SEC Filing Document

Company: Forbright, Inc.
Ticker: 
CIK: 1925062
Filing Type: DRS/A
Document Type: DRS/A
Date Filed: 2026-04-08
Accession Number: 0001628279-26-000459
Exchange: 
SIC Code: 6022
SIC Description: State Commercial Banks
URL: https://www.sec.gov/Archives/edgar/data/1925062/000162827926000459/filename1.htm

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$8.7 million. During 2024, we transferred five real estate finance loans held for investment at amortized cost to OREO assets. There were no sales of OREO during 2024. As of December 31, 2024, there were five OREO properties with an aggregate value of $25.5 million. OREO is recognized in Other Assets on the Consolidated Balance Sheets. Non-performing Loans A loan for which the accrual of interest has been discontinued is designated as a non-accrual loan. When loans are placed on non-accrual status, all interest previously accrued but not collected is reversed against current period interest income. Income on non-accrual loans is subsequently recognized only to the extent that cash is received and the loan’s principal balance is deemed collectible. Loans are restored to accrual status when loans are once again current with regards to payment status, become well-secured, and management believes full collectability of future principal and interest is probable.

A loan is evaluated for individual impairment when we determine that it no longer exhibits similar risk characteristics inline with the rest of the related loan category. Individually evaluated loans include loans on non-accrual status. Depending on a particular loan’s circumstances, we measure impairment of a loan based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s observable market price, or the fair value of the collateral less estimated costs to sell if the loan is collateral dependent. A loan is considered collateral dependent when repayment of the loan is based solely on the liquidation of the collateral. Fair value, where possible, is determined by independent appraisals, typically on an annual basis. Between appraisal periods, the fair value may be adjusted based on specific events, such as if deterioration of quality of the collateral comes to our attention as part of our problem loan monitoring process, or if discussions with the borrower lead us to believe the last appraised value no longer reflects the actual market for the collateral. The impairment amount on a collateral-dependent loan is charged-off to the allowance if deemed not collectible and the impairment amount on a loan that is not collateral-dependent is set up as a specific reserve.

The following tables present non-performing loans held for investment at amortized cost, by loan category, as of the dates indicated:

For the Year Ended December 31, 2025

(dollars in thousands) Commercial Real Estate Commercial and Industrial Consumer Total
Non-accruing $	60,361 $	5,484 $	1,857 $	67,702
Accruing loans 90 days or more past due — — — —

Total non-performing loans held for investment at amortized cost $	60,361 $	5,484 $	1,857 $	67,702

Total loans held for investment at amortized cost $	2,528,996 $	2,475,549 $	217,689 $	5,222,234

Non-accrual loans to total loans held for investment at amortized cost ratio 2.39	% 0.22	% 0.85	% 1.30	%

ACL - loans to non-accrual loans held for investment at amortized cost ratio 30.88	% 474.51	% 448.25	% 78.26	%

Non-performing loans to total loans held for investment at amortized cost ratio 2.39	% 0.22	% 0.85	% 1.30	%

For the Year Ended December 31, 2024

(dollars in thousands) Commercial Real Estate Commercial and Industrial Consumer Total
Non-accruing $	44,694 $	12,789 $	1,122 $	58,605
Accruing loans 90 days or more past due — — — —

Total non-performing loans held for investment at amortized cost $	44,694 $	12,789 $	1,122 $	58,605

Total loans held for investment at amortized cost $	1,730,883 $	1,986,457 $	246,633 $	3,963,973

Non-accrual loans to total loans held for investment at amortized cost ratio 2.58	% 0.64	% 0.45	% 1.48	%
ACL - loans to non-accrual loans ratio 27.02	% 151.54	% 965.78	% 72.17	%

Non-performing loans to total loans held for investment at amortized cost ratio 2.58	% 0.64	% 0.45	% 1.48	%

Total non-performing held for investment loans at amortized cost were $67.7 million as of December 31, 2025, an increase of 15.5% compared to $58.6 million as of December 31, 2024. The increase was due to an increase in non-accrual loans, primarily related to two real estate finance loans and four cash flow lending loans being placed on non-accrual status, during 2025. The increase in non-performing held for investment loans at amortized cost was partially offset by one loan in our healthcare finance loan portfolio being placed back onto accrual status, and two cash flow lending loans on non-accrual being paid off.

