What changed in this filing

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Item 1. Financial Statements

2025-08-08 compared with 2025-05-09 · 629 added, 490 removed, 1082 unchanged (51% of the section changed)

3 unchanged sentences

(Dollars in thousands, except share data)

March 31, 2025

June 30, 2025

December 31, 2024

27 unchanged sentences

per share liquidation preference;

issued and outstanding as of March 31, 2025

issued and outstanding as of June 30, 2025

and December 31, 2024

1 unchanged sentence

per share liquidation preference;

issued and outstanding as of March 31, 2025

issued and outstanding as of June 30, 2025

and December 31, 2024

1 unchanged sentence

per share liquidation preference;

issued and outstanding as of March 31, 2025

issued and outstanding as of June 30, 2025

and December 31, 2024

1 unchanged sentence

shares authorized;

outstanding as of March 31, 2025,

outstanding as of June 30, 2025,

issued and outstanding as of December 31,

1 unchanged sentence

shares authorized;

outstanding as of March 31, 2025 and December

outstanding as of June 30, 2025 and December

Additional paid-in capital on common stock

11 unchanged sentences

except per share data)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

Interest income:

15 unchanged sentences

Non-interest income:

Gain on sale of securities available for sale, net

Gain on sale of loans held for sale, net

21 unchanged sentences

(Dollars in thousands)

Three Months Ended March 31,

Three Months Ended

Six Months Ended

Other comprehensive income (loss):

Unrealized gain (loss) on investment securities

Amortization of net unrealized gain on securities transferred

from available-for-sale to held-to-maturity

Reclassification adjustment for amortization of net

unrealized losses on

securities transferred from available-for-sale to held-to-maturity

Reclassification adjustment for gain included in net

Unrealized gain (loss) on cash flow hedge

Tax benefit (expense)

Total other comprehensive income (loss), net of tax

14 unchanged sentences

Stockholders'

Balance at March 31, 2025

Other comprehensive loss

Exercise of stock options

Dividend payment

Stock-based compensation

Balance at June 30, 2025

Balance at March 31, 2024

Other comprehensive income

Repurchase of Class A common stock

Restricted stock issued

Dividend payment

Stock-based compensation

Balance at June 30, 2024

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

Additional Paid-in

Capital on Common

Accumulated Other

Comprehensive

Stockholders'

Balance at December 31, 2024

2 unchanged sentences

Restricted stock issued

Restricted stock forfeiture

Exercise of stock options

1 unchanged sentence

Stock-based compensation

Balance at March 31, 2025

Balance at June 30, 2025

Balance at December 31, 2023

6 unchanged sentences

Stock-based compensation

Balance at March 31, 2024

Balance at June 30, 2024

The accompanying notes are an integral

part of these unaudited consolidated financial

The accompanying notes are an integral

part of these consolidated financial statements.

4 unchanged sentences

(Dollars in thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash flows from operating activities:

4 unchanged sentences

Accretion of premiums on securities, net

Amortization (accretion) of deferred loan

Amortization of deferred loan fees, net

Stock-based compensation

Gain on sale of available for sale securities,

Gain on sale of loans held for sale, net

14 unchanged sentences

securities available for sale

Proceeds from sales of investment securities

available for sale

Net increase in loans held for investment

11 unchanged sentences

Net increase in deposits

Proceeds from FHLB advances

Proceeds from other borrowings

1 unchanged sentence

Net cash provided by financing activities

Net decrease in cash and cash equivalents

Net increase (decrease) in cash and

cash equivalents

Cash and cash equivalents at beginning

49 unchanged sentences

the financial

most significant

estimates impacting

the Company’s

consolidated financial

statements are

the allowance

(“ACL”) and income taxes.

Reclassifications

Certain amounts in the consolidated financial statements have been reclassified to conform

to the current presentation.

Reclassifications had no impact on the net income or stockholders’

equity of the Company.

presentation.

Reclassifications had no impact on prior period

net income or stockholders’ equity.

