Capital Bancorp IncCBNK
Capital Bancorp Inc Segments Disclosure
Segments
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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 CBHL, the Bank’s residential mortgage banking arm. Additionally, Windsor AdvantageTM, 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 AdvantageTM 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.
Note 19 - Segments (continued)
The Company formed Church Street Capital, LLC (“Church Street Capital” or “CSC”) in 2014 to provide short-term secured real estate financing to Washington, D.C. area investors and developers that may not meet all Bank credit criteria. 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 December 31, 2025, Church Street Capital had loans totaling $6.9 million with a collectively assessed ACL of $218 thousand. Refer to Note 5 - Portfolio Loans Receivable and Allowance for Credit Losses to the Consolidated Financial Statements for further discussion of the consolidated ACL.
Accounting policies for segments are the same as those described in Note 1. 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 years ended December 31, 2025 and 2024.
Note 19 - Segments (continued)
For the Year Ended December 31, 2025 | ||||||||||||||||||||||||||||||||
(in thousands) | Commercial Bank(2)(3) | OpenSky™ | Windsor AdvantageTM | CBHL | Consolidated | |||||||||||||||||||||||||||
| Interest income | $ | 199,122 | $ | 60,943 | $ | — | $ | 806 | $ | 260,871 | ||||||||||||||||||||||
| Interest expense | 64,503 | — | — | 376 | 64,879 | |||||||||||||||||||||||||||
| Net interest income | 134,619 | 60,943 | — | 430 | 195,992 | |||||||||||||||||||||||||||
| Provision for credit losses | 6,172 | 8,793 | — | — | 14,965 | |||||||||||||||||||||||||||
| Provision for credit losses on unfunded commitments | 188 | — | — | — | 188 | |||||||||||||||||||||||||||
| Net interest income after provision | 128,259 | 52,150 | — | 430 | 180,839 | |||||||||||||||||||||||||||
| Noninterest income | ||||||||||||||||||||||||||||||||
| Service charges on deposits | 1,316 | — | — | — | 1,316 | |||||||||||||||||||||||||||
| Credit card fees | — | 17,366 | — | — | 17,366 | |||||||||||||||||||||||||||
| Mortgage banking revenue | 1,476 | — | — | 5,996 | 7,472 | |||||||||||||||||||||||||||
| Government lending revenue | 4,222 | — | — | — | 4,222 | |||||||||||||||||||||||||||
Government loan servicing revenue(1) | (4,116) | — | 19,629 | — | 15,513 | |||||||||||||||||||||||||||
| Loan servicing rights | 545 | — | — | — | 545 | |||||||||||||||||||||||||||
| Other income | 1,913 | 13 | — | 827 | 2,753 | |||||||||||||||||||||||||||
| Total noninterest income | 5,356 | 17,379 | 19,629 | 6,823 | 49,187 | |||||||||||||||||||||||||||
| Noninterest expenses | ||||||||||||||||||||||||||||||||
Salaries and employee benefits | 43,346 | 13,057 | 9,795 | 5,971 | 72,169 | |||||||||||||||||||||||||||
| Occupancy and equipment | 6,888 | 2,381 | 1,535 | 588 | 11,392 | |||||||||||||||||||||||||||
| Professional fees | 6,849 | 2,661 | 442 | 1,007 | 10,959 | |||||||||||||||||||||||||||
| Data processing | 2,270 | 27,320 | 118 | 80 | 29,788 | |||||||||||||||||||||||||||
| Advertising | 2,815 | 2,811 | 212 | 424 | 6,262 | |||||||||||||||||||||||||||
| Loan processing | 1,968 | 533 | 291 | 1,196 | 3,988 | |||||||||||||||||||||||||||
| Merger-related expenses | 3,361 | — | — | — | 3,361 | |||||||||||||||||||||||||||
| Operational and other card fraud related losses | 144 | 3,365 | — | — | 3,509 | |||||||||||||||||||||||||||
| Regulatory assessment expenses | 2,743 | 388 | 143 | 97 | 3,371 | |||||||||||||||||||||||||||
| Other operating | 5,358 | 2,407 | 1,985 | 533 | 10,283 | |||||||||||||||||||||||||||
| Total noninterest expenses | 75,742 | 54,923 | 14,521 | 9,896 | 155,082 | |||||||||||||||||||||||||||
| Net income (loss) before taxes | $ | 57,873 | $ | 14,606 | $ | 5,108 | $ | (2,643) | $ | 74,944 | ||||||||||||||||||||||
Total assets | $ | 3,407,326 | $ | 140,914 | $ | 25,993 | $ | 31,974 | $ | 3,606,207 | ||||||||||||||||||||||
(1)Windsor Advantage’s™ service charge revenues from Windsor™ customers, included within noninterest income, totaled $19.6 million, including $4.1 million of Capital Bank related servicing fees, for the year ended December 31, 2025.