Modifications to Borrowers Experiencing Financial Difficulty

The following tables present by class and by type of modification, the recorded investment and financial effect of modification as of December 31, 2025 and 2024, in our loans that were both modified and experiencing financial

difficulty during the years ended December 31, 2025 and 2024:

December 31, 2025
(dollars in thousands) Term Extension Total Modification to Loan Class Ratio Weighted-Average Term Extension
Commercial and Industrial $	292 $	292 0.01	% 12.0 months
Total $	292 $	292

December 31, 2024
(dollars in thousands) Term Extension Total Modification to Loan Class Ratio Weighted-Average Term Extension
Commercial and Industrial $	1,971 $	1,971 0.10	% 19.2 months
Total $	1,971 $	1,971

As of December 31, 2025 and 2024, there were no unfunded loan commitments on modifications for borrowers experiencing financial difficulty.

See Note 5, “Credit Quality” to our consolidated financial statements and the notes thereto included elsewhere in this prospectus for more information on loan modifications to borrowers experiencing financial difficulty.

Asset Quality Trends

Management monitors trends in delinquencies, nonperforming assets, and criticized loans to identify areas of potential credit deterioration or improvement. While overall credit quality remains consistent with management’s expectations, certain loan segments may be more sensitive to changes in interest rates, borrower cash flows, or economic conditions. Management continues to closely monitor these segments and adjust credit oversight and risk management practices as appropriate.

Asset quality metrics during the period reflect the performance of our loan portfolio and broader economic conditions. We experienced general improvements in asset quality metrics during 2025, due to lower criticized and classified loans, non-accrual loans decreasing as a percentage of total assets, a significant reduction in OREO, and increased total assets and capital.

Credit Quality

We use several credit quality indicators to manage credit risk in an ongoing manner. The risk rating system is central to the overall credit risk management discipline and the important first step in effectively monitoring the credit quality of the portfolio. Credit risk ratings are applied individually to those classes of assets that have significant or unique credit characteristics that benefit from a case-by-case evaluation. Groups of assets that are underwritten and structured using standardized criteria and characteristics, such as statistical models (e.g., credit scoring or payment performance), are typically risk rated and monitored collectively. These are typically assets to individuals in the classes which comprise the consumer and solar portfolio categories.

During 2025, credit metric trends improved primarily due to criticized and classified loans decreasing, both overall and relative to total loans, and the increase in non-accrual loans being lower than the growth in total loans, causing a decrease as a percentage of total loans.

The following are the definitions of our credit quality indicators:

•Acceptable Risk (or better) - Assets in all classes that comprise the commercial and consumer portfolio categories that are not adversely rated, are contractually current as to principal and interest, and are otherwise in compliance with the contractual terms of the asset agreement. Management believes that there is a low likelihood of loss related to those assets that are considered Acceptable Risk or better.

•Higher Risk - Assets in this category may demonstrate weaker credit fundamentals with an above-average chance of resulting in a default combined with a lower risk of loss to create an overall risk, profile which requires appropriate monitoring but do not present potential weaknesses or a warrant a lower rating.

•Special Mention - Assets in this category exhibit potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may, at some future date, result in deterioration of the repayment prospects for the asset. Special Mention assets are not adversely classified and do not expose an institution to sufficient risk to warrant adverse classification. While potentially weak, the asset is currently marginally acceptable, and no loss of principal or interest is envisioned.

•Substandard - A substandard asset is inadequately protected by the current sound worth and paying capacity of the borrower or the collateral pledged, if any. Assets classified in this category must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that we will sustain some loss if the deficiencies are not corrected. Loss potential, which exists in the aggregate amount of Substandard assets, does not have to exist in individual assets classified substandard.