OAKLAND, Calif., Nov. 09, 2026 (GLOBE NEWSWIRE) -- Gateway Bank, F.S.B. (OTCPK: GWBK) (“the Bank”) today announced a net loss of $370,000 for the third quarter of 2026. This compared to a net loss of $171,000 in the preceding quarter, and a net loss of $870,000 in the third 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 nine months of 2026 the Bank reported a net loss of $877,000, compared to a net loss of $2.66 million in the first nine months of 2025. All financial results are unaudited.
“We are approaching the finish line of a turnaround that has been several years in the making. Our third quarter results reflect continued progress across the Bank, and that momentum puts sustained profitability clearly within reach,” said Mukhtar Ali, President and CEO. “Construction was a meaningful source of new business this quarter, thanks largely to Tom Rodriguez and his underwriting team, who joined us in the second quarter. Their expertise has quickly translated into results, and we’ve continued to fund loans from a strong pipeline that we expect to carry thought the end of the year. Our construction lending is focused on single-family infill development rather than large subdivisions. We work with experienced developers who specialize in buying existing homes in well-established neighborhoods, tearing them down, and rebuilding. It’s a niche we understand well, and it fits the way we want to grow this part of the portfolio.”
“Net interest margin came under pressure during the quarter on both sides of the balance sheet. As noted during the prior quarter, our second quarter results benefited from interest income tied to loans returning to accrual status, and that benefit did not repeat to the same degree in the third quarter. That was the primary driver of the decline in yields on earning assets. At the same time, our cost of funds moved higher, reflecting continued competition for deposits across our markets. Going forward, we are focused on managing funding costs and on disciplined pricing of new loan production to stabilize yields and position the margin for improvement over the coming quarters,” said Ali.
Third Quarter and Year to Date 2026 Highlights:
- Net interest income decreased 6.0% to $2.02 million in the third quarter of 2026, compared to $2.15 million in the second quarter of 2026, and increased 63.1% compared to $1.24 million in the third quarter of 2025. In the first nine months of 2026, net interest income increased 55.0% to $5.67 million, compared to $3.66 million in the first nine months of 2025.
- The Bank reported a net loss of $370,000 for the third quarter of 2026, compared to net loss of $171,000 for the second quarter of 2026, and a net loss of $870,000 for the third quarter of 2025. Year to date, the Bank reported a net loss of $877,000, compared to a net loss of $2.66 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, decreased 5.1% to $2.06 million in the third quarter of 2026, compared to $2.17 million in the preceding quarter and increased 69.0% compared to $1.22 million in the third quarter a year ago. In the first nine months of 2026, total revenue increased 60.0% to $5.77 million, compared to $3.60 million in the first nine months of 2025.
- Net interest margin was 2.54% in the third quarter of 2026, compared to 3.05% in the preceding quarter and 2.10% in the third quarter a year ago. The decrease compared to the second quarter of 2026 is primarily attributed to margins stabilizing to anticipated levels after one-time interest and fee items on loans in the previous quarter.
- Non-interest expense increased 6.4% to $2.37 million in the third quarter of 2026, compared to $2.23 million in the preceding quarter, and increased 14.3% when compared to $2.08 million in the third quarter a year ago. Salaries and employee benefits, which make up the largest component of non-interest expense, increased moderately while other non-interest expenses represented the majority of the increase compared to the prior quarter. These increases were partially offset by lower occupancy costs in the third quarter.
- Average assets for the quarter totaled $322.9 million, an increase of $35.2 million, or 12.2% from the prior quarter, and an increase of $82.4 million, or 34.2% from the year ago quarter. Total assets increased 14.2% to $329.1 million at September 30, 2026, compared to $288.2 million at June 30, 2026, and increased $96.0 million, or 41.2% compared to $233.0 million at September 30, 2025.
- Average total gross loans for the third quarter of 2026 increased $19.1 million, or 8.0% to $257.0 million, compared to $237.9 million in the second quarter of 2026, and increased $74.8 million, or 41.1% from $182.2 million in the third quarter of 2025. Total loans at September 30, 2026, increased 12.5% during the quarter to $277.2 million from $246.5 million at June 30, 2026, and increased 54.5% compared to $179.5 million at September 30, 2025.
