Breaking Down CF Bankshares Inc. (CFBK) Financial Health: Key Insights for Investors

You're looking at CF Bankshares Inc. (CFBK) and, honestly, the Q3 2025 numbers show a classic banking story right now: strong core performance battling credit headwinds. For the nine months ended September 30, 2025, the company delivered a solid $11.8 million in net income, or $1.81 per diluted common share, which is a defintely positive trajectory from the prior year. But here's the quick math for the third quarter: net income dropped to $2.3 million (or $0.36 per share) because a $5.1 million provision for credit losses hit earnings hard, reflecting a cautious stance on the loan book. Still, the underlying business is improving, with the Net Interest Margin (NIM) expanding to 2.76% in Q3, plus the book value per share is up to $26.99; that's the kind of stability a seasoned investor appreciates. The key is mapping this credit risk against the $21.8 million year-to-date pre-provision, pre-tax net revenue (PPNR), which shows the bank's earning power before those provisions, and that's a number you can't ignore.

Revenue Analysis

You need to know where the money is actually coming from at CF Bankshares Inc. (CFBK) because a bank's revenue mix tells you everything about its risk profile and growth engine. The clear takeaway for 2025 is that the strategic shift to commercial banking is paying off, driving strong top-line growth despite a tough rate environment for some peers.

The company's revenue streams, like any bank, are split between Net Interest Income (NII) and Noninterest Income. NII, the difference between what they earn on loans and what they pay on deposits, is the core driver. For the nine months ended September 30, 2025 (Year-to-Date or YTD), CF Bankshares Inc. generated approximately $43.8 million in total revenue, a robust figure built on consistent quarterly performance. This momentum is defintely a sign of a successful business model transition.

Primary Revenue Sources and Growth

CF Bankshares Inc. has seen NII grow significantly, reflecting better loan yields and disciplined cost of funds management. For the third quarter of 2025 (Q3 2025), Net Interest Income reached $13.8 million, which is a solid 20.3% increase compared to the same quarter in 2024. This NII expansion is the backbone of their performance.

Noninterest Income, which includes fees and service charges, is also climbing, showing a successful push into fee-based services. In Q3 2025, Noninterest Income was $1.7 million, up 7.0% year-over-year. This segment is crucial because it diversifies revenue away from pure interest rate risk. Honestly, the Q2 2025 total revenue growth rate of 57% year-over-year is a huge number that validates their commercial focus.

• Net Interest Income: Primary driver, up 20.3% in Q3 2025 YoY.
• Noninterest Income: Stabilizing at $1.7 million in Q3 2025.
• Customer Fees: Largest contributor to noninterest income growth in 2024, including Cash Management products.

Segment Contribution and Strategic Shifts

The bank's strategic focus is shifting the revenue contribution away from residential lending and toward higher-yielding Commercial banking relationships. You can see this clearly in the balance sheet movement. For instance, in the first quarter of 2025, they sold $18.1 million in residential mortgage loans to redeploy capital into Commercial banking. Here's the quick math on where the loan growth is: Commercial Real Estate loan balances alone increased by $47.7 million in Q1 2025. That's a clear signal of where the future interest income will come from.

This pivot is a deliberate effort to scale the Commercial Bank and improve the overall loan and customer mix, a strategy you can read more about in their Mission Statement, Vision, & Core Values of CF Bankshares Inc. (CFBK). The goal is to focus on closely held businesses and entrepreneurs across their key markets like Columbus, Cleveland, Cincinnati, Akron, and Indianapolis. This focus on full-service Commercial and Industrial (C&I) loans and treasury management customers is what's driving the net interest margin (NIM) expansion, which hit 2.83% in Q2 2025.

What this estimate hides is the potential volatility in noninterest income, as Q3 2025 saw a decrease in NII compared to the prior quarter, mainly due to a drop in loan prepayment and late fee income. Still, the overall trend is strong. Analysts project that CF Bankshares Inc.'s revenue will grow at a rate of 16.1% annually, outpacing the broader US market's forecasted 10.5% annual growth. That's a strong vote of confidence in their commercial-centric model.

Your action here is to monitor the Commercial Real Estate (CRE) loan portfolio growth against any potential economic slowdown, because that's the new primary revenue engine. The growth is there, but the risk profile has changed.

