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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tax expense computed using the federal statutory rates and income tax expense recognized for the years ended December 31, 2025 and 2024, are presented in the following table: December 31, 2025 December 31, 2024 (dollars in thousands) Amount Percentage of Pre-Tax Income Amount Percentage of Pre-Tax Income Income tax at the federal statutory rate $ 21,243 21.0 % $ 11,417 21.0 % State income tax, net of federal benefit 3,491 3.5 % 2,341 4.3 % Adjustment of provision to tax return 2 — % (2,090) (3.8) % Change in valuation allowance — — % 519 0.9 % Permanent items (61) (0.1) % 150 0.3 % Research and development credits (237) (0.2) % (1,090) (2.0) % Deferred credit assumed in solar servicing business transaction (11,221) (11.1) % — — % Other 14 — % (246) (0.5) % Total income tax expense and rate $ 13,231 13.1 % $ 11,001 20.2 %

A deferred credit was established as a liability, recognized as Other liabilities in the Consolidated Balance Sheets, in connection with the transaction described in Note 16. The amount of the deferred credit as of December 31, 2025 was $54.4 million, and will be amortized as a benefit in income tax expense in proportion to the recognition of the associated tax assets. During the year ended December 31, 2025, $11.2 million of the deferred credit was recognized in Income tax expense in the Consolidated Statements of Income.

The Company has uncertain income tax positions totaling $2.8 million and $1.4 million recorded as of December 31, 2025 and 2024, respectively, recognized in Other liabilities in the Consolidated Balance Sheets.

The components of net deferred tax assets and liabilities as of December 31, 2025 and 2024, are presented in the following table:

(in thousands) December 31, 2025 December 31, 2024
Deferred tax assets:
Allowance for credit losses $	13,061 $	11,270
Unrealized losses on investment portfolio — 153
Net operating losses and tax credit carryforwards 110,947 1,064
Stock compensation 9,392 7,534
Loan fair value adjustments 224 236
Accrued bonuses 7,444 6,296
Deferred loan costs and fees 3,359 4,746
Other 19,279 12,945
Total deferred tax assets 163,706 44,244
Valuation allowance (6,877) (835)
Net deferred tax assets 156,829 43,409
Deferred tax liability:
Depreciation and amortization (2,464) (3,228)

Unrealized gains on investment portfolio (1,051) —
Total deferred tax liabilities (3,515) (3,228)
Deferred tax asset, net $	153,314 $	40,181

Net operating loss, net of related valuation allowance, as of December 31, 2025, includes $104.1 million primarily related to the remaining impact of net operating losses resulting from the solar servicing business transaction during the third quarter of 2025. Pursuant to Section 382 of the Internal Revenue Code, if an “ownership change” (generally defined as a greater than 50% change by value in our stock ownership within a three-year period) occurs or has occurred, our ability to use our pre-change net capital loss carryforwards and certain other pre-change tax attributes to offset our post-change income may be limited. Similar rules and limitations may apply for state tax purposes as well.

The Company has federal net operating loss carryforwards of $374.7 million. All net operating loss carryforwards were generated in tax years beginning after December 31, 2017 and, therefore, do not expire. The utilization of these losses is generally limited to 80% of taxable income in any given tax year. The Company also has state net operating loss carryforwards of $826.8 million. Of the state net operating loss carryforwards, $530.1 million are related to jurisdictions that allow for an indefinite carryforward periods, and $296.7 million relate to jurisdictions with fixed expiration periods, which will begin to expire in 2032 and continue through 2044.

On January 1, 2025, the Company prospectively adopted ASU 2023-09, which requires the disaggregation of the disclosure of income taxes paid. See Note 1 – Significant Accounting Policies for more information.