- Average third quarter 2026 total deposits increased 17.4% to $238.6 million, from $203.4 million in the preceding quarter, and increased 11.2% from $214.6 million in the third quarter a year ago. Total deposits increased 20.3% to $245.5 million, at September 30, 2026, compared to $204.1 million at June 30, 2026, and increased $37.8 million, or 18.2% compared to $207.7 million at September 30, 2025.
- The Bank recorded a $56,000 provision for credit losses in the third quarter of 2026, compared to a $110,000 provision in the second quarter of 2026, and an $11,000 provision in the third quarter of 2025.
- Allowance for credit losses, as a percentage of total loans, was 0.96% at September 30, 2026, compared to 1.07% at June 30, 2026, and 1.41% at September 30, 2025.
- Nonperforming loans were $610,000 for the quarter ended September 30, 2026, and the prior quarter ended June 30, 2026, and decreased compared to $4.40 million a year ago.
- There were no net charge-offs in the third 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 12.25% at September 30, 2026.
“Our Chinatown market continues to be a reliable foundation for our business, and Walnut Creek is quickly becoming a meaningful contributor. Engagement was strong in both markets this quarter, which tells us our approach is working in an established market and a newer one alike. The relationships we have built in these communities are a real competitive advantage, and we intend to keep investing in them to drive long-term growth,” 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 | ||||||||||||||||||||
| Sep 30 2026 | Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and due from banks | 2,854,013 | 1,852,376 | 1,828,608 | 1,629,783 | 1,285,211 | |||||||||||||||
| Fed funds sold | 695,743 | - | 128,881 | - | - | |||||||||||||||
| Interest bearing deposits with banks | 18,174,523 | 7,205,836 | 16,054,308 | 9,150,342 | 15,358,735 | |||||||||||||||
| Total cash and equivalents | 21,724,279 | 9,058,212 | 18,011,797 | 10,780,125 | 16,643,946 | |||||||||||||||
| Investment securities, AFS | 21,379,745 | 23,913,699 | 27,456,099 | 27,839,840 | 30,557,274 | |||||||||||||||
| FHLB Stock and Other Investments | 2,158,600 | 2,158,600 | 2,061,200 | 2,061,200 | 2,061,200 | |||||||||||||||
| 1-4 family residential | 173,154,405 | 163,716,451 | 161,339,952 | 161,718,113 | 134,471,362 | |||||||||||||||
| Multifamily residential | 32,155,049 | 22,630,690 | 21,624,467 | 12,935,464 | 13,002,960 | |||||||||||||||
| Non-farm, non-residential real estate | 65,369,372 | 56,526,390 | 45,360,554 | 36,071,404 | 28,854,756 | |||||||||||||||
| Construction | 4,178,521 | 2,077,420 | - | - | - | |||||||||||||||
| Commercial and industrial | 2,351,668 | 1,535,966 | 4,356,480 | 4,366,320 | 3,134,343 | |||||||||||||||
| Consumer and other | - | 3,134 | - | 410 | 59 | |||||||||||||||
| Loans, net of unearned income | 277,209,015 | 246,490,051 | 232,681,453 | 215,091,711 | 179,463,480 | |||||||||||||||
| Allowance for Credit Losses-Loans | (2,653,236 | ) | (2,639,477 | ) | (2,543,007 | ) | (2,540,065 | ) | (2,531,061 | ) | ||||||||||
| Total loans, net | 274,555,779 | 243,850,574 | 230,138,446 | 212,551,646 | 176,932,419 | |||||||||||||||
| Premises and equipment, net | 866,216 | 889,335 | 800,400 | 695,171 | 602,114 | |||||||||||||||
| Accrued interest receivable | 1,559,834 | 1,434,070 | 1,231,367 | 1,162,055 | 1,156,714 | |||||||||||||||
| Other assets | 6,814,713 | 6,912,319 | 6,830,271 | 5,376,047 | 5,073,847 | |||||||||||||||
| Total Assets | $ | 329,059,166 | $ | 288,216,809 | $ | 286,529,580 | $ | 260,466,084 | $ | 233,027,514 | ||||||||||
| Liabilities | ||||||||||||||||||||
| Non-Interest Bearing Deposits | 12,951,549 | 8,025,908 | 8,365,308 | 9,641,094 | 9,165,121 | |||||||||||||||
| Interest bearing demand deposits | 37,280,733 | 6,086,803 | 5,787,575 | 6,793,724 | 7,025,056 | |||||||||||||||
| Savings and Money Market Deposits | 35,195,870 | 28,692,325 | 26,064,932 | 27,470,224 | 19,978,923 | |||||||||||||||
| Time Deposits - Retail | 150,073,600 | 149,313,715 | 150,125,894 | 147,156,815 | 159,529,226 | |||||||||||||||
| Time Deposits - Wholesale | 9,980,381 | 11,976,568 | 11,972,512 | 11,968,456 | 11,964,400 | |||||||||||||||
| Total Deposits | 245,482,133 | 204,095,319 | 202,316,221 | 203,030,313 | 207,662,726 | |||||||||||||||
| Borrowings | 43,000,000 | 43,000,000 | 43,000,000 | 33,000,000 | - | |||||||||||||||
| Accrued expenses and other liabilities | 3,816,203 | 3,940,874 | 3,871,641 | 2,346,532 | 2,380,514 | |||||||||||||||
| Total Liabilities | 292,298,336 | 251,036,193 | 249,187,862 | 238,376,845 | 210,043,240 | |||||||||||||||
| Equity | ||||||||||||||||||||
| Common stock | 53,763,103 | 53,763,103 | 53,763,103 | 26,991,436 | 26,991,436 | |||||||||||||||
| Capital surplus | 24,897,315 | 24,771,345 | 24,665,279 | 35,972,894 | 35,962,369 | |||||||||||||||
| Retained earnings | (38,216,587 | ) | (38,216,587 | ) | (38,216,587 | ) | (34,332,122 | ) | (34,332,122 | ) | ||||||||||
| Accumulated other comprehensive income (loss) | (2,806,051 | ) | (2,630,700 | ) | (2,534,270 | ) | (2,658,504 | ) | (2,981,990 | ) | ||||||||||
| Net Income | (876,950 | ) | (506,545 | ) | (335,807 | ) | (3,884,465 | ) | (2,655,419 | ) | ||||||||||
| Total Equity | 36,760,830 | 37,180,616 | 37,341,718 | 22,089,239 | 22,984,274 | |||||||||||||||
| Total Liabilities & Equity | $ | 329,059,166 | $ | 288,216,809 | $ | 286,529,580 | $ | 260,466,084 | $ | 233,027,514 | ||||||||||
| # of Shares (period-end) | 537,629,274 | 537,629,274 | 537,629,274 | 269,912,602 | 269,912,602 | |||||||||||||||
| Book Value Per Share | $ | 0.068 | $ | 0.069 | $ | 0.069 | $ | 0.082 | $ | 0.085 | ||||||||||
| Gateway Bank, FSB | ||||||||||||||||||||
| Quarterly Income Statements | ||||||||||||||||||||
| Unaudited | Quarter Ended | |||||||||||||||||||
| Sep 30 2026 | Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | ||||||||||||||||
| Interest Income | ||||||||||||||||||||
| Interest and fees on loans | $ | 3,786,974 | $ | 3,789,596 | $ | 2,907,033 | $ | 2,682,155 | $ | 2,602,415 | ||||||||||
