8-K: Coastal Financial Appoints Fintech Veteran Brandon Soto as CFO

Coastal Financial Corporation announced the appointment of Brandon Soto, a seasoned fintech leader from Square Financial Services, as its new Chief Financial Officer, effective October 1, 2025.

Summary

• Coastal Financial Corporation appointed Brandon Soto as Executive Vice President and Chief Financial Officer, effective October 1, 2025.
• Mr. Soto, 51, previously served as CFO of Square Financial Services, Inc., a subsidiary of Block, Inc., for seven years, overseeing financial operations, regulatory approvals, and treasury functions.
• His compensation package includes an annual base salary of $500,000, a $15,000 one-time signing bonus, 18,000 restricted stock units vesting over four years, and 15,000 performance-based restricted stock units tied to stock price targets.
• Joel G. Edwards will continue as Executive Vice President and Chief Financial Officer until Mr. Soto's effective start date.
• The company expects this appointment to strengthen operating excellence, regulatory stewardship, and the scaling of its fintech and community banking divisions.

Sentiment

Score: 8

Explanation: The appointment of a highly qualified and experienced CFO with a strong fintech background from a reputable company like Square Financial Services is a significant positive for Coastal Financial. His expertise aligns well with the company's strategic direction, suggesting enhanced financial management and growth potential. The compensation package is competitive and includes performance-based incentives, further aligning management interests with shareholder value.

Positives

• Appointment of a highly experienced CFO with over two decades in financial institutions and fintech, including a significant leadership role at Square Financial Services.
• Mr. Soto's expertise in building and scaling financial operations, securing regulatory approvals (FDIC, Utah DFI), and managing treasury functions is a strong asset for the company.
• His background aligns strategically with Coastal's focus on both traditional community banking and its growing CCBX banking-as-a-service fintech segment.
• The CEO, Eric Sprink, expressed strong confidence in Mr. Soto's ability to contribute to the company's mission of innovation and value creation.
• The compensation structure includes performance-based restricted stock units, aligning executive incentives with shareholder value creation through stock price targets.

Risks

• Forward-looking statements are subject to risks, uncertainties, and assumptions that are difficult to predict, as detailed in the company's Annual Report on Form 10-K and subsequent SEC filings.
• Actual results could differ materially from anticipated outcomes if events related to these risks or uncertainties materialize, or if underlying assumptions prove incorrect.

Future Outlook

The company anticipates that Mr. Soto's appointment will mark a new chapter, reaffirming its dedication to operating excellence, strong regulatory stewardship, and the continued scaling of both its fintech and community banking divisions. The company also expects to continue its mission of serving communities, modernizing operations, and creating lasting value for customers, partners, and shareholders.

Management Comments

• "Brandon's extraordinary record of accomplishment and commitment to financial empowerment and innovation are precisely what Coastal needs as we pursue our mission of serving communities, modernizing operations, and creating lasting value to our customers, partners, and shareholders." Eric Sprink, CEO.

Industry Context

The appointment of Brandon Soto, with his extensive background at Square Financial Services, highlights Coastal Financial Corporation's strategic emphasis on integrating fintech capabilities with traditional community banking. This move reflects a broader industry trend where regional banks are increasingly leveraging digital financial service providers and 'banking as a service' models to expand their reach and modernize operations, positioning themselves competitively against larger institutions and pure-play fintech companies.

Comparison to Industry Standards

• Mr. Soto's background as CFO of Square Financial Services, a subsidiary of Block, Inc., positions him as a leader with experience in a highly innovative and regulated fintech environment, comparable to financial executives at other leading digital banking entities.
• His prior roles at Green Dot Bank and Sallie Mae Bank further demonstrate a career trajectory focused on scaling financial infrastructure and navigating growth in dynamic banking sectors, aligning with the strategic needs of a company like Coastal Financial that operates both traditional and BaaS segments.
• The compensation package, including a $500,000 base salary and significant equity awards tied to performance, appears competitive for a CFO of a $4.48 billion asset bank with a growing fintech division, reflecting the demand for executives with specialized fintech and regulatory expertise.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: Potential positive impact due to the appointment of a highly experienced CFO with a strong background in fintech, aligning with strategic growth initiatives and potentially enhancing financial performance and regulatory compliance. Performance-based equity awards align management incentives with shareholder value.
• Employees: The appointment of a new CFO may bring new leadership and strategic direction to the finance department, potentially fostering new opportunities or changes in operational approaches.
• Customers/Partners (CCBX segment): Mr. Soto's experience in scaling financial operations and securing regulatory approvals could enhance the stability and growth of the banking as a service (BaaS) offerings, benefiting digital financial service providers and their customers.
• Regulators: The new CFO's experience with regulatory approvals (FDIC, Utah DFI) suggests a strong focus on compliance and regulatory stewardship, which is favorable for maintaining good standing with regulatory bodies.

Next Steps

• Brandon Soto will officially assume the role of Executive Vice President and Chief Financial Officer on October 1, 2025.
• The performance-based restricted stock unit award agreement will be executed on or around October 1, 2025.
• Mr. Soto's annual base salary will be subject to annual review by the Compensation Committee of the Board of Directors.
• Mr. Soto will be eligible to participate in the company's annual cash incentive plan and receive equity incentive awards under the 2018 Omnibus Incentive Plan.

Key Dates

Recommendation

The appointment of Brandon Soto as CFO is a highly strategic and positive development for Coastal Financial. His extensive experience as CFO of Square Financial Services, a subsidiary of Block, Inc., demonstrates a proven track record in scaling financial operations, navigating complex regulatory environments, and driving growth in the fintech sector. This expertise is directly aligned with Coastal's dual focus on community banking and its high-growth CCBX (banking as a service) segment. A CFO with such a strong background in innovative financial services is a significant asset, likely to enhance operational efficiency, regulatory compliance, and strategic execution, thereby creating substantial long-term shareholder value. The performance-based equity compensation further aligns his incentives with stock price appreciation. This move signals a strong commitment to future growth and innovation, making the stock a compelling 'strong buy' for investors looking for exposure to a well-managed regional bank with a robust fintech strategy.

Keywords

Coastal Financial Corporation, CCB, CFO appointment, Brandon Soto, Chief Financial Officer, fintech, Square Financial Services, Block Inc., banking as a service, CCBX, executive compensation, corporate governance, financial reporting