All amounts are unaudited and in Canadian dollars and are based on financial statements prepared in compliance with International Accounting Standard 34 Interim Financial Reporting, unless otherwise noted. Our second quarter 2025 ("Q2 2025") unaudited Interim Consolidated Financial Statements for the period ended April 30, 2025 and Management's Discussion and Analysis ("MD&A"), are available online at www.versabank.com/investor-relations, SEDAR at www.sedarplus.ca and EDGAR at www.sec.gov/edgar. Supplementary Financial Information will also be available on our website at www.versabank.com/investor-relations.

 VersaBank (or the "Bank") (TSX: VBNK) (NASDAQ: VBNK), a North American leader in business-to-business digital banking, as well as technology solutions for cybersecurity, today reported its results for the second quarter ended April 30, 2025. All figures are in Canadian dollars unless otherwise stated.

CONSOLIDATED FINANCIAL SUMMARY

SEGMENTED FINANCIAL SUMMARY

MANAGEMENT COMMENTARY

"The second quarter of fiscal 2025 was highlighted by the initial contribution and steady ramp up of our Receivable Purchase Program in the United States post acquisition, alongside continued growth in Canada, which drove credit assets and total assets to new records, and which, along with the expected strong sequential expansion in net interest margin, drove revenue to a new all-time high," said David Taylor, President and Chief Executive Officer, VersaBank.  "The fundamentals of our cloud-based, business-to-business model, with its significant operating leverage while increasingly mitigating risk, remain solidly in place. As we look out to the second half of fiscal 2025, we expect continued steady growth in our US Receivable Purchase Program, with a target of at least US$290 million by fiscal year end."

"We also expect continuation of several favourable trends related to net interest margin that will support levels that are consistent with the higher levels we saw in the second quarter.  In our CMHC residential construction loan program in Canada, we remain on pace to meet our target of $1 billion of authorized commitments by fiscal year end, and expect a steadily increasing contribution of this program as the commitments are drawn down."

"In addition, we are aggressively pursuing the renewed opportunity for our proprietary Digital Deposit Receipts, as the US Administration's significantly more favorable stance on digital assets is precipitating public discussions around stablecoin strategies by the mainstream banking industry.  We believe our Digital Deposit Receipts are not just the ultimate stablecoin but take the concept of the stablecoin to an entirely new level.  Our Digital Deposit Receipts are a market ready solution â?? created by a bank for banks â?? that seamlessly integrate with existing bank software systems while addressing the major concerns of regulators."

"As announced last week, with the objective to realize additional shareholder value, we have initiated a plan, subject to shareholder, regulatory and other approvals, to align our corporate structure with the standard bank framework with which the US and international investment communities are most familiar, with the proposed new holding company parent to be domiciled in the United States. We expect the proposed structural realignment to enable eligibility for inclusion in certain stock indices, including the Russell 2000, simplify our regulatory structure and reduce costs."

HIGHLIGHTS FOR THE SECOND QUARTER OF FISCAL 2025

Consolidated (Canadian and U.S. Digital Banking Operations, Digital Meteor and DRTC)

Digital Banking Operations (Combined Canada and U.S.)

Digital Banking Operations Canada

Digital Banking Operations US

Digital Meteor Inc. 

DRTC's Cybersecurity Services Operations 

FINANCIAL SUMMARY  

This news release is intended to be read in conjunction with the Bank's Consolidated Financial Statements  and Management's Discussion & Analysis (MD&A) for the three & six months ended April 30, 2025, which are available on VersaBank's website at www.versabank.com, SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov/edgar.

About VersaBank

VersaBank is a North American bank with a difference.  Federally chartered in both Canada and the US, VersaBank has a branchless, digital, business-to-business model based on its proprietary state-of-the-art technology that enables it to profitably address underserved segments of the banking industry in a significantly risk mitigated manner. Because VersaBank obtains substantially all of its deposits and undertakes the majority of its funding electronically through financial intermediary partners, it benefits from significant operating leverage that drives efficiency and return on common equity.  In August 2024, VersaBank launched its unique Receivable Purchase Program funding solution for point-of-sale finance companies, which has been highly successful in Canada for nearly 15 years, to the underserved multi-trillion-dollar US market.  VersaBank also owns Washington, DC-based DRT Cyber Inc., a North America leader in the provision of cyber security services to address the rapidly growing volume of cyber threats challenging financial institutions, multi-national corporations and government entities.  Through its wholly owned subsidiary, Digital Meteor, Inc. ("Digital Meteor"), VersaBank owns proprietary intellectual property and technology to enable the next generation of digital assets for the banking and financial community, including the Bank's revolutionary Digital Deposit Receipts (DDRs).

