Peoples Bancorp Of North Carolina Inc 8-K, filed Oct 19, 2026
Peoples Bancorp Of North Carolina Inc (PEBK)
About this 8-K
Peoples Bancorp Of North Carolina Inc filed this 8-K on October 19, 2026.
Peoples Bancorp of North Carolina reported third quarter 2026 net earnings of $5.7 million or $1.08 per share, up from $3.7 million or $0.70 per share a year earlier. Net interest margin rose to 3.85% from 3.58%, and total loans reached $1.30 billion. AI summary
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM
CURRENT REPORT Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact Name of Registrant as Specified in Its Charter) |
(State or Other Jurisdiction of Incorporation)
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(Commission File No.) |
| (IRS Employer Identification No.) |
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(Address of Principal Executive Offices) |
| (Zip Code) |
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(Registrant’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
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| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
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| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
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| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Peoples Bancorp of North Carolina, Inc.
INDEX
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3 | |
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3 | |
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4 | |
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| 2 |
| Table of Contents |
Item 2.02. Results of Operations and Financial Condition
On October 19, 2026, Peoples Bancorp of North Carolina, Inc. (the “Company”) issued a press release announcing third quarter 2026 earnings results. The press release contains forward-looking statements regarding the Company and includes cautionary language identifying important factors that could cause actual results to differ materially from those anticipated. The press release is furnished as Exhibit 99(a). Consequently, it is not deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Such materials may only be incorporated by reference into another filing under the Exchange Act or the Securities Act of 1933 if such subsequent filing specifically references this Form 8-K.
Item 9.01. Financial Statements and Exhibits
| (d) |
| Exhibits |
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| Press Release dated October 19, 2026 |
Disclosure about forward-looking statements
Statements made in this Form 8-K, other than those concerning historical information, should be considered forward-looking statements pursuant to the safe harbor provisions of the Securities Exchange Act of 1934 and the Private Securities Litigation Act of 1995. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management and on the information available to management at the time that this report was prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate,” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, changes in interest rate environment, management’s business strategy, national, regional, and local market conditions and legislative and regulatory conditions.
The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances. Readers should also carefully review the risk factors described in other documents the Company files from time to time with the Securities and Exchange Commission.
| 3 |
| Table of Contents |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| PEOPLES BANCORP OF NORTH CAROLINA, INC. | ||
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Date: October 19, 2026 | By: | /s/ Jeffrey N. Hooper | |
| Jeffrey N. Hooper | ||
| Executive Vice President and Chief Financial Officer | ||
| 4 |
EXHIBIT (99)(a)
EARNINGS RELEASE
October 19, 2026
| Contact: | William D. Cable, Sr. |
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| President and Chief Executive Officer |
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| Jeffrey N. Hooper |
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| Executive Vice President and Chief Financial Officer |
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| 828-464-5620 |
For Immediate Release
PEOPLES BANCORP ANNOUNCES THIRD QUARTER 2026 RESULTS
Peoples Bancorp of North Carolina, Inc. (NASDAQ: PEBK) (the “Company”), the parent company of Peoples Bank (the “Bank”), reported third quarter 2026 results with highlights as follows:
Third quarter 2026 highlights:
|
| · | Net earnings were $5.7 million or $1.08 per share and $1.05 per diluted share for the three months ended September 30, 2026, as compared to $3.7 million or $0.70 per share and $0.67 per diluted share for the same period one year ago. |
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| · | Net interest margin was 3.85% for the three months ended September 30, 2026, compared to 3.58% for the three months ended September 30, 2025. |
Year-to-date highlights:
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| · | Net earnings were $15.4 million or $2.89 per share and $2.81 per diluted share for the nine months ended September 30, 2026, compared to $13.2 million or $2.49 per share and $2.41 per diluted share for the same period one year ago. |
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| · | Cash dividends were $0.80 per share for the nine months ended September 30, 2026, compared to $0.76 per share for the prior year period. |
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| · | Total loans were $1.30 billion at September 30, 2026, compared to $1.20 billion at December 31, 2025. |
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| · | Non-performing assets were $4.3 million or 0.25% of total assets at September 30, 2026, compared to $4.2 million or 0.25% of total assets at December 31, 2025. |
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| · | Total deposits were $1.57 billion at September 30, 2026, compared to $1.51 billion at December 31, 2025. |
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| · | Core deposits, a non-GAAP measure, were $1.44 billion or 91.90% of total deposits at September 30, 2026, compared to $1.35 billion or 89.44% of total deposits at December 31, 2025. |
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| · | Net interest margin was 3.78% for the nine months ended September 30, 2026, compared to 3.55% for the nine months ended September 30, 2025. |
Net earnings were $5.7 million or $1.08 per share and $1.05 per diluted share for the three months ended September 30, 2026, as compared to $3.7 million or $0.70 per share and $0.67 per diluted share for the same period one year ago. William D. Cable, Sr., President and Chief Executive Officer, noted third quarter net earnings reflect an increase in net interest income, a decrease in the provision for credit losses and a decrease in non-interest expense which were partially offset by a decrease in non-interest income, compared to the prior year period, as discussed below.