(2)Commercial Bank’s return on assets of 1.70% for the year ended December 31, 2025 is calculated by dividing net income before taxes by total assets.
(3)Commercial Bank’s efficiency ratio of 54.1% for the year ended December 31, 2025 is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income).
Note 19 - Segments (continued)
For the Year Ended December 31, 2024 | ||||||||||||||||||||||||||||||||
(in thousands) | Commercial Bank(2)(3) | OpenSky™ | Windsor AdvantageTM | CBHL | Consolidated | |||||||||||||||||||||||||||
| Interest income | $ | 150,948 | $ | 61,785 | $ | — | $ | 568 | $ | 213,301 | ||||||||||||||||||||||
| Interest expense | 58,192 | — | — | 363 | 58,555 | |||||||||||||||||||||||||||
| Net interest income | 92,756 | 61,785 | — | 205 | 154,746 | |||||||||||||||||||||||||||
| Provision for credit losses | 10,391 | 7,329 | — | — | 17,720 | |||||||||||||||||||||||||||
| Provision for credit losses on unfunded commitments | 385 | — | — | — | 385 | |||||||||||||||||||||||||||
| Net interest income after provision | 81,980 | 54,456 | — | 205 | 136,641 | |||||||||||||||||||||||||||
| Noninterest income | ||||||||||||||||||||||||||||||||
| Service charges on deposits | 883 | — | — | — | 883 | |||||||||||||||||||||||||||
| Credit card fees | — | 15,999 | — | — | 15,999 | |||||||||||||||||||||||||||
| Mortgage banking revenue | 1,072 | — | — | 6,074 | 7,146 | |||||||||||||||||||||||||||
| Government lending revenue | 2,301 | — | — | — | 2,301 | |||||||||||||||||||||||||||
Government loan servicing revenue(1) | (543) | — | 4,536 | — | 3,993 | |||||||||||||||||||||||||||
| Loan servicing rights | 1,013 | — | — | — | 1,013 | |||||||||||||||||||||||||||
| Non-recurring equity and debt investment write-down | (2,620) | — | — | — | (2,620) | |||||||||||||||||||||||||||
| Other income | 1,932 | 123 | 30 | 610 | 2,695 | |||||||||||||||||||||||||||
| Total noninterest income | 4,038 | 16,122 | 4,566 | 6,684 | 31,410 | |||||||||||||||||||||||||||
| Noninterest expenses | ||||||||||||||||||||||||||||||||
Salaries and employee benefits | 36,229 | 12,156 | 1,662 | 5,990 | 56,037 | |||||||||||||||||||||||||||
| Occupancy and equipment | 5,085 | 2,035 | 537 | 587 | 8,244 | |||||||||||||||||||||||||||
| Professional fees | 3,575 | 3,183 | 123 | 965 | 7,846 | |||||||||||||||||||||||||||
| Data processing | 1,496 | 25,991 | 32 | 170 | 27,689 | |||||||||||||||||||||||||||
| Advertising | 1,982 | 3,944 | 106 | 327 | 6,359 | |||||||||||||||||||||||||||
| Loan processing | 1,517 | 59 | 3 | 852 | 2,431 | |||||||||||||||||||||||||||
| Merger-related expenses | 3,930 | — | — | — | 3,930 | |||||||||||||||||||||||||||
| Operational and other card fraud related losses | 37 | 3,677 | — | — | 3,714 | |||||||||||||||||||||||||||
| Regulatory assessment expenses | 1,909 | 21 | 1 | 6 | 1,937 | |||||||||||||||||||||||||||
| Other operating | 5,167 | 2,179 | 206 | 480 | 8,032 | |||||||||||||||||||||||||||
Total noninterest expenses(4) | $ | 60,927 | $ | 53,245 | $ | 2,670 | $ | 9,377 | $ | 126,219 | ||||||||||||||||||||||
Net income (loss) before taxes | $ | 25,091 | $ | 17,333 | $ | 1,896 | $ | (2,488) | $ | 41,832 | ||||||||||||||||||||||
Total assets | $ | 3,033,792 | $ | 125,913 | $ | 25,515 | $ | 21,691 | $ | 3,206,911 | ||||||||||||||||||||||
(1) Gross government loan servicing revenue totaled $4.5 million, including $0.5 million of servicing fees earned from the Commercial Bank by Windsor™, for the year ended December 31, 2024.