| Dividends on FHLB stock | 104,067 | 33,656 | 97,379 | 40,970 | 38,439 | |||||||||||||||
| Interest on federal funds sold | 588 | 888 | 283 | 208 | 3,447 | |||||||||||||||
| Interest on deposits with banks | 305,506 | 128,267 | 217,706 | 118,893 | 189,417 | |||||||||||||||
| Investment securities - AFS | 245,616 | 270,683 | 257,941 | 277,750 | 332,268 | |||||||||||||||
| Total Interest Income | 4,442,751 | 4,223,090 | 3,480,342 | 3,119,976 | 3,165,986 | |||||||||||||||
| Interest Expense | ||||||||||||||||||||
| Interest bearing demand deposits | 322,501 | 1,475 | 1,453 | 1,651 | 1,215 | |||||||||||||||
| Savings and money market deposits | 209,576 | 172,562 | 159,637 | 146,900 | 122,160 | |||||||||||||||
| Retail time deposits | 1,380,560 | 1,384,829 | 1,382,261 | 1,464,269 | 1,661,229 | |||||||||||||||
| Wholesale time deposits | 105,751 | 115,572 | 114,287 | 116,736 | 145,127 | |||||||||||||||
| Total Interest Expense on Deposits | 2,018,388 | 1,674,438 | 1,657,638 | 1,729,556 | 1,929,731 | |||||||||||||||
| Interest expense on borrowings | 408,110 | 402,893 | 309,921 | 144,463 | - | |||||||||||||||
| Total Interest Expense | 2,426,498 | 2,077,331 | 1,967,559 | 1,874,019 | 1,929,731 | |||||||||||||||
| Net Interest Income | 2,016,253 | 2,145,759 | 1,512,783 | 1,245,957 | 1,236,255 | |||||||||||||||
| Provision for credit losses | 55,857 | 109,774 | 1,969 | 7,469 | 10,859 | |||||||||||||||
| Net interest income after provision for credit losses | 1,960,396 | 2,035,985 | 1,510,814 | 1,238,488 | 1,225,396 | |||||||||||||||
| Non Interest Income | ||||||||||||||||||||
| Service charges and fees | 2,965 | 3,322 | 3,188 | 3,222 | 2,994 | |||||||||||||||
| Loan servicing fees & MSR valuation | (4,825 | ) | (11,955 | ) | 720 | (12,209 | ) | (37,304 | ) | |||||||||||
| Other noninterest income | 45,529 | 34,598 | 16,870 | 16,565 | 16,810 | |||||||||||||||
| Total Non Interest Income | 43,669 | 25,965 | 20,778 | 7,578 | (17,500 | ) | ||||||||||||||
| Non Interest Expense | ||||||||||||||||||||
| Salaries and employee benefits | 1,389,926 | 1,374,579 | 1,059,563 | 1,335,580 | 1,120,524 | |||||||||||||||
| Occupancy | 152,406 | 164,801 | 153,832 | 174,937 | 292,661 | |||||||||||||||
| Other noninterest expense | 832,138 | 692,508 | 654,005 | 964,594 | 665,029 | |||||||||||||||
| Total Non Interest Expense | 2,374,470 | 2,231,888 | 1,867,400 | 2,475,111 | 2,078,214 | |||||||||||||||
| Income (Loss) Before Taxes | (370,405 | ) | (169,938 | ) | (335,808 | ) | (1,229,045 | ) | (870,318 | ) | ||||||||||
| Income taxes | - | 800 | - | - | - | |||||||||||||||
| Net Income (Loss) | $ | (370,405 | ) | $ | (170,738 | ) | $ | (335,808 | ) | $ | (1,229,045 | ) | $ | (870,318 | ) | |||||
| # of Shares (wtd avg per quarter) | 537,629,274 | 537,629,274 | 475,162,051 | 269,912,602 | 269,912,602 | |||||||||||||||
| Earnings Per Share | $ | (0.001 | ) | $ | (0.000 | ) | $ | (0.001 | ) | $ | (0.005 | ) | $ | (0.003 | ) | |||||
| Gateway Bank, FSB | |||||||||||||||
