Gateway Bank, F.S.B. Reports Second Quarter 2026 Results; Loan Growth up 35% Year Over Year
OAKLAND, Calif., July 28, 2026 (GLOBE NEWSWIRE) — Gateway Bank, F.S.B. (OTCPK: GWBK) (“the Bank”) today announced a net loss of $171,000 for the second quarter of 2026. This compared to a net loss of $336,000 in the preceding quarter, and a net loss of $827,000 in the second quarter of 2025. Net interest margin expansion and solid loan growth drove improved operating results compared to both the prior quarter and year-ago period. In the first six months of 2026 the Bank reported a net loss of $507,000, compared to a net loss of $1.79 million in the first six months of 2025. All financial results are unaudited.
“Second quarter results reflect the continued progress we are making across the Bank, and we are encouraged by how much closer that momentum is bringing us to sustained profitability,” said Mukhtar Ali, President and CEO. “A key driver of our new business this quarter has been the addition of Tom Rodriguez and his underwriting team, whose construction lending expertise is already paying off. We booked our first credit under the team shortly after they joined in the second quarter, and we have a robust pipeline of construction credits we expect to fund throughout the rest of the year. Beyond construction, we have seen significant loan growth in multifamily and non-farm, non-residential real estate over the first and second quarters, more than doubling in certain areas compared to a year ago. Construction, meanwhile, is an area where we started from a modest base last year, and it’s one where we plan to keep focusing our growth, alongside continued momentum in multifamily and non-farm, non-residential real estate, while our 1-4 single family portfolio remains stable.”
“Net interest margin for the second quarter included some one-time interest and fee items on loans, including a recovery of nonaccrual interest that pushed our margin over 3%. We expect that to moderate going forward – higher than where we started the year, but below where we ended in June. That said, the underlying growth in net interest income tied to loans returning to accrual status is real, even though it skewed our second quarter results somewhat. On the funding side, our cost of funds has stabilized after a period of improvement, consistent with broader market trends, and we expect to hold steady over the next few quarters while focusing on growing yields on earning assets to continue improving our margin,” said Ali.
Second Quarter and Year to Date 2026 Highlights:
- Net interest income increased 41.8% to $2.15 million in the second quarter of 2026, compared to $1.51 million in the first quarter of 2026, and increased 81.0% compared to $1.19 million in the second quarter of 2025. In the first six months of 2026, net interest income increased 50.9% to $3.66 million, compared to $2.42 million in the first six months of 2025.
- The Bank reported a net loss of $171,000 for the second quarter of 2026, compared to net loss of $336,000 for the first quarter of 2026, and a net loss of $827,000 for the second quarter of 2025. Year to date, the Bank reported a net loss of $507,000, compared to a net loss of $1.79 million in the same period one year earlier.
- Total revenue, consisting of net interest income before the provision for credit losses, plus non-interest income, increased 41.6% to $2.17 million in the second quarter of 2026, compared to $1.53 million in the preceding quarter and increased 82.9% compared to $1.19 million in the second quarter a year ago. In the first six months of 2026, total revenue increased 55.4% to $3.71 million, compared to $2.38 million in the first six months of 2025.
- Net interest margin was 3.05% in the second quarter of 2026, compared to 2.23% in the preceding quarter and 1.91% in the second quarter a year ago. The 82 basis point increase in net interest margin during the second quarter was driven by an improved cost of funds and stable earning asset yields compared to the linked quarter. The increase also reflected a one-time recovery of nonaccrual interest, which is not expected to recur in future quarters.
- Non-interest expense increased 19.5% to $2.23 million in the second quarter of 2026, compared to $1.87 million in the preceding quarter, and increased 7.5% when compared to $2.08 million in the second quarter a year ago. Salaries and employee benefits, which make up the largest component of non-interest expense, rose mainly due to the new commercial lending team joining the bank during the prior quarter. That increase was partially offset by lower occupancy costs and a reduction in other non-interest expenses.
- Average assets for the quarter totaled $287.7 million, an increase of $14.4 million, or 5.3% from the prior quarter, and an increase of $37.8 million, or 15.1% from the year ago quarter. Total assets increased nominally to $288.2 million at June 30, 2026, compared to $286.5 million at March 31, 2026, and increased $42.0 million, or 17.1% compared to $246.2 million at June 30, 2025.
