Coastal Financial Corporation (CCB): Business Model Canvas [Dec-2025 Updated]

You're trying to figure out how Coastal Financial Corporation (CCB) actually makes money, and honestly, it's a fascinating dual setup. They aren't just your standard local lender; they're running two engines: a solid community bank in Washington and a high-growth Banking-as-a-Service (BaaS) platform, CCBX, that lets other fintechs build on their charter. To give you the quick picture, as of Q3 2025, they were sitting on $438.7 million in equity, pulling in $77.9 million in Net Interest Income, but they're also spending heavily-$70.2 million in noninterest expenses in that same quarter-to power that tech side. If you want to see exactly how those two very different businesses fit together across all nine building blocks, check out the full canvas breakdown below.

Coastal Financial Corporation (CCB) - Canvas Business Model: Key Partnerships

You're looking at the relationships Coastal Financial Corporation (CCB) solidifies to power its Banking as a Service (BaaS) segment, CCBX. These aren't just casual introductions; these are deep, often financial, ties that drive off-balance sheet activity and fee income.

Digital financial service providers (Fintechs) for CCBX platform and Broker-dealers and brands needing BaaS infrastructure are the core of the CCBX pipeline. The progression of these partners shows where the near-term revenue is coming from. As of September 30, 2025, the pipeline looked like this:

• Partners in testing: two
• Partners in implementation/onboarding: four
• Signed letters of intent (LOI): two

This pipeline activity directly impacts the BaaS segment's financial performance. Total BaaS program fee income was $7.6 million for the three months ended September 30, 2025, marking an increase of $764,000, or 11.3%, from the quarter ended June 30, 2025. Also, the number of off-balance sheet credit cards with fee earning potential grew to 396,812 as of September 30, 2025, which is an increase of 82,985 from the prior quarter. These partners rely on Coastal Financial Corporation's infrastructure to offer banking services.

The risk management aspect of these partnerships is critical. Coastal Financial Corporation maintains contracts with its partners that fully indemnify it against fraud and provide 98.9% indemnification against credit risk on CCBX loan partner balances as of September 30, 2025. That level of protection is a key part of the value proposition for these partners.

Loan purchasers for off-balance sheet credit card receivables are essential for managing capital and risk exposure. During the third quarter of 2025, Coastal Financial Corporation sold $1.62 billion of loans. Of that amount, $1.37 billion was new activity related to previously sold credit card receivables. This off-balance sheet strategy allows the company to retain a portion of the fee income without holding the asset risk.

When it comes to raising capital to support this growth, investment banks act as crucial partners. Keefe, Bruyette & Woods, a Stifel company, served as the lead bookrunning manager for Coastal Financial Corporation's proposed underwritten public offering announced in December 2024. That offering priced 1,200,000 shares at $71.00 per share, expecting to raise approximately $85.2 million in gross proceeds, with the potential to reach $98.0 million if the underwriters exercised their option for an additional 180,000 shares. The completion of this capital raise, totaling $98.0 million in Q4 2024, was cited as enabling CCBX growth to continue into 2025. Furthermore, Keefe, Bruyette & Woods maintained an 'Outperform' rating on CCB in July 2025.

Here's a quick look at the financial scale of these key partnership activities:

The investment in technology vendors for core banking and digital services is reflected in the expense structure; for instance, noninterest expense in Q2 2025 was driven higher by increased data processing and software costs, which totaled $843,000 higher than Q1 2025. Finance: draft the Q4 2025 partnership impact analysis by next Wednesday.

Coastal Financial Corporation (CCB) - Canvas Business Model: Key Activities

You're looking at the engine room of Coastal Financial Corporation (CCB), where the day-to-day work happens to keep the dual model-community bank and Banking-as-a-Service (BaaS) via CCBX-running. These aren't just tasks; they are the direct drivers of their reported performance through the third quarter of 2025.

