# COASTAL FINANCIAL CORP (CCB)

Informational only - not investment advice.

CIK: 0001437958
SIC: 6022 State Commercial Banks
SIC breadcrumb: [Finance, Insurance, And Real Estate](/division/H/) > [Depository Institutions](/major-group/60/) > [SIC 6022 State Commercial Banks](/industry/6022/)
Latest 10-K filed: 2026-02-27
SEC page: https://www.sec.gov/edgar/browse/?CIK=1437958
Filing source: https://www.sec.gov/Archives/edgar/data/1437958/000143795826000013/ck1437958-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-02-27 · accession 0001437958-26-000013 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437958.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 429,617,000 USD | 2025 | verified |
| Net income | 46,993,000 USD | 2025 | verified |
| Assets | 4,741,437,000 USD | 2025 | verified |
| Free cash flow | 246,148,000 USD | 2025 | computed |
| Net margin | 10.94% | 2025 | computed |
| Revenue YoY | +8.28% | 2025 | computed |
| ROE | 9.57% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | CCB | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 10.9% | 21.9% | 9 | 149 |
| Revenue growth | 8.3% | 6.0% | 61 | 148 |
| FCF margin | 57.3% | 23.8% | 98 | 133 |
| ROE | 9.6% | 9.6% | 47 | 149 |
| ROA | 1.0% | 1.1% | 43 | 149 |
| Liabilities / equity | 8.66 | 8.04 | 66 | 149 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 6022 State Commercial Banks, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 429617000 | USD | 2025 | 2026-02-27 |
| Net income | 46993000 | USD | 2025 | 2026-02-27 |
| Assets | 4741437000 | USD | 2025 | 2026-02-27 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-27. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437958.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  | 32,113,000 | 38,743,000 | 48,587,000 | 63,038,000 | 83,083,000 | 192,170,000 | 323,219,000 | 396,777,000 | 429,617,000 |
| Net income |  | 5,436,000 | 9,701,000 | 13,201,000 | 15,146,000 | 27,005,000 | 40,625,000 | 44,579,000 | 45,219,000 | 46,993,000 |
| Diluted EPS |  | 0.59 | 0.91 | 1.08 | 1.24 | 2.16 | 3.01 | 3.27 | 3.26 | 3.06 |
| Operating cash flow |  | 7,617,000 | 14,402,000 | 13,671,000 | 19,330,000 | 29,847,000 | 67,098,000 | 191,540,000 | 259,786,000 | 254,584,000 |
| Capital expenditures |  | 1,057,000 | 1,149,000 | 1,213,000 | 5,368,000 | 2,593,000 | 2,838,000 | 6,245,000 | 9,900,000 | 8,436,000 |
| Assets |  | 805,753,000 | 952,110,000 | 1,128,526,000 | 1,766,122,000 | 2,635,517,000 | 3,144,467,000 | 3,750,005,000 | 4,121,208,000 | 4,741,437,000 |
| Liabilities |  | 740,042,000 | 842,954,000 | 1,004,353,000 | 1,625,905,000 | 2,434,295,000 | 2,900,973,000 | 3,455,027,000 | 3,682,504,000 | 4,250,478,000 |
| Stockholders' equity | 59,897,000 | 65,711,000 | 109,156,000 | 124,173,000 | 140,217,000 | 201,222,000 | 243,494,000 | 294,978,000 | 438,704,000 | 490,959,000 |
| Free cash flow |  | 6,560,000 | 13,253,000 | 12,458,000 | 13,962,000 | 27,254,000 | 64,260,000 | 185,295,000 | 249,886,000 | 246,148,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  | 16.93% | 25.04% | 27.17% | 24.03% | 32.50% | 21.14% | 13.79% | 11.40% | 10.94% |
| Return on equity |  | 8.27% | 8.89% | 10.63% | 10.80% | 13.42% | 16.68% | 15.11% | 10.31% | 9.57% |
| Return on assets |  | 0.67% | 1.02% | 1.17% | 0.86% | 1.02% | 1.29% | 1.19% | 1.10% | 0.99% |
| Liabilities / equity |  | 11.26 | 7.72 | 8.09 | 11.60 | 12.10 | 11.91 | 11.71 | 8.39 | 8.66 |