Profitability Metrics

You're looking for a clear picture of CF Bankshares Inc. (CFBK)'s ability to turn revenue into real profit, and the numbers from the 2025 fiscal year tell a story of strategic, albeit uneven, progress. The direct takeaway is this: CFBK is demonstrating strong operational efficiency and a solid PPNR (Pre-provision, Pre-tax Net Revenue) margin, but a significant provision for credit losses in Q3 2025 compressed the final net income.

For a bank, we don't use the typical 'Gross Profit' metric. Instead, we look at Net Interest Margin (NIM), which is the core measure of lending profitability. CF Bankshares' NIM for Q3 2025 was 2.76%. Now, compare this to the industry average for community banks, which was around 3.62% in Q2 2025. CFBK's NIM is running a bit thin, but the good news is the trend: NIM increased by 35 basis points (bps) compared to Q3 2024. They are defintely moving in the right direction by strategically shifting their loan mix, as detailed in their Mission Statement, Vision, & Core Values of CF Bankshares Inc. (CFBK).

Operational Efficiency and Pre-Tax Profit

The best proxy for 'Operating Profit' in banking is the Pre-provision, Pre-tax Net Revenue (PPNR). This metric strips out the volatile provision for credit losses, giving you a cleaner view of core operational performance. For Q3 2025, CF Bankshares reported PPNR of $7.8 million. Here's the quick math: with quarterly revenue of approximately $15.51 million, the PPNR Margin (our operating profit proxy) for Q3 2025 stands at about 50.3%. That is a very strong indicator of cost management.

This operational strength is further validated by the Efficiency Ratio (non-interest expense as a percentage of net operating revenue). CFBK's Q3 2025 Efficiency Ratio improved to 49.8%, a significant jump from 55.3% in Q3 2024. That's impressive. The industry aggregate for Q1 2025 was a higher 56.2%, so CFBK is clearly outperforming its peers on cost control. They run a tight ship.

• Q3 2025 Efficiency Ratio: 49.8% (Better than the 56.2% industry average).
• PPNR (Operating Profit Proxy): $7.8 million in Q3 2025.
• NIM (Gross Profit Proxy): 2.76% in Q3 2025.

Net Profit and Investor Returns

The final number, Net Income, is where you see the impact of risk management. CF Bankshares' net income for the nine months ended September 30, 2025, totaled $11.8 million. However, Q3 2025 net income was only $2.3 million, due to a substantial $5.1 million provision for credit losses. This provision, essentially a reserve for potential loan defaults, negatively impacted earnings by $0.61 per share for the quarter.

This volatility is why you must look at the ratios. The trailing twelve-month (TTM) Net Profit Margin is reported at a high 33.3%, which suggests strong overall earnings power. However, the Q3 2025 Net Profit Margin was a more modest 14.83% (based on a $2.3 million net income on $15.51 million revenue).

Here is how CFBK's key profitability ratios stack up against industry benchmarks for the second half of 2025:

The action here is clear: CFBK's operational engine (PPNR and Efficiency Ratio) is running well, but the profitability ratios (ROA, ROE) are being dragged down by credit risk provisions. Your next step should be to scrutinize the loan portfolio composition and the rationale behind that $5.1 million provision to gauge if this is a one-time clean-up or a sign of deeper credit quality issues.

Debt vs. Equity Structure

If you're looking at CF Bankshares Inc. (CFBK), the first thing to understand is that their capital structure is conservative, especially for a bank. The company is leaning more on equity-retained earnings and shareholder capital-than on external debt to fund its growth, which is a sign of financial stability.

As of September 30, 2025, CF Bankshares Inc. (CFBK)'s key leverage metric, the Debt-to-Equity (D/E) ratio, stood at approximately 0.56. Here's the quick math: total debt, mostly in the form of Federal Home Loan Bank (FHLB) advances and other debt, was $101.0 million, against a total stockholders' equity of $179.3 million. This means for every dollar of equity, they have about 56 cents in debt. That's defintely a healthy ratio.

This ratio is notably below the industry benchmark for Regional Banks, which averages around 0.50 as of November 2025, but it is still well within the acceptable range for a financial institution. Banks naturally operate with higher leverage, so a D/E ratio under 1.0 is a strong signal of low financial risk. A D/E ratio of 1.5 or lower is generally considered desirable for most companies, so CF Bankshares Inc. (CFBK) is in a comfortable position.

The company's debt is primarily composed of FHLB advances, which are essentially secured loans from the Federal Home Loan Bank system, a common and stable funding source for banks. The total debt of $101.0 million at the end of Q3 2025 was up slightly from $92.7 million at the end of 2024.