Recently Issued Accounting Standards

11 unchanged sentences

beginning after

effective January 1, 2025, the adoption of this ASU did not have a material impact on the

Company’s consolidated financial

effective January 1, 2025.

adoption of this ASU did

not have a material

impact on the Company’s consolidated financial

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

INVESTMENT SECURITIES

The measurement of expected credit losses under the current expected credit loss (“CECL”) methodology is applicable

The following

tables present

of the amortized

cost, unrealized

or unrecognized

value of investment securities at the dates indicated (in

June 30, 2025

Available-for-sale:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Municipal securities

Bank subordinated debt securities

Held-to-maturity:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Corporate bonds

Allowance for credit losses - securities held-to-maturity

Securities held-to maturity, net of allowance for credit losses

December 31, 2024

Available-for-sale:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Municipal securities

Bank subordinated debt securities

Held-to-maturity:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Corporate bonds

Allowance for credit losses - securities held-to-maturity

Securities held-to maturity, net of allowance for credit losses

The unrealized gain

date of transfer

is retained in

in the carrying

the HTM securities

are amortized

remaining life

transfers from AFS to HTM portfolios in 2022.

During the quarter

ended June 30,

2025 there were

investment securities

that were transferred

For the three

months ended June 30, 2025, total

amortization out of AOCI

for net unrealized losses

on securities transferred

USCB FINANCIAL HOLDINGS, INC.

2 unchanged sentences

Q2 2025 Form 10-Q

accounting for available-for-sale

debt securities (“AFS”)

credit losses is

presented as an

allowance rather than

Management does not intend to sell or believes

that it is more likely they will not be required to sell

AFS securities.

in 2022 from AFS to HTM was $

thousand and $

thousand for the six month ended June 30, 2025.

At June 30, 2025,

the fair value of the securities was $

million and the balance of the net unrealized loss was $

transferred from

the six month

2024, the fair value of the securities

million and the balance of the net

unrealized losses retained in AOCI was

The measurement of expected credit losses under the current expected credit loss (“CECL”) methodology is applicable

to financial assets measured at amortized cost, including

loan receivables and held-to-maturity debt securities.

CECL requires a loss reserve for

3 unchanged sentences

projected economic

Government bonds

classified as

4 unchanged sentences

reserve is not required.

The reserve requirement is for three primary assets groups:

The reserve requirement is for

three primary assets groups:

municipal bonds, corporate bonds, and

17 unchanged sentences

ratings are monitored

by the Company on at least

a quarterly basis.

As of March 31, 2025

and December 31, 2024, all HTM securities held by

by the Company on at least a quarterly basis.

As of June 30, 2025 and December 31,

2024, all HTM securities held by the

Company were rated investment grade.

1 unchanged sentence

The remaining

in investment

corporate bonds.

The required reserve for these holdings is

determined each quarter using the model described above.

The required reserve for these

holdings is determined each quarter using the model described above.

the portion of the HTM exposed to non-government

1 unchanged sentence

methodology to estimate

thousand ACL as of March

The book value

for debt securities classified

as HTM represents amortized

debt securities

classified as

HTM represents

amortized cost

less the ACL related to these securities.

The Company’s investment

portfolio includes Available-for-Sale

(“AFS”) debt securities,

which are carried at

with unrealized gains and losses recognized in accumulated other comprehensive income (loss) (“AOCI”), net of

evaluates whether the declines

in fair value

are attributable to credit

losses or other

factors like interest

rate risk, using both

quantitative and qualitative analyses, including company

performance analysis, review of credit

bond vintage,

macro-economic

value of an AFS security is less than its amortized

cost and the decline is attributable to credit-related factors, an allowance

for credit losses (“ACL”) is recorded.

As a result of this evaluation, the Company concluded that no allowance was required

on AFS securities as of June 30, 2025.

Information pertaining

to investment

securities with

gross unrealized

losses, aggregated

by investment

individual securities

loss position,

are presented

the following

tables present

of the amortized

cost, unrealized

or unrecognized

value of investment securities at the dates indicated (in

March 31, 2025

dates (in thousands):

June 30, 2025

Less than 12 months

12 months or more

Available-for-Sale:

5 unchanged sentences

Bank subordinated debt securities

Held-to-maturity:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Corporate bonds

Allowance for credit losses - securities held-to-maturity

Securities held-to maturity, net of allowance for credit losses

USCB FINANCIAL HOLDINGS, INC.

3 unchanged sentences

December 31, 2024

Less than 12 months

12 months or more

Available-for-sale:

5 unchanged sentences

Bank subordinated debt securities

Held-to-maturity:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Corporate bonds

Allowance for credit losses - securities held-to-maturity

Securities held-to maturity, net of allowance for credit losses

maturity securities.