## As-reported value updates

2 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/CCB/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-07. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001437958.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-09-30 |  |  | 0.82 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | 0.91 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 |  |  | 0.95 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 88,331,000 | 10,270,000 | 0.75 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 88,243,000 | 9,012,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 90,472,000 | 6,800,000 | 0.50 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 97,487,000 | 11,596,000 | 0.84 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 105,079,000 | 13,456,000 | 0.97 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 103,739,000 | 13,367,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 104,907,000 | 9,730,000 | 0.63 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 107,797,000 | 11,028,000 | 0.71 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 109,027,000 | 13,592,000 | 0.88 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 107,886,000 | 12,643,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 111,681,000 | 12,019,000 | 0.78 | reported discrete quarter |
| 2026-Q2 | 2026-06-30 | 118,554,000 | -42,105,000 | -2.76 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from CCB's latest 10-K: [/company/CCB/business/](/company/CCB/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from CCB's latest 10-K: [/company/CCB/risk-factors/](/company/CCB/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1437958/000143795826000061/ck1437958-20260630.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-08-07
Report date: 2026-06-30

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

We are a bank holding company that operates through our wholly owned subsidiaries, Coastal Community Bank (“Bank”) and Arlington Olympic LLC. We are headquartered in Everett, Washington, which by population is the largest city in, and the county seat of, Snohomish County. Our business is conducted through three reportable segments: The community bank, CCBX and treasury & administration. The community bank segment includes all community banking activities, with a primary focus on providing a wide range of banking products and services to consumers and small to medium sized businesses in the broader Puget Sound region in the state of Washington and through the Internet and our mobile banking application. We currently operate 14 full-service banking locations, 12 of which are located in Snohomish County, where we are the largest community bank by deposit market share, and two of which are located in neighboring counties (one in King County and one in Island County). The CCBX segment provides banking as a service (“BaaS”) that allows digital financial service providers, companies and brands to offer their customers banking services. The CCBX segment has 30 partners as of June 30, 2026. The treasury & administration segment includes investments, debt and other reporting items that are not specific to the community bank or CCBX segments. The Bank’s deposits are insured in whole or in part by the Federal Deposit Insurance Corporation (“FDIC”). The Bank is subject to regulation by the Federal Reserve and the Washington State Department of Financial Institutions Division of Banks. The Federal Reserve also has supervisory authority over the Company.

As of June 30, 2026, we had total assets of $5.46 billion, total loans receivable of $4.21 billion, total deposits of $4.86 billion and total shareholders’ equity of $463.4 million.

The following discussion and analysis presents our financial condition and results of operations on a consolidated basis. However, because we conduct all of our material business operations through the Bank, the discussion and analysis relate to activities primarily conducted by the Bank.

We generate most of our community bank revenue from interest on loans and CCBX revenue from BaaS fee income and interest on loans. Our primary source of funding for our loans is commercial and retail deposits from our customer relationships and from our partner deposit relationships. We place secondary reliance on wholesale funding, primarily borrowings from the Federal Home Loan Bank (“FHLB”). Less commonly used sources of funding include borrowings from the Federal Reserve System (“Federal Reserve”) discount window, draws on established federal funds lines from unaffiliated commercial banks, brokered funds, which allows us to obtain deposits from sources that do not have a relationship with the Bank and can be obtained through certificate of deposit listing services, via the internet or through other advertising methods, or a one-way buy through an insured cash sweep (“ICS”) account, which allows us to obtain funds from other institutions that have deposited funds through ICS. Our largest expenses are provision for credit losses on loans, interest on deposits and borrowings, BaaS loan expense, and salaries and employee benefits. Our principal lending products are commercial real estate loans, consumer loans, residential real estate, commercial and industrial loans and construction, land and land development loans.

