Capital Bancorp's Dual CEO Strategy Signals Aggressive Diversification

ROCKVILLE, MD – December 30, 2025 – Capital Bancorp, Inc. (NASDAQ: CBNK) today formalized a significant evolution in its executive leadership, a move that signals a deliberate acceleration of its strategy to transform from a traditional regional bank into a diversified financial services powerhouse. The company announced it has renewed the employment agreement for enterprise CEO Ed Barry through 2027, while elevating veteran banker Steve Poynot to the newly created role of Chief Executive Officer for its subsidiary, Capital Bank, N.A.

This dual-CEO structure is designed to provide focused leadership for two distinct but complementary strategic priorities: the continued growth of its high-performing national specialty businesses and the operational fortification of its core commercial banking franchise. The realignment underscores a pivotal moment for the $3.4 billion asset institution as it seeks to build a more resilient, higher-margin enterprise in a rapidly changing financial landscape.

A Deliberate Strategy for Diversified Growth

The leadership restructuring is the latest step in a multi-year plan to create what the company calls a "diversified financial services enterprise." By separating the leadership of the holding company from its primary banking unit, Capital Bancorp is creating a clear division of focus. Ed Barry, who has led the company since 2012 and overseen its rapid expansion, will continue to steer the enterprise-level strategy. His role will concentrate on identifying growth opportunities, managing the portfolio of distinct business lines, and executing key initiatives that span the entire organization.

This structure allows Barry to dedicate his attention to maximizing the value of the company's recent strategic investments, particularly those outside of conventional banking. The board's confidence in this direction was articulated by Chairman Steven J. Schwartz.

“Our long-term growth strategy is built around creating a diversified financial services enterprise comprised of a core commercial bank and a set of differentiated, high-performing businesses,” said Schwartz in the company's announcement. “This leadership alignment acknowledges the complexity of our enterprise and ensures that we continue to harvest the investments that we have made in our commercial banking franchise, while continuing to maximize the growth of our other lines of business.”

This approach aims to solve a common challenge for growing financial institutions: how to nurture new, agile ventures without losing focus on the foundational business that provides stability and funding. The new structure provides a clear answer by dedicating an experienced executive to each domain.

The Power of the Platforms

The strategic importance of this restructuring becomes clear when examining the performance of Capital Bancorp’s non-banking segments. The company has aggressively built and acquired a portfolio of national specialty platforms that are fundamentally reshaping its profitability.

The most dramatic example is Windsor Advantage, a subsidiary acquired through the March 2024 purchase of Integrated Financial Holdings (IFH). As the nation's largest Lender Service Provider (LSP), Windsor provides a comprehensive, outsourced platform for SBA and USDA lending to over 140 client banks and credit unions. This fee-based business has been a game-changer for Capital Bancorp. In the second quarter of 2025, the segment accounted for an astounding 78% of the company's net income—a seismic shift from fiscal year 2023, when its contribution was negligible.

Another key component of the diversification strategy is OpenSky™, the company's nationwide digital credit card division. OpenSky offers secured and unsecured credit cards to under-banked consumers and those seeking to rebuild credit, tapping into a significant niche market. While facing increased competition from fintech rivals, the platform has historically been a strong contributor to pretax net income and represents a crucial, non-local revenue stream.

Rounding out the portfolio are Capital Bank Home Loans (CBHL), a residential mortgage originator operating across all 50 states, and Church Street Capital (CSC), another wholly-owned subsidiary. Together, these businesses illustrate a clear pivot away from reliance on traditional net interest income and toward scalable, fee-generating national platforms.

New Leadership for the Core Bank

With Ed Barry focused on the enterprise's strategic horizon, Steve Poynot will take the helm of Capital Bank, N.A., the company’s commercial banking engine. Poynot, who joined the institution in 2022 as Chief Operating Officer and was promoted to President in 2023, brings over 25 years of commercial banking experience to the CEO role.

His elevation formalizes the leadership position he has already assumed in managing the bank's day-to-day commercial activities, credit functions, and core operations. Before joining Capital Bank, Poynot held executive roles at F&M Trust and spent over 17 years at Howard Bank, where he was instrumental in building its commercial banking infrastructure, including its credit and client support departments.

Poynot’s appointment is intended to ensure that the core commercial bank, which operates primarily in the competitive Washington, D.C., and Baltimore metropolitan areas, continues to receive dedicated executive oversight. His deep experience in sales, operations, technology, and credit is seen as vital to strengthening client relationships and driving operational excellence. He will also retain executive oversight of the highly successful Windsor Advantage platform, ensuring its continued integration and performance within the broader organization.

A Blueprint for the Modern Regional Bank?

Capital Bancorp’s strategic realignment reflects broader trends sweeping across the regional banking industry. Faced with competitive pressure from money-center banks and nimble fintech startups, many regional players are seeking to diversify revenue, invest in technology, and capture niche markets to secure future growth.

The company's approach serves as a compelling case study. Its M&A strategy, exemplified by the transformative IFH acquisition, demonstrates how targeted inorganic growth can rapidly scale specialized, high-return businesses. Furthermore, its investment in a new digital banking platform with partner Q2 shows a commitment to technological modernization, aimed at enhancing its "relationship-first" approach in a digital world.

Market analysts have reacted with measured optimism. While the stock trades at a valuation discount compared to some peers—potentially reflecting investor caution around integration risks and competition—the consensus analyst rating is a "Moderate Buy," with price targets suggesting significant upside. The dramatic success of Windsor Advantage is widely seen as validation of the diversification strategy, though the execution of this complex, dual-pronged approach will remain under close scrutiny.

By creating a leadership structure that mirrors its business strategy, Capital Bancorp is placing a bold bet that it can successfully operate as both a disciplined regional bank and an aggressive national financial services innovator. This calculated move positions the company to navigate the evolving demands of the financial sector, leveraging the stability of its core franchise to fuel the growth of its specialized national platforms.