There was no impact to net income.

are amortized over the remaining life of the security.

The Company made

transfers from AFS to HTM portfolios in 2022.

During the quarter ended March 31, 2025 there were

investment securities that were transferred from

transferred in

the securities

million and the balance of the net unrealized loss was $

transferred from AFS to HTM was $

thousand, At March 31, 2025, the fair value of the securities

the balance of the net unrealized losses retained in AOCI

million at March 31, 2024.

When evaluating

securities under

has evaluated

value is attributable

to credit losses

or other factors

like interest rate risk,

using both quantitative

and qualitative analyses,

speeds and analysis

of macro-economic conditions.

Each investment is

expected to recover

its price depreciation

holding period

these securities

As a result of

this evaluation, the Company

concluded that no allowance

was required on AFS

securities as of

March 31, 2025.

mortgage-backed

securities and collateralized

mortgage obligations of

government sponsored

entities, in the

AFS and HTM categories

respectively.

The unrealized losses for both AFS and HTM portfolios were attributable to a combination of factors, including

relative changes in interest rates since the

time of purchase.

mortgage-backed

securities and

collateralized mortgage

obligations of

sponsored entities

respectively.

The unrealized losses for both AFS and HTM portfolios were attributable to a combination of factors, including

relative changes in interest rates since the time of purchase.

The contractual cash

12 unchanged sentences

security holdings

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

in investment spreads and interest

rate movements and not changes

in credit quality.

Management expects to recover the

entire amortized cost basis of these securities.

Information pertaining

to investment

securities with

gross unrealized

losses, aggregated

by investment

individual securities

loss position,

are presented

the following

dates (in thousands):

March 31, 2025

Less than 12 months

12 months or more

Available-for-Sale:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Municipal securities

Bank subordinated debt securities

December 31, 2024

Less than 12 months

12 months or more

Available-for-sale:

Government Agency

Collateralized mortgage obligations

Mortgage-backed securities - residential

Mortgage-backed securities - commercial

Municipal securities

Bank subordinated debt securities

in investment spreads and interest rate movements and

not changes in credit quality.

identification basis.

securities during

therefore, there were

gains or losses during these periods.

sales or calls of securities nor gains

or losses of securities during the three

six months ended June 30, 2025.

The following table presents the proceeds,

realized gross gains and realized gross losses

on sales and calls of AFS debt securities for the three

and six months ended June 30, 2024 (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Available-for-sale:

Proceeds from sale and call of securities

Net realized gain

The amortized

1 unchanged sentence

indicated (in thousands).

maturities may differ

from contractual maturities

because borrowers may have

Actual maturities may

differ from contractual

maturities because borrowers

may have the right

call or prepay

6 unchanged sentences

Held-to-maturity

March 31, 2025:

June 30, 2025:

Due within one year

6 unchanged sentences

Mortgage-backed securities - commercial

At March 31, 2025, there were no securities held in the portfolio from any

one issuer in an amount greater than 10% of

stockholders’

collateralized

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

At June 30, 2025,

there were no

securities held in

the portfolio from

any one issuer

in an amount greater

total stockholders’

Government Agency

the collateralized

mortgage-backed

4 unchanged sentences

municipalities,

securities pledged

the outstanding

uninsured deposits

% at December 31, 2024.

Bank must also maintain a

minimum amount of pledged securities

to be in the public

As of March 31,

2025, the Bank

million in deposits

under the public

funds program

to the State of Florida for these public funds were

securities pledged to the

State of Florida at a

% of the quarter daily

average balance at June 30,

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

minimum amount

As of June 30, 2025, the

Bank had a total of $

million in deposits under the

public funds program and pledged

the State of Florida for these public funds were

bonds with an aggregate fair value of $

6 unchanged sentences

loans held for investment by type (dollars in thousands):

March 31, 2025

June 30, 2025

December 31, 2024

8 unchanged sentences

respectively,

commercial real estate

and residential mortgage loans

pledged as collateral

credit with the

Reserve Bank of Atlanta.

commercial real estate and residential mortgage loans pledged as collateral for

lines of credit with the FHLB of Atlanta and

the Federal Reserve Bank of Atlanta.