- Average total gross loans for the second quarter of 2026 increased $25.2 million, or 11.8% to $237.9 million, compared to $212.7 million in the first quarter of 2026, and increased $54.0 million, or 29.4% from $183.9 million in the second quarter of 2025. Total loans at June 30, 2026, increased 5.9% during the quarter to $246.5 million from $232.7 million at March 31, 2026, and increased 35.1% compared to $182.4 million at June 30, 2025.
- Average second quarter 2026 total deposits decreased nominally to $203.4 million, from $204.5 million in the preceding quarter, and decreased 9.0% from $223.4 million in the second quarter a year ago. Total deposits increased nominally to $204.1 million, at June 30, 2026, compared to $202.3 million at March 31, 2026, and decreased $15.9 million, or 7.2% compared to $220.0 million at June 30, 2025.
- Largely due to robust loan growth during the quarter, the Bank recorded a $110,000 provision for credit losses in the second quarter of 2026, compared to a $2,000 provision in the first quarter of 2026. In the first quarter of 2025 the Bank recorded a $63,000 credit to the provision for credit losses.
- Allowance for credit losses, as a percentage of total loans, was 1.07% at June 30, 2026, compared to 1.09% at March 31, 2026, and 1.38% at June 30, 2025.
- Nonperforming loans improved to $610,000 at June 30, 2026, compared to $5.76 million at March 31, 2026, and $3.04 million a year ago.
- There were no net charge-offs in the second quarter of 2026, or in the prior quarter or year ago quarter.
- The Bank’s capital levels remained above the threshold for well-capitalized institutions with a Community Bank Leverage Ratio of 13.84% at June 30, 2026.
“We remain deeply committed to the communities we serve, and this quarter’s strong engagement across both our longstanding Chinatown market and our growing presence in Walnut Creek reflects that dedication. We are proud to support the continued growth of these communities and the relationships we have built there,” said Ali. Earlier this year, the Bank celebrated the grand opening of its relocated Walnut Creek branch at 1801 N. California Blvd, Suite 101. The full-service location sits just a block from the Walnut Creek BART station, across from the business district, and offers parking beneath the building.
About Gateway Bank, F.S.B. Gateway Bank is a Federally-chartered savings bank headquartered in Oakland, California and began operations on June 8, 1990. The Bank currently operates out of its offices located in Oakland’s Chinatown and Walnut Creek, and offers banking services to individuals and businesses in the San Francisco Bay Area.
| Gateway Bank, FSB | |||||||||||||||||||
| Balance Sheets | |||||||||||||||||||
| Unaudited | |||||||||||||||||||
| Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | Jun 30 2025 | |||||||||||||||
| Assets | |||||||||||||||||||
| Cash and due from banks | 1,852,376 | 1,828,608 | 1,629,783 | 1,285,211 | 1,940,726 | ||||||||||||||
| Fed funds sold | – | 128,881 | – | – | – | ||||||||||||||
| Interest bearing deposits with banks | 7,205,836 | 16,054,308 | 9,150,342 | 15,358,735 | 22,126,902 | ||||||||||||||