Income tax payments, net of refunds received, made during the year ended December 31, 2025, are presented in the following table:

(in thousands) December 31, 2025
Federal: $	7,520
State and local:

California 627
Other 464
Total state and local income tax payments, net of refunds received 1,091
Total income tax payments, net of refunds received $	8,611

NOTE 18 – EARNINGS PER COMMON SHARE

The following table presents the calculation of basic and diluted earnings per share for the years ended December 31, 2025 and 2024:

December 31, 2025 December 31, 2024

(in thousands, except share and per share data) Voting Non-Voting Voting Non-Voting

Basic Earnings Per Common Share:

Net income $	41,526 $	46,400 $	20,458 $	22,908

Weighted-average shares - basic 19,011,264 21,242,551 18,971,357 21,242,551

Basic earnings per common share $	2.18 $	2.18 $	1.08 $	1.08

Diluted Earnings Per Common Share:

Net income $	42,826 $	45,100 $	21,031 $	22,335
Weighted-average shares - basic 19,011,264 21,242,551 18,971,357 21,242,551
Effect of dilutive securities - stock options and restricted stock awards 1,160,569 — 1,030,448 —

Weighted-average shares - diluted 20,171,833 21,242,551 20,001,805 21,242,551

Diluted earnings per common share $	2.12 $	2.12 $	1.05 $	1.05

The Company has two classes of common stock, Voting and Non-voting, which are participating securities. Earnings are allocated to each class based on their respective participation rights, and basic and diluted earnings per share are presented under the two-class method in accordance with ASC 260. All potentially dilutive shares have voting rights, and net income has been reallocated to reflect the incremental dilutive voting shares.

Diluted weighted-average shares outstanding includes 1,160,569 and 1,030,448 incremental common stock equivalents related to stock options and restricted stock awards as calculated under the treasury-stock method for the years ended December 31, 2025 and 2024, respectively, as the stock options and restricted stock awards are not considered participating securities. For the years ended December 31, 2025 and 2024, 23,209 shares and 8,967 shares, respectively, of common stock equivalents were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. Additionally, for the years ended December 31, 2025 and 2024, 2,325,336 stock options and 2,464,020 stock options, respectively, with unresolved substantive contingencies that must be satisfied before shares can be exercised and issued, and therefore do not represent potential shares of common stock, have been excluded from the weighted-average shares outstanding to calculate basic and diluted earnings per common share. As of December 31, 2025 and 2024, 396,022 shares and 26,000 shares, respectively, of unvested restricted stock awards with voting rights are included in outstanding shares of common stock on the Consolidated Balance Sheets and Consolidated Statements of Changes in Stockholders’ Equity, but are excluded from the calculation of basic earnings per share.

NOTE 19 – RELATED PARTY TRANSACTIONS

In the ordinary course of business, the Company may make loans to and receive deposits from related parties, which primarily includes principal officers and directors, and their affiliates. The Company had no loans outstanding to related parties as of December 31, 2025 and 2024. The aggregate amounts of deposits from related parties as of December 31, 2025 and 2024, was $5.2 million and $7.1 million, respectively. For more information on the activity of loans and deposits with related parties see Note 4 – Loans and Note 9 – Deposits, respectively.

The Company has a related party relationship with BancAlliance because certain employees of the Company also hold officer roles with BancAlliance, and a subsidiary of the Company serves as the asset manager of BancAlliance members. The Company sources loans for its own balance sheet and makes those loans available for sale through the BancAlliance program. Loans sold to BancAlliance are immediately sold to members in the program with terms of loan sales, including pricing, dictated by a Master Participation Agreement for the program that applies the same to all members of BancAlliance. BancAlliance is a pass-through participant and does not incur an economic or accounting impact from the program.

Transactions with BancAlliance for the years ended December 31, 2025 and 2024, and amounts due from BancAlliance as of December 31, 2025 and 2024, are presented in the following table:

(in thousands) December 31, 2025 December 31, 2024
Loans sold to BancAlliance $	228,275 $	261,653
Net gains realized on loans sold to BancAlliance $	1,828 $	3,219
Amounts due from BancAlliance related to funding and expense advancements $	6,035 $	161

In the ordinary course of business, the Company incurs expenses from transactions with vendors who are considered related parties. These transactions resulted in a non-material amount of expense for the years ended December 31, 2025 and 2024.

NOTE 20 – REGULATORY MATTERS

Banks and bank holding companies are subject to various regulatory capital requirements administered by state and federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations, involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators about qualifying capital components, risk weighting (where applicable) and other factors.