Allowance for Credit Losses

methodology to

quantitative portion

driver analysis

(“LDA”) and discounted cash flow analyses.

Weighted-Average

Maturity (“WARM”) methodology to estimate the

quantitative portion of the ACL

for loan pools.

DCF method uses a loss

driver analysis (“LDA”) and discounted cash

flow analyses.

Management engaged

advisors and consultants with expertise in CECL model

development to

development of

regression models

and supportable

of reasonable

default for loan receivables use at least

one of the following economic indicators:

civilian unemployment rate (national), real

gross domestic

product growth

(national GDP)

Index (“HPI”).

WARM methodology is used,

the long-term average

calculated and applied

on a quarterly

basis for the

life of the pool.

Adjustments for economic expectations are

made through qualitative factors.

advisors and consultants

with expertise

in CECL model development

to assist in development of

a LDA based on

regression models and supportable forecast.

reasonable and

supportable forecasts

in projective

forecasts applied

to regression

probability of default for

loan receivables use

at least one of the

following economic indicators:

civilian unemployment rate

(national), real gross

domestic product growth (national

GDP) or the House

Price Index (“HPI”).

each of the segments

in which the WARM methodology is used,

the long-term average loss rate is calculated and applied on a quarterly basis for

the remaining life of the pool.

Adjustments for economic

expectations are made through qualitative factors.

Qualitative factors (“Q-Factors”) used in the ACL methodology

6 unchanged sentences

Changes in the value of underlying collateral

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

The effect of other external factors:

2 unchanged sentences

Changes in lending management, among others

Changes in the ACL for the three months ended March

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

Changes in the ACL for the three and six months ended June

30, 2025 and 2024 were as follows (in thousands):

Correspondent

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Beginning balance

1 unchanged sentence

Ending Balance

Six Months Ended June 30, 2025

Beginning balance

Provision for credit losses

Ending Balance

(1) Provision for credit losses excludes a $

thousand charge due to unfunded commitments included in accrued interest and other

liabilities and a $

thousand release related to investment securities held to maturity.

thousand provision due to unfunded commitments included in accrued interest and

other liabilities and a $

thousand provision related to investment securities held to maturity.

(2) Provision for credit losses excludes a $

thousand provision due to unfunded commitments included in accrued interest and

other liabilities and a $

thousand provision related to investment securities held to maturity.

Correspondent

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Beginning balance

1 unchanged sentence

Ending Balance

Six Months Ended June 30, 2024

Beginning balance

Provision for credit losses

Ending Balance

(1) Provision for credit losses excludes a $

thousand charge due to unfunded commitments included in accrued interest and other

thousand provision due to unfunded commitments included in accrued interest and other

liabilities and a $

thousand charge related to investment securities held to maturity.

At March 31, 2025, the ACL for loans

thousand release related to investment securities held to maturity.

(2) Provision for credit losses excludes a $

thousand provision due to unfunded commitments included in accrued interest and other

liabilities and $

thousand provision related to investment securities held to maturity.

At June 30, 2025, the ACL

for loans was $

million compared to $

1 unchanged sentence

thousand in the ACL was due to loan growth.

The Company had

charge-offs totaling

thousand for the

quarter ended March

31, 2025 related

to loans that

all originated in 2025.

The Company had charge-offs totaling $

thousand for the quarter ended March 31, 2024 related to loans that were all

Charge offs related to loans for the

three months ended June 30, 2025 were

thousand originated in 2022 and $

originated in

thousand originated

thousand originated in 2025.

Charge offs related

to loans for the

three months ended

June 30, 2024

thousand and were

all originated in

Charge offs for the six months ended June 30,

2024 totaled $

thousand and were all originated in 2024.

USCB FINANCIAL HOLDINGS, INC.