• Short-Term/Long-Term Debt: The increase in overall debt was mainly driven by a $10.0 million increase in the outstanding balance on the holding company credit facility, suggesting a tactical use of short-term funding to support operations or loan growth.
• Refinancing Activity: While there was no major bond issuance, the company has been actively managing its funding mix. They are using their credit facility more, but their overall debt structure remains stable, with FHLB advances being the core.

CF Bankshares Inc. (CFBK) is balancing its growth by relying on both debt and equity, but the equity side is growing robustly. The stockholders' equity increased to $179.3 million at September 30, 2025, up 6.4% from December 31, 2024. This growth is primarily fueled by retained net income, proving they can generate capital internally to support their expansion, rather than diluting shareholders or taking on excessive debt. This is the mark of a well-managed bank focused on sustainable growth.

For a deeper dive into their overall performance, including profitability and credit quality, check out our full report: Breaking Down CF Bankshares Inc. (CFBK) Financial Health: Key Insights for Investors.

Here is a snapshot of the capital structure for better clarity:

Liquidity and Solvency

You need to know if CF Bankshares Inc. (CFBK) can cover its short-term obligations, and the quick answer is yes, but with a banking-specific caveat. Their liquidity position as of Q3 2025 is solid, characterized by a tight but healthy Current Ratio of 1.13 and a Quick Ratio that matches it at 1.13. This means for every dollar of short-term debt (current liabilities), the company has $1.13 in assets that are either cash or can be quickly converted to cash. For a bank, these ratios are often near one because customer deposits are technically current liabilities, so a small margin above 1.0 is defintely a strength.

The core of CF Bankshares Inc.'s liquidity strength is in its cash and capital. Cash and Equivalents increased from $231.97 million at the end of 2024 to $272.36 million by September 30, 2025, a jump of over $40 million. This positive growth in the most liquid asset is a strong signal. Also, the regulatory capital ratios are excellent, with a Tier 1 Leverage Ratio of 11.19% and a Total Capital Ratio of 14.88% as of Q3 2025, well above the required minimums. That's a strong buffer against unexpected losses.

When we look at the working capital trends, for a bank, we really look at the net change in cash over time, which is the sum of operating, investing, and financing cash flows. The $40.39 million increase in Cash & Equivalents for the first nine months of 2025 shows strong net cash generation. This is driven by their core business model, which is a classic bank structure:

• Operating Cash Flow: Historically positive, driven by net income. For the nine months ended September 30, 2025, net income was $11.8 million.
• Investing Cash Flow: Typically negative, as the bank uses cash to fund new loans and purchase investment securities. This is the engine of a bank's growth.
• Financing Cash Flow: Mix of inflows from new deposits ($1.78 billion in total deposits as of Q3 2025) and outflows for debt repayments and dividends ($0.08 per share quarterly dividend).

The key liquidity concern, which is common for all regional banks, is the concentration of uninsured deposits. About 29.7% of CF Bankshares Inc.'s total deposits exceed the FDIC insurance limit, a factor that requires close monitoring, especially during periods of market stress. However, their strong capital ratios and cash position mitigate this risk. You can dig deeper into the shareholder base here: Exploring CF Bankshares Inc. (CFBK) Investor Profile: Who's Buying and Why?

Here's the quick math on their short-term financial position:

What this estimate hides is the composition of the loan portfolio, which is the biggest asset. While nonperforming loans are down to $10.0 million (a good sign), there was a significant $7 million charge-off on a single non-customer loan in Q3 2025. This event, while a one-off, shows that credit risk can impact quarterly earnings and, by extension, future operating cash flow. Still, the core pre-provision, pre-tax net revenue (PPNR) of $7.8 million for Q3 2025 indicates the underlying business is generating solid earnings before credit provisions. They are defintely focused on core commercial banking, which is their strength.

Valuation Analysis

You're looking at CF Bankshares Inc. (CFBK) to see if it's a buy, a hold, or a sell right now, and the numbers tell a story of potential value that the market is still skeptical about. My analysis suggests CF Bankshares Inc. looks technically undervalued based on its core banking multiples, but recent earnings misses and a downward stock trend mean the analyst consensus is a cautious Hold.

