OptimumBank Holdings, Inc. Financial Performance for the First Quarter of 2025
Fort Lauderdale, Florida--(Newsfile Corp. - May 13, 2025) - OptimumBank Holdings, Inc. (NYSE:OPHC) (the "Company") is a one-bank holding company and owns 100% of OptimumBank (the "Bank"). Today the Company reported robust financial performance for the quarter ended March 31, 2025. The Company achieved net income of $3.9 million, or $0.33 per basic share and $0.32 per diluted share, compared to net income of $2.4 million, or $0.31 per basic and diluted share, for the same period in 2024. This reflects 63% growth in profitability year-over-year, driven by stronger net interest income and credit loss reversals.
Key Financial Highlights:
Net interest income for the quarter ended March 31, 2025 reached $9.43 million, a 21.7% increase from $7.75 million in the first quarter of 2024, reflecting growth in average interest-earning assets and improved spreads.
Net interest margin improved to 4.06%, up from 3.70% in the same quarter last year.
Noninterest income remained nearly the same at $1.23 million for the quarter, from $1.24 million in the same quarter last year, reflecting stable performance in wire transfer and ACH fee categories.
Asset and Deposit Growth:
Gross loans were $800.2 million as of March 31, 2025, reflecting a 5.86% increase from $755.9 million as of March 31, 2024, driven by sustained demand across our lending products.
As of March 31, 2025, total deposits grew by 6.83% to $852.93 million, from $798.41 million as of March 31, 2024.
Capital Position:
- The Bank's Tier 1 capital ratio improved to 11.71% as of March 31, 2025, compared to 10.20% as of March 31, 2024, reflecting a strengthened capital base that supports continued growth.
Recent Developments: Non-Performing Asset Resolution
- Subsequent to the end of the quarter, the Bank successfully resolved a non-performing loan that had been included in non-performing assets (NPAs) as of March 31, 2025. The note was sold on April 28, 2025, and the Bank received proceeds equal to its carrying value of $5,597,498. No specific reserve had been recorded against the loan, as full recovery was anticipated. This resolution reduces NPAs by approximately $5.6 million, representing nearly 75% of the Bank's total NPA balance of $7.5 million as of March 31, 2025.
Chairman of the Board Commentary
"We are pleased to report another strong quarter of financial performance, highlighted by solid earnings growth, expanding loan and deposit balances, and continued capital strength," said Moishe Gubin, Chairman of the Board.
"These results demonstrate the power of our earnings engine as we scale. Strong net interest income and margin expansion, supported by disciplined asset growth and pricing execution, translated directly into record net income for the quarter. Our ability to raise earnings by 63% year over year while maintaining stable fee income and investing in future capacity speaks to the resilience and maturity of our model. As we deepen relationships across our markets, we believe continued strength in net interest margin will remain a key driver of profitability and shareholder value."
"Noninterest income remained stable at $1.23 million, demonstrating consistency across our fee-based businesses. On the expense side, we continued to invest in growth infrastructure, including talent, compliance, and branch capabilities, resulting in a 19.5% increase in noninterest expenses. We believe these investments are essential to scaling our organization toward our $1 billion milestone."
"Our loan portfolio increased 5.9% year over year to $800.2 million, while total deposits reached $852.9 million as of March 31, 2025, representing a 6.8% increase from $798.4 million one year earlier. This growth reflects the continued strength of our customer relationships and deposit-gathering strategy. Importantly, our noninterest-bearing demand deposits remained steady at approximately 27% of total deposits, even as we expanded our overall funding base. Our credit quality remains sound, with an allowance for credit losses of $8.27 million, or 1.03% of total loans. Strong loan performance, combined with a net recovery position for the quarter, further underscores the conservative nature of our underwriting."
"Our Tier 1 capital ratio improved to 11.71%, with more than $26 million in capital above the regulatory well-capitalized threshold. This strong capital position supports our future growth while reinforcing our resilience. As we look ahead, we remain committed to disciplined growth, customer-centric innovation, and delivering long-term value to our shareholders. We appreciate the continued trust of our customers, employees, and investors."
