BayFirst Financial Corp. reported a net loss of $0.3 million, or $0.17 per common share, for the first quarter of 2025, a decrease from the $9.8 million net income in the fourth quarter of 2024. This shift was primarily due to the absence of the $11.6 million pre-tax gain from the Q4 2024 branch property sale and lower noninterest income from government-guaranteed loan activities. Noninterest income fell to $8.8 million in Q1 2025 from $22.3 million in Q4 2024.
Despite the net loss, net interest income continued to grow, reaching $11.0 million, up from $10.7 million in the prior quarter, and the net interest margin expanded by 17 basis points to 3.77%. However, credit quality deteriorated further, with nonperforming assets increasing to 2.08% of total assets as of March 31, 2025, up from 1.50% at year-end 2024. The provision for credit losses remained elevated at $4.4 million.
Management initiated a comprehensive strategic review aimed at de-risking unguaranteed SBA loan balances and strengthening credit underwriting. In support of these efforts, a new Chief Credit Officer was appointed in January 2025, and a Director of Credit Administration was added in February 2025. The company also reported repurchasing $0.3 million in shares under its authorized program and declared a second-quarter 2025 cash dividend of $0.08 per share.
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