Net interest income was $16.7 million for the three months ended September 30, 2026, compared to $15.1 million for the three months ended September 30, 2025. The increase in net interest income is due to a $938,000 increase in interest income and a $634,000 decrease in interest expense. The increase in interest income is primarily due to a $1.9 million increase in interest income and fees on loans, which was partially offset by a $653,000 decrease in interest income on balances due from banks and a $269,000 decrease in interest income on investment securities. The increase in interest income and fees on loans is primarily due to an increase in total loans. The decrease in interest income on balances due from banks is due to a decrease in average balances outstanding and rate decreases implemented by the Federal Reserve from September 2025 through December 2025. The decrease in interest income on investment securities is due to a reduction in balances outstanding and decreases in yields on variable rate securities. The decrease in interest expense is primarily due to a decrease in rates paid on interest-bearing liabilities resulting from rate decreases implemented by the Federal Reserve from September 2025 through December 2025 and a $12.2 million decrease in time deposits from June 30, 2026 to September 30, 2026. Net interest income after the provision for credit losses was $16.4 million for the three months ended September 30, 2026, compared to $14.6 million for the three months ended September 30, 2025. The provision for credit losses for the three months ended September 30, 2026 was $250,000, compared to $530,000 for the three months ended September 30, 2025.The decrease in the provision for credit losses reflects decreases of $6.8 million in pooled commercial construction loan balances and $14.7 million in pooled non-owner-occupied commercial real estate loan balances during the three months ended September 30, 2026, compared to the three months ended September 30, 2025. Additionally, the decrease in the provision for credit losses includes a $99,000 decrease in net charge-offs during the three months ended September 30, 2026, compared to the three months ended September 30, 2025.
| 2 |
Non-interest income was $6.7 million for the three months ended September 30, 2026, compared to $7.1 million for the three months ended September 30, 2025. The decrease in non-interest income is primarily attributable to a $718,000 decrease in appraisal management fee income due to a decrease in appraisal volume, which was partially offset by a $193,000 increase in miscellaneous non-interest income primarily due to an increase in deferred compensation income associated with an increase in valuations for the assets in the deferred compensation plan.
Non-interest expense was $15.8 million for the three months ended September 30, 2026, compared to $16.9 million for the three months ended September 30, 2025. The decrease in non-interest expense is primarily attributable to a $791,000 decrease in professional fees primarily due to a decrease in legal fees, a $311,000 decrease in debit card expense and a $545,000 decrease in appraisal management fee expense due to a decrease in appraisal volume. These decreases in non-interest expense were partially offset by a $164,000 increase in occupancy expense primarily due to an increase in furniture and equipment maintenance/service contract expenses and a $261,000 increase in miscellaneous non-interest expense primarily due to an increase in deferred compensation expense associated with an increase in valuations for the assets in the deferred compensation plan and increases in various other expenses.
Net earnings were $15.4 million or $2.89 per share and $2.81 per diluted share for the nine months ended September 30, 2026, compared to $13.2 million or $2.49 per share and $2.41 per diluted share for the same period one year ago. The increase in year-to-date net earnings is primarily attributable to an increase in net interest income and a decrease in non-interest expense, which were partially offset by an increase in the provision for credit losses and a decrease in non-interest income, compared to the prior year period, as discussed below.