The core valuation ratios-Price-to-Earnings (P/E) and Price-to-Book (P/B)-are significantly lower than the broader banking sector average, which usually flags an opportunity. Still, you have to consider the near-term risks, especially after the latest quarterly earnings miss.

Key Valuation Multiples: Undervalued on Book Value

When we look at how the market values CF Bankshares Inc. relative to its fundamentals, the picture points to a cheap stock. The Price-to-Book (P/B) ratio is the most compelling metric for a bank, comparing the stock price to the company's net asset value (book value) per share. A P/B below 1.0 often suggests a stock is undervalued, and CF Bankshares Inc.'s P/B is in the range of 0.81 to 0.95.

The trailing Price-to-Earnings (P/E) ratio is also low, sitting around 8.06 to 8.30, which is well below the average for regional banks. Here's the quick math on the key multiples for the 2025 fiscal year:

• Price-to-Earnings (P/E): Trailing P/E is about 8.30, with a forward P/E of 6.25. This indicates a low price for every dollar of current and projected earnings.
• Price-to-Book (P/B): The ratio is between 0.81 and 0.95. This means you are buying the company for less than its net assets.
• Enterprise Value-to-EBITDA (EV/EBITDA): This is less common for banks, but one data point puts it at 2.34. What this estimate hides is the complexity of calculating EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for a financial institution, so defintely prioritize the P/B.

Stock Trends and Analyst Consensus

The stock's price action over the last year shows the market's hesitation, despite the low multiples. CF Bankshares Inc. stock has decreased by 18.93% over the last 12 months, which is a significant drop and reflects the challenges in the banking sector and the recent earnings miss in November 2025. The 52-week trading range shows the volatility, with a low of $19.22 and a high of $29.60.

Analyst ratings reflect this mixed signal of cheap valuation but poor momentum. The consensus rating on CF Bankshares Inc. is a collective Hold, based on one Buy rating and two Hold ratings. The average 12-month price target is $29.00, suggesting a potential upside from the current price around $22.70.

Dividend Strength and Payout

For income-focused investors, the dividend profile is stable and conservative. CF Bankshares Inc. pays an annualized dividend of $0.32 per share, giving a current dividend yield of about 1.4%. The key here is the dividend payout ratio (DPR), which is very low at around 11.51% to 13% of earnings. A low payout ratio means the dividend is extremely well-covered by earnings, giving the company plenty of room to maintain or even grow the dividend, or, more likely, retain capital for balance sheet strength. You can read more about the company's financial stability in our full post: Breaking Down CF Bankshares Inc. (CFBK) Financial Health: Key Insights for Investors.

Risk Factors

You're looking at CF Bankshares Inc. (CFBK) and seeing some promising growth in core revenue, but honestly, the near-term risks-especially around credit quality and profitability-demand your attention. The most immediate financial risk stems from a single, large credit event in the third quarter of 2025.

The bank took a massive $7 million charge-off on one non-customer loan in Q3 2025, which is a huge hit for a bank of this size, representing about 4.67% of its market capitalization. This single event drove the provision for credit losses up to $5.07 million for the quarter, reducing Net Income to only $2.3 million (or $0.36 per diluted share). That's a sharp reminder that credit risk is defintely the top internal concern right now. One bad loan can really hurt a small bank.

Operational and Financial Risks: The Credit Quality Drag

The Q3 2025 earnings clearly showed a disconnect: core operations are strong, but credit issues are dragging down the bottom line. While Pre-provision, pre-tax net revenue (PPNR)-a measure of core operating profit-surged 33% year-over-year to $7.8 million, the profitability metrics lagged peers. The Return on Average Equity (ROE) was only 5.20% and Return on Average Assets (ROA) was 0.45% for Q3 2025. This is significantly below the broader commercial banking sector's average ROE of around 10.19% and ROA of 0.79%, indicating an efficiency problem that gets amplified by credit losses.

Another financial risk is liquidity. As of September 30, 2025, approximately 29.7% of CF Bankshares Inc.'s deposits exceeded the FDIC insurance limit. Plus, the bank relies partly on wholesale funding. This isn't a crisis, but it makes the bank more sensitive to market panic and rising rates than banks with a higher percentage of insured, sticky deposits.

• Credit Concentration Risk: A single loan caused a $7 million charge-off in Q3 2025.
• Profitability Lag: Q3 2025 ROA of 0.45% is nearly half the sector average.
• Liquidity Sensitivity: 29.7% of deposits are uninsured, increasing funding risk.

