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What changed in CHAIN BRIDGE BANCORP INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CHAIN BRIDGE BANCORP INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+540 added−517 removedSource: 10-K (2026-03-20) vs 10-K (2025-03-21)

Top changes in CHAIN BRIDGE BANCORP INC's 2025 10-K

540 paragraphs added · 517 removed · 423 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

58 edited+12 added−16 removed179 unchanged
Biggest changeThis approach is intended to provide our clients with secure, efficient, and convenient banking solutions. However, our branch-less business model may limit our ability to expand our retail lending and deposit businesses beyond the Washington, D.C. metropolitan area, where we have a more concentrated presence.
Biggest changeHowever, our branch-less business model may limit our ability to expand our retail lending and deposit businesses beyond the Washington, D.C. metropolitan area, where we have a more concentrated presence. 8 Table of Contents Serving Political Organizations We focus on clients and business segments where our experience may offer advantages, such as services for political organizations and related entities, including treasury management, deposit services, and trust and wealth management.
The Company is responsible for, among other things, blocking the accounts of, and transactions with, prohibited parties identified by OFAC, avoiding unlicensed trade and financial transactions with such parties, and reporting blocked transactions after their occurrence. Failure to comply with OFAC requirements could have serious legal, financial, and reputational consequences for the Company.
The Bank is responsible for, among other things, blocking the accounts of, and transactions with, prohibited parties identified by OFAC, avoiding unlicensed trade and financial transactions with such parties, and reporting blocked transactions after their occurrence. Failure to comply with OFAC requirements could have serious legal, financial, and reputational consequences for the Company and Bank.
Our Trust & Wealth Department offers a range of fiduciary services, including: • Serving as trustee, investment manager with sole or joint discretion, executor, administrator, registrar of stocks and bonds, and guardian of estates, management of hard-to-value assets such as real estate, closely held businesses, mineral interests, loans and notes, life insurance, and tangible assets like collectibles, and offering specialized trusts such as special needs trusts, settlement protection trusts, land trusts, and charitable trusts. • Providing wealth management services, including investment management, financial planning, and personalized strategies integrating investments, cash flow, risk management, and estate planning. 12 Table of Contents • Providing custodial services for both publicly traded and unique and hard-to-value assets to individual investors, trust administrators, nonprofits, and retirement account holders.
Our Trust & Wealth Department offers a range of fiduciary services, including: • Serving as trustee, investment manager with sole or joint discretion, executor, administrator, registrar of stocks and bonds, and guardian of estates, management of hard-to-value assets such as real estate, closely held businesses, mineral interests, loans and notes, life insurance, and tangible assets like collectibles, and offering specialized trusts such as special needs trusts, settlement protection trusts, land trusts, and charitable trusts. • Providing wealth management services, including investment management, financial planning, and personalized strategies integrating investments, cash flow, risk management, and estate planning. • Providing custodial services for both publicly traded and unique and hard-to-value assets to individual investors, trust administrators, nonprofits, and retirement account holders.
As payment technologies continue to evolve, we strive to maintain our technological capabilities and adapt our services to meet the changing needs of our diverse commercial client base. Our business model operates without a traditional branch network. As of December 31, 2024, we provide in-person banking services exclusively from our headquarters and do not operate additional physical banking locations.
As payment technologies continue to evolve, we strive to maintain our technological capabilities and adapt our services to meet the changing needs of our diverse commercial client base. Our business model operates without a traditional branch network. As of December 31, 2025, we provide in-person banking services exclusively from our headquarters and do not operate additional physical banking locations.
As of December 31, 2024, the outstanding balance on our business credit cards was immaterial. Many of our commercial borrowers maintain deposit accounts with us as part of their loan agreements, which supports our strategy of offering integrated financial services. However, our depositors and our borrowers are typically distinct client groups.
As of December 31, 2025, the outstanding balance on our business credit cards was immaterial. Many of our commercial borrowers maintain deposit accounts with us as part of their loan agreements, which supports our strategy of offering integrated financial services. However, our depositors and our borrowers are typically distinct client groups.
Our investment approach for these funds is intended to be conservative, based on our interpretation of prudent banking practices and current regulatory guidelines. As of December 31, 2024, we served deposit clients in 49 states, the District of Columbia, and Puerto Rico.
Our investment approach for these funds is intended to be conservative, based on our interpretation of prudent banking practices and current regulatory guidelines. As of December 31, 2025, we served deposit clients in 49 states, the District of Columbia, and Puerto Rico.
Additional Information The Company maintains an investor relations website at https://ir.chainbridgebank.com/ where it provides access, free of charge, to its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC.
Additional Information The Company maintains an investor relations website at https://ir.chainbridgebank.com/ where it provides access, free of charge, to its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports as soon as reasonably practicable after they are electronically filed with, or furnished to, the 21 Table of Contents SEC.
Our approach has historically resulted in what we consider to be low levels of non-performing loans and loan charge-offs. As of December 31, 2024, we have reported no non-performing assets since June 30, 2012.
Our approach has historically resulted in what we consider to be low levels of non-performing loans and loan charge-offs. As of December 31, 2025, we have reported no non-performing assets since June 30, 2012.
We believe this overlap is an important aspect of our strategy to deepen client relationships by offering a broad range of banking services. For certain residential mortgage clients, the ability to access both lending and deposit services within our institution may 11 Table of Contents enhance their overall banking experience and support the development of long-term relationships.
We believe this overlap is an important aspect of our strategy to deepen client relationships by offering a broad range of banking services. For certain residential mortgage clients, the ability to access both lending and deposit services within our institution may enhance their overall banking experience and support the development of long-term relationships.
The CFPB focuses on (i) risks to consumers and compliance with the federal consumer financial laws, (ii) the markets in which firms operate and risks to consumers posed by activities in those markets, (iii) depository institutions that offer a wide variety of consumer financial products and services, and (iv) non-depository companies that offer one or more consumer financial products or services.
The CFPB focuses on (i) risks to consumers and compliance with the federal consumer financial laws, (ii) the markets in which firms operate and risks to consumers posed by activities in those markets, (iii) 18 Table of Contents depository institutions that offer a wide variety of consumer financial products and services, and (iv) non-depository companies that offer one or more consumer financial products or services.
Strategic risk refers to the risk arising from adverse business decisions, improper implementation of decisions, or lack of responsiveness to changes in the banking industry and operating environment. Our Board is 13 Table of Contents charged with overseeing our corporate strategy, and our Risk Committee oversees strategic risks and the control processes with respect to such risks.
Strategic risk refers to the risk arising from adverse business decisions, improper implementation of decisions, or lack of responsiveness to changes in the banking industry and operating environment. Our Board is charged with overseeing our corporate strategy, and our Risk Committee oversees strategic risks and the control processes with respect to such risks.
The level of regulation and oversight over financial services activities, including the regulatory enforcement environment applicable to banks and bank holding companies, has in the past increased, and may in the future 14 Table of Contents increase. The laws, regulations and supervisory guidance applicable to the Company and the Bank are subject to frequent and ongoing change.
The level of regulation and oversight over financial services activities, including the regulatory enforcement environment applicable to banks and bank holding companies, has in the past increased, and may in the future increase. The laws, regulations and supervisory guidance applicable to the Company and the Bank are subject to frequent and ongoing change.
The Federal Reserve may, in its discretion, exclude any bank holding company from the application of the SBHC Policy Statement if such action is warranted for supervisory purposes. Deposit Insurance The Bank accepts deposits that are insured by the FDIC up to the applicable limits.
The Federal Reserve may, in its discretion, exclude any bank holding company from the application of the SBHC Policy Statement if such action is warranted for supervisory purposes. Deposit Insurance The Bank’s deposits are insured by the FDIC up to the applicable limits.
Under the FDIA, the FDIC may terminate the insurance of an institution’s deposits upon a finding that the institution has engaged in unsafe or unsound 15 Table of Contents practices; is in an unsafe or unsound condition to continue operations; or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.
Under the FDIA, the FDIC may terminate the insurance of an institution’s deposits upon a finding that the institution has engaged in unsafe or unsound practices; is in an unsafe or unsound condition to continue operations; or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.
The Company has not reported any loan charge-offs since the third quarter of 2017 and has incurred a cumulative net loan charge-offs of $265 thousand since inception. Deposit Composition and Strategy We aim to attract transaction account deposits, particularly from commercial clients.
The Company has not reported any loan charge-offs since the third quarter of 2017 and has incurred a cumulative net loan charge-offs of $265 thousand since inception. 7 Table of Contents Deposit Composition and Strategy We aim to attract transaction account deposits, particularly from commercial clients.
A depository institution may not pay any dividend if payment would cause the institution to become “undercapitalized” or if it already is “undercapitalized.” The OCC may prevent the payment of a dividend if it determines that the payment would be an unsafe and unsound banking practice.
A depository institution may not pay any dividend if payment would cause the institution to become “undercapitalized” or if it already is “undercapitalized.” The OCC may prevent the payment of a dividend if it determines that the payment would 16 Table of Contents be an unsafe and unsound banking practice.
A financial institution is also expected to develop appropriate processes to enable recovery 21 Table of Contents of data and business operations and to address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyberattack.
A financial institution is also expected to develop appropriate processes to enable recovery of data and business operations and to address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyberattack.
While our deposits come from across the United States, the majority of our loans and trust services are concentrated in the Washington, D.C. metropolitan area. Deposit Services As of December 31, 2024, transaction account deposit balances made up 93.3% of our total deposits. We provide a variety of commercial and personal deposit services to commercial and individual clients.
While our deposits come from across the United States, the majority of our loans and trust services are concentrated in the Washington, D.C. metropolitan area. Deposit Services As of December 31, 2025, transaction account deposit balances made up 95.3% of our total deposits. We provide a variety of commercial and personal deposit services to commercial and individual clients.
At each successive lower capital category, an insured depository institution is subject to more restrictions and prohibitions, including restrictions on growth, restrictions on interest rates paid on deposits, restrictions or prohibitions on payment of dividends, and restrictions on the acceptance of brokered deposits.
At each successive lower capital category, an insured depository institution is subject to more restrictions and prohibitions, including restrictions on growth, restrictions on interest rates paid on deposits, restrictions or prohibitions on payment of dividends, and restrictions 15 Table of Contents on the acceptance of brokered deposits.
As required by FDICIA, the federal bank regulatory agencies also have adopted Interagency Guidelines Prescribing Safety and Soundness Standards relating to, among other things, internal controls and information systems, internal audit 18 Table of Contents activities, loan documentation, credit underwriting, and interest rate exposure.
As required by FDICIA, the federal bank regulatory agencies also have adopted Interagency Guidelines Prescribing Safety and Soundness Standards relating to, among other things, internal controls and information systems, internal audit activities, loan documentation, credit underwriting, and interest rate exposure.
Our national charter allows us to offer banking services across state lines without additional state banking licenses. The OCC 7 Table of Contents serves as our primary federal regulator, overseeing our operations and compliance with applicable federal banking laws and regulations. Our national bank fiduciary powers enable us to offer trust services broadly.
Our national charter allows us to offer banking services across state lines without additional state banking licenses. The OCC serves as our primary federal regulator, overseeing our operations and compliance with applicable federal banking laws and regulations. Our national bank fiduciary powers enable us to offer trust services broadly.
Under the CRA, institutions are assigned a rating of “outstanding,” “satisfactory,” “needs to improve,” or “substantial non-compliance.” The Bank was rated “outstanding” in its most recent CRA evaluation received on December 6, 2021. On October 24, 2023, the federal bank regulatory agencies issued a final rule to modernize their respective CRA regulations.
Under the CRA, institutions are assigned a rating of “outstanding,” “satisfactory,” “needs to improve,” or “substantial non-compliance.” The Bank was rated “outstanding” in its most recent CRA evaluation received on February 24, 2025. On October 24, 2023, the federal bank regulatory agencies issued a final rule to modernize their respective CRA regulations.
Approximately 93.3% of these deposits were held in transaction accounts (as such term is defined in the instructions for the Call Report, which the Bank files with the FFIEC on a quarterly basis). Our loan-to-deposit ratio was 25.1%. Additionally, we hold excess deposits sold one-way to other participating banks through the IntraFi Cash Service ® (ICS ® ).
Approximately 95.3% of these deposits were held in transaction accounts (as such term is defined in the instructions for the Call Report, which the Bank files with the FFIEC on a quarterly basis). Our loan-to-deposit ratio was 17.46%. Additionally, we hold excess deposits sold one-way to other participating banks through the IntraFi Cash Service ® (ICS ® ).
We compete for loans, deposits, capital and fiduciary services with other banks and other kinds of financial institutions and enterprises, such as securities firms, insurance companies, savings and loan associations, credit unions, mortgage brokers, fintechs, and private lenders, many of which have substantially greater resources or are subject to less stringent regulations.
Competition The banking industry is highly competitive. We compete for loans, deposits, capital and fiduciary services with other banks and other kinds of financial institutions and enterprises, such as securities firms, insurance companies, savings and loan associations, credit unions, mortgage brokers, fintechs, and private lenders, many of which have substantially greater resources or are subject to less stringent regulations.
However, the CFPB may include its own examiners in regulatory examinations by a smaller institution’s principal 19 Table of Contents regulators and may require smaller institutions to comply with certain CFPB reporting requirements.
However, the CFPB may include its own examiners in regulatory examinations by a smaller institution’s principal regulators and may require smaller institutions to comply with certain CFPB reporting requirements.
Under this requirement, the Company is expected to commit resources to support the Bank, including at times when the Company may not be in a financial position to provide such resources.
Under this requirement, the Company is expected to commit resources to support the Bank, including at times when the Company 17 Table of Contents may not be in a financial position to provide such resources.
The EGRRCPA, among other things, provides financial institutions with less than $10 billion in total consolidated assets with relief from certain capital requirements.
The EGRRCPA, among other things, provides financial institutions with 14 Table of Contents less than $10 billion in total consolidated assets with relief from certain capital requirements.
Some states have physical presence requirements for trust services, 17 Table of Contents and the interplay between federal and state regulations in this area continues to evolve.
Some states have physical presence requirements for trust services, and the interplay between federal and state regulations in this area continues to evolve.
As of December 31, 2024, our loan portfolio consisted of 67.2% in residential real estate loans, 17.1% in commercial real estate loans, 8.9% in commercial loans, and 6.8% in consumer loans, and approximately 83.4% of our loans were to borrowers located in the Washington, D.C. metropolitan area. Consumer Lending.
As of December 31, 2025, our loan portfolio consisted of 73.2% in residential real estate loans, 17.6% in commercial real estate loans, 1.6% in commercial loans, and 7.6% in consumer loans, and approximately 83.4% of our loans were to borrowers located in the Washington, D.C. metropolitan area. Consumer Lending.
The Bank has not opted into the CBLR framework. 16 Table of Contents Enforcement Actions and Receivership In addition to measures taken under the “prompt corrective action” regulations, insured banks may be subject to potential enforcement actions by the federal banking agencies for unsafe or unsound practices in conducting their businesses or for violations of any law, rule, regulation, or condition imposed in writing by the agency or any written agreement with the agency.
Enforcement Actions and Receivership In addition to measures taken under the “prompt corrective action” regulations, insured banks may be subject to potential enforcement actions by the federal banking agencies for unsafe or unsound practices in conducting their businesses or for violations of any law, rule, regulation, or condition imposed in writing by the agency or any written agreement with the agency.
We seek to mitigate operational risks by expanding our operations team and training; working with our vendors to use antifraud protections; establishing security procedures for our clients; and engaging in periodic independent audits of our operations and operating controls.
We seek to mitigate operational risks by maintaining adequate staffing and training of our operations team; working with our vendors to use antifraud protections; establishing security procedures for our clients; and engaging in periodic independent audits of our 12 Table of Contents operations and operating controls.
As of December 31, 2024, the Bank held 55 non-conforming single-family residential jumbo mortgage loans with an aggregate balance of $98.8 million, representing 46.88% of the Bank’s total single-family residential mortgage portfolio. We also provide co-op financing, a service typically not offered by mass retail lenders. A portion of our residential mortgage borrowers also maintain consumer deposit accounts with us.
As of December 31, 2025, the Bank held 44 non-conforming single-family residential jumbo mortgage loans with an aggregate balance of $82.0 million, representing 42.0% of the Bank’s total single-family residential mortgage portfolio. We also provide co-op financing, a service typically not offered by mass retail lenders. A portion of our residential mortgage borrowers also maintain consumer deposit accounts with us.
For a discussion of the ICS ® program, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” As of December 31, 2024, we held deposits from clients across 49 states, the District of Columbia, and Puerto Rico, with approximately 23.62% of total deposits and One-Way Sell ® deposits from the District of Columbia and approximately 33.44% from Virginia.
For a discussion of the ICS ® program, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” As of December 31, 2025, we held deposits from clients across 49 states, the District of Columbia, and Puerto Rico, with approximately 37.2% of total deposits and One-Way Sell ® deposits from the District of Columbia and approximately 24.6% from Virginia.
We aim to be recognized for our “ Strength, Service, Solutions: Your Bridge to Better Banking Nationwide .” As of December 31, 2024, we held total assets of $1.4 billion, including $410.7 million in cash and cash equivalents, of which $406.7 million were interest-bearing reserves held at the Federal Reserve.
We aim to be recognized for our “ Strength, Service, Solutions: Your Bridge to Better Banking Nationwide .” As of December 31, 2025, we held total assets of $1.8 billion, including $586.6 million in cash and cash equivalents, of which $580.9 million were interest-bearing reserves held at the Federal Reserve.
Our portfolio included $659.0 million in securities, with $321.0 million or 48.7% of that in U.S. Treasury securities. Net loans held for investment, after accounting for deferred fees and costs and allowances, totaled $308.8 million. Our total deposits stood at $1.2 billion, with stockholders’ equity at $144.2 million.
Our portfolio included $865.4 million in securities, with $527.8 million or 61.0% of that in U.S. Treasury securities. Net loans held for investment, after accounting for deferred fees and costs and allowances, totaled $270.7 million. Our total deposits stood at $1.6 billion, with stockholders’ equity at $169.2 million.
Operational Model and Technology Focus Our model emphasizes attentive, relationship-based service enhanced by technology solutions. This strategy allows the Bank to serve clients efficiently across a wide geographic area while maintaining lower overhead costs compared to some branch-based banking models.
This interaction may be associated with increased use of our services, which aligns with our approach to client relationships. Operational Model and Technology Focus Our model emphasizes attentive, relationship-based service enhanced by technology solutions. This strategy allows the Bank to serve clients efficiently across a wide geographic area while maintaining lower overhead costs compared to some branch-based banking models.
These privacy provisions generally prohibit a financial institution from providing a customer’s personal financial information to unaffiliated parties without prior notice to and approval from the customer.
Each institution must conduct an internal risk assessment of its ability to protect customer information. These privacy provisions generally prohibit a financial institution from providing a customer’s personal financial information to unaffiliated parties without prior notice to and approval from the customer.