Managing the CCBX Banking-as-a-Service technology platform

The core activity here is the operational management and growth of the CCBX platform, which is clearly the high-octane part of the business. This involves managing the pipeline of fintech partners through various stages of integration.

• Total BaaS program fee income for the three months ended September 30, 2025, was $7.6 million.
• This fee income represented an increase of $764,000, or 11.3%, from the three months ended June 30, 2025.
• As of September 30, 2025, the partner pipeline included two partners in testing, four in implementation/onboarding, and two signed letters of intent (LOI).
• The CCBX segment contributed revenue of $241.19 million for the period ending December 2025.

The platform management is a continuous cycle of onboarding and scaling existing relationships.

Commercial and consumer loan origination and servicing

This activity spans both the traditional community bank lending and the origination/servicing associated with the CCBX segment, which often involves selling loan receivables.

Here's a look at the loan portfolio movement through the first three quarters of 2025:

They retain a portion of the fee income on those sold credit card loans, so servicing is definitely an ongoing key activity.

Investing in technology and risk management infrastructure

Coastal Financial Corporation is actively spending to support the scalability and security of the CCBX platform, which shows up in noninterest expenses.

• Noninterest expense in the second quarter of 2025 was $72.8 million.
• This represented an increase of $843,000, or 1.2%, compared to the first quarter of 2025.
• The Q2 increase was mainly due to higher data processing and software costs.
• Management noted elevated expenses in Q1 2025 related to onboarding/implementation costs for CCBX and investments in technology.

These investments are viewed as important to the long-term success and scalability of the Company.

Maintaining regulatory compliance and bank charter integrity

Operating a BaaS segment requires rigorous risk management, especially concerning credit and fraud exposure with partners. This is managed through contractual agreements.

• As of the second quarter ended June 30, 2025, Coastal Financial Corporation was fully indemnified against fraud with its CCBX partners.
• The company was 98.8% indemnified against credit risk with its CCBX partners as of June 30, 2025.
• The Q1 2025 report also confirmed 98.8% indemnification against credit risk as of March 31, 2025.

Maintaining these indemnification levels is a critical, non-negotiable activity.

Deposit gathering, especially through CCBX partner programs

Stable, low-cost funding is essential, and CCB is clearly using its CCBX partnerships to drive deposit growth, which is a key differentiator from pure-play fintechs.

Deposit growth figures for the first three quarters of 2025:

The T-Mobile deposit program launched on April 1, 2025, and its deposits were expected in the second quarter totals.

Coastal Financial Corporation (CCB) - Canvas Business Model: Key Resources

You're looking at the core assets Coastal Financial Corporation (CCB) relies on to run both its community bank and its high-growth CCBX segment. These aren't just line items; they are the engines for their strategy.

Coastal Community Bank's federal bank charter is the foundational license. This charter allows the entire operation, including the Banking as a Service (BaaS) division, to function legally, especially for deposit-taking and lending activities. The Bank operates through 14 full-service banking locations across Washington state, specifically in Snohomish, Island, and King Counties.

The technological backbone is the proprietary CCBX BaaS technology and API platform. This infrastructure allows CCB to decompose its monolithic banking offering into discrete, consumable services surfaced as APIs for fintech partners. For data handling, compliance oversight, and secure sharing with partners, CCB leverages the Databricks Data Intelligence Platform and Delta Sharing. This technology stack supports significant scale; as of June 30, 2025, there were 313,827 off-balance sheet credit cards with fee-earning potential.

The strong capital base provides the necessary stability and capacity for growth initiatives like CCBX. As specified, the total shareholders' equity was reported at $438.7 million as of December 2024. This capital supports the balance sheet, which, based on the latest filing data available, showed total assets of $4.55 billion and total deposits of $4.02 billion. The Bank remained well capitalized, with common-equity tier 1 capital at 12.04% and total risk-based capital at 14.67% as of December 31, 2024, post-capital raise.