| Year-To-Date Income Statements | |||||||||||||||
| Unaudited | Nine Months Ended | ||||||||||||||
| Sep 30 2026 | Sep 30 2025 | $ Variance | % Variance | ||||||||||||
| Interest Income | |||||||||||||||
| Interest and fees on loans | $ | 10,483,602 | $ | 7,890,135 | $ | 2,593,467 | 33 | % | |||||||
| Dividends on FHLB stock | 235,102 | 109,661 | 125,441 | 114 | % | ||||||||||
| Interest on federal funds sold | 1,758 | 34,873 | (33,115 | ) | -95 | % | |||||||||
| Interest on deposits with banks | 651,479 | 692,851 | (41,372 | ) | -6 | % | |||||||||
| Investment securities - AFS | 774,240 | 1,069,609 | (295,369 | ) | -28 | % | |||||||||
| Total Interest Income | 12,146,181 | 9,797,129 | 2,349,052 | 24 | % | ||||||||||
| Interest Expense | |||||||||||||||
| Interest bearing demand deposits | 325,429 | 2,862 | 322,567 | 11271 | % | ||||||||||
| Savings and money market deposits | 541,775 | 305,575 | 236,200 | 77 | % | ||||||||||
| Retail time deposits | 4,147,650 | 5,326,887 | (1,179,237 | ) | -22 | % | |||||||||
| Wholesale time deposits | 335,610 | 500,682 | (165,072 | ) | -33 | % | |||||||||
| Total Interest Expense on Deposits | 5,350,464 | 6,136,006 | (785,542 | ) | -13 | % | |||||||||
| Interest expense on borrowings | 1,120,923 | - | 1,120,923 | 0 | % | ||||||||||
| Total Interest Expense | 6,471,387 | 6,136,006 | 335,381 | 5 | % | ||||||||||
| Net Interest Income | 5,674,794 | 3,661,123 | 2,013,671 | 55 | % | ||||||||||
| Provision for credit losses | 167,600 | 37,900 | 129,700 | 342 | % | ||||||||||
| Net interest income after provision for credit losses | 5,507,194 | 3,623,223 | 1,883,971 | 52 | % | ||||||||||
| Non Interest Income | |||||||||||||||
| Service charges and fees | 9,475 | 16,399 | (6,924 | ) | -42 | % | |||||||||
| Loan servicing fees | (16,059 | ) | (89,890 | ) | 73,831 | -82 | % | ||||||||
| Other noninterest income | 96,998 | 14,981 | 82,017 | 547 | % | ||||||||||
| Total Non Interest Income | 90,414 | (58,510 | ) | 148,924 | -255 | % | |||||||||
| Non Interest Expense | |||||||||||||||
| Salaries and employee benefits | 3,824,068 | 3,290,434 | 533,634 | 16 | % | ||||||||||
| Occupancy | 471,039 | 772,387 | (301,348 | ) | -39 | % | |||||||||
| Other noninterest expense | 2,178,651 | 2,156,511 | 22,140 | 1 | % | ||||||||||
| Total Non Interest Expense | 6,473,758 | 6,219,332 | 254,426 | 4 | % | ||||||||||
| Income (Loss) Before Taxes | (876,150 | ) | (2,654,619 | ) | 1,778,469 | -67 | % | ||||||||
| Income taxes | 800 | 800 | - | 0 | % | ||||||||||
| Net Income (Loss) | $ | (876,950 | ) | $ | (2,655,419 | ) | $ | 1,778,469 | -67 | % | |||||
| # of Shares (wtd avg per period) | 517,035,684 | 269,912,602 | |||||||||||||
| Earnings Per Share | $ | (0.002 | ) | $ | (0.010 | ) | |||||||||
| Gateway Bank, FSB | ||||||||||||||||||||
| Quarterly Financial Highlights | ||||||||||||||||||||
| Unaudited | For The Quarter Ended | |||||||||||||||||||
| ($ in Thousands) | Sep 30 2026 | Jun 30 2026 | Mar 31 2026 | Dec 31 2025 | Sep 30 2025 | |||||||||||||||