This estimate is subject to data limitations and identifying a client as a political organization sometimes requires judgment, and the actual number of our deposits represented by political organizations may differ from this estimate.
We estimate that there are points in time when at least a majority of our deposit balances are sourced from political organizations. This estimate is subject to data limitations and identifying a client as a political organization sometimes requires judgment, and the actual number of our deposits represented by political organizations may differ from this estimate.
Privacy Legislation Several recent laws, including the Right to Financial Privacy Act of 1978, and related regulations issued by the federal bank regulatory agencies also provide new protections against the transfer and use of customer information by financial institutions.
Privacy Legislation Several laws, including the Right to Financial Privacy Act of 1978, and related regulations issued by the federal bank regulatory agencies also provide protections against the transfer and use of customer information by financial institutions. A financial institution must provide to its customers information regarding its policies and procedures with respect to the handling of customers’ personal information.
The revised rules substantially alter the methodology for assessing compliance with the CRA, with material aspects taking effect January 1, 2026 and revised data-reporting requirements taking effect January 1, 2027. The final rule is currently enjoined while a federal court considers a lawsuit challenging the rule.
The revised rules substantially alter the methodology for assessing compliance with the CRA, with material aspects taking effect January 1, 2026 and revised data-reporting requirements taking effect January 1, 2027.
We intend to protect the use of our trademarks and other intellectual property nationwide. Human Resources As of December 31, 2024, we employed 84 full-time employees. None of our employees is party to a collective bargaining agreement. We consider our relationship with our employees to be excellent and have not experienced interruptions of operations due to labor disagreements.
We intend to protect the use of our trademarks and other intellectual property nationwide. Human Resources As of December 31, 2025, we employed the equivalent of 92 full-time employees. None of our employees is party to a collective bargaining agreement.
Mortgage lenders are required to determine consumers’ ability to repay in one of two ways. The first alternative requires the mortgage lender to consider eight specified underwriting factors when making the credit decision. Alternatively, the mortgage lender can originate “qualified mortgages,” which are entitled to a presumption that the creditor making the loan satisfies the ability-to-repay requirements.
Mortgage lenders are required to determine consumers’ ability to repay in one of two ways. The first alternative requires the mortgage lender to consider eight specified underwriting factors when making the 20 Table of Contents credit decision.
In accordance with FEC requirements, the terms offered for loans to political committees are intended to align with those available to non-political clients, with the goal of ensuring that these transactions are conducted on a commercially reasonable basis.
In accordance with FEC requirements, the terms offered for loans to political committees are intended to align with those available to non-political clients, with the goal of ensuring that these transactions are conducted on a commercially reasonable basis. 11 Table of Contents We also provide letters of credit to our commercial borrowers, including political organizations, to assist them in meeting the security deposit requirements for their office leases.
The proposed rule is intended to give consumers control over their financial data, including with whom it is shared, and encourage competition in the provision of consumer financial products and services. For banks with over $850 million and less than $1.5 billion in total assets, such as the Bank, compliance with the rule is required by April 1, 2030.
The proposed rule is intended to give consumers control over their financial data, including with whom it is shared, and encourage competition in the provision of consumer financial products and services.
Our success depends on our ability to attract, develop and retain qualified professionals. We offer competitive compensation and benefits designed to attract and retain top talent. We offer a short-term cash incentive compensation plan (the “Incentive Compensation Plan”) for which all employees of the Bank as of the end of the fiscal year are eligible.
We offer a short-term cash incentive compensation plan (the “Incentive Compensation Plan”) for which all employees of the Bank as of the end of the fiscal year are eligible.
Office of Foreign Assets Control The U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) is responsible for administering and enforcing economic and trade sanctions against specified foreign parties, including countries and regimes, foreign individuals, and other foreign organizations and entities.
Treasury Department’s Office of Foreign Assets Control (“OFAC”) is responsible for administering and enforcing economic and trade sanctions against specified foreign parties, including countries and regimes, foreign individuals, and other foreign organizations and entities. OFAC publishes lists of prohibited parties that are regularly consulted by the Company in the conduct of its business in order to assure its compliance.
Our experience in processing transactions for these organizations allows us to offer services designed to meet the needs of our clients in this sector. For example, we serve our deposit clients through experienced relationship officers and seek to offer personal service and tailored solutions for account management, image cash letters, remote deposit capture, payment processing, and treasury management.
For example, we serve our deposit clients through experienced relationship officers and seek to offer personal service and tailored solutions for account management, image cash letters, remote deposit capture, payment processing, and treasury management. 10 Table of Contents Lending We provide lending services to consumers and commercial borrowers primarily located in the Washington, D.C. metropolitan area.
Management invests in human capital in several specific areas, such as: encouraging participation in leadership and management training programs; providing required annual skills training focusing on areas such banking, finance, technology and regulatory compliance; and supporting continuous professional development by offering educational benefits for employees to gain additional relevant expertise and certifications.
Management invests in human capital in several specific areas, such as: encouraging participation in leadership and management training programs; providing required annual skills training focusing on areas such banking, finance, technology and regulatory compliance; and supporting continuous professional development by offering educational benefits for employees to gain additional relevant expertise and certifications. 13 Table of Contents The Company seeks to foster a strong and collaborative workplace culture through regular all-staff meetings led by our CEO that provide ongoing training, discussions on Bank operations and strategic initiatives, employee recognition, and an open forum for questions.
The AML laws and their regulations also provide for information sharing, subject to conditions, between federal law enforcement agencies and financial institutions, as well as among financial institutions, for counter-terrorism purposes. Federal banking regulators are required, when reviewing bank holding company acquisition and bank merger applications, to take into account the effectiveness of the anti-money laundering activities of the applicants.
The AML laws and their regulations also provide for information sharing, subject to conditions, between federal law enforcement agencies and financial institutions, as well as among financial institutions, for counter-terrorism purposes.
Our experience suggests that clients with these types of accounts may interact more frequently with our banking services and relationship officers compared to those with other account types. This interaction may be associated with increased use of our services, which aligns with our approach to client relationships.
The composition of our deposit base and the associated cost of funds are consistent with our focus on transaction accounts. Our experience suggests that clients with these types of accounts may interact more frequently with our banking services and relationship officers compared to those with other account types.
Election outcomes can also influence the timing and magnitude of deposit movements, including post-election inflows driven by new fundraising or account activities.
Although the timing and magnitude of these flows have varied from cycle to cycle, such fluctuations are longstanding characteristics of our deposit base. Election outcomes may also influence deposit activity, including post-election inflows driven by new fundraising or account activities.
Competition among providers of financial products and services continues to increase, with consumers having the opportunity to select from a growing variety of traditional and nontraditional 10 Table of Contents alternatives, including fintech companies, which have grown significantly in recent years. The ability of non-bank financial institutions to provide services previously limited to commercial banks has intensified competition.
Competition among providers of financial products and services continues to increase, with consumers having the opportunity to select from a growing variety of traditional and nontraditional alternatives, including fintech companies, and the emergence, adoption and evolution of new technologies that do not require intermediation, including stablecoins, digital assets, blockchains, and other technologies based on distributed ledgers, all of which have grown significantly in recent years.
These services include digital onboarding solutions, image cash letter (“ICL”) processing and treasury management offerings that accommodate multiple users with customizable approval hierarchies. This focus aligns with our goal of attracting and retaining commercial clients with complex transactional needs. At December 31, 2024, 93.3% of our total deposits were held in transaction accounts.
To support our strategy of attracting commercial transaction account deposits, we emphasize services designed to attract commercial clients who manage high transaction volumes. These services include digital onboarding solutions, image cash letter (“ICL”) processing and treasury management offerings that accommodate multiple users with customizable approval hierarchies.
Trust and Wealth Management Services Our Trust & Wealth Department commenced operations in the third quarter of 2020 after the approval by the OCC of the Bank’s application for full fiduciary powers. Our trust offerings serve individuals, families, charitable organizations, and businesses.
These letters of credit are issued in accordance with our standard lending practices and are typically supported by collateral or other security arrangements consistent with commercial lending norms. Trust and Wealth Management Services Our Trust & Wealth Department commenced operations in the third quarter of 2020 after the approval by the OCC of the Bank’s application for full fiduciary powers.
The Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware also changed the number of authorized shares of Preferred Stock from 100,000 to 10,000,000. Our Regulatory Framework and Banking Philosophy Chain Bridge Bank, N.A. operates under a national charter with full fiduciary powers granted by the OCC.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Financial Condition — Deposits” for more information on ICS ® deposits. Our Regulatory Framework and Banking Philosophy Chain Bridge Bank, N.A. operates under a national charter with full fiduciary powers granted by the OCC.
We have historically grown organically and many of our new business opportunities have come through word-of-mouth referrals. We believe our client-focused approach has contributed to maintaining strong relationships. 9 Table of Contents We estimate that there are points in time when at least a majority of our deposit balances are sourced from political organizations.
Our approach generally favors developing capabilities in less saturated sectors and avoiding highly competitive markets, like commercial real estate or mass-market consumer banking. We have historically grown organically and many of our new business opportunities have come through word-of-mouth referrals. We believe our client-focused approach has contributed to maintaining strong relationships.
Deposit growth tends to be stronger leading up to presidential elections, which occur every four years, compared to biennial midterm elections. Consistent with historical trends, we experienced deposit inflows from political organizations preceding the November 2024 federal election, followed by deposit outflows in the months surrounding the election, reflecting seasonal patterns associated with the election cycle.
Deposit growth tends to be stronger leading up to presidential elections, which occur every four years, compared to biennial midterm elections. Historically, deposits from political organizations have typically increased in the periods leading up to federal elections, declined in the quarters around federal elections, and tended to rebuild gradually in the quarters following federal elections.
For the year ended December 31, 2024, our cost of funds was 0.31%. The composition of our deposit base and the associated cost of funds are consistent with our focus on transaction accounts.
This focus aligns with our goal of attracting and retaining commercial clients with complex transactional needs. At December 31, 2025, 95.3% of our total deposits were held in transaction accounts. For the year ended December 31, 2025, our cost of funds was 0.32%.
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See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Financial Condition — Deposits” for more information on ICS ® deposits. Initial Public Offering On October 4, 2024, the Company’s Class A Common Stock began trading on the NYSE under the symbol “CBNA”.
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This approach is intended to provide our clients with secure, efficient, and convenient banking solutions.
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We issued and sold an aggregate of 1,992,897 shares of our Class A Common Stock including 142,897 shares of Class A Common Stock sold pursuant to the underwriters’ partial exercise of their option to purchase additional shares, in our initial public offering, at a public offering price of $22.00 per share for aggregate net proceeds of $36.5 million after deducting underwriting discounts and offering expenses.
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These associations typically bill their members annually for dues and spend the funds down over the course of the year. 9 Table of Contents Certain clients organized under Section 501(c)(4) of the Internal Revenue Code as social welfare organizations may experience fluctuations in deposit balances and transaction activity in connection with issue advocacy or public policy initiatives.
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The initial closing of our initial public offering occurred on October 7, 2024, and the closing for the shares issued pursuant to the underwriters’ option occurred on November 1, 2024. On October 10, 2024, the Company used a portion of the net proceeds to fully repay $10.0 million in short-term borrowings.
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Although such activity may occur during election cycles, these organizations are not considered “political organizations” under the Company’s definition, which is limited to entities organized under Section 527 of the Internal Revenue Code and related campaign and party committees. The Company manages potential variability associated with such activity through its liquidity and asset allocation practices.
Removed
The IPO had a positive impact on our capital position, and contributed to Tier 1 leverage, Tier 1 risk-based, and total risk-based capital ratios of 11.48%, 38.12% and 39.30%, respectively as of December 31, 2024.
Added
The ability of non-bank financial institutions to provide services previously limited to commercial banks has intensified competition.
Removed
The Company intends to use the remainder of net proceeds for general corporate purposes, which may include supporting continued organic deposit growth and funding potential strategic expansion.
Added
Our experience in processing transactions for these organizations allows us to offer services designed to meet the needs of our clients in this sector.
Removed
Reclassification In connection with the IPO, on October 3, 2024, the Company filed an Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, which established two new classes of common stock, the Class A Common Stock and Class B Common Stock, and reclassified and converted each outstanding share of the Company’s existing common stock, par value $1.00 per share, into 170 shares of Class B Common Stock.
Added
Our trust offerings serve individuals, families, charitable organizations, and businesses.
Removed
The following chart shows the distribution of the Bank’s total deposits and One-Way Sell ® deposits by dollar amount across the United States as of December 31, 2024: ($ in thousands) 8 Table of Contents To support our strategy of attracting commercial transaction account deposits, we emphasize services designed to attract commercial clients who manage high transaction volumes.
Added
We consider our relationship with our employees to be excellent and have not experienced interruptions of operations due to labor disagreements. Our success depends on our ability to attract, develop and retain qualified professionals. We offer competitive compensation and benefits designed to attract and retain top talent.
Removed
Serving Political Organizations We focus on clients and business segments where our experience may offer advantages, such as services for political organizations, tailored business, and residential lending and trust and wealth management. Our approach generally favors developing capabilities in less saturated sectors and avoiding highly competitive markets, like commercial real estate or mass-market consumer banking.
Added
The Bank has not opted into the CBLR framework.
Removed
These associations typically bill their members annually for dues and spend the funds down over the course of the year. Competition The banking industry is highly competitive.
Added
The final rule is currently enjoined while a federal court considers a lawsuit challenging the rule, and on July 16, 2025, the agencies proposed to rescind the rule and reinstate the prior framework.
Removed
Lending We provide lending services to consumers and commercial borrowers primarily located in the Washington, D.C. metropolitan area.
Added
Federal banking regulators are required, when reviewing bank holding company acquisition and bank merger applications, to take into account the effectiveness of the anti-money laundering activities of the applicants. 19 Table of Contents Office of Foreign Assets Control The U.S.
Removed
We also provide letters of credit to our commercial borrowers, including political organizations, to assist them in meeting the security deposit requirements for their office leases. These letters of credit are issued in accordance with our standard lending practices and are typically supported by collateral or other security arrangements consistent with commercial lending norms.
Added
For banks with over $850 million and less than $1.5 billion in total assets, such as the Bank, the compliance date for the rule is April 1, 2030, but that deadline is stayed by a court until the CFPB has completed a reconsideration of the rule that the CFPB announced in August 2025.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

159 edited+39 added−28 removed363 unchanged
Biggest changeRepublican Party. • Our deposits are concentrated in uninsured deposits. • Chain Bridge Bancorp, Inc.’s liquidity is dependent on dividends from the Bank. • We may need to raise additional capital in the future, and such capital may not be available when needed or at all. • Our results of operations and financial condition would be adversely affected if the Bank’s allowance for credit losses is insufficient to absorb actual losses or needs to be increased. • Losses related to a single large loan could have a significant impact on the Bank’s financial condition and results of operations. • The Bank relies upon independent appraisals to determine the value of the real estate that secures a significant portion of its loans, and the values indicated by such appraisals may not be realizable if the Bank is compelled to foreclose upon such loans. • Our business may be adversely affected by conditions in the financial markets and economic conditions generally. • The geographic concentration of our business in the Washington, D.C. metropolitan area makes our business highly susceptible to local economic conditions and reductions or changes in government spending. • Our investment securities portfolio exposes us to risks beyond our market area. • Our significant investment in securities held to maturity exposes us to risks that may adversely affect our business, financial condition or results of operations. • There can be no assurance that we will be able to maintain or increase our current levels of transaction accounts, non-interest-bearing demand deposits, and level of profitability or growth. • We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may adversely affect our business, financial condition or results of operations. • Our Trust & Wealth Department exposes us to certain risks and there can be no assurance the department will contribute meaningfully to our revenues or become profitable on a standalone basis. • We may be adversely affected by changes in the actual or perceived soundness or condition of other financial institutions. • There is no assurance that the Bank will be able to compete successfully with others for its business. • We could fail to attract, retain or motivate skilled and qualified personnel, including our senior management, other key employees or directors, which could adversely affect our business. 23 Table of Contents • Certain clients, including our political organization clients, may be subject to, and are particularly sensitive to, negative publicity, which may subject us to enhanced reputational risk. • Fulfilling our public company financial reporting and other regulatory obligations and being a public company will be expensive and time consuming and may strain our resources. • We are subject to operational risk, which could adversely affect our business and reputation and create material legal and financial exposure. • Operational risks associated with funds transfer activities could materially and adversely affect our business, financial condition, and results of operations. • The occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents could have a material adverse effect on our business, financial condition, results of operations, and reputation. • We also face risks related to cyberattacks and other security breaches involving external, third-party vendors and counterparties. • Our operations rely on certain external vendors, and our use of these vendors is subject to increasing regulatory requirements and attention. • The development and use of artificial intelligence present risks and challenges that may adversely impact our business. • We depend on the accuracy and completeness of information about clients and counterparties. • Our reliance on estimates and risk management activities may not always prevent or mitigate risks effectively, leading to potential differences between actual results and our forecasts. • Government regulation significantly affects our business and may result in higher costs and lower stockholder returns. • Litigation and regulatory actions, including possible enforcement actions, could subject us to significant fines, penalties, judgments, restrictions on our business activities or reputational harm. • The Bank’s primary regulator has broad powers to place limitations on the conduct of a bank’s business, or to close an institution. • The Bank is subject to extensive and evolving requirements under anti-money laundering and sanctions laws. • The Bank is subject to numerous “fair and responsible banking” laws and regulations designed to protect consumers, which increase our compliance costs and subject us to potential legal liability or reputational damage. • We engage in lending secured by real estate and may be forced to foreclose on the collateral and own the underlying real estate, subjecting us to potential costs, risks and consumer protection laws. • Any violation of laws regarding, or incidents involving, the privacy, information security and protection of personal, confidential or proprietary information could damage our reputation and otherwise adversely affect our business. • Increases in FDIC insurance premiums could adversely affect our earnings and results of operations. • The Federal Reserve may require the Company to commit capital resources to support the Bank at a time when our resources are limited, which may require us to borrow funds or raise capital on unfavorable terms. • Changes in our accounting policies or in accounting standards could materially affect how we report our financial results and condition. • The dual-class structure of our common stock has the effect of limiting your ability to influence corporate matters and may adversely affect the market for our Class A common stock. • Members of the Fitzgerald Family and other holders of Class B common stock could aggregate their holdings and sell a controlling interest in us to a third party in a private transaction. • Conflicts of interest and other disputes may arise between the members of the Fitzgerald Family and us that may be resolved in a manner unfavorable to us and our other stockholders. • An acquisition of another banking institution could increase operational and regulatory risks, and adversely affect our financial condition and stock price and, if paid for with our Class A Common Stock, could dilute existing stockholders. • An investment in our common stock is not an insured deposit. • If the Bank fails or is put into receivership or conservatorship by the FDIC and its primary regulator, investors will likely lose their entire investment in the Company.