2 unchanged sentences

Q2 2025 Form 10-Q

The ACL and the outstanding

balances in the specified

loan categories as of March

31, 2025 and December 31,

outstanding balances

specified loan

categories as

December 31, 2024

are as follows (in thousands):

1 unchanged sentence

Correspondent

March 31, 2025:

June 30, 2025:

Allowance for credit losses:

54 unchanged sentences

presented below for the periods indicated (in thousands):

As of March 31, 2025

As of June 30, 2025

Term Loans by Origination Year

Residential real estate

Special Mention

Commercial real estate

28 unchanged sentences

payment performance

The following

tables include

total non-accruing

December 31, 2024 (in thousands):

As of March 31, 2025

As of June 30, 2025

Residential real estate:

Home equity line of credit and other

Home equity lines of credit and other

1-4 family residential

14 unchanged sentences

Residential real estate:

Home equity line of credit and other

Home equity lines of credit and other

1-4 family residential

5 unchanged sentences

Commercial property

Leasehold improvements

Commercial and industrial:

2 unchanged sentences

Non-accrual Status

The following table

includes the amortized

cost basis of

loans on non-accrual

status and loans

past due over

and still accruing as of March 31, 2025 and as of December

31, 2024 (in thousands):

March 31, 2025

Days and Still

The following

the amortized

December 31, 2024 (in thousands):

June 30, 2025

Loans With No

Related Allowance

Residential real estate

Commercial and industrial

Consumer and other

December 31, 2024

Days and Still

Loans With No

Related Allowance

Residential real estate

5 unchanged sentences

interest income

attributable to non-accrual loans outstanding during the three

months ended March 31, 2025 and 2024.

Interest income on

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

these loans for

attributable to non-accrual

loans outstanding during

the three months

ended March 31,

ended June 30,

2025 and 2024.

would have been

approximately $

thousand and $

Interest income

been approximately

thousand, respectively,

had these loans performed in accordance with their

had these loans performed

in accordance with their

original terms.

income on these loans

approximately

respectively, had

these loans performed in accordance with their original

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

Collateral-Dependent Loans

6 unchanged sentences

loans related

financial difficulty by type of collateral as of March

financial difficulty by type of collateral as of June

30, 2025 and December 31, 2024 (in thousands):

March 31, 2025

June 30, 2025

Collateral Type

Residential Real

Residential Real Estate

Specific Reserve

Residential real estate

Consumer and other

December 31, 2024

13 unchanged sentences

is calculated.

collateral valuation

recorded investment of the loan, no reserve is determined.

Loan Modifications to Borrowers Experiencing Financial

modifications

March 31, 2025 and one new modification

for the three months ended March 31,

The following table presents newly

restructured loans, by type of modification, which occurred

during the three months ended March 31, 2024 (in

new modifications

experiencing financial

experiencing financial difficulties

months ended June

The following

table presents newly

loans, by type of modification, which occurred during the

six months ended June 30, 2024 (in thousands):

Recorded Investment Prior to Modification

5 unchanged sentences

Commercial and industrial

The loan modification for the borrower experiencing financial difficulty at March 31, 2024

The loan modification for the

borrower experiencing financial

difficulty at June 30,

2024 included

a combination of rate

and maturity modifications.

modifications.

September 2029 was extended to January

existing loan modifications that

subsequently defaulted during the

three months ended March 31,

and March 31, 2024.

subsequently defaulted during

either the three or the

six months ended

June 30, 2025 and June 30, 2024.

USCB FINANCIAL HOLDINGS, INC.

4 unchanged sentences

in the following table for the periods indicated (in thousands):

Three Months Ended March 31,

expense for the periods (computed by applying the U.S.

Six Months Ended June 30,

The actual income tax

expense for the six months

ended June 30, 2025 and 2024

differs from the statutory tax expense

for the periods (computed by applying the U.S.

federal corporate tax rate of

% for both 2025 and 2024

to income before provision for income taxes) as follows

(in thousands):

Three Months Ended March 31,

periods to income

before provision for income taxes) as follows (in thousands):

Six Months Ended June 30,

Federal taxes at statutory rate

3 unchanged sentences

tax liabilities as of the dates indicated were (in thousands):

March 31, 2025

June 30, 2025

December 31, 2024

23 unchanged sentences

whether it is more likely than not that some

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

upon the generation of

3 unchanged sentences

differences become deductible.

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

Management considers the scheduled reversal

10 unchanged sentences

by tax authorities for years before 2022.

For the three months ended

March 31, 2025 and 2024, the

For the six months

ended June 30, 2025 and

2024, the Company did

t have any unrecognized

tax benefits as a

tax positions

current period.

of tax positions taken during a prior period or during

the current period.

Additionally,

recorded as a result of tax uncertainties.

interest or penalties were recorded

as a result of tax uncertainties.