Net Interest Income and Net Interest Margin
Three Months Ended
(Dollars in thousands)
| March 31, 2025 | March 31, 2024 | % Change | |||||||
| Average interest-earning assets | $ | 929,686 | $ | 837,239 | 11% | ||||
| Net interest income | $ | 9,426 | $ | 7,751 | 21.6% | ||||
| Net interest margin | 4.06% | 3.70% | 36 bps |
Net interest income for the three months ended March 31, 2025 was $9.43 million, reflecting a 21.6% increase from $7.75 million in the first quarter of 2024. This growth was primarily driven by an 11.0% increase in average interest-earning assets compared to the prior year, contributing meaningfully to the rise in net interest income. The net interest margin improved to 4.06% from 3.70%, an increase of 36 basis points, underscoring the Company's effective asset utilization and earnings expansion despite higher interest-bearing deposit costs.
Noninterest Income
Three Months Ended
(Dollars in thousands)
| March 31, 2025 | March 31, 2024 | |||||
| Service charges and fees | $ | 1,038 | $ | 968 | ||
| Other | $ | 193 | $ | 271 | ||
| Total noninterest income | $ | 1,231 | $ | 1,239 |
Noninterest income for the three months ended March 31, 2025 was $1.23 million, essentially flat compared to $1.24 million in the first quarter of 2024. While service charges and fees increased modestly to $1.04 million from $968,000, this gain was offset by a decline in other noninterest income, which decreased to $193,000 from $271,000. The shift reflects normal variability in ancillary revenue sources, including loan-related fee income and other miscellaneous service charges.
Noninterest Expenses
Three Months Ended
(Dollars in thousands)
| March 31, 2025 | March 31, 2024 | |||||
| Salaries and employee benefits | $ | 3,381 | $ | 2,849 | ||
| Professional fees | $ | 247 | $ | 195 | ||
| Occupancy and equipment | $ | 282 | $ | 205 | ||
| Data processing | $ | 533 | $ | 554 | ||
| Regulatory assessment | $ | 198 | $ | 123 | ||
| Other | $ | 985 | $ | 783 | ||
| Total noninterest expenses | $ | 5,626 | $ | 4,709 |
Noninterest expenses for the quarter ended March 31, 2025 totaled $5.63 million, a 19.5% increase from $4.71 million for the same period in 2024. This increase reflects continued investment in personnel, infrastructure, and compliance with supporting the Company's strategic growth initiatives.
The largest contributor to the increase was salaries and employee benefits, which rose to $3.38 million from $2.85 million, reflecting the Company's commitment to building a strong operational and lending team to support business expansion.
Occupancy and equipment expenses also increased to $282,000, up from $205,000 in the first quarter of 2024, due to branch enhancements and infrastructure upgrades.
Regulatory assessments rose to $198,000 from $123,000, and professional fees increased to $247,000 from $195,000, driven by growing compliance and consulting needs associated with the Bank's expanding asset base.
Other noninterest expenses rose to $985,000, compared to $783,000 a year earlier, reflecting higher marketing, travel, and training costs associated with customer acquisition and onboarding for new digital and commercial banking solutions.
Meanwhile, data processing costs remained relatively flat at $533,000, compared to $554,000 in the first quarter of 2024, as prior-year investments in treasury management and core system upgrades continued to support operational scale.
These increases are aligned with the Company's long-term growth strategy and are expected to yield revenue benefits over time as the institution approaches the $1 billion asset milestone.
Loans and Credit Quality
(Dollars in thousands)
| March 31, 2025 | March 31, 2024 | % Change | |||||||
| Gross Loans | $ | 800,244 | $ | 755,898 | 5.9% | ||||
| Less: Net Deferred Loan Fees and Costs | $ | (742 | ) | $ | (1,247 | ) | (40.5)% | ||
| Less: Allowance for Credit Losses | $ | (8,270 | ) | $ | (8,281 | ) | (0.13)% | ||
| Loans, Net | $ | 791,232 | $ | 746,370 | 6% |
As of March 31, 2025, gross loans reached $800.2 million, a 5.9% increase from $755.9 million at March 31, 2024. After accounting for net deferred loan fees and costs, which declined by 40.5% to $(742,000), and a nearly unchanged allowance for credit losses of $8.27 million, total net loans amounted to $791.2 million, reflecting a 6.0% year-over-year increase from $746.4 million.