The local branch network and deposit market share in Puget Sound, Washington anchor the traditional banking side. Coastal Financial Corporation is the largest locally headquartered bank by deposit market share in Snohomish County, Washington, holding a 17.5% market share as of June 30, 2024. The community bank segment emphasizes deep relationships, with approximately 80% of community bank loan customers maintaining deposit relationships with the bank. The deposit base is growing, with average deposits reaching $3.97 billion as of September 30, 2025.

Finally, the specialized executive talent in Fintech and risk management is crucial for navigating the BaaS space. The Board of Directors includes fintech industry experts. This expertise is vital for managing the unique risks of the CCBX segment. As of September 30, 2025, CCB remains fully indemnified against fraud and 98.9% against credit risk on CCBX loan partner balances. The pipeline of CCBX partnerships shows the talent is actively engaged:

• Partners in testing as of June 30, 2025: Two
• Partners in implementation/onboarding as of June 30, 2025: Two
• Signed Letters of Intent (LOI) as of June 30, 2025: Five
• New partners moving to active/implementation stage as of September 30, 2025: Four total progression steps reported

The financial output from the CCBX segment underscores the value of these resources. Here's a quick look at the fee income growth:

The growth in fee income, from $5.6 million in Q4 2024 to $7.6 million in Q3 2025, shows the platform is scaling. Honestly, the ability to retain fee income on sold credit card loans is another key financial asset, with $1.62 billion in loans sold during Q3 2025.

Finance: draft 13-week cash view by Friday.

Coastal Financial Corporation (CCB) - Canvas Business Model: Value Propositions

You're looking at Coastal Financial Corporation (CCB) not just as a regional bank, but as a dual-engine platform where community roots meet fintech scale. The value propositions are sharply defined across these two segments.

For Fintechs: BaaS Platform with Risk Mitigation

The core value for fintech partners through the CCBX segment is providing a fully functional Banking as a Service (BaaS) platform. This lets them offer regulated financial products without needing their own charter. The most concrete value here is the risk transfer Coastal Financial Corporation assumes. As of September 30, 2025, Coastal Financial Corporation continues to have contracts with its partners that fully indemnify the bank against fraud losses. Furthermore, the credit risk on CCBX loan partner balances is covered to the tune of 98.9% as of that same date. This level of contractual protection is a major draw for digital-first companies.

Here's a snapshot of the BaaS segment's recent traction:

• BaaS Program Fee Income (Q3 2025): $7.6 million.
• Quarter-over-Quarter Fee Income Growth (Q3 vs Q2 2025): 11.3% increase.
• Active Partner Pipeline (as of Q3 2025): Two in testing, four in implementation/onboarding, and two signed LOIs.

This segment is clearly driving top-line growth; total BaaS program fee income was $7.6 million for the three months ended September 30, 2025.

For Community: Personalized Service and Local Expertise for SMBs

For the community bank segment, the value proposition centers on deep local knowledge and relationship banking, which you won't find at a national chain. This translates into tailored lending and deposit solutions for small-to-medium-sized businesses (SMBs) in the Puget Sound region. While 2023 data shows a strong foundation, the commitment remains to this local focus, which supports the stability of the overall funding base.

The traditional banking suite is robust, focusing on commercial and real estate lending:

The community bank loan portfolio concentration in Washington State was reported at 78% in late 2023, underscoring that local expertise.

Scalable, Compliant Infrastructure for Digital Financial Products

Coastal Financial Corporation is making front-loaded spending on infrastructure to ensure its platform can handle the rapid growth from CCBX partners. This investment in compliance and technology is a key value for partners who need reliability. Management noted that noninterest expenses were lower in Q3 2025 compared to Q2 2025, partly due to lower legal and professional expenses, suggesting some initial onboarding costs are moderating. The company is building a framework that supports innovation while maintaining regulatory standards. You're seeing the results of this investment in the 4.6% quarterly rise in total loans receivable to $163.5 million in Q3 2025.

