Bank of the James Financial Group (BOTJ) investor relations material

Executive summary

• Net income for Q1 2026 was $2.77 million, up 229.5% year-over-year, with EPS of $0.61 versus $0.19 in Q1 2025, driven by higher net interest income, increased noninterest income, and lower noninterest expense.

• Total assets reached $1.06 billion at March 31, 2026, a 4.89% increase year-over-year and up 2.13% from December 2025, primarily due to higher federal funds sold and securities available-for-sale.

• Return on average equity was 13.87%, and return on average assets was 1.07%, both significantly higher than prior year.

• Strong performance was driven by higher net interest income, increased noninterest income, lower noninterest expense, and a recovery of credit losses.

Financial highlights

• Net interest income rose 13.2% to $8.73 million, with net interest margin expanding to 3.57% from 3.25% year-over-year.

• Noninterest income increased 20.8% to $3.96 million, led by gains on loan sales and higher wealth management fees.

• Noninterest expense decreased 4.7% to $9.37 million, reflecting lower data processing and professional fees.

• Efficiency ratio improved to 73.75% from 89.31% year-over-year.

• Book value per share rose to $17.89 at March 31, 2026, from $15.04 a year earlier.

Outlook and guidance

• Management anticipates continued margin support from stable interest rates but notes potential pressure if deposit costs rise.

• Mortgage and wealth management segments expected to remain key contributors, though mortgage activity may be constrained by elevated rates.

• No material impact expected from recent regulatory changes; management is evaluating the new community bank leverage ratio framework.

• Management highlighted continued efficiency improvements, strong asset quality, and well-capitalized status, with expectations for ongoing performance from front-line and commission-based producers.