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Results of Operations

Net Income

Comparison of the quarter ended June 30, 2026 to the comparable quarter in the prior year

Net loss for the three months ended June 30, 2026 was $42.1 million, or $(2.76) per diluted share, compared to net income of $11.0 million, or $0.71 per diluted share, for the three months ended June 30, 2025. 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, which included a $46.0 million credit enhancement receivable valuation adjustment and a $20.5 million increase in the provision for credit losses due primarily to the establishment of a $22.8 million specific provision related to one partner relationship for credit losses not expected to be fully collected under the partner's indemnification arrangement following an individual assessment of collectability. 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 as well as continued investments in growth, technology and risk management. Those expenses were partially offset by a $10.8 million increase in interest income due to an increase in average loans receivable, an increase in BaaS program income of $4.4 million and a decrease in interest expense of $1.9 million.

BaaS credit enhancement income increased $39.5 million, primarily due to loan growth and changes in the composition of the CCBX loan portfolio. This increase corresponds to a $59.9 million increase in the provision for credit losses associated with expected credit losses covered under partners' credit enhancement arrangements, with the difference between the two primarily attributable to a specific reserve for one partner's expected credit losses not expected to be fully collected under that partner's indemnification arrangement, as discussed above. For more information on the accounting for BaaS allowance for credit losses, reserve for unfunded commitments, credit enhancements and fraud enhancements see the section titled “CCBX – BaaS Reporting Information.”

Comparison of the six months ended June 30, 2026 to the comparable period in the prior year

Net loss for the six months ended June 30, 2026 was $30.1 million, or $(1.98) per diluted share, compared to net income of $20.8 million, or $1.36 per diluted share, for the six months ended June 30, 2025. The decrease in net income over the comparable period in the prior year was primarily attributable to a $46.0 million credit enhancement receivable valuation adjustment related to the assessment of collectability of a CCBX partner, a $55.6 million increase in the provision for credit losses related an increase in loans receivable combined with the establishment of a specific reserve related to one partner relationship for credit losses not expected to be fully collected under the partner's indemnification arrangement following an individual assessment of collectability. Also contributing to the variance was an increase of $12.4 million in BaaS loan expense, an $11.6 million increase in data processing and software licenses, a $3.8 million increase in salaries and employee benefits and a $1.3 million increase in legal and professional expenses, all due to continued investments in growth, technology and risk management. Partially offsetting these expense was an increase of $19.9 million in net interest income and an increase in BaaS program income of $9.0 million.

Net Interest Income

Comparison of the quarter ended June 30, 2026 to the comparable quarter in the prior year

Net interest income for the three months ended June 30, 2026 was $89.4 million, compared to $76.7 million for the three months ended June 30, 2025, an increase of $12.6 million, or 16.4%. The increase in net interest income compared to the quarter ended June 30, 2025 was primarily related to growth in loans receivable, partially offset by a decrease in loan yield and a decrease in interest from interest earning deposits with other banks due to lower interest rates. The average balance of loans was $580.6 million higher and average interest earning deposits with other banks was $11.8 million lower for the three months ended June 30, 2026, compared to the three months ended June 30, 2025.

Total interest and fees on loans were $111.1 million for the three months ended June 30, 2026, compared to $98.9 million for the three months ended June 30, 2025. The $12.2 million increase in interest and fees on loans for the quarter ended June 30, 2026, compared to the quarter ended June 30, 2025, was largely due to growth in loans, primarily from CCBX. Total loans receivable was $4.21 billion at June 30, 2026, compared to $3.54 billion at June 30, 2025. CCBX average loans receivable was $2.16 billion for the quarter ended June 30, 2026, compared to $1.69 billion for the quarter ended June 30, 2025, an increase of $476.1 million, or 28.2%. Average CCBX yield of 14.56% was earned on CCBX loans for the quarter ended June 30, 2026, compared to 16.22% for the quarter ended June 30, 2025. The lower loan yield is the

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result of lower rates compared to the prior year period as well as a change in the loan mix. The Federal Open Market Committee ("FOMC") of the Federal Reserve last lowered the targeted federal funds rate by 0.25% on December 11, 2025, a reduction of 0.75% compared to June 30, 2025. Additionally, lower rate capital call lines were $5.2 million higher compared to June 30, 2025. These loans earn a lower rate of interest, but have less credit risk due to the way the loans are structured compared to other commercial loans. CCBX yield does not include the impact of BaaS loan expense. BaaS loan expense represents the amount paid or payable to partners for credit enhancements, fraud enhancements and servicing CCBX loans. The tables later in this section illustrate the impact of BaaS loan expense on CCBX loan yield. Community bank average loans receivable was $1.98 billion at June 30, 2026, compared to $1.88 billion at June 30, 2025, an increase of $104.4 million, or 5.6%. An average community bank yield of 6.57% was earned on community bank loans for the quarter ended June 30, 2026, compared to 6.53% for the quarter ended June 30, 2025.