Biggest changeRepublican Party. • Our deposits are concentrated in uninsured deposits. • Chain Bridge Bancorp, Inc.’s liquidity is dependent on dividends from the Bank. • We may need to raise additional capital in the future, and such capital may not be available when needed or at all. • Our results of operations and financial condition would be adversely affected if the Bank’s allowance for credit losses is insufficient to absorb actual losses or needs to be increased. • Losses related to a single large loan could have a significant impact on the Bank’s financial condition and results of operations. • The Bank relies upon independent appraisals to determine the value of the real estate that secures a significant portion of its loans, and the values indicated by such appraisals may not be realizable if the Bank is compelled to foreclose upon such loans. • Our business may be adversely affected by conditions in the financial markets and economic conditions generally. 22 Table of Contents • The geographic concentration of our business in the Washington, D.C. metropolitan area makes our business highly susceptible to local economic conditions and reductions or changes in government spending. • Our investment securities portfolio exposes us to risks beyond our market area. • Our significant investment in securities held to maturity exposes us to risks that may adversely affect our business, financial condition or results of operations. • There can be no assurance that we will be able to maintain or increase our current levels of transaction accounts, noninterest-bearing demand deposits, and level of profitability or growth. • The use or support of stablecoins by us, or broader market adoption of stablecoins, may expose us to legal, regulatory, operational, and competitive risks. • We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may adversely affect our business, financial condition or results of operations. • Participation in additional or newer reciprocal deposit networks, including NBID, may introduce operational and regulatory risks. • Our Trust & Wealth Department exposes us to certain risks and there can be no assurance the department will contribute meaningfully to our revenues or become profitable on a standalone basis. • We may be adversely affected by changes in the actual or perceived soundness or condition of other financial institutions. • There is no assurance that the Bank will be able to compete successfully with others for its business. • We could fail to attract, retain or motivate skilled and qualified personnel, including our senior management, other key employees or directors, which could adversely affect our business. • Certain clients, including our political organization clients, may be subject to, and are particularly sensitive to, negative publicity, which may subject us to enhanced reputational risk. • Compliance with public company reporting and regulatory requirements is costly and resource-intensive and has placed, and will continue to place, additional demands on our personnel and systems. • We are subject to operational risk, which could adversely affect our business and reputation and create material legal and financial exposure. • Operational risks associated with funds transfer activities could materially and adversely affect our business, financial condition, and results of operations. • The occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents could have a material adverse effect on our business, financial condition, results of operations, and reputation. • We also face risks related to cyberattacks and other security breaches involving external, third-party vendors and counterparties. • Our operations rely on certain external vendors, and our use of these vendors is subject to increasing regulatory requirements and attention. • The development and use of artificial intelligence present risks and challenges that may adversely impact our business. • We depend on the accuracy and completeness of information about clients and counterparties. • Our reliance on estimates and risk management activities may not always prevent or mitigate risks effectively, leading to potential differences between actual results and our forecasts. • Government regulation significantly affects our business and may result in higher costs and lower stockholder returns. • Litigation and regulatory actions, including possible enforcement actions, could subject us to significant fines, penalties, judgments, restrictions on our business activities or reputational harm. • The Bank’s primary regulator has broad powers to place limitations on the conduct of a bank’s business, or to close an institution. • The Bank is subject to extensive and evolving requirements under anti-money laundering and sanctions laws. • The Bank is subject to numerous “fair and responsible banking” laws and regulations designed to protect consumers, which increase our compliance costs and subject us to potential legal liability or reputational damage. • We engage in lending secured by real estate and may be forced to foreclose on the collateral and own the underlying real estate, subjecting us to potential costs, risks and consumer protection laws. • Any violation of laws regarding, or incidents involving, the privacy, information security and protection of personal, confidential or proprietary information could damage our reputation and otherwise adversely affect our business. 23 Table of Contents • Increases in FDIC insurance premiums could adversely affect our earnings and results of operations. • The Federal Reserve may require the Company to commit capital resources to support the Bank at a time when our resources are limited, which may require us to borrow funds or raise capital on unfavorable terms. • Changes in our accounting policies or in accounting standards could materially affect how we report our financial results and condition. • The dual-class structure of our common stock has the effect of limiting your ability to influence corporate matters and may adversely affect the market for our Class A common stock. • Members of the Fitzgerald Family and other holders of Class B common stock could aggregate their holdings and sell a controlling interest in us to a third party in a private transaction. • Conflicts of interest and other disputes may arise between the members of the Fitzgerald Family and us that may be resolved in a manner unfavorable to us and our other stockholders. • An acquisition of another banking institution could increase operational and regulatory risks, and adversely affect our financial condition and stock price and, if paid for with our Class A Common Stock, could dilute existing stockholders. • An investment in our common stock is not an insured deposit. • If the Bank fails or is put into receivership or conservatorship by the FDIC and its primary regulator, investors will likely lose their entire investment in the Company.
An investment in our common stock, including our Class A common stock, is not a bank deposit and, therefore, is not insured against loss by the FDIC, any other DIF, or any other public or private entity.
An investment in our common stock is not an insured deposit. An investment in our common stock, including our Class A common stock, is not a bank deposit and, therefore, is not insured against loss by the FDIC, any other DIF, or any other public or private entity.
These provisions include, among others: • a dual-class common stock structure, which provides for concentrated voting power in the holders of our Class B common stock, including members of the Fitzgerald Family, which provides significant influence over matters requiring stockholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets; • no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • a class vote of the holders of a majority of the outstanding shares of any affected class of common stock, voting together as a separate class, to approve any amendment to our Charter that would adversely affect the rights or preferences of the Class A common stock or the Class B common stock; • the affirmative vote of the holders of a majority of voting power of the outstanding shares held by stockholders other than the Founders (as defined in our Charter), voting together as a separate class, to approve any amendment to our Charter that would disproportionately benefit the Founders relative to stockholders other than the Founders; • authorization to issue shares of one or more series of preferred stock, the terms of which series may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend or other rights or preferences superior to the rights of the holders of Class A common stock; • no stockholders action by written consent; 56 Table of Contents • special stockholder meetings may be called at any time by the Board, the chairman of our Board or the chief executive officer or our secretary upon the written request of the record holders of at least fifteen percent (15%) or more of the total voting power of the then-outstanding shares of common stock; • advance notice requirements for nominations for elections to our Board or for proposing matters that can be acted upon by stockholders at stockholder meetings; and • a class vote of the holders of Class A common stock, voting as a separate class, to approve any merger, consolidation or business combination of us into another corporation, in which any Founder, or an affiliate thereof, is part of the purchaser group.
These provisions include, among others: • a dual-class common stock structure, which provides for concentrated voting power in the holders of our Class B common stock, including members of the Fitzgerald Family, which provides significant influence over matters requiring stockholder approval, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets; • no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; • a class vote of the holders of a majority of the outstanding shares of any affected class of common stock, voting together as a separate class, to approve any amendment to our Charter that would adversely affect the rights or preferences of the Class A common stock or the Class B common stock; • the affirmative vote of the holders of a majority of voting power of the outstanding shares held by stockholders other than the Founders (as defined in our Charter), voting together as a separate class, to approve any amendment to our Charter that would disproportionately benefit the Founders relative to stockholders other than the Founders; • authorization to issue shares of one or more series of preferred stock, the terms of which series may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend or other rights or preferences superior to the rights of the holders of Class A common stock; • no stockholders action by written consent; • special stockholder meetings may be called at any time by the Board, the chairman of our Board or the chief executive officer or our secretary upon the written request of the record holders of at least fifteen percent (15%) or more of the total voting power of the then-outstanding shares of common stock; • advance notice requirements for nominations for elections to our Board or for proposing matters that can be acted upon by stockholders at stockholder meetings; and • a class vote of the holders of Class A common stock, voting as a separate class, to approve any merger, consolidation or business combination of us into another corporation, in which any Founder, or an affiliate thereof, is part of the purchaser group.
AI models, particularly generative AI models, may produce inaccurate, misleading, or unreliable outputs, disclose private, confidential, or proprietary information, reflect biases embedded in training data, or generate content that is perceived as discriminatory, defamatory, or in violation of intellectual property rights.
AI models, particularly generative AI models, may produce inaccurate, misleading, or unreliable outputs, inadvertently disclose private, confidential, or proprietary information, reflect biases embedded in training data, or generate content that is perceived as discriminatory, defamatory, or in violation of intellectual property rights.
We are also subject to the risk that these vendors, including our core technology provider, become unable or unwilling to provide the same products or services on terms that are acceptable to us.
We are also subject to the risk that these vendors, including our core technology provider, may become unable or unwilling to provide the same products or services on terms that are acceptable to us.
Fraudulent activity may manifest in numerous forms, including check fraud, electronic fraud, wire fraud, phishing, business email compromise, social engineering, identity theft, and other dishonest activities.
Fraudulent activity may manifest in numerous forms, including check fraud, electronic fraud, wire fraud, phishing, smishing, business email compromise, social engineering, identity theft, and other dishonest activities.
This could potentially affect our ability to raise capital or impact our valuation in a merger or acquisition. See Note 12, “Fair Value Measurements” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information regarding the estimated fair value of our loan portfolio as of December 31, 2024.
This could potentially affect our ability to raise capital or impact our valuation in a merger or acquisition. See Note 12, “Fair Value Measurements” to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information regarding the estimated fair value of our loan portfolio as of December 31, 2025.
In addition, our securities portfolio includes investments in other financial institutions. As of December 31, 2024, we held $4.5 million principal amount of subordinated debt issued by other bank holding companies. Any changes to the actual or perceived soundness of other financial institutions could adversely affect the value of these securities, which could cause us to incur losses.
In addition, our securities portfolio includes investments in other financial institutions. As of December 31, 2025, we held $4.5 million principal amount of subordinated debt issued by other bank holding companies. Any changes to the actual or perceived soundness of other financial institutions could adversely affect the value of these securities, which could cause us to incur losses.
Further, we estimate that there are periods when a majority of our deposit balances are sourced from political organizations, which cause our deposit balances to fluctuate due to the seasonality of fundraising and spending around elections, and following elections our political organization clients have in the past shifted, and may in the future shift, their funds from non-interest-bearing accounts to interest bearing accounts.
Further, we estimate that there are periods when a majority of our deposit balances are sourced from political organizations, which cause our deposit balances to fluctuate due to the seasonality of fundraising and spending around elections, and following elections our political organization clients have in the past shifted, and may in the future shift, their funds from noninterest-bearing accounts to interest bearing accounts.
If we were to convert some or all of these One-Way Sell ® deposits into reciprocal deposits, bringing them back onto our balance sheet, we would likely gain interest income by investing these deposits, which could increase our net interest income. However, this conversion would result in the loss of deposit placement services income, reducing our non-interest income.
If we were to convert some or all of these One-Way Sell ® deposits into reciprocal deposits, bringing them back onto our balance sheet, we would likely gain interest income by investing these deposits, which could increase our net interest income. However, this conversion would result in the loss of deposit placement services income, reducing our noninterest income.
In the quarters leading up to federal elections, especially presidential elections, our deposits, net interest income, and non-interest income generally increase. Conversely, in the quarters immediately before, during, and after a federal election, we usually experience an outflow of political organization deposits, causing revenue to decline until clients resume fundraising for the next election cycle.
In the quarters leading up to federal elections, especially presidential elections, our deposits, net interest income, and noninterest income generally increase. Conversely, in the quarters immediately before, during, and after a federal election, we usually experience an outflow of political organization deposits, causing revenue to decline until clients resume fundraising for the next election cycle.
Approximately 80% of our total deposit balances were from commercial entities, including businesses, political organizations, trade associations, and nonprofit organizations. These deposit clients are typically intermediated by personal relationships between Bank officers and the commercial client account signers, and therefore can require significant investments of time and resources to maintain.
Approximately 87% of our total deposit balances were from commercial entities, including businesses, political organizations, trade associations, and nonprofit organizations. These deposit clients are typically intermediated by personal relationships between Bank officers and the commercial client account signers, and therefore can require significant investments of time and resources to maintain.
Any of the risks described below, as well as additional risks that are not currently known to us, that we presently do not deem material, or that may later become material, could potentially, individually or in the aggregate, have a material adverse effect on our business, 22 Table of Contents financial condition, results of operations, cash flows, and the trading price, volatility, or liquidity of our Class A Common Stock, though the occurrence, timing, or impact of such effects cannot be predicted with certainty.
Any of the risks described below, as well as additional risks that are not currently known to us, that we presently do not deem material, or that may later become material, could potentially, individually or in the aggregate, have a material adverse effect on our business, financial condition, results of operations, cash flows, and the trading price, volatility, or liquidity of our Class A Common Stock, though the occurrence, timing, or impact of such effects cannot be predicted with certainty.
Introducing additional funds transfer services with similar funding requirements could necessitate adjustments to our liquidity management strategy to optimize returns while maintaining sufficient reserves. • Reliance on External Providers: Our reliance on external service providers increases our exposure to operational and vendor-related risks, particularly concerning funds transfer connectivity, international wire transfers, and the introduction of new funds transfer services. 40 Table of Contents • Fraud and Cybersecurity Risks: Cybersecurity breaches or fraudulent activities could cause unauthorized transfers, regulatory sanctions, financial loss, or reputational harm.
Introducing additional funds transfer services with similar funding requirements could necessitate adjustments to our liquidity management strategy to optimize returns while maintaining sufficient reserves. • Reliance on External Providers: Our reliance on external service providers increases our exposure to operational and vendor-related risks, particularly concerning funds transfer connectivity, international wire transfers, and the introduction of new funds transfer services. • Fraud and Cybersecurity Risks: Cybersecurity breaches or fraudulent activities could cause unauthorized transfers, regulatory sanctions, financial loss, or reputational harm.
Additionally, because a significant majority of our funding consists of non-interest-bearing deposits and a substantial amount of our assets are invested in cash and cash equivalents, a decrease in short-term interest rates would be expected to immediately reduce our interest income without a corresponding reduction in our interest expense, which would reduce our net interest income.
Additionally, because a significant majority of our funding consists of noninterest-bearing deposits and a substantial amount of our assets are invested in cash and cash equivalents, a decrease in short-term interest rates would be expected to immediately reduce our interest income without a corresponding reduction in our interest expense, which would reduce our net interest income.
Although our Charter requires that, so long as our Class A common stock is listed for trading on a national securities exchange, such as the NYSE, a majority of directors must be independent in accordance with and as defined by the rules and regulations of such exchange, if we were to become a “controlled company” in the future we could elect not to comply with the NYSE requirements to maintain independent compensation and nominating and corporate governance committees.
Although our Charter requires that, so long as our Class A common stock is listed for trading on a national securities exchange, such as the NYSE, a majority of directors must be independent in accordance with and as defined by the rules and regulations of such exchange, if we were to become a “controlled company” in the future we could elect not to comply 51 Table of Contents with the NYSE requirements to maintain independent compensation and nominating and corporate governance committees.
Historically, we have manage our deposit levels to maintain a satisfactory Tier 1 leverage ratio by transferring certain deposit accounts off our balance sheet through the ICS ® network as One-Way Sell ® deposits placed at other financial institutions.
Historically, we have managed our deposit levels to maintain a satisfactory Tier 1 leverage ratio by transferring certain deposit accounts off our balance sheet through the ICS ® network as One-Way Sell ® deposits placed at other financial institutions.
In addition, an investment in shares of our common stock involves certain risks related to our common stock, including related to the market price, dilution, our ability to issue preferred stock, our dividend policy, our status as an 24 Table of Contents “emerging growth company” and “smaller reporting company,” analyst research and recommendations, factors that may discourage or delay acquisition attempts for us, and the exclusive forum provisions in our Charter and Bylaws.
In addition, an investment in shares of our common stock involves certain risks related to our common stock, including related to the market price, dilution, our ability to issue preferred stock, our dividend policy, our status as an “emerging growth company” and “smaller reporting company,” analyst research and recommendations, factors that may discourage or delay acquisition attempts for us, and the exclusive forum provisions in our Charter and Bylaws.
However, members of the Fitzgerald Family and other holders of our Class B common stock may in the future decide to act as a group, and could 50 Table of Contents elect to be treated as a “controlled company,” in which case we would not be required to comply with certain corporate governance requirements of the NYSE unless otherwise mandated by our Charter or applicable law.
However, members of the Fitzgerald Family and other holders of our Class B common stock may in the future decide to act as a group, and could elect to be treated as a “controlled company,” in which case we would not be required to comply with certain corporate governance requirements of the NYSE unless otherwise mandated by our Charter or applicable law.
See “— Other Risks Related to Our Business — We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may adversely affect our business, financial condition, or results of operations.” If we are unable to manage our Tier 1 leverage ratio by using the ICS ® network, we may need to restrict our growth or raise additional capital.
See “— 27 Table of Contents Other Risks Related to Our Business — We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may adversely affect our business, financial condition, or results of operations.” If we are unable to manage our Tier 1 leverage ratio by using the ICS ® network, we may need to restrict our growth or raise additional capital.
Additionally, this choice-of-forum provision may limit a stockholder’s ability to bring a claim in a different judicial forum, including one that it may find favorable or convenient for a specified class of disputes with us or our directors, officers, other stockholders or employees, which may discourage such lawsuits even though an action, if successful, might benefit our stockholders.
Additionally, this choice-of-forum provision may limit a stockholder’s ability to bring a claim in a different judicial forum, 57 Table of Contents including one that it may find favorable or convenient for a specified class of disputes with us or our directors, officers, other stockholders or employees, which may discourage such lawsuits even though an action, if successful, might benefit our stockholders.
See “— Risks Related to Our Business — Our Trust & Wealth Department exposes us to certain risks and there can be no assurances the department will contribute meaningfully to our revenues or become profitable on a standalone basis.” 46 Table of Contents Further, our regulators may impose consent orders, civil money penalties, matters requiring attention, or similar types of supervisory criticism.
See “— Risks Related to Our Business — Our Trust & Wealth Department exposes us to certain risks and there can be no assurances the department will contribute meaningfully to our revenues or become profitable on a standalone basis.” Further, our regulators may impose consent orders, civil money penalties, matters requiring attention, or similar types of supervisory criticism.
Our variable rate loans primarily consist of adjustable-rate residential real estate loans with initial fixed-rate periods of three, five, seven, or ten years, which, depending on the loan program, reprice every one, three, or five years after the initial fixed-rate period ends, and so a substantial part of our loan portfolio remains sensitive to interest rate changes for extended periods.
Our variable rate loans primarily consist of adjustable-rate residential real estate loans with initial fixed-rate periods of three, five, seven, or ten years, which, depending on the loan program, reprice every one, three, or five 25 Table of Contents years after the initial fixed-rate period ends, and so a substantial part of our loan portfolio remains sensitive to interest rate changes for extended periods.
See “— Other Risks Related to Our Business — We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may materially adversely affect our business, financial condition, or results of operations.” 45 Table of Contents If the Bank’s capital needs exceed internal resources, the Company may need to raise additional capital.