Full Suite of Traditional Commercial and Retail Banking Products

Beyond the fintech offerings, Coastal Community Bank provides the full spectrum of traditional services. This includes commercial lending, construction financing, and retail banking for local consumers and businesses. This dual offering provides diversification and stability to the balance sheet. For instance, the community bank loan portfolio is heavily weighted toward CRE, Construction, and C&I loans, totaling approximately $1.69 billion as of Q4 2023, representing about 88.6% of community bank loans.

High-Quality Deposit Growth for Stable, Lower-Cost Funding

Stable funding is critical, and Coastal Financial Corporation is attracting high-quality deposits, often driven by the CCBX segment's growth. You saw solid deposit growth in Q3 2025 totaling $59.0 million, which is a 1.5% increase for the quarter. Average deposits for Q3 2025 were reported at $3.97 billion. This growth, primarily from CCBX partner programs, provides a stable, lower-cost funding base to support loan growth, which increased by $163.5 million in the same period. Finance: draft 13-week cash view by Friday.

Coastal Financial Corporation (CCB) - Canvas Business Model: Customer Relationships

You're looking at how Coastal Financial Corporation segments its customer interactions across its two main operating areas: the community bank and the CCBX Banking as a Service (BaaS) segment. The approach is decidedly tiered based on the customer type.

Automated, high-volume service for CCBX end-users

For the end-users of the CCBX platform, the relationship is largely digital and automated, supporting massive scale. The volume is evident in the off-balance sheet activity metrics. As of September 30, 2025, Coastal Financial Corporation supported 396,812 off balance sheet credit cards with fee earning potential. This segment generated BaaS program fee income of $7.6 million for the three months ended September 30, 2025.

• Credit cards with fee earning potential (as of 9/30/2025): 396,812
• CCBX Program Fee Income (Q3 2025): $7.6 million
• Credit risk indemnification level (as of 9/30/2025): 98.9%

Dedicated, high-touch relationship management for BaaS partners

The direct relationship is with the BaaS partners themselves, which requires dedicated management to integrate services and manage risk. Partner progression is a key metric here. As of September 30, 2025, Coastal Financial Corporation had two partners in testing, four in implementation/onboarding, and two signed letters of intent (LOI).

Personalized, in-person service at 14 community bank branches

The traditional community bank segment relies on physical presence for personalized service. Coastal Financial Corporation, through Coastal Community Bank, operates 14 full-service branches across Snohomish, Island, and King Counties as of September 30, 2025. A core tenet of this segment is deep local relationship building; approximately 80% of community bank loan customers maintain deposit relationships with the bank.

The community bank loan portfolio composition as of September 30, 2025, shows the focus areas for these in-person relationships:

Digital self-service via mobile and online banking applications

For community bank customers, digital access complements the branch network. The Bank offers service via the Internet and its mobile banking application. The Chief Digital Banking Officer is responsible for executing the strategy for these digital platforms.

• Digital Service Channels: Internet and mobile banking application.
• Online Platform Capabilities: Mortgage applications, loan tracking, and account management.

Consultative approach for commercial lending clients

Commercial lending clients receive a consultative approach, which is reflected in the specific loan product offerings and underwriting focus. For example, capital call lines, provided to venture capital firms through a CCBX client, were underwritten to the Bank's standards. As of March 31, 2025, these capital call lines had an outstanding balance of $133,466 thousand.

The growth in community bank C&I loans during the quarter ending September 30, 2025, was $20.9 million.

Coastal Financial Corporation (CCB) - Canvas Business Model: Channels

You're looking at how Coastal Financial Corporation (CCB) gets its value proposition-community banking and Banking as a Service (BaaS)-into the hands of its customers as of late 2025. It's a mix of old-school presence and cutting-edge digital partnerships. Honestly, the numbers show where the real growth engine is right now.

The physical footprint remains a core channel for the community bank segment, serving individuals and small-to-medium-sized businesses across the Puget Sound area. This is complemented by digital tools for existing retail customers.