Interest income from interest earning deposits with other banks was $6.6 million for the quarter ended June 30, 2026, a decrease of $1.5 million, or 18.3%, primarily due to a decrease in interest rates compared to the quarter ended June 30, 2025. The average balance of interest earning deposits invested with other banks for the three months ended June 30, 2026 was $717.9 million, compared to $729.7 million for the three months ended June 30, 2025. The yield on these interest earning deposits with other banks decreased 0.75%, which is in line with the reduction in Fed funds compared to the prior year period, to 3.69% compared to 4.44% at June 30, 2025. Interest income on investment securities decreased $14,000 to $612,000 at June 30, 2026, compared to $626,000 at June 30, 2025. Average investment securities decreased $482,000 from $46.3 million for the three months ended June 30, 2025 to $45.8 million for the three months ended June 30, 2026, as a result of principal paydowns. Average yield on investment securities decreased to 5.36% for the three months ended June 30, 2026, compared to 5.42% for the three months ended June 30, 2025.

Interest expense was $29.2 million for the quarter ended June 30, 2026, a $1.9 million decrease from the quarter ended June 30, 2025. Interest expense on deposits was $28.0 million for the quarter ended June 30, 2026, compared to $30.4 million for the quarter ended June 30, 2025. The $2.4 million decrease in interest expense on deposits was largely due to lower interest rates despite an increase of $411.5 million in average interest bearing deposits compared to the quarter ended June 30, 2025. Interest on borrowed funds was $1.1 million for the quarter ended June 30, 2026, compared to $660,000 for the quarter ended June 30, 2025 primarily due to higher average borrowings resulting from changes in the Company's liquidity management and funding strategy.

Cost of funds was 2.62% for the quarter ended June 30, 2026, which was a decre

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1437958/000143795826000013/ck1437958-20251231.htm
Complete FY 2025 MD&A: /company/CCB/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-27
Report date: 2025-12-31

Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

This discussion should be read in conjunction with the consolidated financial statements and the related notes that appear elsewhere in this Form 10-K.

We are a bank holding company that operates through our wholly owned subsidiaries, Coastal Community Bank (“Bank”) and Arlington Olympic LLC. We are headquartered in Everett, Washington, which by population is the largest city in, and the county seat of, Snohomish County. Our business is conducted through three reportable segments: The community bank, CCBX and treasury & administration. The community bank segment includes all community banking activities, with a primary focus on providing a wide range of banking products and services to consumers and small to medium sized businesses in the broader Puget Sound region in the state of Washington and through the Internet and our mobile banking application. We currently operate 14 full-service banking locations, 12 of which are located in Snohomish County, where we are the largest community bank by deposit market share, and two of which are located in neighboring counties (one in King County and one in Island County) and have one loan production office in King County. The CCBX segment provides banking as a service (“BaaS”) that allows our digital financial service partners to offer their customers banking services. The CCBX segment had 28 partners as of December 31, 2025. The treasury & administration segment includes investments, debt and other reporting items that are not specific to the community bank or CCBX segments. The Bank’s deposits are insured in whole or in part by the Federal Deposit Insurance Corporation (“FDIC”). The Bank is subject to regulation by the Federal Reserve and the Washington State Department of Financial Institutions Division of Banks. The Federal Reserve also has supervisory authority over the Company.

As of December 31, 2025, we had total assets of $4.74 billion, total loans receivable of $3.75 billion, total deposits of $4.14 billion and total shareholders’ equity of $491.0 million.

The following discussion and analysis presents our financial condition and results of operations on a consolidated basis. However, because we conduct all of our material business operations through the Bank, the discussion and analysis relate to activities primarily conducted by the Bank. This discussion and analysis should be read in conjunction with the audited consolidated financial statements and the accompanying notes presented elsewhere in this Annual Report on Form 10-K.