| Total cash and equivalents | 9,058,212 | 18,011,797 | 10,780,125 | 16,643,946 | 24,067,628 | ||||||||||||||
| Investment securities, AFS | 23,913,699 | 27,456,099 | 27,839,840 | 30,557,274 | 33,164,921 | ||||||||||||||
| FHLB Stock and Other Investments | 2,158,600 | 2,061,200 | 2,061,200 | 2,061,200 | 2,061,200 | ||||||||||||||
| 1-4 family residential | 163,716,451 | 161,339,952 | 161,718,113 | 134,471,362 | 140,800,113 | ||||||||||||||
| Multifamily residential | 22,630,690 | 21,624,467 | 12,935,464 | 13,002,960 | 9,334,581 | ||||||||||||||
| Non-farm, non-residential real estate | 56,526,390 | 45,360,554 | 36,071,404 | 28,854,756 | 29,032,759 | ||||||||||||||
| Construction | 2,077,420 | – | – | – | – | ||||||||||||||
| Commercial and industrial | 1,535,966 | 4,356,480 | 4,366,320 | 3,134,343 | 3,279,098 | ||||||||||||||
| Consumer and other | 3,134 | – | 410 | 59 | 342 | ||||||||||||||
| Loans, net of unearned income | 246,490,051 | 232,681,453 | 215,091,711 | 179,463,480 | 182,446,893 | ||||||||||||||
| Allowance for Credit Losses-Loans | (2,639,477 | ) | (2,543,007 | ) | (2,540,065 | ) | (2,531,061 | ) | (2,520,472 | ) | |||||||||
| Total loans, net | 243,850,574 | 230,138,446 | 212,551,646 | 176,932,419 | 179,926,421 | ||||||||||||||
| Premises and equipment, net | 889,335 | 800,400 | 695,171 | 602,114 | 366,162 | ||||||||||||||
| Accrued interest receivable | 1,434,070 | 1,231,367 | 1,162,055 | 1,156,714 | 1,227,080 | ||||||||||||||
| Other assets | 6,912,319 | 6,830,271 | 5,376,047 | 5,073,847 | 5,372,032 | ||||||||||||||
| Total Assets | $ | 288,216,809 | $ | 286,529,580 | $ | 260,466,084 | $ | 233,027,514 | $ | 246,185,444 | |||||||||
| Liabilities | |||||||||||||||||||
| Non-Interest Bearing Deposits | 8,025,908 | 8,365,308 | 9,641,094 | 9,165,121 | 8,243,872 | ||||||||||||||
| Interest bearing demand deposits | 6,086,803 | 5,787,575 | 6,793,724 | 7,025,056 | 5,767,092 | ||||||||||||||
| Savings and Money Market Deposits | 28,692,325 | 26,064,932 | 27,470,224 | 19,978,923 | 20,844,299 | ||||||||||||||
| Time Deposits – Retail | 149,313,715 | 150,125,894 | 147,156,815 | 159,529,226 | 167,156,792 | ||||||||||||||
| Time Deposits – Wholesale | 11,976,568 | 11,972,512 | 11,968,456 | 11,964,400 | 17,959,411 | ||||||||||||||
| Total Deposits | 204,095,319 | 202,316,221 | 203,030,313 | 207,662,726 | 219,971,466 | ||||||||||||||
| Borrowings | 43,000,000 | 43,000,000 | 33,000,000 | – | – | ||||||||||||||
| Accrued expenses and other liabilities | 3,940,874 | 3,871,641 | 2,346,532 | 2,380,514 | 2,741,604 | ||||||||||||||
| Total Liabilities | 251,036,193 | 249,187,862 | 238,376,845 | 210,043,240 | 222,713,070 | ||||||||||||||
| Equity | |||||||||||||||||||
| Common stock | 53,763,103 | 53,763,103 | 26,991,436 | 26,991,436 | 26,991,436 | ||||||||||||||
| Capital surplus | 24,771,345 | 24,665,279 | 35,972,894 | 35,962,369 | 35,962,369 | ||||||||||||||
| Retained earnings | (38,216,587 | ) | (38,216,587 | ) | (34,332,122 | ) | (34,332,122 | ) | (34,332,122 | ) | |||||||||
| Accumulated other comprehensive income (loss) | (2,630,700 | ) | (2,534,270 | ) | (2,658,504 | ) | (2,981,990 | ) | (3,364,208 | ) | |||||||||