The CCBX digital platform is the primary channel for their BaaS partners and those partners' end customers. This channel is driving significant fee income and deposit growth, effectively expanding Coastal Financial Corporation's reach beyond its physical footprint.

Here's a quick look at the scale of these distribution channels based on the third quarter of 2025 results:

You see the activity in the CCBX pipeline-partners moving through testing and implementation. That pipeline is what management is counting on for revenue to offset onboarding costs.

For the traditional retail and commercial customer base, Coastal Community Bank utilizes several direct and digital touchpoints:

• CCBX digital platform for BaaS partners and their customers.
• 14 physical branch locations in Snohomish, Island, and King Counties.
• Coastal Community Bank's mobile and online banking applications.
• Direct sales team for commercial and industrial (C&I) lending.
• ATM network access for retail customers.

The direct sales team is key for the C&I lending focus within the community bank segment, which is the largest source of revenue, making up about 71.5% of total revenue over the last five years. Still, the growth in off-balance sheet credit cards, hitting 396,812 as of September 30, 2025, shows the digital channel is scaling fast.

Coastal Financial Corporation (CCB) - Canvas Business Model: Customer Segments

You're looking at the customer base for Coastal Financial Corporation (CCB), which is clearly split between its traditional community bank focus and its high-growth Banking as a Service (BaaS) engine, CCBX. The numbers show where the action is right now.

Digital financial service providers and broker-dealers (CCBX partners)

This segment is the growth engine, focusing on embedding finance through partners. As of September 30, 2025, the pipeline looked like this:

The risk associated with these partners is managed, with Coastal Financial Corporation remaining indemnified against credit risk on 98.9% of CCBX loan partner balances as of September 30, 2025. Total BaaS program fee income for the three months ended September 30, 2025, was $7.6 million, an increase of 11.3% from the prior quarter. The scale of the underlying customer base served by these partners is growing rapidly:

• Off balance sheet credit cards with fee earning potential as of September 30, 2025: 396,812.
• Off balance sheet credit cards with fee earning potential as of June 30, 2025: 313,827.
• Off balance sheet credit cards with fee earning potential as of March 31, 2025: 237,024.

Small-to-medium-sized businesses (SMBs) in the Puget Sound region

This is the core community bank segment. Coastal Financial Corporation operates through Coastal Community Bank, which provides banking products to consumers and SMBs. The physical footprint supporting these customers includes 14 full-service branches across Snohomish, Island, and King Counties. As of June 30, 2024, Coastal Financial Corporation held a 17.5% deposit market share in Snohomish County, making it the largest locally headquartered bank there. To be fair, about 80% of community bank loan customers also maintain deposit relationships with the bank, showing strong cross-segment linkage.

Local consumers and professionals in Washington State

These local customers fund the bank's operations. Average deposits for the quarter ended September 30, 2025, stood at $3.97 billion, an increase of $59.0 million, or 1.5%, over the previous quarter. This local deposit base is crucial for funding loan growth, which saw loans receivable increase by $163.5 million in the third quarter of 2025.

High-growth companies seeking embedded finance solutions

These companies are the direct clients of the CCBX segment, driving loan and transaction volume. The growth in net CCBX loans receivable is evident in the balance sheet movement. For instance, loans receivable increased by $163.5 million in the third quarter of 2025, representing a 4.6% rise. The gross CCBX loans receivable balance as of September 30, 2025, was reported as 1,804,755 (in thousands, based on context). The bank actively manages this portfolio by selling loans; they sold $1.62 billion of loans during the third quarter of 2025.

Retail customers of CCBX partners (indirectly served)

These are the end-users whose activity drives the BaaS revenue. The volume of fee-earning potential tied to these customers is a key metric. The number of off-balance sheet credit cards with fee earning potential reached 396,812 by September 30, 2025. This represents a quarterly increase of 82,985 cards from the end of the second quarter of 2025. The bank is definitely scaling this indirect customer base quickly.