See “— Other Risks Related to Our Business — We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may materially adversely affect our business, financial condition, or results of operations.” If the Bank’s capital needs exceed internal resources, the Company may need to raise additional capital.
See “— We place a significant portion of our clients’ deposits with other banks through the ICS ® network, which exposes us to risks that may adversely affect our business, financial condition or results of operations.” 30 Table of Contents Chain Bridge Bancorp, Inc.’s liquidity is dependent on dividends from the Bank.
See “— We place a significant portion of our clients’ deposits with other banks through the ICS® network, which exposes us to risks that may adversely affect our business, financial condition or results of operations.” Chain Bridge Bancorp, Inc.’s liquidity is dependent on dividends from the Bank.
Expanding into additional funds transfer services may further increase legal risks related to new transfer platforms, transaction disputes, or compliance failures. • System Disruption Risks: Cyberattacks or system failures could disrupt our ability to process funds transfers, especially time-sensitive transfers, and expose us to operational disruptions, liability, or regulatory non-compliance. • Liquidity Management Risks: Faster funds transfer systems such as RTP and FedNow ® operate on instant gross settlement, eliminating settlement risk but requiring immediate funding availability.
Expanding into additional funds transfer services may further increase legal risks related to new transfer platforms, transaction disputes, or compliance failures. 40 Table of Contents • System Disruption Risks: Cyberattacks or system failures could disrupt our ability to process funds transfers, especially time-sensitive transfers, and expose us to operational disruptions, liability, or regulatory non-compliance. • Liquidity Management Risks: Faster funds transfer systems such as RTP and FedNow ® operate on instant gross settlement, eliminating settlement risk but requiring immediate funding availability.
In addition, for so long as we continue to qualify as a non-accelerated filer, we will not be required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act. 55 Table of Contents We cannot predict if investors will find our securities less attractive due to our reliance on these exemptions.
In addition, for so long as we continue to qualify as a non-accelerated filer, we will not be required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act. We cannot predict if investors will find our securities less attractive due to our reliance on these exemptions.
Any changes in political contributions or spending, including as a result of a change in campaign finance laws that restrict our clients’ ability to accept contributions or spend funds, could reduce our deposit inflows and adversely affect our business, financial condition, or results of operations. 28 Table of Contents Our deposit base is concentrated among a small number of clients.
Any changes in political contributions or spending, including as a result of a change in campaign finance laws that restrict our clients’ ability to accept contributions or spend funds, could reduce our deposit inflows and adversely affect our business, financial condition, or results of operations. Our deposit base is concentrated among a small number of clients.
If we or our clients are no longer able to participate in the ICS ® network, including because IntraFi terminates our participation in the ICS ® network, the ICS ® network ceases or because of regulatory changes, we may experience deposit withdrawals, lose revenue from deposit placement fees, or experience a sudden increase in our balance sheet that could adversely affect our regulatory capital ratios.
If we or our clients are no longer able to participate in the ICS ® network, including because IntraFi terminates our participation in the ICS ® network, the ICS ® network ceases or because of regulatory changes, we may experience deposit 35 Table of Contents withdrawals, lose revenue from deposit placement fees, or experience a sudden increase in our balance sheet that could adversely affect our regulatory capital ratios.
Higher funding costs could reduce our net 27 Table of Contents interest margin and net interest income and could have a material adverse effect on our business, financial condition and results of operations. Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.
Higher funding costs could reduce our net interest margin and net interest income and could have a material adverse effect on our business, financial condition and results of operations. Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.
Conversely, if we elect to receive a deposit placement fee instead of receiving reciprocal deposits, the deposits are placed at other banks as One-Way Sell ® deposits, which reduces the amount of deposits on our balance sheet. This reduction allows us to better manage the size of our balance sheet, and the deposit placement fee increases our non-interest income.
Conversely, if we elect to receive a deposit placement fee instead of receiving reciprocal deposits, the deposits are placed at other banks as One-Way Sell ® deposits, which reduces the amount of deposits on our balance sheet. This reduction allows us to better manage the size of our balance sheet, and the deposit placement fee increases our noninterest income.
There can be no assurance that the high levels of transaction accounts or non-interest-bearing demand deposits will continue to be held by the Bank, or that they will not decline, and there can be no assurance that the Bank will be able to replace any such deposits at a similar cost, or increase its lending business on a profitable basis.
There can be no assurance that the high levels of transaction accounts or noninterest-bearing demand deposits will continue to be held by the Bank, or that they will not decline, and there can be no assurance that the Bank will be able to replace any such deposits at a similar cost, or increase its lending business on a profitable basis.
Poor investment performance can result in claims of mismanagement or breach of fiduciary duty, leading to potential legal liabilities. • Personnel Risks : The success of our Trust & Wealth Department heavily relies on retaining specialized trust and wealth management personnel. The market for such skilled professionals is highly competitive.
Poor investment performance can result in claims of mismanagement or breach of fiduciary duty, leading to potential legal liabilities. 36 Table of Contents • Personnel Risks : The success of our Trust & Wealth Department heavily relies on retaining specialized trust and wealth management personnel. The market for such skilled professionals is highly competitive.
Any declaration and payment of dividends on our common stock in the future will depend on regulatory restrictions, our earnings and financial condition, our liquidity and capital requirements, the general economic climate, contractual restrictions, our ability to service any equity or debt obligations senior to our common stock and other factors deemed relevant by our Board.
Any declaration and payment of dividends on our common stock in the future will depend on regulatory restrictions, our earnings and financial condition, our liquidity 54 Table of Contents and capital requirements, the general economic climate, contractual restrictions, our ability to service any equity or debt obligations senior to our common stock and other factors deemed relevant by our Board.
As of December 31, 2024, members of the Fitzgerald Family beneficially owned in the aggregate shares of our common stock representing a majority, of the voting power with respect to all of the outstanding shares of our common stock.
As of December 31, 2025, members of the Fitzgerald Family beneficially owned in the aggregate shares of our common stock representing a majority, of the voting power with respect to all of the outstanding shares of our common stock.
Among other considerations, our ability to pay dividends further depends on the following factors: • Because the Company is a legal entity separate and distinct from the Bank and does not have any stand-alone operations, our ability to pay dividends depends on the ability of the Bank to pay dividends to us, and the OCC and Delaware state law may, under certain circumstances, restrict the payment of dividends to us from the Bank; • Federal Reserve policy states that bank holding companies should not maintain cash dividends on common shares at a rate that would be in excess of net income available over the past year or that would result in prospective earnings retention being inconsistent with the organization’s expected future needs and financial condition; and • Our Board may determine that, even though funds are available for dividend payments, retaining the funds for internal uses, such as expansion of our operations, is necessary or appropriate in light of our business plan and objectives. 54 Table of Contents An investment in our common stock is not an insured deposit.
Among other considerations, our ability to pay dividends further depends on the following factors: • Because the Company is a legal entity separate and distinct from the Bank and does not have any stand-alone operations, our ability to pay dividends depends on the ability of the Bank to pay dividends to us, and the OCC and Delaware state law may, under certain circumstances, restrict the payment of dividends to us from the Bank; • Federal Reserve policy states that bank holding companies should not maintain cash dividends on common shares at a rate that would be in excess of net income available over the past year or that would result in prospective earnings retention being inconsistent with the organization’s expected future needs and financial condition; and • Our Board may determine that, even though funds are available for dividend payments, retaining the funds for internal uses, such as expansion of our operations, is necessary or appropriate in light of our business plan and objectives.
See “Interest rates have in the past resulted in, and could in the future result in, unrealized losses on our investment securities portfolio.” Decreases in the market value of our loan portfolio could potentially become realized losses if we were to sell loans or if our bank were to be acquired.
See “Interest rates have in the past resulted in, and could in the future result in, unrealized losses on our investment 24 Table of Contents securities portfolio.” Decreases in the market value of our loan portfolio could potentially become realized losses if we were to sell loans or if our bank were to be acquired.
These constraints could increase operating expenses or decrease revenues, thereby negatively affecting our financial condition and results of operations. 31 Table of Contents Credit Risk Our results of operations and financial condition would be adversely affected if the Bank’s allowance for credit losses is insufficient to absorb actual losses or needs to be increased.
These constraints could increase operating expenses or decrease revenues, thereby negatively affecting our financial condition and results of operations. Credit Risk Our results of operations and financial condition would be adversely affected if the Bank’s allowance for credit losses is insufficient to absorb actual losses or needs to be increased.
Control weaknesses or failures or other operational risks could result in charges, increased operational costs, business continuity deficiencies, harm to our reputation or foregone business opportunities. 39 Table of Contents Operational risks associated with funds transfer activities could materially and adversely affect our business, financial condition, and results of operations.
Control weaknesses or failures or other operational risks could result in charges, increased operational costs, business continuity deficiencies, harm to our reputation or foregone business opportunities. Operational risks associated with funds transfer activities could materially and adversely affect our business, financial condition, and results of operations.
In addition, to maintain a 49 Table of Contents strong funding position and restore the reserve ratios of the DIF following the financial crisis, the FDIC increased deposit insurance assessment rates generally and, in response to recent bank failures, charged special assessments applicable to certain FDIC-insured financial institutions.
In addition, to maintain a strong funding position and restore the reserve ratios of the DIF following the financial crisis, the FDIC increased deposit insurance assessment rates generally and, in response to recent bank failures, charged special assessments applicable to certain FDIC-insured financial institutions.
Additionally, commercial and industrial loans not primarily secured by real estate are typically made based on the ability of the borrower to make payment on the loan from the cash flow of the business, and are collateralized primarily by business assets such as equipment and accounts receivable.
Additionally, 31 Table of Contents commercial and industrial loans not primarily secured by real estate are typically made based on the ability of the borrower to make payment on the loan from the cash flow of the business, and are collateralized primarily by business assets such as equipment and accounts receivable.
As a result, the outcome of legal and regulatory actions could have an adverse effect on our business, results of operations or financial condition. The Bank’s primary regulator has broad powers to place limitations on the conduct of a bank’s business, or to close an institution.
As a result, the outcome of legal and regulatory actions could have an adverse effect on our business, results of operations or financial condition. 47 Table of Contents The Bank’s primary regulator has broad powers to place limitations on the conduct of a bank’s business, or to close an institution.
Our inability to manage the amount of costs or size of the risks associated with the ownership of real estate, or write-downs in 48 Table of Contents the value of our other real estate owned, could have a material adverse effect on our business, financial condition and results of operations.
Our inability to manage the amount of costs or size of the risks associated with the ownership of real estate, or write-downs in the value of our other real estate owned, could have a material adverse effect on our business, financial condition and results of operations.
The Bank competes for loans, deposits, fiduciary services and capital with other banks and other kinds of financial institutions and enterprises, such as securities firms, insurance companies, savings and loan associations, credit unions, mortgage brokers, and private lenders, many of which have substantially greater resources or are subject to less stringent regulations.
The Bank competes for loans, deposits, fiduciary services and capital with other banks and other kinds of financial institutions and enterprises, such as securities firms, insurance companies, savings and loan associations, credit unions, mortgage brokers, private lenders, and fintech companies, many of which have substantially greater resources or are 37 Table of Contents subject to less stringent regulations.
Although we have implemented cybersecurity defenses, including multi-factor authentication, monitoring, penetration testing, employee cybersecurity awareness training, incident response protocols, and ongoing assessments of industry best practices, we cannot assure complete protection against sophisticated cybersecurity threats.
Although we have implemented cybersecurity defenses, including multi-factor authentication, monitoring, penetration testing, employee cybersecurity awareness training, incident response protocols, vendor risk management practices, and ongoing assessments of industry best practices, we cannot assure complete protection against sophisticated cybersecurity threats.
Any loan by the Company to the Bank would be subordinate in right of repayment to payments to depositors and certain other creditors of the Bank. In the event of the Company’s bankruptcy, the bankruptcy trustee will assume any commitment by the Company to a federal bank regulatory agency to maintain the capital of the Bank.
Any loan by the Company to the Bank would be subordinate in right of repayment to payments to depositors and certain 50 Table of Contents other creditors of the Bank. In the event of the Company’s bankruptcy, the bankruptcy trustee will assume any commitment by the Company to a federal bank regulatory agency to maintain the capital of the Bank.
As of December 31, 2024, a substantial portion of our deposits were held in transaction accounts, most of which are non-interest-bearing accounts that offer an earnings credit to offset service charges in lieu of interest. Transaction accounts have comprised over 50% of the Bank’s total deposits at each year-end since 2014.
As of December 31, 2025, a substantial portion of our deposits were held in transaction accounts, most of which are noninterest-bearing accounts that offer an earnings credit to offset service charges in lieu of interest. Transaction accounts have comprised over 50% of the Bank’s total deposits at each year-end since 2014.
Our inability to 41 Table of Contents anticipate, prevent, detect, or promptly respond to cybersecurity incidents could result in substantial financial losses, regulatory actions, litigation, reputational harm, and operational disruptions. Additionally, our cybersecurity insurance coverage may contain limitations, exclusions, or coverage gaps that could leave us liable for significant uncovered losses resulting from cybersecurity incidents.
Our inability to anticipate, prevent, detect, or promptly respond to cybersecurity incidents could result in substantial financial losses, regulatory actions, litigation, reputational harm, and operational disruptions. Additionally, our cybersecurity insurance coverage may contain limitations, exclusions, or coverage gaps that could leave us liable for significant uncovered losses resulting from cybersecurity incidents.
It may be difficult for us to replace some of our third-party vendors, 42 Table of Contents particularly vendors providing our core banking, mortgage-servicing and debit card services and information services, in a timely manner if they are unwilling or unable to provide us with these services in the future for any reason.
It may be difficult for us to replace some of our third-party vendors, particularly vendors providing our core banking, mortgage-servicing, debit and credit card services, and information services, in a timely manner if they are unwilling or unable to provide us with these services in the future for any reason.
An inability to raise funds through deposits, borrowings, the sale of investment securities and from other sources could have a substantial negative effect on our liquidity. 26 Table of Contents Our most important source of funds consists of our clients’ deposits.
An inability to raise funds through deposits, borrowings, the sale of investment securities and from other sources could have a substantial negative effect on our liquidity. Our most important source of funds consists of our clients’ deposits.
See “Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.” Further, as of December 31, 2024, we estimate that approximately 68.6% of our total deposits were not insured by the FDIC, and these uninsured deposits may be more likely to be withdrawn if we experience, or are perceived to experience, financial distress or during periods of real or perceived stress or instability in financial markets more generally.
See “Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.” Further, as of December 31, 2025, we estimate that approximately 75.0% of our total deposits were not insured by the FDIC, and these uninsured deposits may be more likely to be withdrawn if we experience, or are perceived to experience, financial distress or during periods of real or perceived stress or instability in financial markets more generally.
Integration 53 Table of Contents of acquired businesses is time-consuming and could disrupt our ongoing businesses, produce unforeseen regulatory or operating difficulties, cause us to incur incremental expenses or require incremental financial, management and other resources.
Integration of acquired businesses is time-consuming and could disrupt our ongoing businesses, produce unforeseen regulatory or operating difficulties, cause us to incur incremental expenses or require incremental financial, management and other resources.
However, interest rate risk management techniques are imprecise and may not effectively mitigate these risks. Moreover, we currently do not employ interest rate derivatives to hedge this risk, relying exclusively on portfolio adjustments, which may prove insufficient against rapid or significant rate fluctuations.
However, interest rate risk management techniques are imprecise and may not effectively mitigate these risks or align with depositor preferences. Moreover, we currently do not employ interest rate derivatives to hedge this risk, relying exclusively on portfolio adjustments, which may prove insufficient against rapid or significant rate fluctuations.
As of December 31, 2024, 21.44% of our assets were invested in securities held to maturity (measured at amortized cost, net of allowance for credit losses), which subject us to certain risks that may adversely affect our business, financial condition or results of operations, including the following: • Securities held to maturity are carried at amortized cost, and their fair value is not adjusted for changes in interest rates.
As of December 31, 2025, 14.7% of our assets were invested in securities held to maturity (measured at amortized cost, net of allowance for credit losses), which subject us to certain risks that may adversely affect our business, financial condition or results of operations, including the following: • Securities held to maturity are carried at amortized cost, and their fair value is not adjusted for changes in interest rates.
Compliance with these requirements places additional demands on our legal, accounting, finance, operations and investor relations staff and on our accounting, financial and information systems, and increases our legal and accounting compliance costs as well as our compensation expense as we have hired and expect to continue to hire additional legal, accounting, tax, finance and investor relations staff.
Compliance with these requirements places additional demands on our legal, accounting, finance, 38 Table of Contents operations and investor relations staff and on our accounting, financial and information systems, and increases our legal and accounting compliance costs as well as our compensation expense as we have hired and expect to continue to hire additional legal, accounting, tax, finance and investor relations staff.
Increases in FDIC insurance premiums could adversely affect our earnings and results of operations. The Bank is a member of the FDIC and the deposits of each of its depositors are insured to the maximum amount provided by the Federal Deposit Insurance Act (“FDIA”), subject to the Bank’s payment of deposit insurance premiums to the FDIC.
Increases in FDIC insurance premiums could adversely affect our earnings and results of operations. The Bank is a member of the FDIC and the deposits of each of its depositors are insured to the maximum amount provided by the FDIA, subject to the Bank’s payment of deposit insurance premiums to the FDIC.
Our 29 Table of Contents high concentration of deposits from Republican-affiliated organizations may also attract increased regulatory scrutiny, potentially leading to additional compliance burdens or restrictions on our activities.
Our high concentration of deposits from Republican-affiliated organizations may also attract increased regulatory scrutiny, potentially leading to additional compliance burdens or restrictions on our activities.
There can be no assurance that we will be able to maintain or increase our current levels of transaction accounts, non-interest-bearing demand deposits, and levels of profitability or growth.
There can be no assurance that we will be able to maintain or increase our current levels of transaction accounts, noninterest-bearing demand deposits, and levels of profitability or growth.
If these deposits were included on our balance sheet as of December 31, 2024, we estimate that the Bank’s Tier 1 leverage ratio would have been 8.64%, which exceeds the 5.00% Tier 1 leverage ratio required to be considered “well capitalized” under applicable federal banking regulations.
If these deposits were included on our balance sheet as of December 31, 2025, we estimate that the Bank’s Tier 1 leverage ratio would have been approximately 8.95%, which exceeds the 5.00% Tier 1 leverage ratio required to be considered “well capitalized” under applicable federal banking regulations.
We have in the past been, and may in the future be, named as a defendant in legal actions in connection with our activities. Legal actions could include claims for substantial compensatory or punitive damages or claims for indeterminate amounts of damages.
We have in the past been, are from time to time, and may in the future be, named as a defendant in legal actions in connection with our activities. Legal actions could include claims for substantial compensatory or punitive damages or claims for indeterminate amounts of damages.
Our Trust & Wealth Department’s assets under management are concentrated among a small number of clients. As of December 31, 2024, we had four clients with accounts that each exceeded 5.0% of our total assets under administration, all within the custody segment. These four clients collectively accounted for 35% of our total assets under administration.
