BayFirst Financial Exits SBA Lending Business in Strategic Shift, Sells $103 Million Portfolio to Banesco USA

BayFirst Financial Corp., parent company of BayFirst National Bank, announced plans to exit the SBA 7(a) lending business and sell $103 million of SBA 7(a) loan balances to Banesco USA. This strategic move represents a significant shift for the Florida-based financial institution as it seeks to reposition itself for long-term growth and enhanced shareholder value.

Thomas G. Zernick, Chief Executive Officer of BayFirst, stated that management and the board initiated a comprehensive strategic review earlier in the year aimed at derisking SBA 7(a) balances on the balance sheet. The definitive agreement with Banesco USA marks a major milestone in these efforts, with the transaction expected to close in the fourth quarter of this year. The loans will be sold at 97% of retained balances, and Banesco USA will assume servicing of these loans while also purchasing servicing rights for the purchased loans at book value.

The implications of this transaction extend beyond the financial terms. The majority of BayFirst's current SBA lending staff and support teams will be offered positions with Banesco USA, ensuring that the expertise and experience built within BayFirst's SBA division will continue to support small business lending through the acquiring institution. This transition allows BayFirst to refocus on its core community banking mission while providing continuity for both employees and customers affected by the change.

BayFirst remains committed to its community bank mission of serving individuals, families, and small businesses with stable checking and savings products that contribute to a more predictable, low-cost funding base. The relationship-driven approach continues to strengthen the bank's presence across the vibrant Tampa Bay region and creates opportunities to expand its community bank portfolio, deposit growth, and fee income sources like treasury management services.

For Banesco USA, this acquisition represents a strategic expansion of its small business lending capabilities. Calixto (Cali) Garcia-Velez, President & CEO of Banesco USA, emphasized that through the addition of BayFirst's SBA lending team and the acquisition of the SBA 7(a) loan portfolio, Banesco USA gains the infrastructure, expertise, and enhanced capabilities to deliver SBA lending on a national scale. The transaction aligns with Banesco USA's growth strategy to expand its small business lending capabilities while establishing a presence in the Greater Tampa Bay region.

Banesco USA, an independent Florida state-chartered bank with over $5 billion in assets and eight locations across South Florida and Puerto Rico, distinguishes itself in providing personalized customer service and a suite of products and services to domestic and international clients. This latest investment will establish a nationwide SBA lending platform for the bank, which is poised to continue its growth trajectory fueled by investments in Commercial & Industrial, Business and Professional, International, and Commercial Real Estate lines of business. For more information about Banesco USA, visit https://banescousa.com.