Coastal Financial Corporation (CCB) - Canvas Business Model: Cost Structure

You're looking at the core expenses Coastal Financial Corporation is managing as it scales its Banking-as-a-Service (BaaS) segment, CCBX. The cost structure is heavily influenced by managing credit risk and investing in the necessary infrastructure to support that growth.

Significant noninterest expenses for technology and risk management are a major component of the operating cost base. For the quarter ended September 30, 2025, total noninterest expense was reported at $70.2 million. This figure was actually lower than the preceding quarter, Q2 2025, which was $72.8 million, primarily due to decreases in legal and professional expenses, plus salaries and employee benefits for that specific period. Still, this total was higher compared to the third quarter of 2024, driven by necessary investments in technology and risk management infrastructure to support the expanding CCBX operations. This is where you see the cost of building a scalable platform.

The provision for credit losses remains a substantial, though variable, cost. For Q3 2025, the provision for credit losses was set at $56,598 (in thousands), which is $56.6 million. A large portion of this provision is tied directly to the growth in CCBX loans, even with significant loan sales occurring during the quarter. This reflects the inherently higher expected losses management assigns to the CCBX portfolio compared to the traditional community bank loans.

Interest expense on deposits and borrowings is the other primary cost category, reflecting the cost of funding the balance sheet. For the three months ended September 30, 2025, total interest expense was $31,126 (in thousands), or about $31.1 million. This is broken down into the cost of funding deposits and the cost of borrowed funds.

Salaries and employee benefits reflect the investment in a growing, specialized team. Increases in this area have been noted as necessary for new hires supporting growth, technology integration, and risk management functions. For instance, Q1 2025 expenses were elevated due to annual pay increases and staffing up for these key areas.

Front-loaded compliance and onboarding costs for new CCBX partners are an expected near-term pressure point. Management anticipates ongoing expense fluctuations as new CCBX partners and products launch. The expectation is that most of these compliance and operational risk-focused costs occur early in the launch cycle, before the associated revenue from the new programs begins to meaningfully offset them. This front-loading was evident in Q1 2025 results, which showed elevated expenses related to onboarding and implementation.

Here's a quick look at the key expense line items for the quarter ended September 30, 2025:

The operational investment required for the BaaS model manifests in specific cost drivers:

• Technology and software licenses expenses are increasing.
• Salaries and employee benefits are rising with new hires.
• Legal and professional expenses fluctuate based on activity.
• Compliance costs are front-loaded for new CCBX partners.

If onboarding for a new partner takes longer than expected, the lag between initial compliance spend and revenue generation definitely pressures the efficiency ratio. Finance: draft 13-week cash view by Friday.

Coastal Financial Corporation (CCB) - Canvas Business Model: Revenue Streams

You're looking at how Coastal Financial Corporation (CCB) brings in the money, and honestly, it's still very much a bank driven by its loan book. For the trailing 12 months ending Q3 2025, the total revenue figure was $343.67 million. Historically, lending operations have been the main engine; net interest income made up 71.5% of total revenue over the last five years.

Here's a breakdown of the core revenue components as reported for the third quarter ended September 30, 2025. This gives you a clear snapshot of where the dollars are coming from right now.

The noninterest income bucket is where the newer, technology-driven revenue streams are showing up. You need to track these fee-based sources closely, as they represent the diversification away from pure lending spread. The total noninterest income for the quarter was $66.8 million.

The components feeding into that noninterest income include several key areas:

• Total BaaS (CCBX) program fee income was $7.6 million for the three months ended September 30, 2025.
• Fee income retained from the sale of CCBX-originated loans, with $1.62 billion of CCBX loans sold during the quarter.
• Deposit sweep fee income was $311k in Q3 2025.
• Service charges on deposit accounts and interchange fees are included within the total noninterest income figure, though specific standalone amounts for these aren't broken out in the high-level release.

The growth in CCBX fee income is defintely something to watch; it was up 11.3% from the linked quarter ended June 30, 2025, even after adjusting for a nonrecurring item. Finance: draft 13-week cash view by Friday.