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Organization and Basis of Presentation | 6 Months Ended
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Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Organization and Basis of Presentation | Note 1 – Organization and Basis of Presentation (Restated) This note has been restated to reflect the changes described in the Explanatory Note and in the Restatement section of Note 1, below, of this Form 10-Q/A. Blue Ridge Bankshares, Inc. (the “Company”) conducts its business activities primarily through its wholly-owned subsidiary bank, Blue Ridge Bank, National Association (the “Bank”) and its wealth and trust management subsidiary, BRB Financial Group, Inc. (the “Financial Group”). The Company exists primarily for the purposes of holding the stock of its subsidiaries, the Bank and the Financial Group. The accompanying unaudited consolidated financial statements of the Company include the accounts of the Bank and the Financial Group and were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and general practices within the banking industry. All significant intercompany balances and transactions have been eliminated in consolidation. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2022. Restatement The Company is restating its financial statements to reclassify certain specialty finance loans that were placed on nonaccrual, reserved for, or charged off in the interim periods ended March 31, 2023 and June 30, 2023, and to report such specialty finance loans as nonaccrual, reserved for, or charged off in earlier periods. The effect of the adjustments has resulted in a positive adjustment to earnings and earnings per share for both the three and six months ended June 30, 2023. Balance sheet amounts, including loans held for investment and allowance for credit losses, are affected as of June 30, 2023. The following tables provide a summary of the adjustments as of and for the three and six months ended June 30, 2023 included in the Explanatory Note of this Form 10-Q/A.
|  | For the three months ended June 30, 2023 |
Dollars in thousands, except per share data (unaudited) |  | As Reported |  |  | Adjustments |  |  | As Restated |
Net interest income |  | $ | 20,403 |  |  | $ | 3,487 |  | (a) | $ | 23,890 |
Provision (benefit) for credit losses - loans |  |  | 21,100 |  |  |  | (10,487 | ) | (a) |  | 10,613 |
(Loss) income from continuing operations before income tax expense |  |  | (24,413 | ) |  |  | 13,974 |  |  |  | (10,439 | )
Income tax (benefit) expense |  |  | (4,949 | ) |  |  | 3,123 |  | (b) |  | (1,826 | )
Net (loss) income from continuing operations |  | $ | (19,464 | ) |  | $ | 10,851 |  |  | $ | (8,613 | )
Basic and diluted (loss) earnings per common share from continuing operations |  | $ | (1.03 | ) |  | $ | 0.58 |  |  | $ | (0.45 | )
|  | For the six months ended June 30, 2023 |
Dollars in thousands, except per share data (unaudited) |  | As Reported |  |  | Adjustments |  |  | As Restated |
Net interest income |  | $ | 47,762 |  |  | $ | 1,324 |  | (a) | $ | 49,086 |
Provision (benefit) for credit losses - loans |  |  | 25,200 |  |  |  | (15,697 | ) | (a) |  | 9,503 |
(Loss) income from continuing operations before income tax expense |  |  | (22,318 | ) |  |  | 17,021 |  |  |  | (5,297 | )
Income tax (benefit) expense |  |  | (4,458 | ) |  |  | 3,804 |  | (b) |  | (654 | )
Net (loss) income from continuing operations |  | $ | (17,860 | ) |  | $ | 13,217 |  |  | $ | (4,643 | )
Basic and diluted (loss) earnings per common share from continuing operations |  | $ | (0.95 | ) |  | $ | 0.70 |  |  | $ | (0.25 | )
|  | As of June 30, 2023 |
Dollars in thousands (unaudited) |  | As Reported |  |  | Adjustments |  |  | As Restated |
Loans held for investment, net of deferred fees and costs |  | $ | 2,451,697 |  |  | $ | (4,500 | ) | (c) | $ | 2,447,197 |
Allowance for credit losses |  |  | (43,067 | ) |  |  | 4,500 |  | (c) |  | (38,567 | )
Accrued interest receivable |  |  | 15,474 |  |  |  | — |  |  |  | 15,474 |
Deferred tax asset, net |  |  | 11,051 |  |  |  | — |  |  |  | 11,051 |
Other assets |  |  | 28,175 |  |  |  | — |  |  |  | 28,175 |
Total assets |  | $ | 3,214,424 |  |  | $ | — |  |  | $ | 3,214,424 |
