Primis Financial Corp. (FRST): BCG Matrix [Dec-2025 Updated]

You're looking at Primis Financial Corp.'s (FRST) current strategic map, and the picture is definitely mixed as we hit late 2025. We've got high-flying Stars like Mortgage Warehouse Lending, which shot up an incredible 411% year-to-date, sitting right next to stable Cash Cows like the Core Bank's $3.3 billion deposit base funding operations cheaply at 2.88%. But, you also see the necessary cleanup in the Dogs quadrant, with the third-party Consumer Program shrinking by 44%, while the big potential-and risk-lies with the Question Marks, like the Digital Platform holding over $1.0 billion in deposits but still fighting for share. Dive in to see exactly where management needs to shift capital next.

Background of Primis Financial Corp. (FRST)

You're looking at Primis Financial Corp. (FRST), which operates as the bank holding company for its subsidiary, Primis Bank. Honestly, this firm provides a full suite of financial services, focusing on individuals and small to medium-sized businesses across its footprint. The bank maintains a physical presence with 24 full-service branches located in Virginia and Maryland, though it also pushes services through its digital channels.

The company's history shows a journey of adaptation; it was established back in 1998 and later rebranded to Primis Financial Corporation in 2019. Strategically, Primis has been repositioning its business lines to focus on areas that drive better long-term profitability. For instance, management has been actively divesting parts of its consumer loan book while building scale in mortgage operations, including its mortgage warehouse lending division.

Let's look at the numbers as of late 2025, specifically the third quarter ending September 30, 2025. Primis Financial reported total assets of $4.0 billion, with total loans held for investment at $3.2 billion and total deposits reaching $3.3 billion. The firm's profitability showed marked improvement; net income for the nine months ending September 30, 2025, hit $32 million, translating to $1.29 per diluted share year-to-date.

Drilling into operational metrics for Q3 2025, the core net interest margin stood at 3.15%, an improvement from the prior year, showing effective management of asset yields and funding costs. Noninterest income for that quarter was $12 million, and the company declared a quarterly cash dividend of $0.10 per share. The tangible book value per common share ended Q3 2025 at $11.71, reflecting a 12% increase from the end of 2024.

Primis Financial Corp. (FRST) - BCG Matrix: Stars

You're looking at the business units within Primis Financial Corp. (FRST) that are clearly operating in high-growth segments and capturing significant market share, which is the textbook definition of a Star in the Boston Consulting Group (BCG) Matrix. These units require heavy investment to maintain that growth trajectory but are key drivers for the company's future success.

The Mortgage Warehouse Lending segment exemplifies this Star status. Outstanding loan balances reached $327 million as of September 30, 2025. This represents substantial growth, specifically an increase of 411% from the balance of $64 million at December 31, 2024. Furthermore, this balance was up 77% from the $185 million reported at June 30, 2025, showing continued, rapid scaling through the first three quarters of 2025 following an expansion effort in late 2024.

The Panacea Financial specialized lending to doctors is another clear Star. Loans outstanding for Panacea grew to $548 million by the end of the third quarter of 2025. This growth equates to 40% year-over-year, demonstrating strong penetration in its niche market. To support this, Panacea customer deposits also grew significantly, reaching $133 million at the end of Q3 2025, which is an increase of 47% compared to September 30, 2024.

The Primis Mortgage division is also showing Star-like momentum, translating growth into immediate profitability. Pre-tax earnings for the Primis Mortgage division hit approximately $1.9 million in Q3 2025. This is a substantial jump when you compare it to the $0.1 million reported in Q2 2025, which had been impacted by adding new teams. The division closed mortgage volume of $308 million in Q3 2025, marking a 34% increase over the same quarter in 2024. Management noted that monthly production increased from $20 million to a range of $100-$120 million.

These high-growth, specialized national lines are undeniably driving the company's overall profitability momentum. Primis Financial Corp. reported Q3 2025 net income available to common shareholders of $7 million, or $0.28 per diluted share, a solid improvement from $1 million, or $0.05 per diluted share, in Q3 2024. The company's total assets stood at $4.0 billion as of September 30, 2025.

Here's a quick look at the key performance indicators for these growth engines as of September 30, 2025:

The success in these areas is also reflected in the funding mix, which is crucial for supporting continued growth. Noninterest-bearing DDA (demand deposit accounts) rose 16% year-over-year to $490 million, helping the overall Net Interest Margin (NIM) climb to 3.18% in Q3 2025, up from 2.97% in Q3 2024. The core NIM was 3.15%.

