Safe Harbor Financial CEO Highlights Growth Platform Launch, Debt Elimination, and Financial Stabilization in Letter to Shareholders

DENVER, March 09, 2026 (GLOBE NEWSWIRE) -- SHF Holdings, Inc., d/b/a Safe Harbor Financial (“Safe Harbor” or the “Company”) (NASDAQ: SHFS), a leading fintech platform serving the banking, lending, and financial services needs of the regulated cannabis and hemp industries, today released a letter to shareholders from Terrance Mendez, Chief Executive Officer of Safe Harbor.

Dear Fellow Shareholders,

Today, Safe Harbor has a strong financial base and is ready to grow: we are debt-free, hold more than $6 million in cash, and have secured a long-term agreement with a major customer that is expected to generate at least $10.5 million in incremental cash flow. Here is a summary of the past year and why we believe the next chapter is significantly more valuable than the last.

The Numbers Tell the Story

The single most important thing I can tell a shareholder today is this: we eliminated substantially all of the Company's debt in September 2025. Members of management and our Board of Directors participated directly in the financing round that made this possible, because we believe in the long term growth potential of the business we are building. We put our own capital to work alongside yours.

Here is where we stand financially:

• More than $6 million cash on hand with no meaningful debt obligations at the end of 2025
• Long-term revenue visibility through 2031 under our amended agreement with Partner Colorado Credit Union (PCCU) that is expected to increase cash flow by over $10 million over the term
• 29% deposit growth in Emerging U.S. Markets over the 12 months ended February 4, 2026, driven by more than 100 new accounts
  

In short: the balance sheet that was a liability 12 months ago is now what we believe to be a foundation for growth.

Improved Profitability: More Revenue, Lower Costs, Long Term Stability

On February 9, 2026, we announced a significant improvement to our relationship with PCCU, our primary banking partner and a key shareholder. The new agreement extends our partnership by two years through the end of 2031 and restructures our economics in a way that directly benefits shareholders. We exchanged a future risk protection for an opportunity for immediate and consistent cash revenue, a transaction that is profitable precisely because the cost of bearing that risk is less than the revenue we expect to receive for doing so. Under the modified agreement, our share of loan interest income increases from approximately 35% to 65% nearly doubling our participation in the loan portfolio we work every day to build and service.

The modified agreement is expected to generate an estimated $9 million in incremental revenue and over $1.5 million in total incremental cost savings over the 6.25 year term assuming no growth in deposits. However, as we grow deposits and facilitate new loans under this modified agreement, the benefits should expand. This amended agreement with PCCU helps to enhance the stability and visibility of our revenue model through 2031, removes growth barriers, and generates significant cash revenue and cost savings in exchange for non-cash risk exposure, positioning us well for profitable expansion with our valued long-term strategic partner.

After securing a more stable and profitable relationship with PCCU, we are simultaneously executing a deliberate diversification strategy to broaden our revenue base across bank services, managed services, lending, technology integration, and programs to help financial institutions scale.

Securing a strong and stable foundation with PCCU was priority one. Priority two is executing a deliberate strategy to diversify our revenue across four growth vectors.

Launch of our Fully Managed Cannabis Banking Program

In September we launched our Fully Managed Cannabis Banking Program, offering a compliant turnkey program designed for community banks, credit unions, and financial institutions seeking to serve the legal cannabis market. Safe Harbor manages everything, including compliance, onboarding, account support and loan syndications while deposits remain directly at the financial institution. We are actively engaged with new financial institutions interested in partnering through this program, and it represents one of the most significant near-term revenue opportunities in our pipeline. We believe this strategy strengthens our long-term risk profile and positions Safe Harbor for sustainable, profitable growth.

Expanded Lending Platform

One year ago, Safe Harbor's lending capabilities were largely limited to commercial real estate. Today, Safe Harbor has meaningfully expanded its lending capabilities such that we now have the ability to structure financing across the entire operator lifecycle, from startup funding of as little as $5,000 to transactions as large as $25 million or more, funded through our network of credit unions, regional banks, family offices, and private equity relationships. We closed one of our first startup capital transactions for a first-time dispensary operator in Massachusetts, which is a transaction that would not have been possible under our prior lending framework. We have built the infrastructure to be the financial partner cannabis operators turn to at every stage of their growth, leveraging our domain expertise and disciplined underwriting to identify, evaluate, and price risk appropriately for our financial partners.

