0001751783-26-000018
SEC filingRevenue and net income declined slightly in Q1, as higher non-interest expenses offset the benefit of lower funding costs.
The decrease in the provision for credit losses was primarily due to lower loan balances, as noted in management discussion. The company estimates the allowance for credit losses as a calculation of expected lifetime credit losses utilizing a forward-looking forecast of macroeconomic conditions, which may differ significantly from actual results.
Net cash provided by operating activities was $3.5 million in Q1 2026, compared to $4.3 million in the prior year quarter. Capital expenditures increased to $637,000 from $116,000, reflecting investments in the business. Free cash flow, defined as operating cash flow minus capital expenditures, was $2.9 million. Management maintains liquid assets at levels considered adequate to meet both short-term and long-term liquidity needs and adjusts liquidity as appropriate to meet asset and liability management objectives.
The company continues to focus on managing its balance sheet and funding costs in the current interest rate environment. The allowance for credit losses incorporates forward-looking macroeconomic forecasts, and actual results may differ from estimates.