External and Strategic Headwinds

The external environment presents the usual, but still potent, risks for regional banks. Interest rate risk is always present; while CF Bankshares Inc. saw its cost of funds decline 58bps year-over-year in Q3 2025, future rate hikes or cuts could still impact the Net Interest Margin (NIM) and earnings volatility. Regulatory changes also remain a constant threat, especially any new rules tightening capital requirements or increasing compliance costs for regional players.

Strategically, the bank is actively shifting its focus, contracting its Residential loan portfolio (selling $18.1 million in Q1 2025) to expand its higher-yielding Commercial Bank relationships. This is a smart move, but it means their growth is tied to the health of the commercial real estate and business lending markets in their primary Ohio and Indiana metro markets. New Commercial Loan production totaled $155 million year-to-date, so that growth needs to be managed with extreme credit discipline.

Mitigation Strategies and Capital Strength

The good news is that CF Bankshares Inc. has strong capital buffers to absorb these shocks. As of September 30, 2025, the bank was well-capitalized, with a Total Capital Ratio of 14.88% and a Tier 1 Leverage ratio of 11.19%, both well above regulatory minimums.

Management's primary mitigation strategy for the credit risk is to isolate the problem. They emphasized that the $7 million charge-off was on a 'non-customer' purchased loan, differentiating it from their core, internally-originated loan book. This suggests a clean-up of legacy or non-strategic assets, which, if true, means the worst of that specific issue is behind them. You can read more about the shareholder base and who is betting on this strategy in Exploring CF Bankshares Inc. (CFBK) Investor Profile: Who's Buying and Why?

Growth Opportunities

You're looking for a regional bank that can genuinely outgrow the market, and honestly, CF Bankshares Inc. (CFBK) is positioned as a compelling outlier right now. The core takeaway is that their strategic pivot to a commercial-focused model is paying off in margins and loan growth, which analysts project will translate into significant earnings acceleration in the near term.

The company's management is defintely executing a clear strategy: scale the Commercial Bank and actively reduce lower-rate Residential Mortgage portfolio loans. This shift is the primary growth driver, and it's why their Pre-provision, Pre-tax Net Revenue (PPNR)-a key measure of core profitability-jumped 33% in Q3 2025 compared to the same period last year, reaching $7.8 million. That's a strong signal of core business health.

Future Revenue and Earnings Estimates

The numbers for the 2025 fiscal year paint a picture of robust expansion, especially when you stack them against the broader US banking sector. Analysts project CF Bankshares Inc.'s total revenue for 2025 to be around $63.11 million, which is a massive average growth rate of 40.0% over the prior year. That's a powerful engine.

The earnings per share (EPS) forecast is even more striking. The average EPS for 2025 is estimated at $3.24, representing a growth of 57.46%. Here's the quick math on that growth: it's driven by a combination of higher-yielding commercial loans and a better handle on costs, which is reflected in their improved Efficiency Ratio of 49.8% in Q3 2025.

Strategic Initiatives and Competitive Edge

The growth isn't accidental; it's anchored in specific strategic moves. CF Bankshares Inc. is aggressively building out its Commercial Team, a move that is expected to accelerate net commercial loan growth into 2026. They already produced $155 million in new Commercial Loans year-to-date through Q3 2025. Also, their core competency in Construction Lending gives them a valuable specialization, often leading to full banking relationships with proven developers.

Their competitive advantage is essentially a boutique model in major metro markets-Columbus, Cleveland, Cincinnati, and Indianapolis. They offer the sophistication of a larger bank but with direct access to decision-makers, cutting through the bureaucracy. Plus, their Net Profit Margin rose to 33.3% this year, which is notably higher than what's typical for US banks, signaling strong operational control and a favorable revenue mix. This margin strength is a key differentiator you should watch.

• Scale the Commercial Bank, focusing on closely held businesses.
• Improve Net Interest Margin (NIM), which hit 2.76% in Q3 2025.
• Invest in top banking talent for the Commercial Team.
• Repurchase up to 325,000 shares (about 5% of stock) by early 2026.

What this estimate hides is the potential for credit loss provisions, like the $5.1 million provision expense they took in Q3 2025, which can temporarily impact net income. Still, the underlying core earnings remain solid. For a deeper dive into the bank's risk profile, you should check out our full analysis: Breaking Down CF Bankshares Inc. (CFBK) Financial Health: Key Insights for Investors.