-		-
Single Family HELOC		4		(2	)		-			-		2
Consumer		1,457		1,024			(1,469	)		4		1,016
	$	9,890	$	5,152		$	(2,630	)	$	6	$	12,418


	Allowance for Credit Losses
	Balance,										Balance,
(Dollars in thousands)	April 1,		Provision for			Amounts			Amounts		June 30,
	2025		Credit Losses			Charged Off			Recovered		2025

Commercial and industrial	$	343	$	22		$	-		$	-	$	365
Commercial real estate - non-owner occupied		7,806		728			(912	)		79		7,701
Commercial real estate - owner occupied		503		175			-			-		678
Construction and land development		48		52			-			-		100
Multifamily		62		(2	)		-			-		60
Single Family Sr. Lien		15		(11	)		-			-		4
Single Family Jr. Lien		9		(2	)		-			-		7
Single Family HELOC		6		(2	)		-			-		4
Consumer		205		119			(38	)		-		286
	$	8,997	$	1,079		$	(950	)	$	79	$	9,205


	Allowance for Credit Losses
	Balance,										Balance,
(Dollars in thousands)	January 1,		Provision for			Amounts			Amounts		June 30,
	2025		Credit Losses			Charged Off			Recovered		2025

Commercial and industrial	$	496	$	32		$	(163	)	$	-	$	365
Commercial real estate - non-owner occupied		7,837		1,320			(1,535	)		79		7,701
Commercial real estate - owner occupied		537		141			-			-		678
Construction and land development		49		51			-			-		100
Multifamily		39		21			-			-		60
Single Family Sr. Lien		33		(29	)		-			-		4
Single Family Jr. Lien		14		(7	)		-			-		7
Single Family HELOC		11		(7	)		-			-		4
Consumer		98		267			(79	)		-		286
	$	9,114	$	1,789		$	(1,777	)	$	79	$	9,205

The Company had gross loan charge offs of $1.2 million during the three months ended June 30, 2026 comprised of commercial and industrial and commercial real estate - non-owner occupied loans. Comparatively, the Company had gross loan chargeoffs of $950 thousand during the three months ended June 30, 2025 comprised of commercial real estate - non-owner occupied, and consumer loans. Gross loan charges offs for six months ended June 30, 2026 and 2025 were $2.6 million and $1.8 million, respectively comprised of commercial and industrial, commercial real estate - non-owner occupied, and consumer loans.

Modifications to Borrowers Experiencing Financial Difficulty

The Company may modify certain loans when a borrower is experiencing financial difficulties and the Company grants concessions to the borrower that it would not otherwise consider. These concessions may include rate reductions, principal forgiveness, extension of maturity date and other actions intended to minimize potential losses.

The following table presents the amortized cost basis of loans held for investment that were modified during the period for borrowers experiencing financial difficulty by loan portfolio segment:


	Amortized Cost Basis at June 30, 2026
(Dollars in thousands)					Combination:
					Interest Rate				% of Total Class
	Term		Interest Rate		Reduction and				of Financing
	Extension		Reduction		Term Extension		Total		Receivable
Commercial real estate - non-owner occupied	$	-	$	-	$	-	$	-		0.0	%


	Amortized Cost Basis at June 30, 2025
(Dollars in thousands)					Combination:
					Interest Rate				% of Total Class
	Term		Interest Rate		Reduction and				of Financing
	Extension		Reduction		Term Extension		Total		Receivable
Commercial real estate - non-owner occupied	$	-	$	-	$	3,334	$	3,334		0.5	%

The financial effects of the term extensions in the table above added a weighted-average of 5.0 years to the life of the loans, which also reduced the monthly payment amounts for the borrowers.

The performance of these modified loans is monitored for twelve months following the modification. As of June 30, 2026 and 2025, all modified loans were on nonaccrual status and performing under their respective modified terms. The Company had no commitments to lend additional funds to borrowers experiencing financial difficulty whose loan terms were modified.

Note 4. Operating Leases

The Company leases real estate for its main office and two branch offices, as well as office space for operations departments under various operating lease agreements. The lease agreements have maturity dates ranging from September 2030 to October 2032, some of which include options to renew at the Company's discretion. At lease inception, if the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the measurement of the right-of-use asset and lease liability.