We generate most of our community bank revenue from interest on loans and CCBX revenue from BaaS fee income and interest on loans. Our primary source of funding for our loans is commercial and retail deposits from our customer relationships and from our partner deposit relationships. We place secondary reliance on wholesale funding, primarily borrowings from the Federal Home Loan Bank (“FHLB”). Less commonly used sources of funding include borrowings from the Federal Reserve System (“Federal Reserve”) discount window, draws on established federal funds lines from unaffiliated commercial banks, brokered funds, which allows us to obtain deposits from sources that do not have a relationship with the Bank and can be obtained through certificate of deposit listing services, via the internet or through other advertising methods, or a one-way buy through an insured cash sweep (“ICS”) account, which allows us to obtain funds from other institutions that have deposited funds through ICS. Our largest expenses are provision for credit losses - loans, interest on deposits and borrowings, BaaS loan expense, salaries and employee benefits, BaaS fraud expense, legal and professional expenses, data processing and software licenses and occupancy expense. Our principal lending products are commercial real estate loans, consumer loans, residential real estate, commercial and industrial loans and construction, land and land development loans.

Key Factors Affecting our Business

Average Balances and Interest Rates

Our operating results depend primarily on our net interest income, which is the largest contributor to our net income and is the difference between the interest and fees earned on interest-earning assets (such as loans and securities) and the interest expense incurred in connection with interest-bearing liabilities (such as deposits and borrowings). Net interest income is primarily a function of the average balances of interest-earning assets and interest-bearing liabilities and the yields and costs with respect to these assets and liabilities. Average balances are influenced by internal considerations such as the types of products we offer and the amount of risk that we are willing to assume as well as external influences

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such as economic conditions, competition for loans and deposits, and interest rates. The yields generated by our loans and securities are typically affected by short-term and long-term interest rates and, in the case of loans, competition for similar products in our market area. Interest rates are often impacted by the actions of the Federal Reserve. The cost of our deposits and short-term borrowings is primarily based on short-term interest rates, which are largely driven by competition and by the actions of the Federal Reserve. The level of net interest income is influenced by movements in interest rates and the pace at which such movements occur, as well as the relationship between short- and long-term interest rates.

Credit Quality

We have well established loan policies and underwriting practices that have resulted in low levels of charge-offs and nonperforming assets for the community bank. Through our thorough underwriting process, we strive to originate quality loans that will maintain and enhance the overall credit quality of our loan portfolio, and through our careful monitoring of our community bank loan portfolio and prompt attention to delinquencies, we seek to minimize the impact of problem loans. However, credit trends in the markets in which we operate are largely impacted by economic conditions beyond our control and can adversely impact our financial condition. We originate loans through our CCBX partners and while these loans will have higher levels of charge-offs and nonperforming assets, agreements with our CCBX partners provide for a credit enhancement which protects the Bank by absorbing incurred losses. For additional information on credit enhancements see Item 1. Business - Concentrations of Credit Risk section. If our partners are unable to fulfill their contracted obligations then the Bank would be exposed to additional credit losses as a result of this counterparty risk. Management regularly evaluates and manages this counterparty risk.

Operating Efficiency

The largest component of noninterest expense is BaaS loan expense and salaries and employee benefits. Other significant operating expenses include BaaS fraud expense, legal and professional expenses, data processing and software licenses and occupancy expense. Our operating efficiency, as measured by our efficiency ratio, has gradually improved primarily because the growth of our deposits and loans has enabled our net interest income and noninterest income to outpace the growth of our expenses. When we make substantial investments in our infrastructure and make investments to increase our operating capacity, our operating efficiency ratio decreases until we generate enough revenue growth to offset the increased costs however, prior to making such investments, we focus on how best and most expediently we can achieve the revenue growth necessary to offset the costs of these investments or new branches. Our efficiency ratio has been impacted by the increase in CCBX income and CCBX expense. Our efficiency ratio was 53.13% at December 31, 2025, compared to 42.38% at December 31, 2024. This ratio increased as a result of an increase in net interest income, decrease in credit enhancement income and higher noninterest expenses for the year ended December 31, 2025 compared to the year ended December 31, 2024.

Economic Conditions

Our business and financial performance are affected by economic conditions generally in the United States for CCBX and more directly for the community bank in the markets in the Puget Sound region where we operate. The significant economic factors that are most relevant to our business and our financial performance include, but are not limited to, real estate values, interest rates and unemployment rates. In recent years, the Puget Sound region has experienced significant population gain, fueled in large part by the region’s technology industry, low unemployment and rising real estate values, all of which positively impacted our business. The macro economic environment is continuously changing, primarily due to the pace of economic growth, inflation, changing interest rates, global trade tensions, tariffs, unemployment, global unrest, the war in Ukraine, conflicts in the Middle East, political uncertainty, natural disasters and trade issues that contribute to economic uncertainty which has caused increased market volatility and may lead to a significant decrease in consumer confidence and business generally.

Critical Accounting Estimates and Significant Accounting Policies

Our accounting policies are integral to understanding our results of operations. Our accounting policies are described in greater detail in Note 1 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Certain accounting policies involve significant judgments and assumptions by us that have a material impact on the carrying value of certain assets and liabilities. Our critical accounting estimates are included and discussed below. These assumptions, estimates and judgments we use can be influenced by a number of factors, including the general economic environment. Actual results could differ from these judgments and estimates under different conditions, resulting in a change that could have a material impact on the carrying values of our assets and liabilities and our results of

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operations. We believe that of our accounting policies, the following accounting policies may involve a higher degree of judgment and complexity:

Allowance for Credit Losses

The allowance for credit losses ("ACL") is an estimate of the expected credit losses on financial assets measured at amortized cost. The ACL is evaluated and calculated on a collective basis for those loans which share similar risk characteristics. At each reporting period, the Company evaluates whether the loans in a pool continue to exhibit similar risk characteristics as the other loans in the pool and whether it needs to evaluate the allowance on an individual basis. The Company must estimate expected credit losses over the loans’ contractual terms, adjusted for expected prepayments. In estimating the life of the loan, the Company cannot extend the contractual term of the loan for expected extensions, renewals and modifications, unless the extension or renewal options are included in the contract at the reporting date and are not unconditionally cancellable by the Company. Because expected credit losses are estimated over the contractual life adjusted for estimated prepayments, determination of the life of the loan may significantly affect the ACL. The Company has chosen to segment its portfolio consistent with the manner in which it manages the risk of the type of credit.

•Community bank Portfolio: The ACL calculation is derived from loan segments utilizing loan level information and relevant available information from internal and external sources related to past events and current conditions. In addition, the Company incorporates a reasonable and supportable fo

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/CCB/mda/fy2025/
All MD&A years: /company/CCB/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/CCB/mda/fy2024/): filed 2025-03-17; accession 0001437958-25-000058 (https://www.sec.gov/Archives/edgar/data/1437958/000143795825000058/ck1437958-20241231.htm)
- [FY 2023 MD&A](/company/CCB/mda/fy2023/): filed 2024-03-15; accession 0001437958-24-000052 (https://www.sec.gov/Archives/edgar/data/1437958/000143795824000052/ck1437958-20231231.htm)
- [FY 2022 MD&A](/company/CCB/mda/fy2022/): filed 2023-03-16; accession 0001437958-23-000051 (https://www.sec.gov/Archives/edgar/data/1437958/000143795823000051/ck1437958-20221231.htm)
- [FY 2021 MD&A](/company/CCB/mda/fy2021/): filed 2022-03-14; accession 0001564590-22-009970 (https://www.sec.gov/Archives/edgar/data/1437958/000156459022009970/ck1437958-10k_20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 6022 State Commercial Banks) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity

Macro-to-micro threads including this sector: [Interest rates & the Fed](/thread/interest-rates-fed/), [Money & trade](/thread/money-trade/), [Consumer & credit](/thread/consumer-credit/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/CCB.md · JSON record: /company/CCB.json · verified financials: /company/CCB/financials.json / /company/CCB/financials.csv · machine TOC for the whole site: /llms.txt