Coastal Financial Corporation (CCB) SEC Filings & Earnings Calls

Potential deposit outflow from Bluevine relationship change; mitigated by sweep capability and diversification.

“Bluevine-related deposits ~$447M; company expects no material adverse effect but acknowledges fluctuation.”

CCBX partner concentration risk

“The decrease in net income over the comparable period in the prior year was primarily attributable to a $68.8 million credit expense related to a single, isolated CCBX partner relationship.” · word for word

Credit enhancement asset collectability risk

“Credit enhancement receivable valuation adjustment 46,009 — 46,009 100.0” · word for word

Technology investment risk

“Data processing and software licenses were $8.8 million higher due to $4.4 million of capitalized software amortization due to shortened useful lives associated with technology modernization.” · word for word

Significant credit loss on a single CCBX partner relationship, with $68.8M total credit expense including $22.8M provision and $46.0M valuation adjustment

“$68.8 million credit expense related to a single, isolated CCBX partner relationship” · word for word

Capital ratios reduced by approximately one percentage point due to the quarter's charges

“The quarter's charges reduced capital ratios by approximately one percentage point” · word for word

Three partners in wind-down status, indicating ongoing partner relationship risk

“Wind down - active but preparing to exit relationship: 3” · word for word

Key financial leadership departure; interim CFO is a retiree; permanent replacement uncertain.

“CFO leaving for CEO role at a fintech bank; interim CFO is a former CFO who retired in 2025.”

High net charge-off ratio in CCBX segment

“Net charge-offs for the quarter ended March 31, 2026 totaled $49.6 million, or 5.18% of total average loans” · word for word

Declining CCBX loan yield

“Average CCBX yield of 15.01% was earned on CCBX loans for the quarter ended March 31, 2026, compared to 16.88% for the quarter ended March 31, 2025.” · word for word

Concentration in BaaS partner model

“CCBX partner agreements provide for credit enhancements that cover $48.6 million, or 97.9%, of the charge-offs on CCBX loans for the three months ended March 31, 2026.” · word for word

Concentration risk in BaaS segment; credit risk largely indemnified (98.8%) but fraud indemnification is 100%.

“contracts with our partners that fully indemnify us against fraud and 98.8% against credit risk on CCBX loan partner balances” · word for word

Execution risk: definitive agreements and regulatory approvals required; deal may not close.

“subject to the execution of definitive agreements, the receipt of required regulatory approvals and other customary closing conditions.” · word for word

Credit risk from CCBX partner portfolio

“Net charge-off goals are based on community bank data only as CCBX charge-offs are reimbursed by our CCBX partners, except for 5% of one CCBX partner portfolio. As of December 31, 2025, our portion of that portfolio represented $22.1 million in loans, on which the Company is responsible for any losses.” · word for word

Key person dependence on CEO and top executives

“CEO Eric Sprink holds 100,000 PSUs with stock price hurdles; CFO Brandon Soto holds 15,000 PSUs; CCBX President Brian Hamilton holds 75,000 PSUs. Departure or underperformance could impact strategic execution.”

BaaS concentration risk

“Deposit accounts acquired through these relationships totaled $2.56 billion, or 61.7% of total deposits at December 31, 2025.” · word for word

Regulatory scrutiny of BaaS

“In recent years, a significant number of banks that provide BaaS have become subject to enforcement actions relating to their partners’ activities, indicating that banking regulators have made banks’ oversight over their BaaS partners a supervisory priority and that there is an increased risk that we could similarly become subject to additional regulatory sc” · word for word

Credit risk in CCBX portfolio

“Net charge-offs for the year ended December 31, 2025 totaled $196.8 million, or 5.45% of total average loans.” · word for word

Partner termination risk

“Also, our CCBX partner(s) could terminate a relationship with us for many reasons, including being able to obtain better terms from another provider or dissatisfaction with the level or quality of our services.” · word for word

Provision for credit losses remains elevated at $48M, though down from $56.6M QoQ.

“Provision for credit losses 48,041” · word for word

Net income declined YoY from $13.4M to $12.6M.

“net income of $12.6 million ... compared to $13.4 million for the three months ended December 31, 2024”

Total revenue decreased 4.6% QoQ due to lower credit enhancement revenue.

“Total revenue decreased 4.6% from the prior quarter, driven by lower credit enhancement revenue.” · word for word

CCBX credit risk concentration

“Although agreements with our CCBX partners provide for credit enhancements that provide protection to the Bank from credit and fraud losses by indemnifying or reimbursing incurred credit and fraud losses, if our partner is unable to fulfill their contracted obligation then the Bank would be exposed to additional loan and deposit losses (counterparty risk)” · word for word

Interest rate sensitivity

“The FOMC last lowered the targeted Federal Funds rate by 0.25% on September 18, 2025; a reduction of 0.75% compared to September 30, 2024.” · word for word

Credit loss provision remains elevated; nonperforming assets at 1.31% of total assets.

“Provision for credit losses $56.6M; nonperforming assets to total assets 1.31%.”

Expense fluctuations expected due to new CCBX partner launches.

“We anticipate ongoing expense fluctuations due to new CCBX partners and product launches.” · word for word