The lease liability is equal to the present value of the future lease payments, discounted using the rate implicit in the lease (or if that rate cannot be readily determined, the lessee’s incremental borrowing rate). Given that the rate implicit in the lease is rarely available, lease liability amounts were calculated using the Company’s incremental borrowing rate at lease inception, on a collateralized basis, for a similar term.

Operating lease right-of-use assets, as well as operating lease liabilities, are presented as separate line items on the consolidated balance sheets. The Company has elected not to report short-term leases (i.e., leases with initial terms of twelve months or less) on the consolidated balance sheets.

There were no sale and leaseback transactions or leveraged leases as of June 30, 2026 or December 31, 2025. There were no leases that had not commenced as of June 30, 2026.

Below is a summary of the operating lease right-of-use asset and related lease liability, as well as the weighted average lease term (in years), weighted average discount rate and total rent expense as of the dates and periods indicated.


(Dollars in thousands)	June 30, 2026			December 31, 2025
Right-of-use asset	$	4,857		$	5,297
Lease liability	$	5,382		$	5,757
Weighted average remaining lease term (in years)		5.7			6.1
Weighted average discount rate (annualized)		4.58	%		4.58	%


	Three Months Ended				Six Months Ended
	June 30, 2026		June 30, 2025		June 30, 2026		June 30, 2025
Rent expense	$	220	$	220	$	440	$	436
Cash paid for operating lease liabilities	$	267	$	263	$	530	$	520

At June 30, 2026, future minimum payments for operating leases are payable as follows:


(Dollars in thousands)
Years ending December 31:
2026		505
2027		1,037
2028		1,118
2029		1,129
2030		1,038
Thereafter		1,318
Total lease payments	$	6,145
Less: imputed interest		(763	)
Present value of lease liability	$	5,382

Note 5. Loan Servicing Assets

The Company’s servicing assets consist primarily of the right to service the guaranteed portion of government guaranteed loans sold to others. The fair value of the servicing asset is essentially a valuation of the net future income stream, which is based on the rate of the fee, the estimated repayment speed of the loan and the estimated cost to service the loan.

The amount allocated to the loan servicing assets is recorded at fair value at the time of sale, as calculated by a third-party consulting firm specializing in government guaranteed loan matters.

The fair value of the servicing asset is calculated for each loan using the following valuation variables:



·	Servicing fee: This is the amount of the fee charged to a third-party buyer to service the loan. It is generally one percent (1%) of the loan balance for SBA loans and two percent (2%) for USDA loans on a declining basis as the loan repays principal.

·	Prepayment assumption: This is an estimate of the repayment speed of the loan using a constant prepayment rate (“CPR”) based on pools of similar government guaranteed loans.

·	Servicing costs: The internal rates of return (IRR) are the pre-tax yield rates used to discount the expected future cash flow stream from servicing the government guaranteed loan portfolios.

·	Internal rate of return: The internal rates of return (IRR) are the pre-tax yield rates used to discount the expected future cash flow stream from servicing the government guaranteed loan portfolios.

The loan servicing asset is amortized over the period of estimated servicing income, generally five to seven years, with the amortization recorded against loan servicing fee income.

The balance of loans owned by third parties that are being serviced by the Company was $1.2 billion and $1.0 billion as of June 30, 2026 and December 31, 2025, respectively.

The following table presents a reconciliation of loan servicing rights as of the periods indicated:


(Dollars in thousands)	Six Months Ended June 30, 2026			Year Ended December 31, 2025
Balance, beginning of period	$	11,140		$	8,976
Additions - servicing rights related to loans sold		4,167			7,798
Reductions - write-off of servicing assets		-			-
Reductions - amortization and early payoff		(3,037	)		(5,634	)
Balance, end of period	$	12,270		$	11,140

In the event of an early repayment of a serviced loan, the unamortized balance of the loan servicing asset for that loan is charged off against loan servicing fee income.

The aggregate balance of loan servicing rights is evaluated for impairment to ensure that the recorded balance is at the lower of amortized cost or fair value. There was no allowance for impairment recorded as of June 30, 2026 or December 31, 2025.

Note 6. Deposits

At June 30, 2026 and December 31, 2025, time deposits amounted to $553.2 million and $568.6 million, respectively. Interest expense on time deposits amounted to $5.9 million and $4.7 million for the three months ended June 30, 2026 and 2025, respectively. Interest expense on time deposits amounted to $11.7 million and $9.1 million for the six months ended June 30, 2026 and 2025, respectively.

