GBank Financial Holdings (GBFH) investor relations material

Executive summary

• Recorded a $0.22 per share charge-off due to third-party credit card fraud in a discontinued retail card program, resulting in a $3.2 million after-tax loss and impacting net income, but robust new fraud prevention systems have since been implemented and no further material fraud detected.

• Reported net income of $1.3 million ($0.09 per diluted share) for Q1 2026, with adjusted net income at $4.7 million ($0.31 per share).

• Loan originations reached $208 million in Q1 2026, up 56% year-over-year and 65% sequentially, with total loans surpassing $1 billion for the first time.

• Total assets under management stood at $2.5 billion as of March 31, 2026.

• Core banking and gaming fintech operations continue to show strong growth, with new product launches and technology enhancements.

Financial highlights

• Net interest income was $12.2 million, down 9.4% sequentially but up 2.5% year-over-year; net interest margin compressed to 3.86% due to lower market rates and high funding costs, with bank-only NIM at 4.02%.

• Allowance for Credit Loss provision expense was $2.3 million, with $860,000 related to loan growth and $1.4 million to increased reserves on non-performing loans.

• Non-interest income rose to $7.5 million, up from $7.3 million in Q4 2025 and $5.5 million in Q1 2025.

• Sold $79 million of government-guaranteed loans, generating a $3.8 million gain on sale at a 4.79% margin, exceeding budget.

• Non-interest expense increased to $15.9 million, mainly due to $4.2 million in credit card fraud losses.

Outlook and guidance

• Expect continued strong performance in credit card and prepaid card programs, especially with high-limit customers and new gaming partnerships.

• Anticipate net interest margin and net interest income to recover and expand in Q2 as new loans and investments contribute fully.

• Gain on sale margins expected to remain above long-term targets due to favorable spreads and pent-up demand.

• Growth in gaming accounts and transaction volumes projected to accelerate in the second half of 2026 with Bold Bets and Bankroll launches.

• Plans to launch new gaming prepaid debit and MasterCard prepaid card products in Q3 2026, and focus on deposit transformation to increase non-interest-bearing deposits.