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BayFirst Stock Falls 8% Despite Q3 Loss Narrowing Y/Y
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Shares of BayFirst Financial Corp. (BAFN - Free Report) have declined 8.3% since the company reported earnings for the quarter ended Sept. 30, 2026, compared with the S&P 500 index’s 2.7% decline over the same period. Over the past month, the stock has fallen 24.1%, underperforming the broader index, which has declined 3.4%.
BayFirst incurred a third-quarter 2026 net loss of 4 cents per share, narrower than a loss of $4.71 per share a year earlier.
Net interest income declined 6.1% year over year to $10.6 million from $11.3 million, while noninterest income improved to $1.1 million from negative $1.1 million.
The company incurred a net loss of $0.7 million, narrowing from a loss of $19.1 million in the year-ago quarter. Lower credit-loss provisions and operating expenses supported the improvement in profitability.
BayFirst Financial Corp. Price, Consensus and EPS Surprise
BayFirst's net interest margin expanded to 4.07% from 3.64% in the prior-year quarter. However, lower loan interest income, partially offset by reduced deposit interest expenses, pressured year-over-year net interest income.
Total loans held for investment reached $903 million, declining 9.1% year over year. Community banking loans, excluding government-guaranteed balances, increased $41.9 million during the quarter, representing 25% annualized growth.
Total deposits were $1 billion, declining 13.4% year over year. Deposit growth outpaced loan growth during the quarter, reflecting improving funding trends.
BayFirst's Asset Quality and Capital Position
The company recorded a negative provision for credit losses of $0.7 million compared with provisions of $11.2 million in the year-ago quarter.
Net charge-offs declined to $3.2 million from $3.5 million a year earlier.
Nonperforming assets represented 1.29% of total assets, improving from 1.98% at the end of September 2025.
The allowance for credit losses represented 4.85% of loans held for investment at amortized cost compared with 2.63% a year earlier.
Total assets declined 14.3% year over year to $1.2 billion. Shareholders' equity totaled $104.5 million, while tangible book value per common share declined to $3.64 from $4.82 at June 30, 2026.
The Tier 1 leverage ratio improved to 8.79% from 6.14% a year earlier, with the bank meeting regulatory requirements for well-capitalized institutions.
Factors Influencing BAFN's Earnings
Noninterest expenses declined 49.2% year over year to $12.8 million from $25.2 million, reflecting lower compensation costs and the absence of restructuring expenses recorded in the prior-year quarter.
The discontinuation of SBA 7(a) lending continued to reshape operations. While the exit reduced government-guaranteed loan-sale gains, it also supported efforts to reduce exposure to troubled loans and streamline operating costs.
Management reported that the unguaranteed SBA 7(a) portfolio declined to $132.4 million from $142 million at June 30, 2026.
BayFirst's Management Commentary and Outlook
CEO Al Rogers emphasized progress under the company's asset resolution plan, citing stronger community lending, improved funding trends and declining nonperforming assets.
Management remains focused on relationship-based banking, deposit growth and operational efficiency across the Tampa Bay and Sarasota markets. CFO Scott McKim expects higher quarter-end loan balances and improved margins to support future net interest income. However, management acknowledged that achieving sustained profitability remains a priority.
Other Developments
During July, BayFirst converted Series D and E preferred shares into approximately 22.9 million common shares. The company also redeemed its outstanding Series A and B preferred shares in August.
On Oct. 8, 2026, BayFirst completed a common stock offering generating $14.4 million in gross proceeds to strengthen capital and support banking growth. The company continued its restructuring toward community banking following its earlier exit from SBA 7(a) lending.
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BayFirst Stock Falls 8% Despite Q3 Loss Narrowing Y/Y
Shares of BayFirst Financial Corp. (BAFN - Free Report) have declined 8.3% since the company reported earnings for the quarter ended Sept. 30, 2026, compared with the S&P 500 index’s 2.7% decline over the same period. Over the past month, the stock has fallen 24.1%, underperforming the broader index, which has declined 3.4%.
BayFirst incurred a third-quarter 2026 net loss of 4 cents per share, narrower than a loss of $4.71 per share a year earlier.
Net interest income declined 6.1% year over year to $10.6 million from $11.3 million, while noninterest income improved to $1.1 million from negative $1.1 million.
The company incurred a net loss of $0.7 million, narrowing from a loss of $19.1 million in the year-ago quarter. Lower credit-loss provisions and operating expenses supported the improvement in profitability.
BayFirst Financial Corp. Price, Consensus and EPS Surprise
BayFirst Financial Corp. price-consensus-eps-surprise-chart | BayFirst Financial Corp. Quote
BAFN's Net Interest Margin and Loan Performance
BayFirst's net interest margin expanded to 4.07% from 3.64% in the prior-year quarter. However, lower loan interest income, partially offset by reduced deposit interest expenses, pressured year-over-year net interest income.
Total loans held for investment reached $903 million, declining 9.1% year over year. Community banking loans, excluding government-guaranteed balances, increased $41.9 million during the quarter, representing 25% annualized growth.
Total deposits were $1 billion, declining 13.4% year over year. Deposit growth outpaced loan growth during the quarter, reflecting improving funding trends.
BayFirst's Asset Quality and Capital Position
The company recorded a negative provision for credit losses of $0.7 million compared with provisions of $11.2 million in the year-ago quarter.
Net charge-offs declined to $3.2 million from $3.5 million a year earlier.
Nonperforming assets represented 1.29% of total assets, improving from 1.98% at the end of September 2025.
The allowance for credit losses represented 4.85% of loans held for investment at amortized cost compared with 2.63% a year earlier.
Total assets declined 14.3% year over year to $1.2 billion. Shareholders' equity totaled $104.5 million, while tangible book value per common share declined to $3.64 from $4.82 at June 30, 2026.
The Tier 1 leverage ratio improved to 8.79% from 6.14% a year earlier, with the bank meeting regulatory requirements for well-capitalized institutions.
Factors Influencing BAFN's Earnings
Noninterest expenses declined 49.2% year over year to $12.8 million from $25.2 million, reflecting lower compensation costs and the absence of restructuring expenses recorded in the prior-year quarter.
The discontinuation of SBA 7(a) lending continued to reshape operations. While the exit reduced government-guaranteed loan-sale gains, it also supported efforts to reduce exposure to troubled loans and streamline operating costs.
Management reported that the unguaranteed SBA 7(a) portfolio declined to $132.4 million from $142 million at June 30, 2026.
BayFirst's Management Commentary and Outlook
CEO Al Rogers emphasized progress under the company's asset resolution plan, citing stronger community lending, improved funding trends and declining nonperforming assets.
Management remains focused on relationship-based banking, deposit growth and operational efficiency across the Tampa Bay and Sarasota markets.
CFO Scott McKim expects higher quarter-end loan balances and improved margins to support future net interest income. However, management acknowledged that achieving sustained profitability remains a priority.
Other Developments
During July, BayFirst converted Series D and E preferred shares into approximately 22.9 million common shares. The company also redeemed its outstanding Series A and B preferred shares in August.
On Oct. 8, 2026, BayFirst completed a common stock offering generating $14.4 million in gross proceeds to strengthen capital and support banking growth.
The company continued its restructuring toward community banking following its earlier exit from SBA 7(a) lending.