The investment thesis for Stars centers on maintaining market share through continued funding. Primis Financial Corp. is clearly channeling resources into these areas, which are generating significant top-line growth. The strategy is to keep feeding these high-growth segments so they can mature into Cash Cows when the market growth inevitably slows.

Key growth metrics supporting the Star categorization include:

• Mortgage Warehouse Loan Balances: $327 million as of 9/30/2025.
• Panacea Loan Growth: $155 million added over 12 months.
• Mortgage Division Pre-Tax Earnings: $1.9 million in Q3 2025.
• Total Company Net Income (YTD 2025): $32 million.
• Total Company Assets (9/30/2025): $4.0 billion.

If market share is kept, Stars are likely to grow into cash cows. Primis Financial Corp. is defintely investing heavily here, as evidenced by the jump in mortgage pre-tax earnings following team additions. Finance: draft 13-week cash view by Friday.

Primis Financial Corp. (FRST) - BCG Matrix: Cash Cows

Cash Cows represent the established, high-market-share segments of Primis Financial Corp.'s business that generate more cash than they consume, funding the rest of the enterprise. These units thrive in mature markets where significant new investment for growth isn't necessary, allowing for high cash flow generation.

The foundation of this stability is the Core Bank, which serves as the primary source of low-cost, reliable funding. The Core Bank's total deposits were $3.3 billion as of September 30, 2025, providing a solid, stable funding base for the organization. This deposit base is becoming even more cost-effective.

You see this in the growth of the most valuable deposit type. Noninterest-bearing checking accounts grew 16% year-over-year, which is a strong indicator of relationship depth and deposit stickiness. This favorable shift in the mix helped drive the overall cost of interest-bearing deposits down to 2.88% in Q3 2025. Honestly, managing that cost structure is key to milking these cash cows effectively.

The traditional regional branch network in Virginia and Maryland is the physical manifestation of this mature asset base. Primis Bank maintains twenty-four full-service branches across these two states, representing established customer relationships built over decades. These branches anchor the core business, which is characterized by stability rather than rapid expansion.

The largest, most established asset within this segment is the loan portfolio. Core Bank loans totaled $2.1 billion at Q3 2025. This portfolio is the bedrock of the bank's traditional lending operations, providing consistent net interest income. Investments here are focused on efficiency, like supporting infrastructure, rather than aggressive market share grabs.

Here's a quick look at the core banking metrics that define this Cash Cow segment as of Q3 2025:

The strategy for these units is clear: maintain productivity and harvest the gains. You want to invest just enough to keep the customer base happy and the infrastructure running smoothly. The focus is on operational leverage, which is evident in the improving net interest margin, which reached 3.18% for the quarter, with the core NIM at 3.15%.

The benefits derived from these Cash Cows are substantial and fund other parts of Primis Financial Corp.'s strategy:

• Fund the dividend: Primis Financial Corp. declared a quarterly cash dividend of $0.10 per share, payable November 21, 2025.
• Cover corporate overhead, including general administrative costs.
• Provide capital for higher-growth areas, like the Panacea division, which saw loan balances grow to $548 million (+40% YoY).
• Support debt servicing and maintain a strong capital position, with Tangible Common Equity at $289 million.

The low-growth, high-share nature of the Core Bank means you don't need massive promotional spending here. Instead, you focus on incremental efficiency improvements. For instance, management noted that run-rate pre-tax earnings were estimated at $11 million for the quarter, equating to an approximately 90 basis point return on assets when adjusting for certain items. Finance: draft 13-week cash view by Friday.

Primis Financial Corp. (FRST) - BCG Matrix: Dogs

You're looking at the segments of Primis Financial Corp. (FRST) that fit the classic BCG 'Dogs' profile: low market share in markets that aren't seeing much growth, or in this case, actively shrinking, tying up capital without delivering significant returns. These are the areas management is clearly working to minimize or exit, which is the textbook strategy for a Dog.

The most prominent example here is the third-party originated Consumer Program loan book. This portfolio continued its planned contraction, ending at $101 million as of September 30, 2025. That represents a significant year-over-year reduction of 44%, or $79 million compared to the balance on September 30, 2024. Honestly, this shrinking balance shows active divestiture or runoff, not organic growth. This portfolio has historically been a source of headaches, bringing volatility and requiring write-offs of accrued interest, which you want to avoid in a core business line.