OFF-BALANCE SHEET ARRANGEMENTS

23 unchanged sentences

is represented by the contractual amount of these commitments.

March 31, 2025 and December 31, 2024 (in thousands):

March 31, 2025

June 30, 2025 and December 31, 2024 (in thousands):

June 30, 2025

December 31, 2024

39 unchanged sentences

Interest Rate Swaps Designated as a Cash Flow Hedge

As of March 31,

2025, the Company

interest rate swap

agreements with

a notional aggregate

June 30, 2025,

interest rate

swap agreements

notional aggregate

were designated

1 unchanged sentence

compound SOFR being received.

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q1 2025 Form 10-Q

As of December

5 unchanged sentences

The interest rate swap agreements have an

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

compound SOFR being received.

corresponding recognition

in other comprehensive

income (loss)

and subsequently reclassified

to earnings when

losses are realized.

these interest

accrued interest

corresponding

comprehensive

gains or losses are realized.

Interest Rate Swaps Designated as Fair Value

As of March 31, 2024, the Company had

interest rate swap agreements with a notional aggregate amount of $

million that were designated as fair value hedges on loans.

rate swap agreements have an average maturity of

During the quarter

ended September 30, 2024,

the Company unwound

fair value interest rate

aggregate amount

quarter ended

September 30,

Company unwound

interest rate

and asset-liability management strategies.

termination fee to unwind the

fair value swaps totaled $

termination fee allocated

loan category

interest rate

forecasts and

liability management

early termination

swaps totaled

fee allocated to

each loan category

is being amortized

over the remining

straight-line basis with full recognition of the unamortized

cost upon the early payoff of the hedge

The amortization of

the termination

interest income

the Consolidated

maturities of

value interest

had an average maturity of

years at the date of their termination.

The Company had no interest rate swap agreements

designated as fair value hedges at March 31, 2025.

hedge loans on

a monthly straight-line

loan interest

of Operations

The remaining

unamortized termination fee as of June 30, 2025 was $

The original maturities of these fair value interest swaps

were between 2025

fair value interest

rate swap agreements

had an average

date of their termination.

million that were designated as fair value hedges on loans.

rate swap agreements have an average maturity of

Interest Rate Swaps

18 unchanged sentences

Balance Sheet Location

March 31, 2025:

June 30, 2025:

Derivatives designated as cash flow hedges:

17 unchanged sentences

fair value of

financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

USCB FINANCIAL HOLDINGS, INC.

2 unchanged sentences

Q2 2025 Form 10-Q

financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction

between market

95 unchanged sentences

are classified within

the hierarchy and

often involve using

quoted market

prices for similar

the hierarchy

involve using quoted

market prices

securities, pricing models or discounted cash flow analyses

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Q2 2025 Form 10-Q

March 31, 2025 and December 31, 2024 for each of the

June 30, 2025 and December 31, 2024 for each of the

fair value hierarchy levels (in thousands):

March 31, 2025

June 30, 2025

December 31, 2024

17 unchanged sentences

not carried at fair

value as of March 31, 2025 and December 31, 2024 (in

value as of June 30, 2025 and December 31, 2024 (in

Fair Value Hierarchy

March 31, 2025:

June 30, 2025:

Financial Assets:

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Financial Liabilities:

Demand deposits

Money market and savings accounts

Interest-bearing checking accounts

Non-interest bearing demand deposits

Savings and money market deposits

Interest-bearing demand deposits

Time deposits

9 unchanged sentences

Financial Liabilities:

Demand deposits

Money market and savings accounts

Interest-bearing checking accounts

Non-interest bearing demand deposits

Savings and money market deposits

Interest-bearing demand deposits

Time deposits

6 unchanged sentences

STOCKHOLDERS’ EQUITY

Bank completed

public offering

shares of Class A

common stock at a

received total net proceeds

million after deducting underwriting discounts and expenses.

In December 2021,

the Company acquired

all the issued

and outstanding shares

A common stock

Bank, which at the time were

the only issued and outstanding shares

of the Bank’s capital stock,

in a share exchange (the

“Reorganization”)

common stock,

formerly held

converted into

and exchanged

Company’s wholly owned subsidiary.