(2) Commercial Bank’s return on assets of 0.83% for the year ended December 31, 2024 is calculated by dividing net income before taxes by total assets. This measurement has been adjusted to reflect the inclusion of the Corporate reportable segment.
(3) Commercial Bank’s efficiency ratio of 62.9% for the year ended December 31, 2024 is calculated by dividing noninterest expense by total revenue (net interest income plus noninterest income). This measurement has been adjusted to reflect the inclusion of the Corporate reportable segment.
(4) Prior to March 31, 2025, the Company presented only the subtotals for noninterest income and noninterest expense. The subtotals included the total amount of shared service expenses allocated to each segment but did not allocate the shared services to the individual components within noninterest expense. Beginning March 31, 2025, the Company has performed the allocation of these shared services to the individual components of noninterest expense. It should be noted that such restructuring of the tabular disclosure did not result in any changes to the Company’s methodology for allocating shared services to segments. The Company restructured prior period tabular disclosure to achieve appropriate comparability.
Note 19 - Segments (continued)
The following table presents financial information as of December 31, 2025 and December 31, 2024.
| December 31, 2025 | ||||||||||||||||||||||||||||||||
| (in thousands) | Commercial Bank | OpenSky™ | Windsor Advantage™ | CBHL | Consolidated | |||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 242,149 | $ | 8,039 | $ | 5,377 | $ | — | $ | 255,565 | ||||||||||||||||||||||
| Goodwill | 22,448 | — | 3,521 | — | 25,969 | |||||||||||||||||||||||||||
| Intangible assets | 3 | — | 13,243 | — | 13,246 | |||||||||||||||||||||||||||
| Core deposit intangibles | 1,525 | — | — | — | 1,525 | |||||||||||||||||||||||||||
| Other segment assets | 3,141,201 | 132,875 | 3,852 | 31,974 | 3,309,902 | |||||||||||||||||||||||||||
| Total assets | $ | 3,407,326 | $ | 140,914 | $ | 25,993 | $ | 31,974 | $ | 3,606,207 | ||||||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||||||||||||||
| (in thousands) | Commercial Bank | OpenSky™ | Windsor Advantage™ | CBHL | Consolidated | |||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 193,860 | $ | 7,890 | $ | 3,582 | $ | — | $ | 205,332 | ||||||||||||||||||||||
| Goodwill | 17,605 | — | 3,521 | — | 21,126 | |||||||||||||||||||||||||||
| Intangible assets | 3 | — | 14,069 | — | 14,072 | |||||||||||||||||||||||||||
| Core deposit intangibles | 1,745 | — | — | — | 1,745 | |||||||||||||||||||||||||||
| Other segment assets | 2,820,579 | 118,023 | 4,343 | 21,691 | 2,964,636 | |||||||||||||||||||||||||||
| Total assets | $ | 3,033,792 | $ | 125,913 | $ | 25,515 | $ | 21,691 | $ | 3,206,911 | ||||||||||||||||||||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 16, 2026 | Showing above |
| 2024 | Mar 17, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Mar 15, 2023 | |
| 2021 | Mar 15, 2022 | |
| 2020 | Mar 15, 2021 | |
| 2019 | Mar 16, 2020 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.