The restatement deepens the capital erosion and confirms material weaknesses in internal controls, increasing the risk of regulatory action or further dilution. Monitor the rights offering at $3.50/share and the bank's ability to regain well-capitalized status; the asset resolution plan's $38.4M impact is a key near-term catalyst.
Price Chart
Executive Summary
BayFirst Financial Corp. filed this 10-Q/A to restate its Q1 2026 financials, correcting a $6.2 million cumulative error in deferred origination costs and accrued interest on SBA 7(a) loans, plus a $3.4 million overstatement of gain on sale. The restatement deepens the Q1 2026 net loss from $5.7M to $5.9M and reduces retained earnings by $6.2M, following a prior 8-K disclosure of a $37M loan portfolio adjustment and a broader restatement covering 2024, 2025, and Q1 2026. The filing also discloses a material weakness in internal controls over financial reporting related to nonaccrual and charge-off procedures, with remediation underway.
Key Facts
- Restatement corrects $2.8M pretax deferred origination costs and $2.1M pretax accrued interest errors on unguaranteed SBA 7(a) loans.
- Restatement also corrects $3.4M pretax overstatement of gain on sale of government guaranteed loans.
- Q1 2026 net loss worsened by $250K to $5.9M; retained earnings reduced by $6.2M to $7.8M.
- Material weakness identified in internal controls over financial reporting related to nonaccrual and charge-off procedures.
- Bank did not meet all well-capitalized regulatory thresholds as of March 31, 2026; capital raise expected to address this.
- Preferred stock dividends suspended since October 2025; $1.16M in dividends accrued as of filing date.
- Subsequent events include a $38.4M asset resolution plan, $1.5M impairment, $1.6M write-down, and a rights offering at $3.50/share.
Financial Impact
Cumulative $6.2M reduction in retained earnings from restatement; Q1 2026 net loss increased by $250K to $5.9M; $38.4M asset resolution plan, $1.5M impairment, and $1.6M write-down in subsequent events.
Risk Factors
- Regulatory enforcement or capital directive risk due to not meeting well-capitalized thresholds and material weakness in controls.
- Further dilution from the rights offering at $3.50/share, which is well below current book value.
- Potential for additional loan losses or impairments from the asset resolution plan beyond the $38.4M already identified.
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 8 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 10-Q/A Filing (Primary) | 0001649739-26-000050 |
| Exhibit: ex311-principalexecutiveof.htm | 0001649739-26-000050 |
| Exhibit: ex312-principalfinancialof.htm | 0001649739-26-000050 |
| Exhibit: ex321-principalexecutiveof.htm | 0001649739-26-000050 |
| Exhibit: ex322-principalfinancialof.htm | 0001649739-26-000050 |
| Document: 0001649739-26-000050-index-headers.html | 0001649739-26-000050 |
| Document: 0001649739-26-000050-index.html | 0001649739-26-000050 |
| Document: 0001649739-26-000050.txt | 0001649739-26-000050 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 19, 2026 7d ago | SC 13D/A | $6.44 | awaiting T+60 | — | $6.57 (+2.02%) |
Oct 13, 2026 13d ago | SC 13D/A | $5.25 | awaiting T+60 | — | $6.57 (+25.14%) |
Sep 30, 2026 26d ago | 8-K | $6.81 | awaiting T+60 | — | $6.57 (−3.52%) |
Sep 29, 2026 27d ago | 8-K | $7.21 | awaiting T+60 | — | $6.57 (−8.88%) |
Sep 24, 2026 4w ago | 3 | $7.12 | awaiting T+60 | — | $6.57 (−7.72%) |
Sep 24, 2026 4w ago | Press Release | $7.12 | awaiting T+60 | — | $6.57 (−7.72%) |
Sep 1, 2026 7w ago | 8-K | $7.15 | awaiting T+60 | — | $6.57 (+8.11%) |
Aug 27, 2026 8w ago | 8-K | $6.61 | awaiting T+60 | — | $6.57 (−0.61%) |
Aug 25, 2026 8w ago | EFFECT | $7.37 | awaiting T+60 | — | $6.57 (+10.85%) |
Aug 21, 2026 9w ago | S-1/A | $7.31 | awaiting T+60 | — | $6.57 (+10.12%) |
US Market Status
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