Deposits
Deposits Summary
Condensed Consolidated Balance Sheets
(Dollars in thousands)
| March 31, 2025 | March 31, 2024 | % Change | |||||||
| Total Deposits | $ | 852,934 | $ | 798,409 | 6.8% | ||||
| Noninterest-bearing demand deposits | $ | 235,779 | $ | 217,940 | 8.2% | ||||
| Savings, NOW, and money-market deposits | $ | 289,768 | $ | 318,511 | (9.0)% | ||||
| Time deposits | $ | 327,387 | $ | 261,958 | 24.9% |
Interest Rates on Deposits
(Dollars in thousands)
| Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | |||||
| Interest-bearing Deposits: | ||||||
| Savings, NOW, and money-market deposits averages | $ | 277,012 | $ | 318,987 | ||
| Interest Expense on Savings, NOW, and money-market deposits | $ | 1,751 | $ | 2,356 | ||
| Time Deposits averages | $ | 312,116 | $ | 201,257 | ||
| Interest Expense on Time Deposits | $ | 3,527 | $ | 2,721 |
Deposit Composition
(Percentage of Total Deposits)
| March 31, 2025 | March 31, 2024 | |||||
| Uninsured Deposits to Total Deposits | 31.0% | 28.1% | ||||
| Noninterest Deposits to Total Deposits | 27.6% | 27.3% |
Total deposits reached $852.9 million as of March 31, 2025, representing a 6.8% increase from $798.4 million on March 31, 2024. This growth was driven by an 8.2% increase in noninterest-bearing demand deposits, which rose to $235.8 million, up from $217.9 million one year earlier. Savings, NOW, and money-market deposits declined 9.0% year-over-year, totaling $289.8 million compared to $318.5 million at the end of the first quarter in 2024. Time deposits, by contrast, increased significantly to $327.4 million, up 24.9% from $262.0 million. As of March 31, 2025, uninsured deposits represented 31.0% of total deposits, up from 28.1% one year earlier. Meanwhile, noninterest-bearing deposits accounted for 27.6% of total deposits, compared to 27.3% at March 31, 2024. These figures reflect a modest shift in the deposit mix, with a continued emphasis on maintaining core, relationship-based funding.
Capital Position
(Dollars in thousands)
| Actual | |||||||
| Amount | % | ||||||
| As of March 31, 2025: | |||||||
| Tier 1 Capital to Total Assets | $ | 112,303 | 11.71 | % | |||
| As of March 31, 2024: | |||||||
| Tier 1 Capital to Total Assets | $ | 88,272 | 10.20 | % | |||
As of March 31, 2025, the Bank's Tier 1 capital totaled $112.3 million, representing a Tier 1 capital to total assets ratio of 11.71%. This marks a meaningful increase from $88.3 million and a ratio of 10.20% as of March 31, 2024. The Bank's Tier 1 capital growth of $24.0 million was derived from $15.5 million in net earnings and $8.6 million through new investment in the Bank. The Bank continues to operate with a strong capital buffer that supports its ongoing growth and lending expansion.
Safe Harbor Statement
This press release contains forward-looking statements that can be identified by terminology such as "believes," "expects," "potential," "plans," "suggests," "may," "should," "could," "intends," or similar expressions. Many forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from any future results or implied by such statements. These factors include, but are not limited to, our limited operating history, managing our expected growth, risks associated with the integration of acquired websites, possible inadvertent infringement of third-party intellectual property rights, our ability to effectively compete, our acquisition strategy, and a limited public market for our common stock, among other risks. OptimumBank Holdings, Inc.'s future results may also be impacted by other risk factors listed from time to time in its SEC filings. Many factors are difficult to predict accurately and are generally beyond the company's control. Forward-looking statements speak only as to the date they are made, and OptimumBank Holdings, Inc. does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
Investor Relations & Corporate Relations
Contact: Seth Denison
Telephone: (305) 401-4140
Email: [email protected]
Select Financial Data
Condensed Consolidated Balance Sheets
(Dollars in thousands, except share amounts)
| March 31, 2025 (Unaudited) | December 31, 2024 (Audited) | |||||||
| Assets: | ||||||||
| Cash and due from banks | $ | 13,542 | $ | 13,982 | ||||
| Interest-bearing deposits with banks | 129,914 | 79,648 | ||||||