| Net Income | (506,545 | ) | (335,807 | ) | (3,884,465 | ) | (2,655,419 | ) | (1,785,101 | ) | |||||||||
| Total Equity | 37,180,616 | 37,341,718 | 22,089,239 | 22,984,274 | 23,472,374 | ||||||||||||||
| Total Liabilities & Equity | $ | 288,216,809 | $ | 286,529,580 | $ | 260,466,084 | $ | 233,027,514 | $ | 246,185,444 | |||||||||
| Book Value Per Share | $ | 0.069 | $ | 0.069 | $ | 0.082 | $ | 0.085 | $ | 0.087 | |||||||||
| Gateway Bank, FSB | |||||||||||||||||||
| Quarterly Income Statements | |||||||||||||||||||
| Unaudited | Quarter Ended | ||||||||||||||||||
| Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | Jun 30 2025 | |||||||||||||||
| Interest Income | |||||||||||||||||||
| Interest and fees on loans | $ | 3,789,596 | $ | 2,907,033 | $ | 2,682,155 | $ | 2,602,415 | $ | 2,562,996 | |||||||||
| Dividends on FHLB stock | 33,656 | 97,379 | 40,970 | 38,439 | 32,181 | ||||||||||||||
| Interest on federal funds sold | 888 | 283 | 208 | 3,447 | 2,036 | ||||||||||||||
| Interest on deposits with banks | 128,267 | 217,706 | 118,893 | 189,417 | 253,223 | ||||||||||||||
| Investment securities – AFS | 270,683 | 257,941 | 277,750 | 332,268 | 367,675 | ||||||||||||||
| Total Interest Income | 4,223,090 | 3,480,342 | 3,119,976 | 3,165,986 | 3,218,111 | ||||||||||||||
| Interest Expense | |||||||||||||||||||
| Interest bearing demand deposits | 1,475 | 1,453 | 1,651 | 1,215 | 785 | ||||||||||||||
| Savings and money market deposits | 172,562 | 159,637 | 146,900 | 122,160 | 98,936 | ||||||||||||||
| Retail time deposits | 1,384,829 | 1,382,261 | 1,464,269 | 1,661,229 | 1,754,029 | ||||||||||||||
| Wholesale time deposits | 115,572 | 114,287 | 116,736 | 145,127 | 178,729 | ||||||||||||||
| Total Interest Expense on Deposits | 1,674,438 | 1,657,638 | 1,729,556 | 1,929,731 | 2,032,479 | ||||||||||||||
| Interest expense on borrowings | 402,893 | 309,921 | 144,463 | – | – | ||||||||||||||
| Total Interest Expense | 2,077,331 | 1,967,559 | 1,874,019 | 1,929,731 | 2,032,479 | ||||||||||||||
| Net Interest Income | 2,145,759 | 1,512,783 | 1,245,957 | 1,236,255 | 1,185,632 | ||||||||||||||
| Provision for credit losses | 109,774 | 1,969 | 7,469 | 10,859 | (62,583 | ) | |||||||||||||
| Net interest income after provision for credit losses | 2,035,985 | 1,510,814 | 1,238,488 | 1,225,396 | 1,248,215 | ||||||||||||||
| Non Interest Income | |||||||||||||||||||
| Service charges and fees | 3,322 | 3,188 | 3,222 | 2,994 | 5,269 | ||||||||||||||
| Loan servicing fees & MSR valuation | (11,955 | ) | 720 | (12,209 | ) | (37,304 | ) | (27,567 | ) | ||||||||||
| Other noninterest income | 34,598 | 16,870 | 16,565 | 16,810 | 23,917 | ||||||||||||||
| Total Non Interest Income | 25,965 | 20,778 | 7,578 | (17,500 | ) | 1,619 | |||||||||||||
| Non Interest Expense | |||||||||||||||||||
| Salaries and employee benefits | 1,374,579 | 1,059,563 | 1,335,580 | 1,120,524 | 1,072,994 | ||||||||||||||
| Occupancy | 164,801 | 153,832 | 174,937 | 292,661 | 241,429 | ||||||||||||||
| Other noninterest expense | 692,508 | 654,005 | 964,594 | 665,029 | 762,095 | ||||||||||||||