Further supporting the 'Dog' classification is the Life Premium Finance portfolio. The data confirms this is a non-core business line management is exiting; the portfolio is explicitly noted as being in runoff. This planned exit means resources are being deliberately pulled away from this segment, aligning perfectly with the 'avoid and minimize' directive for Dogs. The focus is clearly shifting to the Core Bank, Panacea Financial, and Mortgage Warehouse segments, which are showing growth.

Even as the company focuses on core strengths, asset quality in legacy areas remains a challenge you need to watch. Nonaccrual loans have been a point of concern, with an increase of $32 million in the third quarter of 2025 due to specific relationships moving to nonaccrual status. Despite this, the overall allowance for credit losses to total loans improved slightly to 1.40% at the end of the third quarter of 2025, down from 1.72% at the end of the third quarter of 2024, suggesting better coverage relative to the shrinking total loan base, but the underlying credit issues in these legacy assets still require resolution.

Here are the key figures illustrating the status of these low-growth/shrinking portfolios as of September 30, 2025:

The management's actions speak volumes about how they view these units:

• The Consumer Program loan balance declined by $79 million year-over-year.
• The Life Premium Finance portfolio is in runoff, signaling a strategic exit.
• Provisions for the Consumer Program were only $274 thousand in Q3 2025, down from $4.0 million in Q3 2024 provisions associated with the portfolio.
• Total allowance and discounts on the Consumer Program loan portfolio represented 9.5% of its gross principal balance as of September 30, 2025.

These units are candidates for divestiture or aggressive reduction because the capital tied up in them, even if they frequently break even, could be better deployed in the growing segments. Finance: draft the projected cash flow impact of fully exiting the Life Premium Finance book by next Tuesday.

Primis Financial Corp. (FRST) - BCG Matrix: Question Marks

You're looking at the new growth engines for Primis Financial Corp. (FRST), the units that are burning cash now for a shot at future dominance. These are the Question Marks, characterized by high market growth potential but currently holding a small slice of that market.

The Digital Platform is the primary example here. As of the third quarter of 2025, this platform holds over $1.0 billion in deposits. While this is a significant absolute number, it competes in the national digital banking space, which is incredibly fragmented, meaning its relative market share remains small. The strategy here is clearly to invest to capture more of that growth. For instance, in the second quarter of 2025, the digital platform raised $36 million in deposits at a cost of 4.06%. This cost profile contrasts sharply with the core bank's funding advantage.

The V1BE technology platform represents the high-potential, unproven revenue stream. While specific licensing revenue for 2025 isn't public, the focus on technology is clear through cost management efforts. Management has negotiated solutions that are expected to save about $300,000 per month starting in August 2025, with savings potentially reaching $600,000 per month by early 2027. This investment in scalable technology is intended to lower the operating expense burden, which management targets to be between $18 million and $18.5 million per quarter by 2026.

The entire push for scale in these areas is tied directly to the company's profitability goals. Primis Financial Corp. is targeting a core Return on Assets (ROA) of 1%. The reported ROA for the third quarter of 2025 was 70 basis points (or 0.70%), indicating that the Question Marks are currently consuming cash relative to their small contribution to the bottom line, which is typical for this quadrant. To hit that 1% ROA goal, pre-tax earnings are projected to grow to over $13 million in the near term.

The immediate outlook for digital deposit growth suggests a pause for consolidation, which is a key near-term risk for this Question Mark. While noninterest-bearing checking accounts grew 16% year-over-year in Q3 2025, management indicated that digital platform deposits are expected to be flat for the remainder of 2025, with the core bank expected to outgrow digital on the deposit side. This means the heavy investment phase may be shifting focus from pure deposit acquisition to platform monetization or efficiency gains.

Here's a quick look at how the funding profile of these new ventures compares to the established business as of mid-2025:

The path forward for these Question Marks involves critical decision points:

• The Digital Platform needs to accelerate market share gains quickly to avoid becoming a Dog.
• Continued investment is required to realize the potential of the V1BE technology licensing model.
• The company must scale earning assets to support the 1% ROA target.
• The current growth trajectory for digital deposits is expected to be flat in the second half of 2025.

Finance: draft 13-week cash view by Friday.