Our Trust & Wealth Department’s assets under management are concentrated among a small number of clients. As of December 31, 2025, we had four clients with accounts that each exceeded 5.0% of our total assets under administration, all within the custody segment. These four clients collectively accounted for 32.2% of our total assets under administration.
See “— Liquidity Risk — Loss of deposits could increase our funding costs or require us to sell assets or borrow.” Increases in interest rates could result in a decrease in the market value of our loans. As of December 31, 2024, variable rate loans, which include floating and adjustable rate structures, comprised 70.8% of our loan portfolio.
See “— Liquidity Risk — Loss of deposits could increase our funding costs or require us to sell assets or borrow.” Increases in interest rates could result in a decrease in the market value of our loans. As of December 31, 2025, variable rate loans, which include floating and adjustable rate structures, comprised 69.7% of our loan portfolio.
See “Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.” Our primary source of liquidity is our account at the Federal Reserve, which held $406.7 million at December 31 2024, which supports our daily and ongoing activities.
See “Our deposits are concentrated in political organizations, which can vary significantly in volume due to seasonality or changes in political activity or campaign finance laws.” Our primary source of liquidity is our account at the Federal Reserve, which held $580.9 million at December 31, 2025, which supports our daily and ongoing activities.
Our Trust & Wealth Department generated revenues of approximately $907 thousand for the year ended December 31, 2024 and $565 thousand for the year ended December 31, 2023, but has not achieved standalone profitability. There can be no assurance that the Trust & Wealth Department will contribute meaningfully to our revenues or become profitable on a standalone basis.
Our Trust & Wealth Department generated revenues of approximately $1.3 million for the year ended December 31, 2025 and $907 thousand for the year ended December 31, 2024, but has not achieved standalone profitability. There can be no assurance that the Trust & Wealth Department will contribute meaningfully to our revenues or become profitable on a standalone basis.
In particular, we rely on a core technology provider for the banking software used by our clients and operations personnel. Accordingly, our operations are exposed to the risk that these vendors, including our core technology provider, will not perform in accordance with the contracted arrangements or under service-level agreements.
In particular, we rely on a core technology provider for the banking software used by our clients and operations personnel. Accordingly, our operations are exposed to the risk that these vendors, including our core technology provider, may fail to perform in accordance with the contracted arrangements or applicable service-level agreements.
Some, but certainly not all, of the factors that could negatively affect the price of our Class A common stock, or result in fluctuations in the price or trading volume of our Class A common stock, include: • general market conditions; • domestic and international economic factors unrelated to our performance; • variations in our quarterly operating results or failure to meet the market’s earnings expectations; • publication of research reports about us or the financial services industry in general; • the failure of securities analysts to cover or continue to cover our Class A common stock; • additions to or departures of our key personnel; • adverse market reactions to any indebtedness we may incur or securities we may issue in the future; • actions by our stockholders; • the expiration of contractual lock-up agreements; • future sales of our Class A common stock, including upon the conversion of shares of our Class B common stock; • the operating and securities price performance of companies that investors consider to be comparable to us; • changes or proposed changes in laws or regulations affecting our business; and • actual or potential litigation and governmental investigations.
Some, but certainly not all, of the factors that could negatively affect the price of our Class A common stock, or result in fluctuations in the price or trading volume of our Class A common stock, include: • general market conditions; • domestic and international economic factors unrelated to our performance; • variations in our quarterly operating results or failure to meet the market’s earnings expectations; • publication of research reports about us or the financial services industry in general; 53 Table of Contents • the failure of securities analysts to cover or continue to cover our Class A common stock; • removal from stock indices; • delisting from the New York Stock Exchange; • additions to or departures of our key personnel; • adverse market reactions to any indebtedness we may incur or securities we may issue in the future; • actions by our stockholders; • future sales of our Class A common stock, including upon the conversion of shares of our Class B common stock; • the operating and securities price performance of companies that investors consider to be comparable to us; • changes or proposed changes in laws or regulations affecting our business; and • actual or potential litigation and governmental investigations.
Moreover, litigation challenging actions or regulations by federal or state authorities could reshape the supervisory framework governing our operations, with outcomes that are difficult to predict.
Moreover, litigation challenging actions or 46 Table of Contents regulations by federal or state authorities could reshape the supervisory framework governing our operations, with outcomes that are difficult to predict.
See “— Interest Rate Risk — Interest rates have in the past resulted in, and could in the future result in, unrealized losses on our investment securities portfolio.” As of December 31, 2024, the carrying value (net of allowance for credit losses) of our securities held to maturity was $300.5 million, compared to a fair value of $279.0 million. 34 Table of Contents • In general, we cannot sell any of our securities held to maturity without potentially triggering a reclassification of our entire held to maturity securities portfolio to available for sale, except under specific circumstances permitted by accounting standards, causing all unrealized losses, marked to market and net of taxes, to be reflected in the accumulated other comprehensive loss component of our total stockholders’ equity and a decline in our tangible book value.
See “— Interest Rate Risk — Interest rates have in the past resulted in, and could in the future result in, unrealized losses on our investment securities portfolio.” As of December 31, 2025, the carrying value (net of allowance for credit losses) of our securities held to maturity was $256.6 million, compared to a fair value of $245.3 million. • In general, we cannot sell any of our securities held to maturity without potentially triggering a reclassification of our entire held to maturity securities portfolio to available for sale, except under specific circumstances permitted by accounting standards, causing all unrealized losses, marked to market and net of taxes, to be reflected in the accumulated other comprehensive loss component of our total stockholders’ equity and a decline in our tangible book value.
Failure to adhere to these rules can disqualify the trust, leading to the loss of benefits for the beneficiary and potential legal liabilities for the trustee. In addition, the service charges we receive for assets under management are subject to fluctuations in the value of the underlying assets.
However, the rules governing these trusts are complex and state-specific. Failure to adhere to these rules can disqualify the trust, leading to the loss of benefits for the beneficiary and potential legal liabilities for the trustee. In addition, the service charges we receive for assets under management are subject to fluctuations in the value of the underlying assets.
We accept deposits directly from consumer and commercial clients and, as of December 31, 2024, we had $1.2 billion in total deposits. If we are unable to sufficiently maintain or grow our deposits to meet liquidity objectives, we may be subject to paying higher funding costs or unable to satisfy our funding needs.
We accept deposits directly from consumer and commercial clients and, as of December 31, 2025, we had $1.6 billion in total deposits. If we are unable to sufficiently maintain or 26 Table of Contents grow our deposits to meet liquidity objectives, we may be subject to paying higher funding costs or unable to satisfy our funding needs.
See “— Legal, Regulatory and Compliance Risks — Government regulation significantly affects our business and may result in higher costs and lower stockholder returns.” As of December 31, 2024, the Bank’s Tier 1 leverage ratio was 9.57% and our One-Way Sell ® deposits totaled $63.3 million.
See “— Legal, Regulatory and Compliance Risks — Government regulation significantly affects our business and may result in higher costs and lower stockholder returns.” As of December 31, 2025, the Bank’s Tier 1 leverage ratio was 9.61% and our One-Way Sell ® deposits totaled $359.9 million.
As a financial institution, we are susceptible to evolving cybersecurity threats, including attacks by cybercriminals, nation-state actors, insiders, and risks associated with rapid advancements in technology such as quantum computing, sophisticated artificial intelligence (AI), and other emerging technologies, which may compromise existing security measures.
As a financial institution, we are susceptible to evolving cybersecurity threats, including attacks by cybercriminals, nation-state actors, insiders, and risks associated with rapid advancements in technology including developments in AI, machine learning, quantum computing, and other emerging technologies, which may compromise existing security measures.
Information security breaches and cybersecurity incidents may involve unauthorized access or compromise of systems used by us, our service providers, or our clients; denial-of-service or distributed denial-of-service attacks; ransomware; malware; insider-threats; exploitation of third-party vulnerabilities (such as cloud services, web browsers, or operating systems); quantum-enabled attacks on encrypted communications or stored data; physical damage to critical infrastructure; or human errors resulting in data leaks or system compromises.
Information security breaches and cybersecurity incidents may involve unauthorized access or compromise of systems used by us, our service providers, or our clients; denial-of-service or distributed denial-of-service attacks; ransomware; malware; insider-threats; exploitation of third-party vulnerabilities (such as cloud services, web browsers, or operating systems); attacks leveraging vulnerabilities in vendor supply chains or third-party software dependencies; AI-enhanced or deepfake-enabled impersonation techniques; quantum-enabled attacks on encrypted communications or stored data; physical damage to critical infrastructure; or human errors resulting in data leaks or system compromises.
If the average interest rate we pay on our deposits increases, our cost of funds would rise. A significant majority of our funding consists of non-interest-bearing deposits. As of December 31, 2024, over 70% of our liabilities consisted of non-interest-bearing deposits.
If the average interest rate we pay on our deposits increases, our cost of funds would rise. A significant majority of our funding consists of noninterest-bearing deposits. As of December 31, 2025, over 75% of our liabilities consisted of noninterest-bearing deposits.
As of December 31, 2024, we held $130.3 million in reciprocal deposits that could be converted into One-Way Sell ® deposits, compared to the $63.3 million that had already been placed at other participating banks as One-Way Sell ® deposits. Any of these conditions could adversely affect our business, financial condition or results of operations.
As of December 31, 2025, we held $106.7 million in reciprocal deposits that could be converted into One-Way Sell ® deposits, compared to the $359.9 million that had already been placed at other participating banks as One-Way Sell ® deposits. Any of these conditions could adversely affect our business, financial condition or results of operations.
Furthermore, recent regulation requires us to enhance our due diligence, ongoing monitoring and control over our third-party vendors and other ongoing third-party business relationships. In certain cases, we may be required to renegotiate our agreements with these vendors to meet these enhanced requirements, which could increase our costs.
Furthermore, supervisory guidance and regulatory expectations require us to enhance our due diligence, ongoing monitoring and control over our third-party vendors and other ongoing third-party business relationships. In certain cases, we may be required to renegotiate our agreements with these vendors to meet these enhanced requirements, which could increase our costs.
Although we are still evaluating our options under the JOBS Act, we may take advantage of some or all of the reduced regulatory and reporting obligations that will be available to us so long as we qualify as an “emerging growth company,” and thus the level of information we provide may be different from that of other public companies.
As an emerging growth company, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. 55 Table of Contents Although we are still evaluating our options under the JOBS Act, we may take advantage of some or all of the reduced regulatory and reporting obligations that will be available to us so long as we qualify as an “emerging growth company,” and thus the level of information we provide may be different from that of other public companies.
The ability of the members of the Fitzgerald Family and other holders of Class B common stock to aggregate their shares and privately sell them, with no requirement for a concurrent offer to be made to acquire all of the shares of our outstanding common stock that will be publicly traded hereafter, could prevent you from realizing any change-of-control premium on your shares of our common stock that may accrue to members of the Fitzgerald Family and other holders of Class B common stock in such private sale of our common stock.
Accordingly, any acquirer of our common stock from members of the Fitzgerald Family and other holders of Class B common stock may not be able to exercise the same aggregate amount of voting power with respect to such shares. 52 Table of Contents The ability of the members of the Fitzgerald Family and other holders of Class B common stock to aggregate their shares and privately sell them, with no requirement for a concurrent offer to be made to acquire all of the shares of our outstanding common stock that will be publicly traded hereafter, could prevent you from realizing any change-of-control premium on your shares of our common stock that may accrue to members of the Fitzgerald Family and other holders of Class B common stock in such private sale of our common stock.
If regional economic conditions deteriorate as a result of these federal spending reductions, we may experience: reduced opportunities to maintain or grow business relationships; heightened risks to loan 33 Table of Contents collectability (particularly within our CRE portfolio); declines in collateral values for residential and commercial real estate; decreased loan demand; and possible consumer or business deposit outflows.
If regional economic conditions deteriorate as a result of federal spending reductions, workforce adjustments, contract terminations, or changes in government office utilization, we may experience: reduced opportunities to maintain or grow business relationships; heightened risks to loan collectability (particularly within our CRE portfolio); declines in collateral values for residential and commercial real estate; decreased loan demand; and possible consumer or business deposit outflows.
If we are compelled to foreclose on a property, there is a risk that the real estate may be worth less than the appraised value, which could result in the Bank not recovering the full amount of the loan.
If we are compelled to foreclose on a property, there is a risk that the real estate may be worth less than the appraised value, which could result in the Bank not recovering the full amount of the loan. In such cases, we could incur losses that may adversely affect our financial condition.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs of the date of this Annual Report on Form 10-K, the Company has contracted with a third-party firm to provide CISO services, who reports to the Chief Risk Officer and the IT Committee Chair. This engagement allows the Company to access specialized knowledge, industry best practices, and regulatory insights while maintaining flexibility in managing its information security strategy.
Biggest changeThis engagement allows the Company to access specialized knowledge, industry best practices, and regulatory insights while maintaining flexibility in managing its information security strategy. The external CISO provides guidance and oversight on cybersecurity risk assessments, incident response, and compliance.
The Director of Technology is responsible for monitoring cybersecurity risks and reporting any material threats or incidents to the IT Committee or Board for oversight, strategic response planning, and mitigation efforts. 57 Table of Contents • Access Controls & Identity Management: Implementation of multi-factor authentication, role-based access controls, and monitoring of user permissions. • Incident Detection & Response: Security monitoring supported by an incident response plan designed for timely identification, containment, and remediation of cybersecurity incidents. • Data Protection & Encryption: Encryption, standards, data loss prevention protocols, and secure data storage measures for sensitive client and corporate information. • Third-Party Risk Management: Security assessments, monitoring, and contractual requirements to manage cybersecurity risks from third-party vendors. • Training & Awareness: Mandatory cybersecurity training for employees to enhance awareness of cybersecurity threats and compliance requirements. • Regulatory Compliance & Audit: Regular internal and external cybersecurity audits to assess compliance with applicable regulations, standards, and Company policies. • Continuous Improvement & Testing: Periodic penetration tests and vulnerability assessments to evaluate cybersecurity risks and enhanced security measures.
The Director of Technology is responsible for monitoring cybersecurity risks and reporting any material threats or incidents to the IT Committee or Board for oversight, strategic response planning, and mitigation efforts. • Access Controls & Identity Management: Implementation of multi-factor authentication, role-based access controls, and monitoring of user permissions. • Incident Detection & Response: Security monitoring supported by an incident response plan designed for timely identification, containment, and remediation of cybersecurity incidents. • Data Protection & Encryption: Encryption, standards, data loss prevention protocols, and secure data storage measures for sensitive client and corporate information. • Third-Party Risk Management: Security assessments, monitoring, and contractual requirements to manage cybersecurity risks from third-party vendors. • Training & Awareness: Mandatory cybersecurity training for employees to enhance awareness of cybersecurity threats and compliance requirements. • Regulatory Compliance & Audit: Regular internal and external cybersecurity audits to assess compliance with applicable regulations, standards, and Company policies. • Continuous Improvement & Testing: Periodic penetration tests and vulnerability assessments to evaluate cybersecurity risks and enhanced security measures.
ITEM 1C. CYBERSECURITY Risk Management and Strategy The Company identifies, assesses, and manages cybersecurity risks as part of its risk management program. Our cybersecurity strategy aligns the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”), applicable regulatory guidelines and other industry practices to secure critical information systems and sensitive data.
ITEM 1C. CYBERSECURITY Risk Management and Strategy The Company identifies, assesses, and manages cybersecurity risks as part of its risk management program. Our cybersecurity strategy is informed by the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”), applicable regulatory guidelines and other industry practices to secure critical information systems and sensitive data.
The Committee Chair has expertise in auditing and regulatory compliance within the financial services industry. 58 Table of Contents Management Oversight The Company’s cybersecurity operations are overseen by the Director of Technology, who possesses twelve years of experience in cybersecurity management, information technology infrastructure, and risk mitigation.
The Committee Chair has expertise in auditing and regulatory compliance within the financial services industry. Management Oversight The Company’s cybersecurity operations are overseen by the Director of Technology, who has over a decade of experience in cybersecurity management, information technology infrastructure, and risk mitigation.
While these efforts aim to assess and mitigate cybersecurity risks, no security assessment can eliminate all potential risks associated with third-party vendors. Board Oversight The Board oversees cybersecurity through the Bank’s Information Technology Committee (“IT Committee”), the Company’s Audit Committee, and the Company’s Risk Committee, aligning cybersecurity practices with the Company’s risk management framework and regulatory requirements.
While these efforts aim to assess and mitigate cybersecurity risks, no program can eliminate all potential risks associated with third-party vendors. Board Oversight The Board oversees cybersecurity through the Bank’s IT Committee, the Company’s Audit Committee, and the Company’s Risk Committee, aligning cybersecurity practices with the Company’s risk management framework and 58 Table of Contents regulatory requirements.
Updates on cybersecurity strategy, risk assessments, and regulatory developments are provided to the relevant committees. The Risk Committee monitors the quality and effectiveness of the Company’s information technology security, and at least annually reviews, appraises, and discuss with management the quality and effectiveness of the Company’s information technology security, data privacy, disaster recovery capabilities and cybersecurity and related risks.
The Risk Committee monitors the quality and effectiveness of the Company’s information technology and security program, and at least annually reviews, appraises, and discuss with management the design and implementation of the Company’s information technology security, data privacy, disaster recovery capabilities and cybersecurity and related risks.
The IT Committee is chaired by Dr. Yonesy F. Núñez, CISSP, who holds a Doctor of Professional Studies in Computing Information Assurance and Security from Pace University. Dr. Núñez has experience in cybersecurity governance and risk management and currently serves as Chief Information Security Officer (“CISO”) of a Systematically Important Financial Market Utility.
Núñez, CISSP, who holds a Doctor of Professional Studies in Computing Information Assurance and Security from Pace University. Dr. Núñez has experience in cybersecurity governance and risk management and previously served as Chief Information Security Officer (“CISO”) of a Systematically Important Financial Market Utility, CISO at Jack Henry & Associates, and in senior cybersecurity positions at major financial institutions.
The external CISO provides guidance and oversight on cybersecurity risk assessments, incident response, and compliance. Incident Response As of the date of this Annual Report on Form 10-K, the Company has not identified any cybersecurity incidents materially affecting its business strategy, results of operations, or financial condition.
Incident Response As of the date of this Annual Report on Form 10-K, the Company has not identified any cybersecurity incidents materially affecting its business strategy, results of operations, or financial condition. Recognizing cybersecurity threats continue to evolve, the Company maintains a focus on enhancing its detection, response, and resilience capabilities.
Issues are elevated to the Board by either the Director of Technology or by the Chairs of the IT Committee and Risk Committee, the Chief Risk Officer, or the CEO.
Issues are elevated to the Board by either the Director of Technology or by the Chairs of the IT Committee and Risk Committee, the Chief Risk Officer, or the CEO. The Company has contracted with a third-party firm to provide CISO services, who reports to the Chief Risk Officer and the IT Committee Chair.
