OptimumBank Holdings, Inc. Financial Performance for the First Quarter of 2025

About this update from Optimumbank Holdings, Inc.

Fort Lauderdale, Florida--(Newsfile Corp. - May 13, 2025) - OptimumBank Holdings, Inc. (NYSE American: 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: Asset and Deposit Growth: Capital Position: Recent Developments: Non-Performing Asset Resolution 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)   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)   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)   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)   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)   Interest Rates on Deposits (Dollars in thousands)   Deposit Composition (Percentage of Total Deposits)   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)   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)   Condensed Consolidated Statements of Earnings (Dollars in thousands, except per share amounts)   Condensed Consolidated Statements of Comprehensive Income (Dollars in thousands)   To view the source version of this press release, please visit https://www.newsfilecorp.com/release/251670

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