Managed Services and Back Office Solutions

We launched our Managed Services platform that delivers end-to-end back-office solutions to cannabis operators spanning treasury management, HR outsourcing, employee banking, accounts receivable management, and cash flow advisory. These services carry higher margins, generate recurring free cash flow, and create depositor stickiness. In December, we acquired the core operating assets and active client contracts of 420 IT Solutions, a recognized cannabis-focused managed services firm, and hired its founders to lead our Managed Services platform. We acquired an established business with proven leadership and strong industry relationships immediately extending our reach.

Critically, we believe these services differentiate Safe Harbor's banking relationships from those offered by competing financial institutions, creating a depth of partnership that a traditional bank simply cannot replicate.

Safe Harbor Advantage Partner Network

We are expanding beyond core banking and lending to offer the operational infrastructure our clients need to run more stable, resilient businesses. In January 2026, we began offering cannabis-specific insurance solutions through partnerships with Frontier Risk and AlphaRoot. Clients can now access property, workers' compensation, general liability, product liability, and related risk management coverage all tailored for cannabis operators. This is the first offering in what we intend to be a broader suite of compliant, curated services that deepen our client relationships and improve retention. That same month, we also expanded our payments solutions portfolio through new partnerships with Lüt and GreenCard. Lüt's closed-loop, wallet-based payment system provides operators with guaranteed funds and uninterrupted payment flow, while GreenCard unifies retail, delivery, e-commerce, and wholesale transactions on a single platform, transforming lengthy check cycles into next-day ACH settlement. Together, these additions give our clients the flexibility, redundancy, and operational resilience they need in an industry where payment infrastructure remains one of the most persistent challenges. These launches are the first offerings in what we intend to be a broader suite of compliant, curated services that deepen our client relationships and improve retention.

The Cannabis Market Is Moving Our Way

Since its founding, Safe Harbor has facilitated more than $26 billion in cannabis-related transactions across 41 states and territories. We have been doing this longer than almost anyone. And for the first time in years, federal policy appears to be moving in our direction.

The Trump Administration's Executive Order to complete Rescheduling in December represents a meaningful policy shift. We believe reclassification, once implemented, would improve the financial position of cannabis operators, reduce business attrition, and increase participation by financial institutions expanding the addressable market for Safe Harbor's services. We are cautiously optimistic and are positioning the business to capitalize on this tailwind when it arrives, not scramble to catch up after the fact.

We are also generating real results in emerging state markets right now. Deposit balances in states with recently launched or expanded cannabis programs including New York, New Jersey, Illinois, Florida, Ohio, and Kentucky grew 29% over the past year and now represent 31% of our total average deposit base. These are the markets where the next wave of cannabis banking demand will originate, and we are already there.

More to Come in 2026

We are a leaner, better-capitalized, and more diversified company than we were 12 months ago and we are building new revenue lines. While we’ve made significant progress, we’re continuing to develop additional compliant solutions and look forward to announcing them when appropriate. We see much more opportunity to create value, and intend to capture it through continued execution.

In closing, our interests are aligned with that of our shareholders. Members of Management and our Board of Directors participated in the financing round that eliminated substantially all of the Company’s outstanding debt and provided growth capital. We did this because we believe the risk/reward profile of the Company is meaningfully better than it was a year ago. With the progress we have made with our amended commercial alliance agreement with PCCU as well as strengthening our capital position, launching new client-focused services, and adding talent with deep cannabis domain expertise, I am proud to say we have made significant strides in turning Safe Harbor’s business around and positioning the Company for future success.

I would like to thank all of our valued shareholders, financial partners and customer base for your continued support.

Regards,
Terrance Mendez
Chief Executive Officer
Safe Harbor Financial

About Safe Harbor:
Safe Harbor is a cannabis-exclusive financial platform delivering smarter banking, lending, payments and business services tailored to how the cannabis industry actually operates. As one of the original pioneers of compliant cannabis banking in the U.S., Safe Harbor has facilitated more than $26 billion in cannabis-related transactions across 41 states and territories. Through its proprietary Cannabis Banking Solutions™ Platform and network of regulated financial institution partners, Safe Harbor empowers cannabis operators to gain clarity, control and confidence in their financial operations. From daily banking to long-term growth, Safe Harbor provides real solutions and personal support built exclusively for cannabis. Safe Harbor is a financial technology company, not a bank. Banking services are provided by our partner financial institutions.