| EARNINGS | ||||||||||||||||||||
| Net interest income | $ | 2,016 | $ | 2,146 | $ | 1,513 | $ | 1,246 | $ | 1,236 | ||||||||||
| Provision for credit losses | 56 | 110 | 2 | 7 | 11 | |||||||||||||||
| Non-interest income | 44 | 26 | 21 | 8 | (18 | ) | ||||||||||||||
| Non-interest expense | 2,374 | 2,232 | 1,867 | 2,475 | 2,078 | |||||||||||||||
| Net income | (370 | ) | (171 | ) | (336 | ) | (1,229 | ) | (870 | ) | ||||||||||
| PERFORMANCE RATIOS | ||||||||||||||||||||
| Yield on loans | 5.85 | % | 6.38 | % | 5.48 | % | 5.52 | % | 5.71 | % | ||||||||||
| Yield on earning assets | 5.61 | % | 5.99 | % | 5.19 | % | 5.20 | % | 5.32 | % | ||||||||||
| Cost of funds | 3.42 | % | 3.37 | % | 3.34 | % | 3.41 | % | 3.57 | % | ||||||||||
| Net interest margin | 2.54 | % | 3.05 | % | 2.23 | % | 2.10 | % | 2.10 | % | ||||||||||
| Efficiency ratio | 115 | % | 103 | % | 122 | % | 197 | % | 171 | % | ||||||||||
| CAPITAL | ||||||||||||||||||||
| Tangible equity to tangible assets | 11.09 | % | 12.81 | % | 12.94 | % | 8.38 | % | 9.74 | % | ||||||||||
| Community Bank Leverage Ratio | 12.25 | % | 13.84 | % | 14.59 | % | 10.18 | % | 10.65 | % | ||||||||||
| ASSET QUALITY | ||||||||||||||||||||
| Net loan charge-offs (recoveries) | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
| Allowance for credit losses on loans | 2,653 | 2,639 | 2,543 | 2,540 | 2,531 | |||||||||||||||
| Non-performing loans | 610 | 610 | 5,757 | 5,877 | 4,039 | |||||||||||||||
| ACL to total loans | 0.96 | % | 1.07 | % | 1.09 | % | 1.18 | % | 1.41 | % | ||||||||||
| ACL to non-performing loans | 435 | % | 432 | % | 44 | % | 43 | % | 63 | % | ||||||||||
| END OF PERIOD BALANCES | ||||||||||||||||||||
| Total loans, gross | $ | 277,209 | $ | 246,490 | $ | 232,681 | $ | 215,092 | $ | 179,463 | ||||||||||
| Total assets | 329,059 | 288,217 | 286,530 | 260,466 | 233,028 | |||||||||||||||
| Deposits | 245,482 | 204,095 | 202,316 | 203,030 | 207,663 | |||||||||||||||
| FHLB Advances | 43,000 | 43,000 | 43,000 | 33,000 | - | |||||||||||||||
| Total equity | 36,761 | 37,181 | 37,342 | 22,089 | 22,984 | |||||||||||||||
| Loan to deposit ratio | 112.9 | % | 120.8 | % | 115.0 | % | 105.9 | % | 86.4 | % | ||||||||||
| Common Shares Outstanding (thousands) | 537,629 | 537,629 | 537,629 | 269,913 | 269,913 | |||||||||||||||
| QUARTERLY AVERAGE BALANCES | ||||||||||||||||||||
| Total loans, gross | $ | 256,986 | $ | 237,875 | $ | 212,719 | $ | 194,060 | $ | 182,190 | ||||||||||
| Earning assets | 314,406 | 279,472 | 266,442 | 236,773 | 234,217 | |||||||||||||||
| Total assets | 322,926 | 287,726 | 273,297 | 243,104 | 240,555 | |||||||||||||||
| Deposits | 238,639 | 203,350 | 204,549 | 202,358 | 214,611 | |||||||||||||||
| FHLB Advances | 43,000 | 43,000 | 34,000 | 15,565 | - | |||||||||||||||
| Total equity | 37,462 | 37,349 | 32,128 | 22,768 | 23,295 | |||||||||||||||
| Common Shares Outstanding (thousands) | 537,629 | 537,629 | 475,162 | 269,913 | 269,913 | |||||||||||||||
Contact:
Mukhtar Ali
(510) 813-8582
Mukhtar.Ali@gatewayfsb.com