| Total Non Interest Expense | 2,231,888 | 1,867,400 | 2,475,111 | 2,078,214 | 2,076,518 | ||||||||||||||
| Income (Loss) Before Taxes | (169,938 | ) | (335,808 | ) | (1,229,045 | ) | (870,318 | ) | (826,684 | ) | |||||||||
| Income taxes | 800 | – | – | – | 800 | ||||||||||||||
| Net Income (Loss) | $ | (170,738 | ) | $ | (335,808 | ) | $ | (1,229,045 | ) | $ | (870,318 | ) | $ | (827,484 | ) | ||||
| Gateway Bank, FSB | ||||||||||||||
| Year-To-Date Income Statements | ||||||||||||||
| Unaudited | Six Months Ended | |||||||||||||
| Jun 30 2026 | Jun 30 2025 | $ Variance | % Variance | |||||||||||
| Interest Income | ||||||||||||||
| Interest and fees on loans | $ | 6,696,629 | $ | 5,287,720 | $ | 1,408,909 | 27 | % | ||||||
| Dividends on FHLB stock | 131,035 | 71,221 | 59,814 | 84 | % | |||||||||
| Interest on federal funds sold | 1,171 | 33,022 | (31,851 | ) | -96 | % | ||||||||
| Interest on deposits with banks | 345,973 | 501,839 | (155,866 | ) | -31 | % | ||||||||
| Investment securities – AFS | 528,624 | 737,341 | (208,717 | ) | -28 | % | ||||||||
| Total Interest Income | 7,703,432 | 6,631,143 | 1,072,289 | 16 | % | |||||||||
| Interest Expense | ||||||||||||||
| Interest bearing demand deposits | 2,927 | 1,647 | 1,280 | 78 | % | |||||||||
| Savings and money market deposits | 332,199 | 183,415 | 148,784 | 81 | % | |||||||||
| Retail time deposits | 2,767,090 | 3,665,658 | (898,568 | ) | -25 | % | ||||||||
| Wholesale time deposits | 229,858 | 355,555 | (125,697 | ) | -35 | % | ||||||||
| Total Interest Expense on Deposits | 3,332,074 | 4,206,275 | (874,201 | ) | -21 | % | ||||||||
| Interest expense on borrowings | 712,814 | – | 712,814 | 0 | % | |||||||||
| Total Interest Expense | 4,044,888 | 4,206,275 | (161,387 | ) | -4 | % | ||||||||
| Net Interest Income | 3,658,544 | 2,424,868 | 1,233,676 | 51 | % | |||||||||
| Provision for credit losses | 111,743 | 27,041 | 84,702 | 313 | % | |||||||||
| Net interest income after provision for credit losses | 3,546,801 | 2,397,827 | 1,148,974 | 48 | % | |||||||||
| Non Interest Income | ||||||||||||||
| Service charges and fees | 6,509 | 13,406 | (6,897 | ) | -51 | % | ||||||||
| Loan servicing fees | (11,235 | ) | (52,586 | ) | 41,351 | -79 | % | |||||||
| Other noninterest income | 51,468 | (1,830 | ) | 53,298 | -2912 | % | ||||||||
| Total Non Interest Income | 46,742 | (41,010 | ) | 87,752 | -214 | % | ||||||||
| Non Interest Expense | ||||||||||||||
| Salaries and employee benefits | 2,434,142 | 2,169,910 | 264,232 | 12 | % | |||||||||
| Occupancy | 318,633 | 479,726 | (161,093 | ) | -34 | % | ||||||||
| Other noninterest expense | 1,346,513 | 1,491,482 | (144,969 | ) | -10 | % | ||||||||
| Total Non Interest Expense | 4,099,288 | 4,141,118 | (41,830 | ) | -1 | % | ||||||||
| Income (Loss) Before Taxes | (505,745 | ) | (1,784,301 | ) | 1,278,556 | -72 | % | |||||||
| Income taxes | 800 | 800 | – | 0 | % | |||||||||
| Net Income (Loss) | $ | (506,545 | ) | $ | (1,785,101 | ) | $ | 1,278,556 | -72 | % | ||||
| Gateway Bank, FSB | |||||||||||||||||||
| Quarterly Financial Highlights | |||||||||||||||||||