Reorganization,

received securities

substantially

same designations,

powers, preferences,

qualifications,

and restrictions,

held in the Bank,

and the Company’s

then current shareholders

owned the same

percentages of the

Company’s common

stock as they previously owned of the Bank’s common

During the first quarter

restricted stock awards issued

in the three months ended

June 30, 2025.

the six months ended

Company issued

as restricted

pursuant to the Company’s 2015 equity incentive

second quarter 2024,

the Company issued

common stock to

employees as restricted

stock awards pursuant to the Company’s 2015 equity incentive

For the six month ended June 30, 2024 the Company

shares of Class A common stock

to employees as restricted stock

awards pursuant to the Company’s

equity incentive plan.

During the first quarter 2025, the Company repurchased

shares of Class A

common stock to employees as

common stock at a weighted average

cost per share of $

The aggregate purchase price for

these transactions was approximately $

thousand, including

transaction costs.

These repurchases

the Company’s

incentive plan

quarter 2024,

shares of Class A

common stock to employees

as restricted stock awards

pursuant to the Company’s

incentive plan.

During the three months ended

March 31, 2025, the Company

shares of Class A common stock at

a weighted average cost per

The aggregate purchase

price for these transactions was

approximately $

publicly announced

authorized for repurchase under the Company’s two stock

repurchase programs.

shares remained

for repurchase

two stock repurchase programs.

Shares of the

Company’s Class A common stock

issued and outstanding as

of March 31, 2025 and

December 31, 2024

Shares of the Company’s Class A common stock issued and outstanding as of June 30, 2025 and December

, respectively.

25 unchanged sentences

such payment to be an unsafe or unsound practice.

As of March 31, 2025,

the Company was not subject to any

formal supervisory restrictions on its ability to

pay dividends

As of June 30, 2025, the Company was not subject

to any formal supervisory restrictions on its

ability to pay dividends

but will notify the Federal Reserve

22 unchanged sentences

2025 dividend was

quarter of 2024 was $

per share of Class A common

stock, paid on March 5, 2024,

to stockholders of record as

quarterly dividend

second quarter

June 5, 2025, to stockholders

of record as of close of

business on May 15, 2025.

The aggregate distribution in connection

with the second quarter dividend was $

On January 29,

2024, the Company

announced that its

Board of Directors

approved a quarterly

cash dividend program.

The quarterly dividend for

the first quarter of

per share of Class

A common stock, paid

on March 5, 2024,

to stockholders

on February 15,

The aggregate

distribution in connection

quarter dividend

quarterly dividend

second quarter

common stock, paid on June

5, 2024, to stockholders of

record as of the

close of business on May 15,

The aggregate

distribution in connection with the second quarter dividend was

USCB FINANCIAL HOLDINGS, INC.

2 unchanged sentences

Q2 2025 Form 10-Q

close of business

on February 15,

The aggregate

distribution in connection

with the first quarter

2024 dividend was

The following table details the dividends

declared and paid by the Company during

the three months ended March 31,

2025 and 2024:

As of March 31, 2025

The following table details the dividends declared and paid by

the Company for the periods presented:

Six Months Ended June 30, 2025

Declaration Date

4 unchanged sentences

March 5, 2025

As of March 31, 2024

April 21, 2025

Six Months Ended June 30, 2024

Declaration Date

4 unchanged sentences

March 5, 2024

April 22, 2024

“well-capitalized”

guidelines as of March 31, 2025 and December 31, 2024.

At March 31, 2025, the total risk-based capital

ratios for the Bank

guidelines as

2025 and December

At June 30, 2025,

the total risk

-based capital ratios

because the Company is deemed to be a small bank holding

See Note 11, Subsequent

Events, for information regarding dividends declared in April 2025.

See Note 13, Subsequent Events, for information regarding

dividends declared in July 2025.

EARNINGS PER SHARE

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EPS when their effect is dilutive.