Net interest income was $47.8 million for the nine months ended September 30, 2026, compared to $43.7 million for the nine months ended September 30, 2025. The increase in net interest income is due to a $2.7 million increase in interest income and a $1.5 million decrease in interest expense. The increase in interest income is primarily due to a $4.9 million increase in interest income and fees on loans, which was partially offset by a $1.3 million decrease in interest income on balances due from banks and a $942,000 decrease in interest income on investment securities. The increase in interest income and fees on loans is primarily due to an increase in total loans. The decrease in interest income on balances due from banks is due to a decrease in average balances outstanding and rate decreases implemented by the Federal Reserve from September 2025 through December 2025. The decrease in interest income on investment securities is due to a reduction in balances outstanding and decreases in yields on variable rate securities. The decrease in interest expense is primarily due to a decrease in rates paid on interest-bearing liabilities resulting from rate decreases implemented by the Federal Reserve from September 2025 through December 2025 and a $58.7 million decrease in time deposits from December 31, 2025 to September 30, 2026. Net interest income after the provision for credit losses was $46.7 million for the nine months ended September 30, 2026, compared to $43.1 million for the nine months ended September 30, 2025. The provision for credit losses for the nine months ended September 30, 2026 was $1.1 million, compared to $585,000 for the nine months ended September 30, 2025. The increase in the provision for credit losses reflects continued growth in total loans, which increased $98.6 million during the nine months ended September 30, 2026, compared to an increase of $45.0 million during the nine months ended September 30, 2025.
Non-interest income was $20.3 million for the nine months ended September 30, 2026, compared to $21.3 million for the nine months ended September 30, 2025. The decrease in non-interest income is primarily attributable to a $2.1 million decrease in appraisal management fee income due to a decrease in appraisal volume, which was partially offset by a $181,000 increase in mortgage banking income due to an increase in secondary mortgage market activity and a $685,000 increase in miscellaneous non-interest income primarily due to an increase in deferred compensation income associated with an increase in valuations for the assets in the deferred compensation plan and an increase in income on Small Business Investment Company (SBIC) investments.
Non-interest expense was $47.2 million for the nine months ended September 30, 2026, compared to $47.3 million for the nine months ended September 30, 2025. The decrease in non-interest expense is primarily attributable to a $1.6 million decrease in appraisal management fee expense due to a decrease in appraisal volume and a $612,000 decrease in professional fees primarily due to a decrease in legal fees. These decreases in non-interest expense were partially offset by a $422,000 increase in salaries and employee benefits expense primarily due to increases in salary and restricted stock expenses, a $925,000 increase in occupancy expense primarily due to an increase in furniture and equipment maintenance/service contract expenses, a $120,000 increase in debit card expense and a $554,000 increase in miscellaneous non-interest expense primarily due to an increase in deferred compensation expense associated with an increase in valuations for the assets in the deferred compensation plan.
| 3 |
Income tax expense was $1.6 million for the three months ended September 30, 2026, compared to $1.1 million for the three months ended September 30, 2025. The effective tax rate was 22.25% for the three months ended September 30, 2026, compared to 22.95% for the three months ended September 30, 2025. Income tax expense was $4.4 million for the nine months ended September 30, 2026, compared to $3.9 million for the nine months ended September 30, 2025. The effective tax rate was 22.21% for the nine months ended September 30, 2026, compared to 22.77% for the nine months ended September 30, 2025. The decrease in the effective tax rate is primarily due to the North Carolina corporate income tax rate decreasing from 2.25% to 2.00% effective January 1, 2026 and the revaluation of the deferred tax asset due to further upcoming reductions in the North Carolina corporate income tax rate.
Total assets were $1.76 billion as of September 30, 2026, compared to $1.70 billion as of December 31, 2025. Available for sale securities were $341.6 million as of September 30, 2026, compared to $377.4 million as of December 31, 2025. Total loans were $1.30 billion as of September 30, 2026, compared to $1.20 billion at December 31, 2025.
Non-performing assets were $4.3 million or 0.25% of total assets at September 30, 2026, compared to $4.2 million or 0.25% of total assets at December 31, 2025. Non-performing assets comprise $3.6 million in residential mortgage loans, $668,000 in commercial mortgage loansand $114,000 in other loans at September 30, 2026, compared to $3.6 million in residential mortgage loans and $533,000 in commercial mortgage loans at December 31, 2025.