His prior roles include CISO at Jack Henry & Associates and senior cybersecurity positions at major financial institutions. The Risk Committee, chaired by a former senior executive from KPMG LLP, who established and led KPMG’s Financial Risk Management practice in the U.S., annually evaluates the effectiveness of the Company’s cybersecurity controls.
The Risk Committee, chaired by a former senior executive from KPMG LLP, who established and led KPMG’s Financial Risk Management practice in the U.S., annually evaluates the effectiveness of the Company’s cybersecurity controls. The Audit Committee selects third-party auditors to conducts cybersecurity audits, penetration tests, and risk assessments.
Additionally, the Director of Technology submits semi-annual reports to the Board, providing insights into ongoing and emerging risks, technology developments, and IT security initiatives. In cases where significant IT or cybersecurity risks arise, such matters are escalated to the Company’s Board through the Chair of the Risk Committee or the Chief Risk Officer, for timely awareness and response.
In cases where significant IT or cybersecurity risks arise, such matters are escalated to the Company’s Board through the Chair of the Risk Committee, the Chief Risk Officer, the appropriate committee chair, or the CEO, for timely awareness and response. The IT Committee is chaired by Dr. Yonesy F.
Recognizing cybersecurity threats continue to evolve, the Company maintains a focus on enhancing its detection, response, and resilience capabilities. The Company cannot assure the prevention of future cybersecurity incidents.
The Company cannot assure the prevention of future cybersecurity incidents.
Removed
The Audit Committee selects third-party auditors to conducts cybersecurity audits, penetration tests, and risk assessments.
Added
Updates on cybersecurity strategy, risk assessments, and regulatory developments are provided to the relevant committees.
Added
Additionally, the Director of Technology submits semi-annual reports to the Board, providing insights into ongoing and emerging risks, technology developments, and IT security initiatives.

Item 2. Properties

Properties — owned and leased real estate

3 edited+1 added−2 removed5 unchanged
Biggest changeThis space houses the Bank’s deposit operations, commercial deposit relationship officers, compliance, information technology, human resources, and accounting departments. • Emerson One, 6718 Whittier Avenue, Unit 220, McLean, Virginia 22101: This commercial condominium unit, totaling approximately 2,209 square feet, was acquired in February 2025.
Biggest changeThis space houses the Bank’s deposit operations, commercial deposit relationship officers, compliance, information technology, and human resources departments. • Emerson One, 6718 Whittier Avenue, Unit 220, McLean, Virginia 22101: This commercial condominium unit, totaling approximately 2,209 square feet, houses the Bank’s accounting and audit functions.
As of the filing of this Annual Report on Form 10-K, the Bank owns the following properties: Main Banking Office Palladium at McLean, 1445-A Laughlin Avenue, Unit 102, McLean, Virginia 22101, totaling approximately 4,500 square feet.
As of the filing of this Annual Report on Form 10-K, the Bank owns the following properties: 59 Table of Contents Main Banking Office Palladium at McLean, 1445-A Laughlin Avenue, Unit 102, McLean, Virginia 22101, totaling approximately 4,500 square feet.
The Company continuously evaluates its real estate requirements to support future growth and operational efficiency. The Company believes its properties are adequately covered by insurance and suitable for existing operations. There are no material environmental issues, liens, or other encumbrances affecting these properties that would materially impact their use.
All properties are in good condition and adequately maintained. The Company continuously evaluates its real estate requirements to support future growth and operational efficiency. The Company believes its properties are adequately covered by insurance and suitable for existing operations. There are no material environmental issues, liens, or other encumbrances affecting these properties that would materially impact their use.
Removed
The Bank plans to remodel this space for use as administrative and accounting offices, although no construction contracts have been executed as of the date of this Annual Report on Form 10-K. If remodeling proceeds, it is expected to be completed by December, 2025, subject to customary permitting and construction timelines.
Added
The Company believes these owned properties adequately meet its current operational needs and provide limited capacity for anticipated future growth. In addition, the Bank is under contract to acquire two additional units within the Emerson One building, with a projected closing date no later than May 2026, which, if completed, would expand available office space for Bank use.
Removed
Upon completion, the accounting department will relocate to this unit, freeing up space in Units 110, 120, and 130 for commercial banking officers and other personnel. 59 Table of Contents The Company believes these owned properties adequately meet its current operational needs and provide limited capacity for anticipated future growth. All properties are in good condition and adequately maintained.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+9 added−0 removed3 unchanged
Biggest changeThe Company did not repurchase any of its equity securities during fiscal year 2024, including during the three months ended December 31, 2024. ITEM 6. [Reserved] 61 Table of Contents
Biggest changeUnregistered Sales and Issuer Repurchases of Common Stock There were no unregistered sales of the Company’s equity securities during fiscal years ended December 31, 2025 or 2024. The Company did not repurchase any of its equity securities during fiscal year 2025, including during the three months ended December 31, 2025.
There is no established public trading market for the Company’s Class B Common Stock; however, each outstanding share of Class B Common Stock remains convertible, at the option of the holder, into one share of Class A Common Stock at any time.
There is no established public trading market for the Company’s Class B Common Stock; however, each share of Class B Common Stock is convertible, at the option of the holder, into one share of Class A Common Stock at any time.
Dividends The Company did not declare or pay any dividends on its Class A Common Stock or Class B Common Stock in fiscal year 2024. The Company does not currently intend to pay dividends on its common equity in the foreseeable future. Instead, the Company currently intends to retain all available earnings to support its growth strategy and business expansion.
The Company does not currently intend to pay dividends on its common equity in the foreseeable future. Instead, the Company currently intends to retain all available earnings to support its growth strategy and business expansion.
As of March 20, 2025, the Company’s Class A Common Stock was held by 28 stockholders of record, including Cede & Co., which holds our beneficial stockholders whose shares were held in “street name” through a broker or bank. The Company’s Class B Common Stock was held by 184 stockholders of record.
As of March 19, 2026, the Company’s Class A Common Stock was held by 12 stockholders of record (including Cede & Co., the nominee of The Depository Trust Company, which holds shares on behalf of beneficial owners whose shares are held in “street name” through brokers or banks).
The payment of dividends in the future will be at the discretion of the Board and is dependent upon, among other things, the Company’s future income, financial position, and capital requirements. Unregistered Sales and Issuer Repurchases of Common Stock There were no unregistered sales of the Company’s equity securities during fiscal years ended December 31, 2024 or 2023.
The payment of dividends in the future will be at the discretion of the Board and is dependent upon, among other things, the Company’s future income, financial position, capital requirements, regulatory restrictions, and other considerations the Board may deem relevant at the time. There can be no assurance that dividends will be declared or paid in the future.
As of March 20, 2025, the latest practicable date prior to the filing of this report, the Company had outstanding 3,119,317 shares of Class A Common Stock and 3,442,500 shares of Class B Common Stock. The Class A Common Stock and Class B Common Stock represent 8.31% and 91.69% of the combined voting power of our common stock, respectively.
As of March 19, 2026, the latest practicable date prior to the filing of this Annual Report on Form 10-K, the Company had outstanding 3,322,762 shares of Class A Common Stock and 3,239,055 shares of Class B Common Stock.
Added
The Class A Common Stock and Class B Common Stock represent 9.30% and 90.70% of the combined voting power of our common stock, respectively.
Added
The Company’s Class B Common Stock was held by 158 stockholders of record.
Added
In 2025, no additional shares of common stock were issued other than shares of Class A Common Stock converted from shares of Class B Common Stock at the option of the holders. Dividends The Company did not declare or pay any dividends on its Class A Common Stock or Class B Common Stock in fiscal year 2025 or 2024.
Added
Performance Graph The following graph compares the cumulative total shareholder return (“TSR”) on Chain Bridge Bancorp’s Class A Common Stock from October 4, 2024 (the date our Class A Common Stock first traded on the NYSE) through December 31, 2025, with (i) the Russell 3000 Index (a broad-based equity market index) and (ii) the KBW Nasdaq Regional Banking Index (“KRX”), which the Company believes is representative of the performance of publicly traded regional and community bank holding companies of comparable size and scope.
Added
The graph assumes that $100 was invested on October 4, 2024 in each of (1) the Company’s Class A Common Stock, (2) the Russell 3000 Index, and (3) the KBW Nasdaq Regional Banking Index, and in each case that all dividends 61 Table of Contents were reinvested.
Added
The comparisons shown below are based solely on historical data and are not intended to forecast or guarantee future performance of the Company’s common stock.
Added
Past performance may not be indicative of future results 1 Cumulative Total Returns Period Ending October 4, 2024 December 31, 2024 December 31, 2025 Chain Bridge Bancorp, Inc. $ 100.00 $ 113.95 $ 155.55 Russell 3000 Index 100.00 102.80 120.42 KBW Regional Banking Index 100.00 108.62 115.69 Management selected the Russell 3000 Index as the Company’s broad market comparator because the Company’s Class A Common Stock was included in the index during 2025 and it represents a widely recognized measure of overall U.S. equity performance.
Added
The KBW Nasdaq Regional Banking Index was chosen as the industry comparator because it includes a broad group of U.S. regional and community banks that the Company believes are most similar in asset size, regulatory profile, and market focus.
Added
The Company believes that the combination of these indices provides investors with meaningful context for evaluating total shareholder return relative to both the general market and the banking industry.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

178 edited+54 added−47 removed95 unchanged
Biggest changeThe precise amount and timing of any such outflows remain uncertain and may not follow historical patterns, as they depend on a range of external factors, including the fundraising and disbursement activities of our political organization clients. 85 Table of Contents The following table presents the types of deposits compared to total deposits for the periods indicated: As of December 31, 2024 2023 Change ( dollars in thousands ) Amount % of total deposits Amount % of total deposits $ % Noninterest-bearing $ 913,379 73.1 % $ 766,933 69.0 % $ 146,446 19.1 % Savings, interest-bearing and money market accounts 324,845 26.0 % 328,350 29.5 % (3,505) (1.1 %) Time, $250 and over 6,510 0.5 % 9,385 0.8 % (2,875) (30.6 %) Other time 5,201 0.4 % 7,357 0.7 % (2,156) (29.3 %) Total $ 1,249,935 100.0 % $ 1,112,025 100.0 % $ 137,910 12.4 % The following table presents the average balances and average rates paid for the periods indicated: Year Ended December 31, 2024 2023 ( dollars in thousands ) Average Balance Average Rate Average Balance Average Rate Noninterest-bearing $ 930,978 — % $ 645,418 — % Savings, interest-bearing checking and money market accounts 233,217 1.24 % 284,706 1.11 % Time, $250 and over 7,563 2.93 % 8,262 2.73 % Other time 5,778 2.84 % 9,775 2.98 % Total average deposits $ 1,177,536 0.28 % $ 948,161 0.39 % FDIC deposit insurance covers $250 thousand per depositor, per FDIC-insured bank, for each account ownership category.
Biggest changeThe following table presents the average balances and average rates paid for the periods indicated: Year Ended December 31, 2025 2024 ( dollars in thousands ) Average Balance Average Rate Average Balance Average Rate Noninterest-bearing $ 986,531 — % $ 930,978 — % Savings, interest-bearing checking and money market accounts 377,492 1.08 % 233,217 1.24 % Time, $250 and over 5,329 2.67 % 7,563 2.93 % Other time 4,878 2.40 % 5,778 2.84 % Total average deposits $ 1,374,230 0.32 % $ 1,177,536 0.28 % FDIC deposit insurance covers $250 thousand per depositor, per FDIC-insured bank, for each account ownership category.
Noninterest Income Noninterest income consists of deposit placement services income, service charges on deposit accounts, trust and wealth management income, gains on sale of mortgage loans, net gains or losses on sales of securities and other income.
Noninterest Income Noninterest income consists of trust and wealth management income, service charges on deposit accounts, deposit placement services income, gains on sale of mortgage loans, net gains or losses on sales of securities and other income.
Additionally, decreased demand for commercial office space and housing may place downward pressure on residential and commercial real estate values, which could further affect the region’s economy and the performance of our loan portfolio. Monetary Policy : We rely on the Federal Reserve’s payment of interest on reserve balances as a source of interest income.
Additionally, decreased demand for commercial office space and housing may place downward pressure on residential and commercial real estate values, which could further affect the region’s economy and the performance of our loan portfolio. 65 Monetary Policy : We rely on the Federal Reserve’s payment of interest on reserve balances as a source of interest income.
The service charges we collect for AUM are subject to fluctuations in the total value of assets managed, which can vary with changes in market conditions, including stock prices and bond yields. Therefore, any significant market volatility or changes in interest rates could impact the valuation of the assets we manage, thereby affecting the service fees we collect.
The service charges we collect for AUM are subject to fluctuations in the total value of assets managed, which can vary with changes in market conditions, including stock prices and bond yields. Therefore, any significant market volatility 73 or changes in interest rates could impact the valuation of the assets we manage, thereby affecting the service fees we collect.
The deposit products we offer include noninterest-bearing and interest-bearing checking accounts, savings accounts, and money market accounts. We aim to attract transaction account deposits, particularly from commercial clients. Our deposit base is largely composed of funds from commercial entities, specifically federal political organizations, trade associations, non-profit organizations and business enterprises.
The deposit products we offer include noninterest-bearing and interest-bearing checking accounts, savings accounts, and money market accounts. We aim to 84 attract transaction account deposits, particularly from commercial clients. Our deposit base is largely composed of funds from commercial entities, specifically federal political organizations, trade associations, non-profit organizations and business enterprises.
At various points throughout 2024, we estimate that at least a majority of our deposit balances were sourced from political organizations, which we believe reduces our direct exposure to broader economic trends. However, economic downturns may lead to declines in political donations, which could adversely affect our deposit levels and income.
At various points throughout 2024 and 2025, we estimate that at least a majority of our deposit balances were sourced from political organizations, which we believe reduces our direct exposure to broader economic trends. However, economic downturns may lead to declines in political donations, which could adversely affect our deposit levels and income.
On October 10, 2024, the Company used a portion of the net proceeds from the IPO to fully repay the $10.0 million outstanding principal balance on this line of credit and closed the line on October 11, 2024. Substantially all interest on short-term borrowings reported during 2024 and 2023 was related to this line of credit.
On October 10, 2024, the Company used a portion of the net proceeds from the IPO to fully repay the $10.0 million outstanding principal balance on this line of credit and closed the line on October 11, 2024. Substantially all interest on short-term borrowings reported during 2024 was related to this line of credit.
In determining return on average equity for a given period, net income is divided by the average stockholders’ equity for that period. Return on Average Assets . We monitor return on average assets to measure our operating performance and to determine how efficiently our assets are being used to generate net income.
In determining return on average equity for a given period, net income is divided by the average stockholders’ equity for that period. 66 Return on Average Assets . We monitor return on average assets to measure our operating performance and to determine how efficiently our assets are being used to generate net income.
In determining return on average assets for a given period, net income is divided by the average total assets for that period. Return on Average Risk-Weighted Assets . We use return on average risk-weighted assets to measure how efficiently our assets are being used to generate net income on a risk-adjusted basis.
In determining return on average assets for a given period, net income is divided by the average total assets for that period. Return on Average Risk-Weighted Assets . We use return on average RWA to measure how efficiently our assets are being used to generate net income on a risk-adjusted basis.
Off-Balance Sheet Arrangements We are party to credit-related financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our clients. These financial instruments include commitments to extend credit and standby letters of credit.
Off-Balance Sheet Arrangements We are party to credit-related financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our clients. These financial instruments include commitments to extend credit and standby 87 letters of credit.
Management individually evaluates the expected credit loss for certain loans, such as those that are collateral-dependent, are graded doubtful, or are identified as having risk characteristics dissimilar to those of the established loan pools.
Management individually evaluates the expected credit loss for certain loans, such as those that are graded doubtful, or are identified as having risk characteristics dissimilar to those of the established loan pools, including loans that are collateral-dependent.
We aim to be recognized for our “ Strength, Service, Solutions: Your Bridge to Better Banking Nationwide .” Reclassification and Initial Public Offering In connection with the IPO, on October 3, 2024, the Company filed an Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, which established two new classes of common stock, Class A common stock, par value $0.01 per share (“Class A Common Stock”) and Class B common stock, par value $0.01 per share (“Class B Common Stock”), and reclassified and converted each outstanding share of the Company’s existing common stock, par value $1.00 per share (“Old Common Stock”), into 170 shares of Class B Common Stock (the “Reclassification”).
We aim to be recognized for our “ Strength, Service, Solutions: Your Bridge to Better Banking Nationwide .” Reclassification In connection with the IPO, on October 3, 2024, the Company filed an Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, which established two new classes of common stock, Class A common stock, par value $0.01 per share (“Class A Common Stock”) and Class B common stock, par value $0.01 per share (“Class B Common Stock”), and reclassified and converted each outstanding share of the Company’s existing common stock, par value $1.00 per share (“Old Common Stock”), into 170 shares of Class B Common Stock (the “Reclassification”).
Our risk management practices include annual internal reviews of commercial mortgages with balances over $500 thousand, focusing on early warning signs like payment delinquencies, property performance, and borrower financial condition. We also engage a third party to conduct an external loan review audit of the entire loan portfolio annually.
Our risk management practices include annual internal reviews of commercial mortgages with balances over $500 thousand, focusing on early warning signs like payment delinquencies, property performance, and borrower financial condition. We also engage a third party to conduct an external loan review of the loan portfolio annually.
The Company records as noninterest income deposit placement services income for One-Way Sell ® deposits which are sold into the ICS ® network. See “— Financial Condition — Deposits” for more information on these deposits. Service charges on deposit accounts include fees earned from monthly service charges, account analysis charges and interchange fee income.
The Bank records as noninterest income deposit placement services income for One-Way Sell ® deposits which are sold into the ICS ® network. See “— Financial Condition — Deposits” for more information on these deposits. Service charges on deposit accounts include fees earned from monthly service charges, account analysis charges and interchange fee income.
Primary Factors Used to Evaluate Our Financial Condition The most significant factors we use to evaluate and manage our financial condition include liquidity, asset quality and capital. Liquidity .
Primary Factors Used to Evaluate Our Financial Condition The most significant factors we use to evaluate and manage our financial condition include liquidity, asset quality and capital. 67 Liquidity .
The months following a general election, including the last months of 2024 and the first months of 2023, often see elevated commercial and industrial loan balances, as political organizations typically utilize their lines of credit around election periods and may repay these balances over the subsequent six to twelve months, or as cash flows allow.
The months following a general election, including the last months of 2024, often see elevated commercial and industrial loan balances, as political organizations typically utilize their lines of credit around election periods and may repay these balances over the subsequent six to twelve months, or as cash flows allow.
The risk rating scale is intended to provide a framework for analyzing risk across various credit exposures, regardless of their nature, type or location. The internal loan review process, performed by our credit administration staff, aims to verify that basic requirements for loan origination have been met.
