News Summary
BayFirst Financial has announced its exit from the SBA lending business, selling a portfolio of $103 million in SBA 7(a) loans to Banesco USA. This decision aims to ‘derisk’ their balance sheet after a review of operations. The sale, which is expected to complete before Thanksgiving, aligns with Banesco USA’s goal to enhance its national SBA lending operations. The move led to a 24% increase in BayFirst’s stock price, indicating market optimism despite previous financial setbacks.
St. Petersburg, Florida – BayFirst Financial has announced its exit from the Small Business Administration (SBA) lending business, opting to sell a portfolio of $103 million in SBA 7(a) loans to Banesco USA, a Miami-based bank. This decision forms part of a broader strategy aimed at “derisking” their balance sheet, following a comprehensive review of the bank’s operations.
The sale of the loan portfolio represents a significant transition for BayFirst, which had previously boasted a national SBA lending program. In the SBA’s 2024 fiscal year alone, BayFirst originated $508 million in 7(a) loans, with a cumulative total of nearly $2.4 billion over the last seven years. The announcement of the sale resulted in a notable 24% increase in BayFirst’s stock price, which reached $11.16 by midday on the day of the announcement.
Banesco USA plans to offer employment to a majority of BayFirst’s SBA lending and support teams following the completion of the transaction, which is expected to finalize before Thanksgiving. As part of the agreement, the loans will be transferred to Banesco USA at 97% of their retained balances, relieving BayFirst of a significant portion of its SBA-related obligations. In addition to acquiring the loans, Banesco USA will take over servicing responsibilities for these loans while continuing to support those that BayFirst retains.
Financially, BayFirst reported a $1.2 million loss for the quarter ending June 30, primarily due to a rise in problem 7(a) loans. This situation was compounded by the fact that BayFirst had already shut down its small-dollar 7(a) loan program in August, which catered to loans up to $150,000. Despite this setback, the bank’s CEO indicated that its core mission remains focused on community banking and providing stable financial products for small businesses.
Banesco USA’s acquisition aligns with its ambitions to create a national SBA lending operation. The bank believes that bringing BayFirst’s SBA lending team and portfolio into its fold will significantly enhance its lending capabilities. As of June 30, 2025, BayFirst reported total assets of $1.34 billion, while Banesco USA had assets amounting to $5.2 billion. Banesco USA currently operates eight branches across South Florida and Puerto Rico and aims to leverage this acquisition to bolster its small business lending operations on a national scale.
In the SBA’s 2025 fiscal year, the overall loan volume for 7(a) loans stood at $36.2 billion, despite challenges associated with increasing problem loans, particularly in the small-dollar segment. The transition of BayFirst’s SBA lending responsibilities to Banesco USA is positioned as a strategy that not only aids in stabilizing BayFirst’s financial standing but also enables Banesco USA to expand its market reach and support small businesses across a broader area.
Deeper Dive: News & Info About This Topic
HERE Resources
St. Petersburg’s BayFirst Bank Achieves Fifth Place Nationally in SBA Loan Volume
Additional Resources
- Business Observer: St. Pete Bank Small Business Loans
- GlobeNewswire: BayFirst Financial Announces Exit from SBA 7(a) Lending
- American Banker: Florida Bank to Quit SBA
- TipRanks: BayFirst Financial Exits SBA 7(a) Lending Business
- Wikipedia: Small Business Administration
Author: STAFF HERE PETERSBURG WRITER
ST PETERSBURG STAFF WRITER The ST PETERSBURG STAFF WRITER represents the experienced team at HEREStPetersburg.com, your go-to source for actionable local news and information in St Petersburg, Pinellas County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Grand Prix of St. Petersburg, Localtopia, and SHINE Mural Festival. Our coverage extends to key organizations like the St. Petersburg Area Chamber of Commerce and St. Pete Downtown Partnership, plus leading businesses in finance, manufacturing, and healthcare that power the local economy such as Raymond James Financial, Jabil, and Bayfront Health St. Petersburg. As part of the broader HERE network, including HEREJacksonville.com, HEREOrlando.com, HERETallahassee.com, and HERETampa.com, we provide comprehensive, credible insights into Florida's dynamic landscape.