Total stockholders' equity |  | $ | 231,271 |  |  | $ | — |  |  | $ | 231,271 |
(a) - Net interest income and provision for credit losses were positively adjusted from the previously reported figures as of and for the three and six months ended June 30, 2023 due to the restatements of the Company's 2022 and first quarter 2023 financial results. |
(b) - Deferred income tax benefit of 22.35% on pre-tax adjustments. |
(c) - Reflects the application of cash received in the first six months of 2023 as a reduction in loans held for investment, previously reported as interest and fee income on loans in prior periods, with an equal reduction in the allowance for credit losses. |
For the convenience of the reader, this Form 10-Q/A sets forth the information in the original Form 10-Q filing in its entirety; however, only the following sections of the original Form 10-Q filing are revised in this Form 10-Q/A, solely as a result of and to reflect the restatement and conditions related to the restatement noted above.
Part I, Item 1 | Financial Statements and Notes to Consolidated Financial Statements
Notes: | Note 1 - Organization and Basis of Presentation
| Note 2 - Adoption of New Accounting Standard
| Note 4 - Loans and ACL
| Note 11 - Minimum Regulatory Capital Requirements
| Note 13 - Earnings Per Share
| Note 14 - Business Segments
| Note 17 - Subsequent Events
Item 2 | Management's Discussion and Analysis of Financial Condition and Results of Operation
Item 4 | Controls and Procedures
Except as it relates to the restatement described above with related disclosures and updated subsequent events disclosures, this Form 10-Q/A does not reflect events occurring after the date of the ori ginal Form 10-Q filing. Other Matters The Company sold its majority interest in MoneyWise Payroll Solutions, Inc. (“MoneyWise”) to the holder of the minority interest in MoneyWise in the first quarter of 2022. Income statement amounts related to MoneyWise are reported as discontinued operations for all relevant periods. On August 29, 2022, the Bank entered into a formal written agreement (the “Written Agreement”) with the Office of the Comptroller of the Currency (the “OCC”), the Bank’s primary federal banking regulator. The Written Agreement principally concerns the Bank’s fintech line of business and requires the Bank to continue enhancing its controls for assessing and managing the third-party, Bank Secrecy Act/Anti-Money Laundering, and information technology risks stemming from its fintech partnerships. A complete copy of the Written Agreement was filed as an exhibit to a Form 8-K filed with the Securities and Exchange Commission (“SEC”) on September 1, 2022 and can be accessed on the SEC’s website (www.sec.gov) and the Company’s website (www.blueridgebankshares.com). The Company is actively working to bring the Bank’s fintech policies, procedures, and operations into conformity with OCC directives. The Company reports that although work is progressing, many aspects of the Written Agreement require considerable time for completion, implementation, validation, and sustainability. On May 15, 2023, the Company sold its wholesale mortgage business operating as LenderSelect Mortgage Group (“LSMG”) to a third-party for $250 thousand in cash. The Company recorded a loss on the sale of LSMG of $553 thousand, which is reported in other noninterest income in the consolidated statements of operations for the three and six months ended June 30, 2023. Certain amounts presented in the consolidated financial statements of prior periods have been reclassified to conform to current period presentations. The reclassifications had no effect on net income, net income per share, total assets, total liabilities, or stockholders’ equity as previously reported. The Company's significant accounting policies are disclosed in Note 2 of the audited financial statements and notes for the year ended December 31, 2022 and are contained in the Company's Annual Report on Form 10-K/A. There have been no significant changes to the application of significant accounting policies since December 31, 2022, except as described in Note 2 - Adoption of New Accounting Standard of this Form 10-Q/A.

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