| Unaudited | For The Quarter Ended | ||||||||||||||||||
| ($ in Thousands) | Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | Jun 30 2025 | ||||||||||||||
| EARNINGS | |||||||||||||||||||
| Net interest income | $ | 2,146 | $ | 1,513 | $ | 1,246 | $ | 1,236 | $ | 1,186 | |||||||||
| Provision for credit losses | 110 | 2 | 7 | 11 | (63 | ) | |||||||||||||
| Non-interest income | 26 | 21 | 8 | (18 | ) | 2 | |||||||||||||
| Non-interest expense | 2,232 | 1,867 | 2,475 | 2,078 | 2,077 | ||||||||||||||
| Net income | (171 | ) | (336 | ) | (1,229 | ) | (870 | ) | (827 | ) | |||||||||
| PERFORMANCE RATIOS | |||||||||||||||||||
| Yield on loans | 6.38 | % | 5.48 | % | 5.52 | % | 5.71 | % | 5.58 | % | |||||||||
| Yield on earning assets | 5.99 | % | 5.19 | % | 5.20 | % | 5.32 | % | 5.21 | % | |||||||||
| Cost of funds | 3.37 | % | 3.34 | % | 3.41 | % | 3.57 | % | 3.65 | % | |||||||||
| Net interest margin | 3.05 | % | 2.23 | % | 2.10 | % | 2.10 | % | 1.91 | % | |||||||||
| Efficiency ratio | 103 | % | 122 | % | 197 | % | 171 | % | 175 | % | |||||||||
| CAPITAL | |||||||||||||||||||
| Tangible equity to tangible assets | 12.81 | % | 12.94 | % | 8.38 | % | 9.74 | % | 9.41 | % | |||||||||
| Community Bank Leverage Ratio | 13.84 | % | 14.59 | % | 10.18 | % | 10.65 | % | 10.58 | % | |||||||||
| ASSET QUALITY | |||||||||||||||||||
| Net loan charge-offs (recoveries) | $ | – | $ | – | $ | – | $ | – | $ | – | |||||||||
| Allowance for credit losses on loans | 2,639 | 2,543 | 2,540 | 2,531 | 2,520 | ||||||||||||||
| Non-performing loans | 610 | 5,757 | 5,877 | 4,039 | 3,040 | ||||||||||||||
| ACL to total loans | 1.07 | % | 1.09 | % | 1.18 | % | 1.41 | % | 1.38 | % | |||||||||
| ACL to non-performing loans | 432 | % | 44 | % | 43 | % | 63 | % | 83 | % | |||||||||
| END OF PERIOD BALANCES | |||||||||||||||||||
| Total loans, gross | $ | 246,490 | $ | 232,681 | $ | 215,092 | $ | 179,463 | $ | 182,447 | |||||||||
| Total assets | 288,217 | 286,530 | 260,466 | 233,028 | 246,185 | ||||||||||||||
| Deposits | 204,095 | 202,316 | 203,030 | 207,663 | 219,971 | ||||||||||||||
| FHLB Advances | 43,000 | 43,000 | 33,000 | – | – | ||||||||||||||
| Total equity | 37,181 | 37,342 | 22,089 | 22,984 | 23,472 | ||||||||||||||
| Loan to deposit ratio | 120.8 | % | 115.0 | % | 105.9 | % | 86.4 | % | 82.9 | % | |||||||||
| Common Shares Outstanding (thousands) | 537,629 | 537,629 | 269,913 | 269,913 | 269,913 | ||||||||||||||
| QUARTERLY AVERAGE BALANCES | |||||||||||||||||||
| Total loans, gross | $ | 237,875 | $ | 212,719 | $ | 194,060 | $ | 182,190 | $ | 183,889 | |||||||||
| Earning assets | 279,472 | 266,442 | 236,773 | 234,217 | 243,567 | ||||||||||||||
| Total assets | 287,726 | 273,297 | 243,104 | 240,555 | 249,954 | ||||||||||||||
| Deposits | 203,350 | 204,549 | 202,358 | 214,611 | 223,431 | ||||||||||||||
| FHLB Advances | 43,000 | 34,000 | 15,565 | – | – | ||||||||||||||
| Total equity | 37,349 | 32,128 | 22,768 | 23,295 | 23,731 | ||||||||||||||
| Common Shares Outstanding (thousands) | 537,629 | 475,162 | 269,913 | 269,913 | 269,913 | ||||||||||||||
Contact:
Mukhtar Ali
(510) 813-8582
Mukhtar.Ali@gatewayfsb.com