The risk rating scale is intended to provide a framework for analyzing risk across various credit exposures, regardless of their nature, type or location. The internal loan review process, performed by our credit administration staff, aims to evaluate that basic requirements for loan origination have been met.
There were no loan charge-offs for the years ended December 31, 2024 or 2023. As a result, the ratio of loan charge-offs to average loans outstanding is 0.00% for all reported periods. Deposits We provide a wide range of commercial and personal deposit services.
There were no loan charge-offs for the years ended December 31, 2025 or 2024. As a result, the ratio of loan charge-offs to average loans outstanding is 0.00% for all reported periods. Deposits We provide a wide range of commercial and personal deposit services.
Historically, deposits from political organizations increase in the periods leading up to federal elections followed by a decline around the elections. Election outcomes may also impact the timing and scale of deposit inflows or outflows from political organizations, and this cycle was no exception.
Historically, deposits from political organizations increase in the periods leading up to federal elections followed by a decline around the elections. Election outcomes may also impact the timing and scale of deposit inflows or outflows from political organizations, and this most recent cycle was no exception.
If demand for One-Way Buy ® deposits is high, then the rate required to successfully bid for One-Way Buy ® deposits would be expected to increase, and so One-Way Buy ® deposits may be a less reliable source of liquidity. As of December 31, 2024, there was no outstanding balance.
If demand for One-Way Buy ® deposits is high, then the rate required to successfully bid for One-Way Buy ® deposits would be expected to increase, and so One-Way Buy ® deposits may be a less reliable source of liquidity. As of December 31, 2025, there was no outstanding balance.
The se factors negatively impact the value of commercial properties, making commercial real estate loans less attractive. See “— Financial Condition — Loan Portfolio” below for an analysis of the composition of our loan portfolio. Interest and dividends on securities, taxable .
These factors negatively impact the value of commercial properties, making commercial real estate loans less attractive. See “— Financial Condition — Loan Portfolio” below for an analysis of the composition of our loan portfolio. Interest and dividends on securities, taxable .
Professional services expenses include internal and external audit, legal, loan review, compliance audit and compliance monitoring fees. Occupancy and equipment expenses include depreciation for buildings and improvements, fixtures and furniture, equipment, and technology related items as well as building related expenses such as utilities and maintenance costs.
Professional services expenses include those such as internal and external audit, legal, loan review, recruiting fees, compliance audit, and compliance monitoring fees. Occupancy and equipment expenses include depreciation for buildings and improvements, fixtures and furniture, equipment, and technology related items as well as building related expenses such as utilities and maintenance costs.
The use of these credit facilities is contingent upon compliance with specified financial conditions and covenants. As of December 31, 2024 and December 31, 2023, the Bank had no outstanding balances under these federal funds purchase lines.
The use of these credit facilities is contingent upon compliance with specified financial conditions and covenants. As of December 31, 2025 and December 31, 2024, the Bank had no outstanding balances under these federal funds purchase lines.
If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value 77 Table of Contents through income. For AFS debt securities that do not meet the aforementioned criteria, management evaluates whether the decline in fair value has resulted from credit losses or other factors.
If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For AFS debt securities that do not meet the aforementioned criteria, management evaluates whether the decline in fair value has resulted from credit losses or other factors.
In such cases, the loan risk classification may be re-evaluated. 81 Table of Contents An external loan review is conducted annually by a third-party firm. This review examines a sample of the loan portfolio, focusing on areas such as underwriting practices, adherence to loan policies and banking regulations, loan documentation, watch list, and portfolio concentration.
In such cases, the loan risk classification may be re-evaluated. An external loan review is conducted annually by a third-party firm. This review examines a sample of the loan portfolio, focusing on areas such as underwriting practices, adherence to loan policies and banking regulations, loan documentation, watch list, and portfolio concentration.
Renewal of these loans is subject to review and credit approval, as well as modification of terms upon maturity. Actual repayments of the loans may differ from the maturities reflected below 80 Table of Contents because consumer borrowers and some commercial borrowers have the right to prepay obligations with or without prepayment penalties.
Renewal of these loans is subject to review and credit approval, as well as modification of terms upon maturity. Actual repayments of the loans may differ from the maturities reflected below because consumer borrowers and some commercial borrowers have the right to prepay obligations with or without prepayment penalties.
As of December 31, 2024 and 2023, based on our internal classifications, we did not identify any assets that met our criteria for classification as non-performing assets or OREO.
As of December 31, 2025 and 2024, based on our internal classifications, we did not identify any assets that met our criteria for classification as non-performing assets or OREO.
Loans determined to be non-performing or potentially uncollectible may be placed in non-accrual status pending further collection efforts or charged off if collection of principal or interest is deemed doubtful. 82 Table of Contents For loans placed in non-accrual status, all interest previously accrued but not collected is generally reversed against interest income.
Loans determined to be non-performing or potentially uncollectible may be placed in non-accrual status pending further collection efforts or charged off if collection of principal or interest is deemed doubtful. For loans placed in non-accrual status, all interest previously accrued but not collected is generally reversed against interest income.
As of December 31, 2024, our non-owner-occupied office loans totaled $6.4 million, retail loans totaled $12.8 million, multifamily loans totaled $7.4 million, and hotel loans totaled $4.0 million. • Geographic Concentration: Our commercial real estate loan portfolio is concentrated in the Washington, D.C. metropolitan area.
At December 31, 2024, our non-owner occupied office loans totaled $6.4 million, retail loans totaled $12.8 million, multifamily loans totaled $7.4 million, and hotel loans totaled $4.0 million. • Geographic Concentration: Our commercial real estate loan portfolio is concentrated in the Washington, D.C. metropolitan area.
As of December 31, 2024, the terms and conditions for participation in the ICS ® network include a $265.0 million limit on the amount of each participating client’s ICS ® deposits that may be placed at other banks within the ICS ® network, a $3.5 billion and $6.5 billion limit on the maximum amount of savings account deposits and demand account deposits, respectively, that a bank may place at other banks as reciprocal deposits, and a $10.0 billion limit on the maximum amount of deposits that a bank may place at other banks as One-Way Sell® deposits.
As of December 31, 2025, the terms and conditions for participation in the ICS ® network include a $285.0 million limit on the amount of each participating client’s ICS ® deposits that may be placed at other banks within the ICS ® network, a $3.5 billion and $6.5 billion limit on the maximum amount of savings account deposits and demand account deposits, respectively, that a bank may place at other banks as reciprocal deposits, and a $10.0 billion limit on the maximum amount of deposits that a bank may place at other banks as One-Way Sell® deposits.
(the “Company”) is a Delaware corporation and a publicly traded bank holding company whose Class A common stock is listed on the New York Stock Exchange under the symbol “CBNA”.
(the “Company”) is a Delaware-chartered bank holding company and a publicly traded bank holding company whose Class A common stock is listed on the New York Stock Exchange under the symbol “CBNA”.
The Bank maintains unsecured lines of credit with three correspondent banks that provide combined availability of $68.0 million. There were no outstanding balances as of December 31, 2024. 88 Table of Contents As an intermediate source of liquidity, we may sell AFS securities or allow AFS and HTM securities to mature without reinvestment in the securities portfolio.
The Bank maintains unsecured lines of credit with three correspondent banks that provide combined availability of $68.0 million. There were no outstanding balances as of December 31, 2025 or December 31, 2024. As an intermediate source of liquidity, we may sell AFS securities or allow AFS and HTM securities to mature without reinvestment in the securities portfolio.
The effects of new accounting pronouncements are detailed in Note 1 to the Consolidated Financial Statements, “Organization and Summary of Significant Accounting Policies.” 67 Table of Contents Results of Operations Net Income The following table sets forth the principal components of net income for the periods indicated.
The effects of new accounting pronouncements are detailed in Note 1 to the Consolidated Financial Statements, “Organization and Summary of Significant Accounting Policies.” 68 Results of Operations Net Income The following table sets forth the principal components of net income for the periods indicated.
There was no further activity related to the AFS allowance for credit loss in 2024. The following table presents the allocation of the allowance for credit losses on our HTM securities portfolios by segment. There was no ACL established for the AFS portfolio as of the indicated period ends.
There was no further activity related to the AFS allowance for credit losses in 2024, and no activity in 2025. The following table presents the allocation of the allowance for credit losses on our HTM securities portfolios by segment. There was no ACL established for the AFS portfolio as of the indicated period ends.
Single family (1-4 units) residential mortgage loans are primarily secured by owner-occupied primary and secondary residences and are “closed-end” mortgage loans, which means that the loan amount is fixed at the outset and repaid over a set term without the ability to re-borrow.
Residential real estate loans, closed-end . Single family (1-4 units) residential mortgage loans are primarily secured by owner-occupied primary and secondary residences and are “closed-end” mortgage loans, which means that the loan amount is fixed at the outset and repaid over a set term without the ability to re-borrow.
The Bank maintains access to unsecured federal funds purchase lines of credit with: • Pacific Coast Bankers’ Bank: $50.0 million, maturing June 30, 2025 • First National Bankers’ Bank: $10.0 million, maturing June 30, 2025 • Community Bankers’ Bank: $8.0 million, matured March 12, 2025, and subsequently renewed for a one year period to March 12, 2026 These federal funds lines renew annually, and balances may remain outstanding for periods ranging from 10 to 90 consecutive days.
The Bank also maintains access to unsecured federal funds purchase lines of credit with: • Pacific Coast Bankers’ Bank: $50.0 million, maturing June 30, 2026, • First National Bankers’ Bank: $10.0 million, maturing June 30, 2026, and • Community Bankers’ Bank: $8.0 million, matured March 4, 2026, and subsequently renewed for a one year period to March 2, 2027 These federal funds lines renew annually, and balances may remain outstanding for periods ranging from 10 to 90 consecutive days.
As of December 31, 2024, we had $63.3 million in One-Way Sell ® deposit accounts through the ICS ® platform that could be converted to a reciprocal position in order to provide additional near-term liquidity. It is important to note that these ratios and amounts are point-in-time measurements and may not be indicative of future liquidity positions.
As of December 31, 2025, we had $359.9 million in One-Way Sell ® deposit accounts through the ICS ® platform that could be converted to a reciprocal position in order to provide additional near-term liquidity. It is important to note that these ratios and amounts are point-in-time measurements and may not be indicative of future liquidity positions.
See Item 1,“Business — Supervision and Regulation.” Uninsured Deposits : Most of our deposits come from commercial clients rather than retail clients, resulting in a relatively high level of account balances exceeding the FDIC coverage limits. As of December 31, 2024, we estimate that approximately 68.6% of our total deposits were not insured by the FDIC.
See Item 1,“Business — Supervision and Regulation.” Uninsured Deposits : Most of our deposits come from commercial clients rather than retail clients, resulting in a relatively high level of account balances exceeding the FDIC coverage limits. As of December 31, 2025, we estimate that approximately 75.0% of our total deposits were not insured by the FDIC.
We aim to adjust the allowance for credit losses to reflect loan volumes, identified credit and collateral conditions, economic conditions and other qualitative factors. 66 Table of Contents Capital . We manage capital to comply with our internal planning targets and regulatory capital standards.
We aim to adjust the allowance for credit losses to reflect loan volumes, identified credit and collateral conditions, economic conditions and other qualitative factors. Capital . We manage capital to comply with our internal planning targets and regulatory capital standards.
We use the ICS ® network to help manage our Tier 1 leverage ratio by moving certain deposit accounts off our balance sheet by placing the deposits at other banks as One-Way Sell ® deposits. As of December 31, 2024, our deposits enrolled in the ICS ® program which were in a One-Way Sell® position totaled $63.3 million.
We use the ICS ® network to help manage our Tier 1 leverage ratio by moving certain deposit accounts off our balance sheet by placing the deposits at other banks as One-Way Sell ® deposits. As of December 31, 2025, our deposits enrolled in the ICS ® program which were in a One-Way Sell ® position totaled $359.9 million.
As of December 31, 2024 and 2023, the Bank had not pledged any collateral to the FHLB. Consequently, no credit availability was established, and no outstanding borrowings were recorded. Short-Term Borrowings . As of December 31, 2024, the Company had no outstanding short-term borrowings.
December 31, 2025 and December 31, 2024, the Bank had not pledged any collateral to the FRB. Consequently, no credit availability was established, and no outstanding borrowings were recorded. Short-Term Borrowings . As of December 31, 2025, the Company had no outstanding short-term borrowings.
Our account at the Federal Reserve, which held $406.7 million as of December 31, 2024, is a primary source of our liquidity for daily and ongoing activities. Asset Quality . We monitor the quality of our assets based upon several factors, including the level and severity of deterioration in borrower cash flows and asset quality.
Our account at the Federal Reserve, which held $580.9 million as of December 31, 2025, is a primary source of our liquidity for daily and ongoing activities. Asset Quality . We monitor the quality of our assets based upon several factors, including the level and severity of deterioration in borrower cash flows and asset quality.
Return on average risk-weighted assets is calculated as annualized net income divided by the average of quarter end risk-weighted assets over the period observed. Net Interest Income . Net interest income, representing interest income less interest expense, is the largest component of our net income.
Return on average RWA is calculated as annualized net income divided by the average of quarter end RWA over the period observed. Net Interest Income . Net interest income, representing interest income less interest expense, is the largest component of our net income.
The provision for credit losses represents the amount of expense charged to current earnings to fund an increase in the 71 Table of Contents ACL. Conversely, a recapture of credit loss is recorded to earnings when the ACL is reduced.
The provision for credit losses represents the amount of expense charged to current earnings to fund an increase in the ACL. Conversely, a recapture of credit losses is recorded to earnings when the ACL is reduced.
The leverage ratio is computed as tier 1 capital divided by total average assets for the quarter. 89 Table of Contents The Bank’s capital level is characterized as “well capitalized” under the Basel III Capital Rules.
The leverage ratio is computed as tier 1 capital divided by total average assets for the quarter. The Bank’s capital level is characterized as “well capitalized” under the Basel III Capital Rules.
Based on the valuation techniques applied, and the sensitivity of financial statement amounts to the underlying methods, assumptions, and estimates, we have identified the determination of the allowance for credit losses and the fair value of securities as the areas that involve the most subjective or complex judgments and, as such, could be subject to revision as new information becomes available.
Based on the valuation techniques applied, and the sensitivity of financial statement amounts to the underlying methods, assumptions, and estimates, we have identified the determination of the allowance for credit losses as the area that involves the most subjective or complex judgments and, as such, could be subject to revision as new information becomes available.
These transactions involve certain expenses, which include interest on the deposits and any associated fees, which we consider within our broader liquidity planning. Management estimates that up to 68.6% of deposits were uninsured as of December 31, 2024.
These transactions involve certain expenses, which include interest on the deposits and any associated fees, which we consider within our broader liquidity planning. Management estimates that up to 75.0% of deposits were uninsured as of December 31, 2025.
If we elect to receive reciprocal deposits, we are required to pay a fee to IntraFi ® equal to our reciprocal deposits balances 84 Table of Contents multiplied by an annualized rate of 0.125% as of December 31, 2024.
If we elect to receive reciprocal deposits, we are required to pay a fee to IntraFi ® equal to our reciprocal deposits balances multiplied by an annualized rate of 0.125% as of December 31, 2025.
Our account at the Federal Reserve, which held approximately $406.7 million as of December 31, 2024, serves as a primary source of liquidity for daily and ongoing activities. We also maintain additional supplemental sources of liquidity, as discussed below.
Our account at the Federal Reserve, which held approximately $580.9 million as of December 31, 2025, serves as a primary source of liquidity for daily and ongoing activities. We also maintain additional supplemental sources of liquidity, as discussed below.
The Bank can request funding of up to 10% of total assets, which equates to $140.1 million as of the Bank’s December 31, 2024 Call Report, in a One-Way Buy ® of daily maturing or term deposit products.
The Bank can request funding of up to 10% of total assets, which equates to $158.5 million as of the Bank’s December 31, 2025 Call Report, in a One-Way Buy ® of daily maturing or term deposit products.
We recognize that robust capital management practices are integral to addressing various financial and operational challenges, which may include managing credit risk, liquidity risk, balance sheet growth, new products, regulatory changes and competitive pressures. Stockholders’ equity as of December 31, 2024 was $144.2 million, an increase of $60.8 million compared to $83.4 million as of December 31, 2023.
We recognize that robust capital management practices are integral to addressing various financial and operational challenges, which may include managing credit risk, liquidity risk, balance sheet growth, new products, regulatory changes and competitive pressures. Stockholders’ equity as of December 31, 2025 was $169.2 million, an increase of $25.0 million compared to $144.2 million as of December 31, 2024.
Other operating costs include other operating and administrative costs such as other vendor and employee costs, postage and printing, office supplies, and subscriptions. As discussed above, we expect our noninterest expenses to increase as a result of the additional costs associated with being a public company.
Other operating costs include other operating and administrative costs such as other vendor and employee costs, postage and printing, office supplies, marketing and business development costs, and subscriptions. As discussed above, we expect our noninterest expenses to increase as a result of the additional costs associated with operational growth and functioning as a public company.
Significant Factors Impacting Our Business, Financial Condition and Results of Operations Several key factors impact our financial performance: Short-term interest rates : The cyclical nature of our balance sheet and our focus on liquidity cause our primary revenue source, net interest income, to be highly correlated to short-term interest rates. We strive to maintain high liquidity and low loan-to-deposit ratios.
Significant Factors Impacting Our Business, Financial Condition and Results of Operations Several key factors impact our financial performance: Short-term interest rates : The cyclical nature of our balance sheet and our focus on liquidity cause our primary revenue source, net interest income, to be highly correlated to short-term interest rates.
For regulatory reporting purposes, the liquidity ratio is typically calculated as the sum of our cash and cash equivalents plus unpledged securities classified as investment grade divided by total liabilities. Based on this calculation 87 Table of Contents method, as of December 31, 2024 and 2023, our reported liquidity ratios were 85.13% and 78.75%, respectively.
For regulatory reporting purposes, the liquidity ratio is typically calculated as the sum of our cash and cash equivalents plus unpledged securities classified as investment grade divided by total liabilities. Based on this calculation method, as of December 31, 2025 and 2024, our reported liquidity ratios were 91.86% and 85.13%, respectively.
As a bank holding company, we are subject to comprehensive supervision and regulatory oversight by the Federal Reserve. The Bank’s primary regulator and supervisor is the OCC, which oversees our operations, risk management, compliance, and corporate governance through regular examinations.
Regulatory and Supervisory Environment : We incur significant costs due to our regulation and supervision by the federal government. As a bank holding company, we are subject to comprehensive supervision and regulatory oversight by the Federal Reserve. The Bank’s primary regulator and supervisor is the OCC, which through regular examinations oversees our operations, risk management, compliance, and corporate governance.