The scheduled maturities of time deposits at June 30, 2026, are as follows:


(Dollars in thousands)	Time Deposit Maturities
	Less Than $250,000		$250,000 or more
2026	$	263,884	$	20,695
2027		178,422		14,600
2028		42,140		5,835
2029		21,383		-
2030		6,017		251
Maturing thereafter		-		-
Total time deposits	$	511,846	$	41,381

GBank had $120.1 million and $105.7 million of brokered certificates of deposit as of June 30, 2026 and December 31, 2025, respectively, having terms between six months and five years.

The aggregate amount of demand deposit overdrafts that were reclassified as loans was $211 thousand at June 30, 2026, compared to $62 thousand as of December 31, 2025.

Note 7. Subordinated Debt, Other Borrowings, and Available Lines of Credit

Subordinated Debt Issued 2026

On January 14, 2026, the Company completed a private placement of $11.0 million in aggregate principal amount of 7.25% Fixed-to-Floating Rate Subordinated Notes due 2036 (the “2026 Notes”). The Company intends to utilize the net proceeds for general corporate purposes, including refinancing existing indebtedness. The 2026 Notes were structured to qualify as Tier 2 capital for GBank for regulatory capital purposes. The 2026 Notes initially bear a fixed interest rate of 7.25% until January 15, 2031, after which time and until maturity on January 15, 2036, the interest rate will reset quarterly to an annual floating rate equal to the Three-Month Term Secured Overnight Financing Rate (“SOFR”) plus 382 basis points. The 2026 Notes are redeemable by the Company at its option, in whole or in part, on or after January 15, 2031. Any redemption will be at a redemption price equal to 100% of the principal amount of the 2026 Notes being redeemed, plus accrued and unpaid interest.

On January 15, 2026, utilizing the proceeds from the 2026 Notes, the Company redeemed $6.5 million of fixed-to-floating rate subordinated notes originally issued December 30, 2020 ("the 2020 Notes"). The 2020 Notes had a maturity date of January 15, 2031 and carried a fixed interest rate of 4.50% for the first five years through January 14, 2026. Thereafter, the 2020 Notes would have had a quarterly adjustable rate equal to the then-current three-month term SOFR as published by the Federal Reserve Bank of New York, plus four hundred twenty-three (423) basis points.

The net proceeds of the 2026 Notes were $10.5 million which includes $491 thousand of debt issuance costs that are being amortized over the expected life of the 2026 Notes.

The 2026 Notes are unsecured, subordinated obligations of the Company, are not obligations of, and are not guaranteed by, any subsidiary of the Company, and rank junior in right of payment to the Company’s current and future senior indebtedness. The 2026 Notes are intended to qualify as Tier 2 capital of the Company for regulatory capital purposes.

Subordinated Debt Issued 2021

On December 15, 2021, the Company completed a $20.0 million private placement of 3.875% fixed-to-floating rate subordinated notes due 2031 (the “2021 Notes”). The 2021 Notes are subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed, or incurred (collectively, “Senior Indebtedness”). The 2021 Notes are not secured by any assets of the Company or its sole subsidiary, GBank.

The 2021 Notes have a maturity date of December 15, 2031 and carry a fixed interest rate of 3.875% for the first five years through December 15, 2026, and thereafter is payable in arrears quarterly. Thereafter, the 2021 Notes will pay interest at a quarterly adjustable rate equal to the then-current three-month term Secured Overnight Financing Rate (“SOFR”) as published by the Federal Reserve Bank of New York, plus two hundred and eighty-nine (289) basis points.

Interest on the 2021 Notes is payable in arrears semiannually on December 15 and June 15 through December 15, 2026. The 2021 Notes are redeemable by the Company in whole or in part on any interest payment date beginning with the interest payment date of December 15, 2026. The net proceeds of the 2021 Notes were $19.6 million which includes $558 thousand of debt issuance costs that are being amortized over the expected life of the 2021 Notes.

The 2021 Notes are intended to qualify as Tier 2 capital for the Company for regulatory capital purposes. At the closing of the private placement, the Company invested $18.0 million into the Company’s wholly owned subsidiary, GBank. The funds invested into GBank are intended to qualify as Tier 1 capital of GBank.

Subordinated Debt Issued 2020

On December 30, 2020, the Company completed a $6.5 million private placement of 4.50% fixed-to-floating rate subordinated notes due 2031 (the “2020 Notes”). The 2020 Notes were subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed, or incurred (collectively, “Senior Indebtedness”). The 2020 Notes were not secured by any assets of the Company or its sole subsidiary, GBank.

