St. Petersburg bank lays off employees as it cuts loan program

BayFirst National Bank is laying off 52 employees as it cuts its small balance Small Business Administration lending program.

The St. Petersburg community bank notified the state of the job cuts in letter stating that the layoffs are expected to be permanent. The official who signed the letter did not respond to an early morning email Thursday.

According the letter, sent to meet federal Worker Adjustment Retraining and Notification requirements, the layoffs began Monday Aug. 4 and will be completed by Oct. 4.

The employees who lost their jobs will get 60 days of pay as well as benefits for 60 days.

In the letter to the state, the bank writes that it “has made an extremely difficult decision to discontinue our small balance SBA lending division and reduce our consumer lending division.”

It did not give further details, but the community bank’s parent, BayFirst Financial Corp., posted a statement on its website Aug. 4 stating that after “a comprehensive strategic review” it had decided to eliminate its Bolt loan program.

The program, according to the statement, “was an SBA 7(a) loan designed to provide small balance loans to small businesses, typically used for working capital” of $150,000 or less.

In its second quarter earnings statement released July 29, BayFirst reported that since launching the Bolt program in 2022, it has originated 6,745 loans totaling $869 million. Of those, 538 loans totaling $67.9 million were originated during the second quarter.

In that same earnings report, BayFirst’s CEO Thomas G. Zernick explained the problems the bank was having with the program saying that “credit challenges extended into the second quarter, with net charge-offs and fair value write-downs on Bolt SBA 7(a) loans increasing compared to the prior quarter.”

 “Although our core SBA and conventional commercial loan portfolio performance remains strong, many of our SBA small business clients continue to struggle in a difficult environment even though many have shown some resilience in the face of inflation and persistent high interest rates,” he says.

BayFirst National Bank was founded in 1999 and operates 12 branches throughout Tampa Bay and Sarasota.

For the quarter, BayFirst’s total assets when compared with a year ago increased 4% — $51.9 million — to $1.34 billion. It has $1.6 billion in deposits as of June 30.