C&F Financial Corporation (the Corporation) (NASDAQ:CFFI), the holding company for C&F Bank, today announced the completion of the sale (the Transaction) of the Corporation's interest (held by C&F Bank's subsidiary, C&F Insurance Services, LLC) in Bearing Insurance Group, LLC (Bearing) to an unaffiliated third party, effective May 1, 2026. Based solely on information available to the Corporation on the date hereof, the Corporation estimates that a pre-tax gain of approximately $8.3 million will be recognized on the Transaction, which will be included in the Corporation's financial results for the second quarter of 2026.

Following the completion of the Transaction, the Corporation executed a strategic restructuring of a portion of its securities available for sale (AFS) portfolio (the Portfolio Restructuring), which will offset a portion of the gain from the Transaction. In the Portfolio Restructuring, the Corporation sold $72.6 million in book value of securities AFS with a weighted average yield of 1.40% and representing approximately 14.7% of the entire securities portfolio, and purchased approximately $67.8 million of securities AFS with a weighted average yield of approximately 4.70%. Based solely on information available to the Corporation on the date hereof, the Corporation estimates that the Portfolio Restructuring will result in a pre-tax loss of approximately $7.1 million, which will also be included in the Corporation's financial results for the second quarter of 2026. The estimated loss on the Portfolio Restructuring is expected to be recovered over approximately 3.3 years. The Corporation expects, on an annualized basis, the Portfolio Restructuring will improve earnings per share by approximately $0.51 per share and net interest margin by approximately 9 basis points.

While the loss recognized upon the Portfolio Restructuring is expected to have no impact on the Corporation's total consolidated equity or tangible book value per share, the gain from the sale of Bearing is expected to increase tangible book value per share by an estimated $1.90 per share after taxes.