C & F FINANCIAL CORP 8-K

What Happened
C & F Financial Corporation announced on May 7, 2026 that it completed the sale of its membership interest in Bearing Insurance Group, LLC to an unaffiliated third party, effective May 1, 2026. The company estimates a pre-tax gain of approximately $8.3 million that will be recorded in the second quarter of 2026. Immediately after the sale, C&F executed a strategic restructuring of part of its available-for-sale (AFS) securities portfolio, selling $72.6 million (book value) of lower-yielding securities and purchasing about $67.8 million of higher-yielding securities. The company estimates the Portfolio Restructuring will produce a pre-tax loss of about $7.1 million, also included in Q2 2026 results.

Key Details

• Sale effective date: May 1, 2026; 8-K filed May 7, 2026.
• Estimated pre-tax gain on sale of Bearing: ~$8.3 million (recognized in Q2 2026).
• Portfolio changes: sold $72.6M book value of AFS securities (weighted avg yield 1.40%; ~14.7% of portfolio) and bought ~$67.8M of AFS securities (weighted avg yield ~4.70%).
• Estimated pre-tax loss on restructuring: ~$7.1 million (recognized in Q2 2026); expected to be recovered over ~3.3 years. Annualized benefit: ≈+$0.51 EPS and ≈+9 basis points net interest margin. Sale expected to increase tangible book value per share by about $1.90 after taxes; restructuring loss expected to have no impact on consolidated equity or tangible book value per share.

Why It Matters
For investors, the combined actions shift C&F’s balance sheet and future income profile: the Bearing sale provides a one-time pre-tax gain ($8.3M) and a material lift to tangible book value per share, while the securities portfolio changes trade a near-term accounting loss ($7.1M pre-tax) for higher recurring yield that should boost net interest income, improve net interest margin (+9 bps), and increase annualized EPS (+$0.51). Both the gain and the restructuring loss will appear in Q2 2026 results; the restructuring loss is expected to be recovered over roughly 3.3 years. The company attached a news release as Exhibit 99.1 to the Form 8-K.