The market will likely react negatively to the net loss and partner credit issue, but the core BaaS business continues to show strong growth and improving credit trends. Monitor for further disclosures on the affected partner and any potential capital actions. The selloff may present an entry point if the partner issue proves isolated.
Price Chart
Executive Summary
Coastal Financial Corp reported a Q2 2026 net loss of $42.1M (EPS -$2.76) driven by a $22.8M specific reserve and $46.0M valuation adjustment related to a single BaaS partner. Excluding that partner, core CCBX loan balances grew 46% YoY and BaaS program fee income rose 57% YoY, but the headline earnings collapse overshadows underlying operational strength.
Key Facts
- Net loss of $42.1 million in Q2 2026 vs net income of $12.0 million in Q1 2026 and $11.0 million in Q2 2025
- Diluted EPS of ($2.76) vs $0.78 in Q1 2026 and $0.71 in Q2 2025
- Total revenue of $178.1 million, up 19.2% QoQ and 49.1% YoY
- Provision for credit losses of $92.2 million, up from $51.4 million in Q1 2026
- Noninterest expense of $141.1 million includes $46.0 million valuation adjustment to credit enhancement asset and $4.4 million capitalized software amortization
- Excluding the affected partner, CCBX loan balance grew 46% YoY to $1.70 billion and annualized net charge-offs improved to 8.73% from 10.84% YoY
- Total assets decreased 3.7% QoQ to $5.46 billion; book value per share fell 8.2% QoQ to $30.33
- Bank remains well capitalized with CET1 ratio of 10.97% and total risk-based capital of 12.27%
Financial Impact
One-time charges of $68.8 million ($22.8M specific reserve + $46.0M valuation adjustment) drove a net loss of $42.1M, representing ~3.8% of market cap
Risk Factors
- Further credit deterioration or additional charges from the affected partner or other BaaS partners
- Potential regulatory scrutiny or capital adequacy concerns if losses persist
- Dependence on partner concentration and counterparty risk in the BaaS model
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001437958-26-000053 |
| Document: ck1437958-20260730.htm | 0001437958-26-000053 |
| Document: 0001437958-26-000053-index-headers.html | 0001437958-26-000053 |
| Document: 0001437958-26-000053-index.html | 0001437958-26-000053 |
| Document: 0001437958-26-000053.txt | 0001437958-26-000053 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Oct 22, 2026 5d ago | Press Release | $44.90 | awaiting T+20 | — | $45.66 (+1.69%) |
Sep 28, 2026 29d ago | 8-K | $37.55 $45.08 | ▲ +20.07% | ▲ +20.10% | $45.66 (+21.61%) |
Aug 26, 2026 8w ago | 3 | $46.74 $43.62 | ▼ −6.68% | ▼ −6.17% | $45.66 (−2.31%) |
Aug 7, 2026 11w ago | Insider Cluster | $48.61 $49.47 | ▲ +1.77% | ▲ +2.68% | $45.66 (−6.07%) |
Jul 30, 2026 12w ago | 8-K | $39.91 $46.74 | ▼ −17.11% | ▼ −13.15% | $45.66 (−14.41%) |
Jul 30, 2026 12w ago | 8-K | $39.91 $46.74 | ▼ −17.11% | ▼ −13.15% | $45.66 (−14.41%) |
Jul 23, 2026 13w ago | Press Release | $72.19 | awaiting T+20 | — | $45.66 (−36.75%) |
Jul 22, 2026 13w ago | Press Release | $71.41 $46.06 | ▼ −35.51% | ▼ −38.81% | $45.66 (−36.06%) |
Jun 11, 2026 19w ago | Institutional Cluster | $73.53 $78.47 | ▲ +6.72% | ▲ +4.94% | $45.66 (−37.90%) |
May 1, 2026 25w ago | Insider Cluster | $76.39 $71.34 | ▼ −6.61% | ▼ −11.90% | $45.66 (−40.23%) |
US Market Status
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