On January 15, 2026, the Company redeemed the 2020 Notes through utilization of the proceeds from the issuance of the 2026 Notes.

The Company recorded interest expense on subordinated debt issuances totaling $419 thousand for the three months ended June 30, 2026, compared to $262 thousand for the three months ended June 30, 2025, and $929 thousand for the six months ended June 30, 2026 compared to $547 thousand for the six months ended June 30, 2025. Accrued interest on subordinated debt totaled $406 thousand as of June 30, 2026, compared to $166 thousand accrued as of December 31, 2025.

Lines of Credit

The Company has a line of credit available from the Federal Home Loan Bank of San Francisco (the “FHLB”). The unused borrowing capacity at June 30, 2026 and December 31, 2025 with the FHLB, as collateralized by qualifying securities and pledged loans, was $130.8 million and $88.7 million, respectively. No draws have been made on the line, and the balance was zero at the end of June 30, 2026 compared to $100 thousand December 31, 2025.

The Company also has unsecured lines of credit with other correspondent banks totaling $40.0 million at June 30, 2026 and December 31, 2025. No draws have been made on these lines of credit and no balances were outstanding as of June 30, 2026 or December 31, 2025.

Other Borrowing Arrangements

GBank is approved to pledge loans and investment securities as collateral under the Federal Reserve Bank of San Francisco’s Borrower-In-Custody (“BIC”) Program. As of June 30, 2026, the Company had pledged loans and investment securities with an approximate carrying value of $617.7 million to the BIC Program and had unused borrowing capacity of $326.7 million. Comparatively, the Company had pledged loans and investment securities with an approximate carrying value of $633.1 million to the BIC Program and had unused borrowing capacity of $351.3 million at December 31, 2025. The balance outstanding under the BIC Program was zero as of June 30, 2026, compared to $1 thousand as of December 31, 2025.

The Company had no short-term borrowings outstanding as of June 30, 2026 compared to $371 thousand at December 31, 2025.

Note 8. Stockholders' Equity and Earnings Per Share

Authorized Shares

The Company is authorized to issue three classes of shares: preferred stock, voting common stock, and nonvoting common stock. The Company had no preferred shares outstanding as of June 30, 2026 or December 31, 2025. The Company’s non-voting common stock and voting common stock share equally in dividends and residual net assets on a per share basis, and have identical rights and privileges, with the exception of voting rights. As of June 30, 2026 and December 31, 2025, the Company had 231,508 shares of nonvoting common stock issued and outstanding relating to the acquisition of a nonvoting equity interest in BankCard Services LLC ("BCS") during the second quarter of 2024. Earnings per share amounts, as well as the balance of common stock issued and outstanding on the consolidated balance sheets, reflect both voting and nonvoting common shares.

Stock Option Loans

During the year ended December 31, 2022, the Company approved a stock option loan program (the "Program") under which the Company made secured loans to option holders with proceeds used to pay the exercise price of the stock options. The collateral for the loans was the shares obtained upon exercise of the option using the loan proceeds. All loans under the Program were repaid in full during the first quarter of 2025.

Earnings Per Share

Basic earnings per share are computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during each of the periods presented. Diluted earnings per common share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding plus common shares that would have been outstanding if dilutive potential common shares, consisting of unvested restricted stock and outstanding stock options, had been issued.

The computation of earnings per share is provided in the table below for the three and six-month periods indicated.


	Three Months Ended				Six Months Ended
(Dollars in thousands, except per share data)	June 30, 2026		June 30, 2025		June 30, 2026		June 30, 2025
Net income available to common stockholders	$	5,462	$	4,755	$	6,777	$	9,225
Weighted average shares outstanding (basic)		14,470,352		14,273,433		14,442,745		14,264,794
Effect of dilutive stock options		25,938		120,483		26,661		119,810
Effect of dilutive restricted stock		47,455		157,207		41,533		151,287
Weighted average shares outstanding (diluted)		14,543,745		14,551,123		14,510,939		14,535,891
Basic earnings per share	$	0.38	$	0.33	$	0.47	$	0.65
Diluted earnings per share	$	0.38	$	0.33	$	0.47	$	0.63
Anti-dilutive stock options excluded from
the computation of earnings per share	</

Form: 10-Q

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