VersaBank's Common Shares trade on the Toronto Stock Exchange and NASDAQ under the symbol VBNK.

Forward-Looking Statements 

This press release contains forward-looking information and forward-looking statements within the meaning of applicable securities laws ("forward-looking statements") including statements regarding the ability to obtain shareholder, regulatory and other approvals of the structural alignment; the expected realization of additional shareholder value, the simplification of the regulatory structure and the reduction of costs as a result of the proposed structural alignment; the key elements of the proposed structural alignment; the ability to obtain inclusion on stock indices, including the Russell 2000; the ability to continue to grow the US Receive Purchase Program; the ability to expand our net interest margin; and the ability to continue to grow the CMHC residential construction loan program. Forward-looking statements of this type are included in this document and may be included in other filings and with Canadian securities regulators or the US Securities and Exchange Commission, or in other communications. All such statements are made pursuant to the "safe harbor" provisions of, and are intended to be forward-looking statements under, the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. The statements in this press release that relate to the future are forward-looking statements. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, many of which are out of VersaBank's control. Risks exist that predictions, forecasts, projections and other forward-looking statements will not be achieved. Readers are cautioned not to place undue reliance on these forward-looking statements as a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited to, the strength of the Canadian and US economies in general and the strength of the local economies within Canada and the US in which VersaBank conducts operations; the effects of changes in monetary and fiscal policy, including changes in interest rate policies of the Bank of Canada and the US Federal Reserve; global commodity prices; the effects of competition in the markets in which VersaBank operates; changes in trade laws and tariffs; inflation; capital market fluctuations; the timely development and introduction of new products in receptive markets; the impact of changes in the laws and regulations pertaining to financial services; changes in tax laws; technological changes; unexpected judicial or regulatory proceedings; unexpected changes in consumer spending and savings habits; the impact of wars or conflicts and the impact of both on global supply chains and markets; the impact of outbreaks of disease or illness that affect local, national or international economies; the possible effects on our business of terrorist activities; natural disasters and disruptions to public infrastructure, such as transportation, communications, power or water supply; and VersaBank's anticipation of and success in managing the risks implicated by the foregoing. 

Completion of VersaBank's plan to realign its corporate structure to a standard US bank framework is subject to numerous factors, many of which are beyond the Bank's control, including but not limited to, the failure to obtain required shareholder, regulatory and other approvals, and other important factors disclosed previously and from time to time in the Bank's filings with the SEC and the securities commissions or similar securities regulatory authorities in each of the provinces or territories of Canada.

The foregoing list of important factors is not exhaustive. When relying on forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. The forward-looking information contained in the management's discussion and analysis is presented to assist VersaBank shareholders and others in understanding VersaBank's financial position and may not be appropriate for any other purposes.

For a detailed discussion of certain key factors that may affect VersaBank's future results, please see VersaBank's annual MD&A for the year ended October 31, 2024. Except as required by securities law, VersaBank does not undertake to update any forward-looking statement that is contained in this press release or made from time to time by VersaBank or on its behalf.

Conference Call

VersaBank will be hosting a conference call and webcast today, Wednesday, June 4, 2025, at 9:00 a.m. (ET) to discuss its first quarter results, featuring a presentation by David Taylor, President & CEO and John Asma, CFO, followed by a question-and-answer period. To join the conference call by telephone without operator assistance, you may register and enter your phone number in advance at: https://emportal.ink/4jdDXlc to receive an instant automated call back.  Alternatively, you may also dial direct and be entered into the call by an Operator at:  1-416-945-7677 or 1-888-699-1199 (toll free).

For those preferring to listen to the presentation via the Internet, a live webcast will be available at https://app.webinar.net/Yd10e9z2zAb or on the Bank's web site at: https://www.versabank.com/investor-relations/events-presentations/.  The slide presentation management will use during the conference call/webcast will be available on the Bank's web site at: https://www.versabank.com/investor-relations/financial-results/.

The archived webcast presentation will be available for 90 days following the live event at https://app.webinar.net/Yd10e9z2zAb and on the Bank's web site at: https://www.versabank.com/investor-relations/events-presentations/.  Replay of the teleconference will be available until July 4, 2025 by calling 289-819-1450 or 1-888-660-6345 (toll free) and the passcode is: 07223#

Visit our website at:  www.versabank.com

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SOURCE VersaBank

SOURCE: VersaBank

FOR FURTHER INFORMATION, PLEASE CONTACT: LodeRock Advisors, Lawrence Chamberlain,
(416) 519-4196, lawrence.chamberlain@loderockadvisors.com

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