The following table reflects the calculation of net income

available to common shareholders for the three months ended

March 31, 2025 and 2024 (in thousands):

Three Months Ended March 31,

The following table

reflects the calculation of

net income available to

common shareholders for the

three and six months

ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30,

Six Months Ended

Net income available to common shareholders

4 unchanged sentences

The following table reflects

the calculation of basic and

diluted earnings per common

share class for the

ended March 31, 2025 and 2024 (in thousands, except

per share amounts):

Three Months Ended March 31,

the calculation of basic

and diluted earnings per

common share class

for the three

months ended June 30, 2025 and 2024 (in thousands,

except share amounts):

Three Months Ended June 30,

Six Months Ended June 30,

Net income available to common shares

3 unchanged sentences

Weighted average shares outstanding for basic EPS

Dilutive effects of assumed exercises of stock options

Dilutive effects of assumed exercises of stock

Weighted avg.

shares including dilutive potential common shares

shares including dilutive potential common

Earnings per share, diluted

Anti-dilutive stock options excluded from diluted EPS

Net income has not been allocated to unvested restricted

stock awards that are participating securities

because the amounts that would be allocated are

not material to net income per share of common

Unvested restricted stock awards that are participating

securities represent less than one percent

of all of the outstanding shares of common stock

for each of the periods presented.

Anti-dilutive stock options excluded from diluted

Net income has not been allocated to unvested

restricted stock awards that are participating

securities because the amounts that

would be allocated are not material to net income

per share of common stock.

Unvested restricted

stock awards that are

participating securities represent less than one percent

of all of the outstanding shares of common

stock for each of the periods

SEGMENT REPORTING

30 unchanged sentences

commercial and industrial loans, commercial real estate

investor residential real estate loans, correspondent banking

investor residential real estate loans, correspondent bank

loans, and letters of credit.

17 unchanged sentences

analyses that benchmark the Company to competitors.

As a result, the Company has determined that it has only one

As a result, the Company has determined that it has only

reportable segment.

14 unchanged sentences

on the Company’s Consolidated Financial Statements.

RELATED PARTY

In the ordinary course of business, principal officers,

directors, and affiliates may engage in transactions

Loan Purchases

During the six months ended June 30, 2025 the Bank purchased

million from entities that deemed to be related

The Bank paid those entities net fees of $

During the year 2024, the Bank purchased $

million of loans from entities that are deemed to be related

The Bank paid those entities fees of $

Loan Originations

During the three months ended June 30, 2025, the Bank

acted as the lead arranger in a $

million syndicated loan

extended to an entity deemed to be a related party.

As of June 30, 2025, the Bank held an outstanding balance

million related to this transaction.

In connection with the syndication,

the Bank received a

-basis point commitment fee

and will earn a

-basis point annual servicing fee.

The other two financial

institutions participating in the syndication were

also deemed to be related parties.

Although originating

loans to related parties is not part of the Company’s

policy, this transaction

was reviewed by the appropriate departments in accordance

with Company procedures.

analyses were presented to the Board of Directors and

the Audit and Risk Committee, and all necessary approvals

Additional analysis was conducted to determine that

the transaction was executed in the ordinary course

business and on arm’s-length terms, consistent with the

requirements of Regulation O.

loan originations or syndications extended to entities deemed

to be related parties during the three

months ended March 31, 2025 and for the year ended December

SUBSEQUENT EVENTS

quarterly dividend for

the second quarter

per share of Class

A common stock

and will be paid

5, 2025, to stockholders of record as of the close of business

on May 15, 2025.

21, 2025, the

Company announced that

declared its quarterly

cash dividend.

dividend for the third quarter of

per share of Class A

common stock and will be paid

on September 5, 2025,

to stockholders of record as of the close of business on August

Company entered into

a two-year costless

notional amount of

exposure to interest

rate volatility on a

three-month brokered CD.

derivative is based on

overnight index

and establishes a

floor rate of

%, effectively creating a

defined range of

interest rate outcomes

without requiring

designated as

under ASC 815,

Derivatives and

comprehensive income

hedge remains

believes this

strengthens the

Company’s interest rate risk management strategy by

mitigating the impact of rate movements on future cash flows.

costless collar

interest rate outcomes without requiring

an upfront premium.

The hedge was

designated as a cash flow

hedge under ASC

recorded in other

comprehensive income

to the extent

the hedge remains

Management believes

this instrument

USCB FINANCIAL HOLDINGS, INC.

Notes to the Consolidated Financial Statements - Unaudited

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

strengthens the

Company’s interest

management strategy

by mitigating

Kroll Bond Rating Agency assigned both the Company and the Bank investment grade

debt ratings in July 2025.

USCB Financial Holdings, Inc.

Q2 2025 Form 10-Q

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements