SEC Filing Document

Company: Forbright, Inc.
Ticker: 
CIK: 1925062
Filing Type: S-1
Document Type: S-1
Date Filed: 2026-05-15
Accession Number: 0001628280-26-035713
Exchange: 
SIC Code: 6022
SIC Description: State Commercial Banks
URL: https://www.sec.gov/Archives/edgar/data/1925062/000162828026035713/forbright-sx1publicflip.htm

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deferred tax assets primarily related to federal and state net operating loss carryforwards. In accordance with ASC 740 - Income Taxes, we assess the realizability of these deferred tax assets each reporting period by evaluating all available positive and negative evidence to determine whether it is more likely than not that some or all of the deferred tax assets will be realized. Based on this weighted evidence, management concluded that it is more likely than not that the net operating loss carryforwards, net of valuation allowances, recorded as of March 31, 2026 will be realized. As of March 31, 2026, we maintain a valuation allowance only for the portion of state net operating loss carryforwards likely to expire unused due to shorter carryforward periods. We will continue to monitor these assumptions going forward; any significant decline in actual results versus our projections may require an increase to the valuation allowance.

The amount of net operating loss carryforwards reflected on the balance sheet as of March 31, 2026, which are related to the acquisition of the solar servicing business, remain subject to change upon completion of acquisition accounting, which is expected to occur prior to the end of the third quarter of 2026 when the final tax return of the acquired entity is completed.

See above in “Results of Operations for the Years Ended December 31, 2025 and 2024—Income Taxes” for additional discussion regarding our deferred tax assets.

Financial Condition

Loan Portfolio

We manage our exposure to credit losses by evaluating credit risk in the following loan categories. Descriptions of the loan categories, which provide detail on the levels at which we develop and document our systematic methodology to determine the allowance for credit losses, are:

•Commercial Real Estate - CRE loans are primarily secured by various types of real estate including healthcare facilities, hospitality, office, retail, warehouse, industrial, multi-family properties, residential real estate (for commercial purposes), and other CRE properties, and are made to owners of such properties.

The category also includes loans for the construction of those property types. Within this category, loans are further bifurcated between loans secured by owner-occupied properties and investment (non-owner-occupied) properties. As of March 31, 2026, 54% of CRE loans were owner-occupied and 46% were non-owner-occupied. The repayment of loans secured by owner-occupied properties is dependent on cash flow from the successful operation of the business which owns the property. The repayment of loans secured by investment properties is dependent upon the operation (net operating income) or sale of the property. Both property types may be subject to adverse conditions in the CRE market or in the general economy. Loans secured by healthcare facilities are primarily owner-occupied properties and loans secured by other property types are primarily non-owner-occupied properties. Loans secured by healthcare facilities represent our largest concentration and represented approximately 60% of CRE loans and approximately 28% of our total loan portfolio as of March 31, 2026. No single CRE loan category secured by any other property type represented greater than 12% of CRE loans and 6% of our total loan portfolio as of March 31, 2026.

•Commercial and Industrial - Within this category, there is further distinction among lender finance loans, fund finance loans, healthcare asset-based loans, and corporate loans (which are typically cash flow loans). The market area for these loans is national with geographic diversification. The loan category also includes asset-secured energy project loans and small business loans and commercial solar loans purchased through fintech platforms. Of primary concern in commercial lending is the borrower’s creditworthiness and ability to successfully generate cash flow from their business to service the debt. No single commercial and industrial loan collateral type, industry, or infrastructure project type represented greater than 20% of commercial and industrial loans and 10% of our total loan portfolio as of March 31, 2026.

•Consumer - These loans consist primarily of loans made to individuals for personal, solar, family, and residential real estate purposes (including closed end mortgages and home equity lines of credit), with the majority of the portfolio comprised of loans purchased through fintech lender platforms. The vast majority of our consumer loans were purchased or originated before 2024 and a significant portion of the portfolio was sold during 2024. Outside of loans purchased under forward flow purchase agreements, the remaining consumer and residential real estate purpose loans represents less than 1% of the total loan portfolio as of March 31, 2026 and December 31, 2025. We no longer originate residential real estate loans to consumers.

Our loan portfolio consists primarily of commercial loans to small and medium-sized, privately owned businesses in a variety of industries and markets including on a national scale and across multiple lending strategies. As of March 31, 2026 and December 31, 2025, the single largest industry concentration in the Company’s loan portfolio was healthcare. We do not believe that it is reasonably possible that loss events could occur in the near term to cause any concentrations to result in a severe impact to our results of operations or liquidity. We do not have any concentrations involving loan product terms, loans with negative amortization schedules, significant payment increases, or high loan-to-value ratios. Additionally, due to the national operating footprint of our borrowers, we believe that we do not have a significant geographic concentration of credit exposure.

Our healthcare finance loan portfolio represented approximately 31% of our total loan portfolio as of March 31, 2026. Approximately 90% of the portfolio is classified as commercial real estate and approximately 10% of the portfolio is classified as commercial and industrial. This portfolio is diversified through a broad range of facility types, such as skilled nursing, assisted living, memory care, and behavioral health, where none of the facility types represented greater than 17% of total loans as of March 31, 2026.

Our lender finance loan portfolio represented approximately 19% of our total loan portfolio as of March 31, 2026. The portfolio is entirely classified as commercial and industrial. This portfolio is diversified across different collateral types, such as consumer finance, small business, and real estate, where none of the collateral types represented greater than 8% of total loans as of March 31, 2026.

Our real estate finance loan portfolio represented approximately 19% of our total loan portfolio as of March 31, 2026. Approximately 99% of the portfolio is classified as commercial real estate and approximately 1% of the portfolio is classified as commercial and industrial. This portfolio is diversified across different collateral types, such

as hospitality, multifamily, and office, where none of the collateral types represented greater than 6% of our total loan portfolio as of March 31, 2026.

Our fund finance loan portfolio represented approximately 14% of our total loan portfolio as of March 31, 2026. The portfolio is entirely classified as commercial and industrial. This portfolio is diversified across different collateral types, such as specialty finance (primarily consisting of asset based and/or real estate backed collateral), private credit, and private equity where none of the collateral types represented greater than 10% of total loans as of March 31, 2026. As of March 31, 2026, we had six loans to private credit funds and business development corporations that are collateralized by loans. Our private credit loan portfolio had total commitments and outstanding balances of $218 million and $187 million, respectively, and a weighted average effective advance rate of 61.2% on eligible collateral as of March 31, 2026. The majority of the loan collateral within this private credit portfolio is leveraged lending and other forms of enterprise value lending.

Our corporate finance loan portfolio represented approximately 12% of our total loan portfolio as of March 31, 2026. Approximately 100% of the portfolio is classified as commercial and industrial. This portfolio is diversified across different industries, such as manufacturing, business services, and healthcare as well as infrastructure projects, where none of the industry or the infrastructure project types represented greater than 2% of total loans as of March 31, 2026.

Total loans were $5.8 billion as of March 31, 2026, an increase of $182.1 million, or approximately 3.2%, compared with $5.6 billion as of December 31, 2025. Total loans were $5.6 billion as of December 31, 2025, an increase of $1.3 billion, or approximately 31%, compared with $4.3 billion as of December 31, 2024. Loans as of March 31, 2026, December 31, 2025, and December 31, 2024, included $407.6 million, $379.7 million, and $316.5 million of loans held-for-sale, respectively. As of March 31, 2026, December 31, 2025, and December 31, 2024, total loans were 81.1%, 82.7%, and 77.0% of deposits, respectively, and 70.3%, 71.1%, and 59.1% of total assets, respectively.

The following table presents loans held for investment at amortized cost, by loan type, as of March 31, 2026 and December 31, 2025: