v3.25.3
Segments
 9 Months Ended
Sep. 30, 2025
Segment Reporting [Abstract]  
Segments Segments
The Company’s reportable segments represent business units with discrete financial information whose results are regularly reviewed by management. The four segments include Commercial Banking, OpenSky™ (the Company’s credit card division), Windsor Advantage™ (the Company’s SBA/USDA loan servicing provider) and CBHL (the Company’s residential mortgage loan division).
Our Commercial Banking division operates primarily in the Washington, D.C. and Baltimore metropolitan areas and focuses on providing personalized service to commercial clients throughout our area of operations supplemented by lending outside of our primary market as well as engaging in government-guaranteed lending on a national basis. Additionally, the Commercial Bank engages in deposit verticals on a nationwide scale providing services to HOAs, mortgage companies and other customers.
The Company issues credit cards through OpenSky™, a digitally-driven, nationwide credit card platform providing secured, partially secured, and unsecured credit solutions, and originates residential mortgages for sale in the secondary market through Capital Bank Home Loans (“CBHL”), the Bank’s residential mortgage banking arm. Additionally, Windsor Advantage™, a wholly-owned subsidiary of the Company, is a loan service provider that offers community banks and credit unions with a comprehensive SBA 7(a) and USDA lending platform.
The Company’s reportable segments are determined by the Chief Executive Officer, who is the
designated chief operating decision maker, based upon organizational design, leadership structure and the Company’s products and services offered. The Company’s reportable segments are also distinguished by the level of information provided to the chief operating decision maker, who uses such information to review performance of various components of the business, which are then aggregated if operating performance, products/services, and customers are similar.
The chief operating decision maker evaluates the financial performance of the Company’s business components by evaluating revenue streams, significant expenses, and variance to the annual financial plan to assess the performance of the Company’s segments and in the determination of allocating resources and investments.
The chief operating decision maker uses revenue streams and other relevant market data to evaluate product pricing and significant expenses to assess segment performance. Segment pretax income or loss, return on assets and the efficiency ratio is used to assess the performance of the Commercial Bank segment by monitoring the margin between interest income and interest expense. Segment pretax income or loss is used to assess the performance of the CBHL segment by monitoring the mortgage banking revenue from loan originations and sales. Segment pretax income or loss is used to assess the performance of the OpenSky™ segment by monitoring credit card interest income, interchange fees, and other fees. Segment pretax income or loss is used to assess the performance of the Windsor Advantage™ segment by monitoring the service charge revenues from Windsor Advantage™ customers.
Loans, investments, and deposits and fees provide the revenues in the Commercial Bank, loan sales provide the revenues in CBHL, credit card loan interest and fees provide the revenues in OpenSky™, and service charges and ancillary fees provide the revenues in Windsor Advantage™. Interest expense, provisions for credit losses and personnel provide the significant expenses in the commercial bank, cost of loan sales and personnel provide the significant expenses in CBHL, data processing and personnel provide the significant expenses in OpenSky™, and personnel provide the significant expenses in Windsor Advantage™.
Prior to January 1, 2025, the Company disclosed Corporate as a reportable segment. The Company has determined that what was previously deemed the Corporate reportable segment consists of other business activities that are associated with the Commercial Bank and are reflected in the tabular disclosures that follow. It should be noted that such restructuring of the tabular disclosure did not result in any changes to the Company’s revenue and expense allocation methodology. The Company restructured prior period tabular disclosures to achieve appropriate comparability.
CSC operates as a wholly owned subsidiary of Capital Bancorp, Inc. CSC originates and services a portfolio of primarily mezzanine loans with certain characteristics that do not meet Capital Bank’s general underwriting standards, but command a higher rate of return. At September 30, 2025, CSC had loans totaling $7.0 million with a collectively assessed ACL of $118 thousand. Refer to Note 5 - “Portfolio Loans Receivable and Allowance for Credit Losses” to the “Notes to Unaudited Consolidated Financial Statements” for further discussion of the consolidated ACL. The operations of CSC are included within the Commercial Bank segment performance.
Accounting policies for segments are discussed in detail in Note 1 “Nature of Business and Basis of Presentation” in the “Notes to the Consolidated Financial Statements” contained in Item 8 “Financial Statements and Supplementary Data” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Segment performance is evaluated using income (loss) before taxes. Indirect expenses are allocated on revenue. Transactions among segments are made at fair value.
The following schedules reported internally for performance assessment by the chief operating decision maker presents financial information for each reportable segment at and for the three months ended September 30, 2025 and 2024.
For the Three Months Ended September 30, 2025
(in thousands)Commercial BankOpenSky™
Windsor Advantage™
CBHLConsolidated
Interest income$49,035 $15,628 $— $228 $64,891 
Interest expense12,768 — — 103 12,871 
Net interest income36,267 15,628 — 125 52,020 
Provision for credit losses1,852 2,798 — — 4,650 
Provision for credit losses on unfunded commitments217 — — — 217 
Net interest income after provision34,198 12,830 — 125 47,153 
Noninterest income
Service charges on deposits425 — — — 425 
Credit card fees— 4,509 — — 4,509 
Mortgage banking revenue315 — — 1,612 1,927 
Government lending revenue14 — — — 14 
Government loan servicing revenue(1)
(1,074)— 5,339 — 4,265 
Loan servicing rights (government guaranteed)(2)
368 — — — 368 
Other (loss) income(557)(33)— 150 (440)
Total noninterest income(509)4,476 5,339 1,762 11,068 
Noninterest expenses
Salaries and employee benefits
10,559 3,271 2,455 1,443 17,728 
Occupancy and equipment1,635 632 416 166 2,849 
Professional fees1,079 571 198 283 2,131 
Data processing350 7,154 97 53 7,654 
Advertising694 833 76 111 1,714 
Loan processing740 15 67 292 1,114 
Merger-related expenses697 — — — 697 
Operational losses— 923 — — 923 
Regulatory assessment expenses788 (30)(11)(7)740 
Other operating1,493 587 614 110 2,804 
Total noninterest expenses18,035 13,956 3,912 2,451 38,354 
Net income (loss) before taxes$15,654 $3,350 $1,427 $(564)$19,867 
Total assets$3,213,222 $134,422 $21,743 $20,055 $3,389,442 
(1) Gross government loan servicing revenue totaled $5.3 million, including $1.1 million of servicing fees earned from the Commercial Bank by Windsor Advantage™, for the three months ended September 30, 2025.
(2) Interest income of $49.0 million for the Commercial Bank includes a $1.3 million one-time impact associated with the reversal of income related to previously recognized interest income in the first and second quarter that was also correctly recognized as Fee Revenue in those periods.
For the Three Months Ended September 30, 2024
(in thousands)Commercial BankOpenSky™CBHLConsolidated
Interest income$36,824 $15,625 $161 $52,610 
Interest expense14,148 — 108 14,256 
Net interest income22,676 15,625 53 38,354 
Provision for credit losses1,454 2,294 — 3,748 
Provision for credit losses on unfunded commitments17 — — 17 
Net interest income after provision21,205 13,331 53 34,589 
Noninterest income
Service charges on deposits235 — — 235 
Credit card fees— 4,055 — 4,055 
Mortgage banking revenue166 — 1,716 1,882 
Other income327 41 95 463 
Total noninterest income728 4,096 1,811 6,635 
Noninterest expenses
Salaries and employee benefits
8,542 3,273 1,530 13,345 
Occupancy and equipment1,165 485 141 1,791 
Professional fees1,005 722 253 1,980 
Data processing396 6,492 42 6,930 
Advertising429 697 97 1,223 
Loan processing371 16 228 615 
Foreclosed real estate expenses, net1 — — 1 
Merger-related expenses520 — — 520 
Operational losses8 1,000 — 1,008 
Regulatory assessment expenses483 — — 483 
Other operating1,134 591 104 1,829 
Total noninterest expenses14,054 13,276 2,395 29,725 
Net income (loss) before taxes$7,879 $4,151 $(531)$11,499 
Total assets$2,419,370 $121,587 $19,831 $2,560,788 
For the Nine Months Ended September 30, 2025
(in thousands)Commercial BankOpenSky™
Windsor Advantage™
CBHLConsolidated
Interest income$147,128 $44,566 $— $543 $192,237 
Interest expense46,273 — — 251 46,524 
Net interest income100,855 44,566 — 292 145,713 
Provision for credit losses3,457 7,520 — — 10,977 
Provision for credit losses on unfunded commitments217 — — — 217 
Net interest income after provision97,181 37,046 — 292 134,519 
Noninterest income
Service charges on deposits945 — — — 945 
Credit card fees— 12,529 — — 12,529 
Mortgage banking revenue1,043 — — 4,469 5,512 
Government lending revenue4,222 — — — 4,222 
Government loan servicing revenue(1)
(3,164)— 14,641 — 11,477 
Loan servicing rights (government guaranteed)250 — — — 250 
Other income1,215 3 — 570 1,788 
Total noninterest income4,511 12,532 14,641 5,039 36,723 
Noninterest expenses
Salaries and employee benefits
32,275 10,019 7,370 4,591 54,255 
Occupancy and equipment5,115 1,693 1,495 451 8,754 
Professional fees3,802 1,714 389 760 6,665 
Data processing1,244 20,633 283 126 22,286 
Advertising2,207 2,177 215 265 4,864 
Loan processing1,867 58 128 783 2,836 
Foreclosed real estate expenses, net1 — — — 1 
Merger-related expenses3,361 — — — 3,361 
Operational losses131 2,628 — — 2,759 
Regulatory assessment expenses2,513 — — — 2,513 
Other operating4,718 1,441 1,222 304 7,685 
Total noninterest expenses57,234 40,363 11,102 7,280 115,979 
Net income (loss) before taxes$44,458 $9,215 $3,539 $(1,949)$55,263 
Total assets$3,213,222 $134,422 $21,743 $20,055 $3,389,442 
(1) Gross government loan servicing revenue totaled $14.6 million, including $3.2 million of servicing fees earned from the Commercial Bank by Windsor Advantage™, for the nine months ended September 30, 2025.
(2) Interest income of $147.1 million for the Commercial Bank includes a $1.3 million one-time impact associated with the reversal of income related to previously recognized interest income in the first and second quarter that was also correctly recognized as Fee Revenue in those periods.
For the Nine Months Ended September 30, 2024
(in thousands)Commercial BankOpenSky™CBHLConsolidated
Interest income$104,887 $46,331 $376 $151,594 
Interest expense40,943 — 232 41,175 
Net interest income63,944 46,331 144 110,419 
Provision for credit losses3,740 6,152 — 9,892 
Provision for credit losses on unfunded commitments263 — — 263 
Net interest income after provision59,941 40,179 144 100,264 
Noninterest income
Service charges on deposits642 — — 642 
Credit card fees— 12,266 — 12,266 
Mortgage banking revenue788 — 4,537 5,325 
Other income680 113 471 1,264 
Total noninterest income2,110 12,379 5,008 19,497 
Noninterest expense
Salaries and employee benefits
25,846 9,171 4,507 39,524 
Occupancy and equipment3,430 1,418 420 5,268 
Professional fees2,661 2,338 697 5,696 
Data processing857 19,496 126 20,479 
Advertising1,215 3,865 247 5,327 
Loan processing763 45 654 1,462 
Foreclosed real estate expenses, net2 — — 2 
Merger-related expenses1,315 — — 1,315 
Operational losses13 2,708 — 2,721 
Regulatory assessment expenses1,384 — — 1,384 
Other operating3,569 1,609 349 5,527 
Total noninterest expenses41,055 40,650 7,000 88,705 
Net income (loss) before taxes$20,996 $11,908 $(1,848)$31,056 
Total assets$2,419,370 $121,587 $19,831 $2,560,788 
The following table presents financial information as of September 30, 2025, December 31, 2024 and September 30, 2024.
September 30, 2025
(in thousands)Commercial BankOpenSky™
Windsor Advantage™
CBHLConsolidated
Cash and cash equivalents$176,685 $7,701 $4,475 $— $188,861 
Goodwill25,969 — — — 25,969 
Intangible assets3 — 13,454 — 13,457 
Core deposit intangibles1,576 — — — 1,576 
Other segment assets3,008,989 126,721 3,814 20,055 3,159,579 
Total assets$3,213,222 $134,422 $21,743 $20,055 $3,389,442 
December 31, 2024
(in thousands)Commercial BankOpenSky™
Windsor Advantage™
CBHLConsolidated
Cash and cash equivalents$193,860 $7,890 $3,582 $— $205,332 
Goodwill21,126 — — — 21,126 
Intangible assets3 — 14,069 — 14,072 
Core deposit intangibles1,745 — — — 1,745 
Other segment assets2,820,581 118,023 4,341 21,691 2,964,636 
Total assets$3,037,315 $125,913 $21,992 $21,691 $3,206,911 
September 30, 2024
(in thousands)Commercial BankOpenSky™
Windsor Advantage™
CBHLConsolidated
Cash and cash equivalents$150,171 $6,529 $— $— $156,700 
Goodwill— — — — — 
Intangible assets— — — — — 
Core deposit intangibles— — — — — 
Other segment assets2,269,199 115,058 — 19,831 2,404,088 
Total assets$2,419,370 $121,587 $— $19,831 $2,560,788