A summary of the Bank’s regulatory capital ratios, and minimum requirement to be considered “well capitalized” are presented below: December 31, Well- capitalized requirement 2024 2023 ($ in thousands) Amount Ratio Amount Ratio Ratio Total risk-based capital $ 131,750 32.94 % $ 104,523 25.44 % 10.00 % Tier 1 risk-based capital 127,034 31.76 % 99,856 24.30 % 8.00 % Common equity tier one risk-based capital 127,034 31.76 % 99,856 24.30 % 6.50 % Tier 1 leverage 127,034 9.57 % 99,856 9.21 % 5.00 % During periods of growth in deposits due to seasonality, our assets could reach a level that would require the Bank to control the level of these deposits or require the Company to obtain additional capital to maintain a Tier 1 leverage ratio that exceeds our internal regulatory capital policies or targets and satisfies regulatory requirements.
A summary of the Bank’s regulatory capital ratios, and minimum requirement to be considered “well capitalized” are presented below: December 31, Well- capitalized requirement 2025 2024 ($ in thousands) Amount Ratio Amount Ratio Ratio Total risk-based capital $ 165,665 44.63 % $ 131,750 32.94 % 10.00 % Tier 1 risk-based capital 161,442 43.49 % 127,034 31.76 % 8.00 % Common equity tier one risk-based capital 161,442 43.49 % 127,034 31.76 % 6.50 % Tier 1 leverage 161,442 9.61 % 127,034 9.57 % 5.00 % During periods of growth in deposits due to seasonality, our assets could reach a level that would require the Bank to control the level of these deposits or require the Company to obtain additional capital to maintain a Tier 1 leverage ratio that exceeds our internal regulatory capital policies or targets and satisfies regulatory requirements.
Higher rates generally increase our net interest income because of our high levels of liquid interest-earning assets and low levels of interest-bearing deposits and borrowings. Conversely, if short-term interest rates fall, our net interest income would likely decrease due to our high levels of cash.
We strive to maintain high levels of liquidity and low loan-to-deposit ratios. Higher rates generally increase our net interest income because of our high levels of liquid interest-earning assets and low levels of interest-bearing deposits and borrowings. Conversely, if short-term interest rates fall, our net interest income would likely decrease due to our high levels of cash.
Critical Accounting Policies and Estimates We prepare our consolidated financial statements according to generally accepted accounting principles in the United States (“GAAP”). Preparing these statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the balance sheet and the reported amounts of revenues and expenses during the reporting period.
Critical Accounting Policies and Estimates We prepare our consolidated financial statements according to GAAP. Preparing these statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the balance sheet and the reported amounts of revenues and expenses during the reporting period.
In addition, rising interest rates caused a reduction in demand for consumer loans during the time between periods, and management has strategically allowed a decline in the commercial real estate portfolio. Rising interest rates have increased the cost of borrowing and remote work trends continue to be a concern for the commercial real estate portfolio.
In addition, elevated interest rates continue to cause a reduction in demand for consumer loans, and management has strategically allowed a decline in the commercial real estate portfolio. Elevated interest rates have increased the cost of borrowing and remote work trends continue to be a concern for the commercial real estate portfolio.
For the year ended December 31, 2024, our trust and wealth management income increased by 60.6%, compared to the corresponding period in the prior year. This increase was primarily due to a rise in the volume of total assets under administration, which grew to $330.3 million at December 31, 2024 from $240.1 million at December 31, 2023.
For the year ended December 31, 2025, our trust and wealth management income increased by 48.4%, compared to the corresponding period in the prior year. This increase was primarily due to a rise in the volume of total assets under administration, which grew to $610.7 million at December 31, 2025 from $330.3 million at December 31, 2024.
Allowance for Credit Losses on Loans: The allowance for credit losses on loans is determined based on management’s assessment of expected credit losses over the life of the loan portfolio, utilizing historical loss experience, current economic conditions, management’s assessment of borrower creditworthiness, and other qualitative factors.
Allowance for Credit Losses on Loans: The ACL on loans is determined based on management’s assessment of expected credit losses over the life of the loan portfolio, utilizing historical loss experience, current economic conditions, management’s assessment of borrower creditworthiness, and other qualitative factors, all of which may undergo frequent and significant changes.
Additionally, a substantial portion of our custody account balances are related to political organizations, which are seasonal and are expected to decline following periods of high spending around federal elections. Gain on sale of mortgage loans .
Additionally, a substantial portion of our custody account balances are related to political organizations, which are seasonal and are expected to decline following periods of high spending around federal elections. Service charges on accounts .
The size and mix of the assets under administration drove the income growth. Assets under management, which produce a higher rate of income under our fee structure, increased 70.4% from December 31, 2023, while assets under custody increased 22.8% over the same period.
The size and mix of the assets under administration drove the income growth. Assets under management, which produce a higher rate of income under our fee structure, increased 69.8% from December 31, 2024, while assets under custody increased 94.3% over the same period.
In addition, the Bank issues time deposits that pay a fixed rate of interest until the instrument matures. For the year ended December 31, 2024, our interest expense on deposits decreased 10.7% compared to the prior period.
In addition, the Bank issues time deposits that pay a fixed rate of interest until the instrument matures. For the year ended December 31, 2025, our interest expense on deposits increased 32.6% compared to the prior period.
The following table presents the components of other consumer loans: As of December 31, ( dollars in thousands ) 2024 2023 Residential construction loans $ 1,806 $ 3,445 HELOCs 16,373 14,664 Consumer secured 2,428 2,527 Consumer unsecured 587 574 Total consumer loans $ 21,194 $ 21,210 Loan Maturity and Sensitivity to Interest Rates The information in the following table is based on the contractual maturities of individual loans, including loans that may be subject to renewal at their contractual maturity.
The following table presents the components of other consumer loans: As of December 31, ( dollars in thousands ) 2025 2024 Residential construction loans $ 2,954 $ 1,806 HELOCs 15,382 16,373 Consumer secured 2,099 2,428 Consumer unsecured 465 587 Total consumer loans $ 20,900 $ 21,194 Loan Maturity and Sensitivity to Interest Rates The information in the following table is based on the contractual maturities of individual loans, including loans that may be subject to renewal at their contractual maturity.
As of December 31, 2024, deposit balances totaling $193.6 million were enrolled in the ICS ® program. $63.3 million of these deposits were positioned as One-Way Sell ® deposits and are therefore not reflected on the balance sheet.
As of December 31, 2025, deposit balances totaling $466.6 million were enrolled in the 88 ICS ® program. $359.9 million of these deposits were positioned as One-Way Sell ® deposits and are therefore not reflected on the balance sheet.
The contractual amounts of financial instruments with off-balance sheet commitments are as follows: As of December 31, (dollars in thousands) 2024 2023 Commitments to grant loans $ 408 $ — Credit card lines 762 448 Unfunded commitments under lines of credit 22,230 22,499 Standby letters of credit 4,491 3,598 Commitments to grant loans increased from December 31, 2023 to December 31, 2024, due to one loan which was in the process of origination at December 31, 2024.
The contractual amounts of financial instruments with off-balance sheet commitments are as follows: As of December 31, (dollars in thousands) 2025 2024 Commitments to grant loans $ 1,000 $ 408 Credit card lines 1,397 762 Unfunded commitments under lines of credit 21,390 22,230 Standby letters of credit 3,094 4,491 Commitments to grant loans increased from December 31, 2024 to December 31, 2025, due to two loans which was in the process of origination at December 31, 2025.
For the year ended December 31, 2024, our Virginia bank franchise tax increased $145 thousand, or 19.6%, compared to the year ended December 31, 2023, primarily driven by the growth in the Bank’s capital which forms the basis for the tax computation. FDIC and regulatory assessments .
For the year ended December 31, 2025, our state franchise taxes increased $405 thousand, or 45.8%, compared to the year ended December 31, 2024, primarily driven by the growth in the Bank’s capital which forms the basis for our Virginia bank franchise tax computation. FDIC and regulatory assessments .
Our trust and wealth management services utilize service charge structures for assets under management (“AUM”) and assets under custody (“AUC”) that are distinct with respect to the level and range of services used.
Our trust and wealth management services utilize service charge structures for AUM and AUC that are distinct with respect to the level and range of services used.
The line of credit, which had a total commitment of $10.0 million and an outstanding balance of $5.0 million as of December 86 Table of Contents 31, 2023, was fully repaid on October 10, 2024, using a portion of the net proceeds from the IPO. The Company formally closed the line of credit on October 11, 2024.
The Company fully repaid its previously outstanding balance on an unsecured line of credit from a correspondent bank. The line of credit, which had a total commitment of $10.0 million and an outstanding balance of $5.0 million as of December 31, 2023, was fully repaid on October 10, 2024, using a portion of the net proceeds from the IPO.
The level of net interest income is primarily a function of the average balance of interest-earning assets, the average balance of interest-bearing liabilities and the spread between the realized yield on such assets and the cost of such liabilities.
The level of net interest income is primarily a function of the average balance of interest-earning assets, the average balance of interest-bearing liabilities and the spread between the realized yield on such assets and the cost of such liabilities. Net interest income is impacted by the relative mix of interest-earning assets and interest-bearing liabilities and movements in market interest rates.
The terms and conditions also include limitations on a bank’s ability to receive reciprocal deposits, place One-Way Sell ® deposits, or receive One-Way Buy ® deposits if the bank is not “well capitalized” under the applicable federal banking regulations. The fees associated with our participation in the ICS ® network require careful management.
The terms and conditions also include limitations on a bank’s ability to receive reciprocal deposits, place One-Way Sell ® deposits, or receive One-Way Buy ® deposits if the bank is not “well capitalized” under the applicable federal banking regulations.
Credit card lines increased by $314 thousand, or 70.1% during the year, due to growth in the business credit card program. Unfunded commitments under lines of credit decreased $717 thousand, or 3.1% from December 31, 2023 to December 31, 2024, staying relatively consistent.
Credit card lines increased by $635 thousand, or 83.3% during the year, due to growth in the business credit card program. Unfunded commitments under lines of credit decreased $840 thousand, or 3.8% from December 31, 2024 to December 31, 2025, staying relatively consistent.
As of December 31, 2024, variable rate loans, which include floating and adjustable rate structures, comprised 70.8% of our loan portfolio.
As of December 31, 2025, variable rate loans, which include floating and adjustable rate structures, comprised 69.7% of our loan portfolio.
We have exposures to certain categories of loans that we believe represent relatively higher credit risk, such as commercial real estate loans. To manage our exposures to these loans, our policy is to require low loan-to-value ratios and high debt service coverage ratios, and to conduct borrower credit assessments.
We have exposures to certain categories of loans that we believe represent relatively higher credit risk, such as commercial real estate loans. To manage our exposures to these loans, we generally seek low loan-to-value ratios, strong debt service coverage ratios, and conduct borrower credit assessments in accordance with our internal policies.
As of December 31, 2024, our mortgage-backed securities decreased by $1.3 million, or 13.0%, compared to December 31, 2023. During the period, mortgage-backed securities represented less than 2.0% of our securities portfolio. Corporate bonds . Corporate bonds are debt obligations issued by companies to raise capital and refinance obligations of the issuer.
As of December 31, 2025, our mortgage-backed securities decreased by $2.1 million, or 24.4%, compared to December 31, 2024. At December 31, 2025, mortgage-backed securities represented 0.7% of our securities portfolio. Corporate bonds . Corporate bonds are debt obligations issued by companies to raise capital and refinance obligations of the issuer.
As of December, 2024 2023 Balance at the end of each period ( dollars in thousands ) Amount % to total HTM bonds Amount % to total HTM bonds U.S. government and federal agencies $ — — % $ — — % Mortgage-backed securities — — % — — % Corporate 171 0.06 % 322 0.10 % State and municipal 31 0.01 % 26 0.01 % Total $ 202 0.07 % $ 348 0.11 % The following tables present the allocation of the net charge offs within the AFS securities portfolio by segment.
As of December 31, 2025 2024 ( dollars in thousands ) Amount % to total HTM bonds Amount % to total HTM bonds U.S. government and federal agencies $ — — % $ — — % Mortgage-backed securities — — % — — % Corporate 99 0.04 % 171 0.06 % State and municipal 29 0.01 % 31 0.01 % Total $ 128 0.05 % $ 202 0.07 % The following tables present the allocation of the net charge offs within the AFS securities portfolio by segment.
As of and for the year ended December 31, 2024 2023 ( dollars in thousands ) Net (charge-offs) recoveries Average AFS securities outstanding Ratio of net (charge-offs) recoveries to average total bonds outstanding Net (charge-offs) recoveries Average AFS securities outstanding Ratio of net (charge-offs) recoveries to average total bonds outstanding U.S. government and federal agencies $ — $ 103,746 — % $ — $ 94,072 — % Mortgage-backed securities — 8,165 — % — 9,562 — % Corporate 210 51,185 0.08 % (785) 59,611 (0.29) % State and municipal — 100,147 — % — 104,036 — % Loan Portfolio Our loan portfolio consists of mortgage, commercial, and consumer loans to clients.
For the Year Ended December 31, 2025 2024 ( dollars in thousands ) Net (charge-offs) recoveries Average AFS securities outstanding Ratio of net (charge-offs) recoveries to average total bonds outstanding Net (charge-offs) recoveries Average AFS securities outstanding Ratio of net (charge-offs) recoveries to average total bonds outstanding U.S. government and federal agencies $ — $ 322,879 — % $ — $ 103,746 — % Mortgage-backed securities — 6,433 — % — 8,165 — % Corporate — 52,168 — % 210 51,185 0.08 % State and municipal — 97,780 — % — 100,147 — % Loan Portfolio Our loan portfolio consists of mortgage, commercial, and consumer loans to clients.
Commercial loans are commercial and industrial (C&I) term loans or lines of credit and, due to the participation of political organizations in this segment, exhibit cyclicality when measured as a percentage of our loan portfolio. C&I loans include unsecured or UCC secured lending, accounts receivable, inventory or equipment financing loans or working capital loans.
Commercial loans consisting of commercial and industrial (C&I) term loans or lines of credit exhibit cyclicality due to the involvement of political organizations in this segment. C&I loans include unsecured or UCC secured lending, accounts receivable, equipment financing loans or working capital loans.
These costs have included, and will continue to include, additional personnel, legal, consulting, regulatory, insurance, accounting, investor relations and other expenses that we did not incur as a private company.
Public Company Costs : Following the completion of, our IPO, we have incurred, and expect to continue to incur, additional costs associated with operating as a public company. These costs have included, and will continue to include, additional personnel, legal, consulting, regulatory, insurance, accounting, investor relations and other expenses that we did not incur as a private company.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−0 removed11 unchanged
Biggest changeChange in interest rates (ramped) -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2024 (18.05 %) (13.46 %) (8.98 %) (4.55 %) 4.45 % 8.93 % 13.37 % 17.91 % December 31, 2023 (16.22 %) (12.11 %) (8.06 %) (4.04 %) 4.00 % 8.02 % 12.14 % 16.11 % Change in interest rates (immediate) -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2024 (48.48 %) (36.12 %) (23.86 %) (11.92 %) 11.80 % 23.50 % 35.42 % 47.20 % December 31, 2023 (34.76 %) (25.74 %) (16.98 %) (8.41 %) 8.34 % 16.54 % 24.88 % 33.27 % The results show that we are asset-sensitive, further indicating that we can expect net interest income to increase as rates rise and to decrease as rates decline.
Biggest changeChange in interest rates (ramped) -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2025 (22.87 %) (17.40 %) (11.45 %) (5.70 %) 5.75 % 11.52 % 17.21 % 23.00 % December 31, 2024 (18.05 %) (13.46 %) (8.98 %) (4.55 %) 4.45 % 8.93 % 13.37 % 17.91 % Change in interest rates (immediate) -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2025 (46.37 %) (38.21 %) (25.29 %) (12.41 %) 12.31 % 24.49 % 36.74 % 49.00 % December 31, 2024 (48.48 %) (36.12 %) (23.86 %) (11.92 %) 11.80 % 23.50 % 35.42 % 47.20 % The results show that we are asset-sensitive, further indicating that we can expect net interest income to increase as rates rise and to decrease as rates decline.
Management reviews the assumptions on an as-needed basis and at least annually through a thorough examination. Key changes are presented to the ALCO. 90 Table of Contents The table below summarizes the results of our IRR analysis in simulating the change in net interest income over a 12-month horizon as of the indicated dates.
Management reviews the assumptions on an as-needed basis and at least annually through a thorough examination. Key changes are presented to the ALCO. The table below summarizes the results of our IRR analysis in simulating the change in net interest income over a 12-month horizon as of the indicated dates.
The changes in our balance sheet over the course of a two-year election cycle causes a degree of variability among our interest rate risk results over time. 91 Table of Contents
The changes in our balance sheet over the course of a two-year election cycle causes a degree of variability among our interest rate risk results over time. 91
This is because the present value of future cash flows, and in some cases the cash flows themselves, may change when interest rates vary. Interest rate risk is generally considered a significant market risk for financial institutions. We have developed an interest rate risk policy that aims to provide management with guidelines for funds management.
This is because the present value of future cash flows, and in some cases the cash flows themselves, may change when interest rates vary. Interest rate risk is generally considered a significant market risk for financial institutions. We have developed interest rate risk policies that aim to provide management with guidelines for funds management.
Change in interest rates -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2024 (5.48 %) (3.37 %) (1.72 %) (1.19 %) 0.36 % 0.68 % 1.32 % 2.12 % December 31, 2023 14.25 % 12.33 % 8.27 % 3.21 % (4.81 %) (8.85 %) (12.35 %) (15.45 %) Due to the nature of our client base, and the resulting balance sheet cyclicality, we will sometimes hold high volumes of immediately repricing assets ( i.e. , cash) to fund impending political organization deposit outflows.
Change in interest rates -400 bps -300 bps -200 bps -100 bps +100 bps +200 bps +300 bps +400 bps December 31, 2025 (11.85 %) (9.65 %) (5.65 %) (2.65 %) 2.28 % 4.57 % 7.57 % 9.73 % December 31, 2024 (5.48 %) (3.37 %) (1.72 %) (1.19 %) 0.36 % 0.68 % 1.32 % 2.12 % Due to the nature of our client base, and the resulting balance sheet cyclicality, we will sometimes hold high volumes of immediately repricing assets ( i.e. , cash) to fund impending political organization deposit outflows.
We had a total one-year cumulative gap in rate-sensitive assets and rate-sensitive liabilities of $616.5 million and $319.4 million as of December 31, 2024 and 2023, respectively, indicating that, overall, our assets will reprice before our liabilities.
However, it’s important to note that despite these measures, significant changes in interest rates could potentially impact our earnings, liquidity and capital positions. 90 We had a total one-year cumulative gap in rate-sensitive assets and rate-sensitive liabilities of $937.9 million and $616.5 million as of December 31, 2025 and 2024, respectively, indicating that, overall, our assets will reprice before our liabilities.
We have also established a system for monitoring our net interest rate sensitivity position. However, it’s important to note that despite these measures, significant changes in interest rates could potentially impact our earnings, liquidity and capital positions.
We have also established a system for monitoring our net interest rate sensitivity position.