| Total cash and cash equivalents | 143,456 | 93,630 | ||||||
| Debt securities available for sale | 23,043 | 22,773 | ||||||
| Debt securities held-to-maturity (fair value of $241 and $247) | 269 | 281 | ||||||
| Loans, net of allowance for credit losses of $8,270 and $8,660 | 791,232 | 794,985 | ||||||
| Federal Home Loan Bank stock | 1,128 | 2,929 | ||||||
| Premises and equipment, net | 2,249 | 2,062 | ||||||
| Right-of-use lease assets | 2,647 | 2,679 | ||||||
| Accrued interest receivable | 3,287 | 3,348 | ||||||
| Deferred tax asset | 2,777 | 3,001 | ||||||
| Other assets | 7,380 | 7,245 | ||||||
| Total assets | $ | 977,468 | $ | 932,933 | ||||
| Liabilities and Stockholders' Equity: | ||||||||
| Liabilities: | ||||||||
| Noninterest-bearing demand deposits | $ | 235,779 | $ | 211,900 | ||||
| Savings, NOW and money-market deposits | 289,768 | 278,355 | ||||||
| Time deposits | 327,387 | 281,940 | ||||||
| Total deposits | 852,934 | 772,195 | ||||||
| Federal Home Loan Bank advances | 10,000 | 50,000 | ||||||
| Operating lease liabilities | 2,746 | 2,774 | ||||||
| Other liabilities | 3,785 | 4,780 | ||||||
| Total liabilities | 869,465 | 829,749 | ||||||
| Commitments and contingencies (Notes 8 and 11) | ||||||||
| Stockholders' equity: | ||||||||
| Preferred stock, no par value; 6,000,000 shares authorized: | - | - | ||||||
| Series B Convertible Preferred, no par value, 1,520 shares authorized, 1,360 shares issued and outstanding | - | - | ||||||
| Series C Convertible Preferred, no par value, 4,000,000 shares authorized, 525,641 shares issued and outstanding | - | - | ||||||
| Common stock, $.01 par value; 30,000,000 shares authorized, 11,751,082 and 11,636,092 shares issued and outstanding | 118 | 116 | ||||||
| Additional paid-in capital | 112,015 | 111,485 | ||||||
| Retained earnings (accumulated deficit) | 1,023 | (2,847 | ) | |||||
| Accumulated other comprehensive loss | (5,153 | ) | (5,570 | ) | ||||
| Total stockholders' equity | 108,003 | 103,184 | ||||||
| Total liabilities and stockholders' equity | $ | 977,468 | $ | 932,933 | ||||
Condensed Consolidated Statements of Earnings
(Dollars in thousands, except per share amounts)
| Three Months Ended March 31, | |||||||
| 2025 | 2024 | ||||||
| Interest income: | |||||||
| Loans | $ | 13,601 | $ | 11,836 | |||
| Debt securities | 160 | 170 | |||||
| Other | 1,246 | 1,459 | |||||
| Total interest income | 15,007 | 13,465 | |||||
| Interest expense: | |||||||
| Deposits | 5,278 | 5,077 | |||||
| Borrowings | 303 | 637 | |||||
| Total interest expense | 5,581 | 5,714 | |||||
| Net interest income | 9,426 | 7,751 | |||||
| Credit loss (reversal) expense | (165 | ) | 1,057 | ||||
| Net interest income after credit (reversal) loss expense | 9,591 | 6,694 | |||||
| Noninterest income: | |||||||
| Service charges and fees | 1,038 | 968 | |||||
| Other | 193 | 271 | |||||
| Total noninterest income | 1,231 | 1,239 | |||||
| Noninterest expenses: | |||||||
| Salaries and employee benefits | 3,381 | 2,849 | |||||
| Professional fees | 247 | 195 | |||||
| Occupancy and equipment | 282 | 205 | |||||
| Data processing | 533 | 554 | |||||
| Regulatory assessment | 198 | 123 | |||||
| Other | 985 | 783 | |||||
| Total noninterest expenses | 5,626 | 4,709 | |||||
| Net earnings before income taxes | 5,196 | 3,224 | |||||
| Income tax expense | 1,326 | 847 | |||||
| Net earnings | $ | 3,870 | $ | 2,377 | |||
| Net earnings per share - Basic | $ | 0.33 | $ | 0.31 | |||
| Net earnings per share - Diluted | $ | 0.32 | $ | 0.31 | |||
Condensed Consolidated Statements of Comprehensive Income
(Dollars in thousands)
| Three Months Ended | |||||||
| March 31, | |||||||
| 2025 | 2024 | ||||||
| Net earnings | $ | 3,870 | $ | 2,377 | |||
| Other comprehensive income (loss): | |||||||
| Change in unrealized gain (loss) on debt securities: | |||||||
| Unrealized gain (loss) arising during the period | 561 | (513 | ) | ||||
| Amortization of unrealized loss on debt securities transferred to held-to-maturity | (1 | ) | - | ||||
| Other comprehensive income (loss) before income taxes | 560 | (513 | ) | ||||
| Deferred income tax (expense) benefit | (143 | ) | 131 | ||||
| Total other comprehensive income (loss) | 417 | (382 | ) | ||||
| Comprehensive income | $ | 4,287 | $ | 1,995 | |||
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