The allowance for credit losses on loans was $10.7 million or 0.82% of total loans at September 30, 2026, compared to $10.1 million or 0.84% of total loans at December 31, 2025. The allowance for credit losses on loans increased $572,000 from December 31, 2025 to September 30, 2026 primarily due to a $98.6 million increase in total loans over the same period. The allowance for credit losses on unfunded commitments was $1.7 million at September 30, 2026, compared to $1.4 million at December 31, 2025. The increase in the allowance for credit losses on unfunded commitments was due to a $21.3 million increase in unfunded loan commitments from December 31, 2025 to September 30, 2026. The allowance for credit losses on unfunded commitments is included in other liabilities on the Company’s consolidated balance sheets. Management believes the current level of the allowance for credit losses is adequate; however, there is no guarantee that additional adjustments to the allowance will not be required because of changes in economic conditions, regulatory requirements or other factors.
Deposits were $1.57 billion as of September 30, 2026, compared to $1.51 billion as of December 31, 2025. Core deposits, a non-GAAP measure, which include noninterest-bearing demand deposits, NOW, MMDA, savings and non-brokered certificates of deposit of denominations of less than $250,000, were $1.44 billion at September 30, 2026, compared to $1.35 billion at December 31, 2025. Management believes it is useful to calculate and present core deposits because of the positive impact this low cost funding source provides to the Bank’s overall cost of funds and profitability. Certificates of deposit in amounts of $250,000 or more totaled $126.9 million at September 30, 2026, compared to $160.4 million at December 31, 2025.
Junior subordinated debentures were $15.5 million at September 30, 2026 and December 31, 2025. Shareholders’ equity was $157.7 million, or 8.95% of total assets, at September 30, 2026, compared to $157.1 million, or 9.23% of total assets, at December 31, 2025. The decrease in the equity-to-assets ratio is primarily due to an increase in the unrealized loss on investment securities available for sale due to rate changes between December 31, 2025 and September 30, 2026.
Peoples Bank operates 15 banking offices in North Carolina, with offices in Catawba, Alexander, Lincoln, Mecklenburg and Iredell Counties. The Bank also operates loan production offices in Lincoln, Mecklenburg, Rowan and Forsyth Counties. The Company’s common stock is publicly traded and is listed on the Nasdaq Global Market under the symbol “PEBK.”
Statements made in this earnings release, other than those concerning historical information, should be considered forward-looking statements pursuant to the safe harbor provisions of the Securities Exchange Act of 1934 and the Private Securities Litigation Act of 1995. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management and on the information available to management at the time that this release was prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate,” and “believe,” variations of these words and other similar expressions. Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, (1) competition in the markets served by the Bank, (2) changes in the interest rate environment, (3) general national, regional or local economic conditions may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and the possible impairment of collectibility of loans, (4) legislative or regulatory changes, including changes in accounting standards, (5) significant changes in the federal and state legal and regulatory environment and tax laws, (6) the impact of changes in monetary and fiscal policies, laws, rules and regulations and (7) other risks and factors identified in the Company’s other filings with the Securities and Exchange Commission, including but not limited to those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
| 4 |
| CONSOLIDATED BALANCE SHEETS |
| September 30, 2026, December 31, 2025 and September 30, 2025 |
| (Dollars in thousands) |
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| September 30, 2026 |
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| December 31, 2025 |
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| September 30, 2025 |
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| (Unaudited) |
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| (Audited) |
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| (Unaudited) |
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| ASSETS: |
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| Cash and due from banks |
| $ | 26,194 |
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| $ | 27,721 |
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| $ | 28,714 |
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| Interest-bearing deposits |
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| 30,956 |
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|
| 30,384 |
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| 88,302 |
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| Cash and cash equivalents |
|
| 57,150 |
|
|
| 58,105 |
|
|
| 117,016 |
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| Investment securities available for sale |
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| 341,558 |
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| 377,363 |
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| 376,868 |
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| Other investments |
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| 2,551 |
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|
| 2,595 |
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|
| 2,621 |
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| Total securities |
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| 344,109 |
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| 379,958 |
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| 379,489 |
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| Mortgage loans held for sale |
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| 733 |
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| 1,136 |
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|
| 1,390 |
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| Loans |
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| 1,302,938 |
|
|
| 1,204,388 |
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| 1,183,442 |
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| Less: Allowance for credit losses on loans |
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| (10,698 | ) |
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| (10,126 | ) |
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| (10,206 | ) |
| Net loans |
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| 1,292,240 |
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| 1,194,262 |
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| 1,173,236 |
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| Premises and equipment, net |
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| 13,955 |
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| 14,162 |
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| 14,417 |
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| Cash surrender value of life insurance |
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| 18,233 |
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| 17,837 |
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| 17,710 |
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| Right of use lease asset |
|
| 2,976 |
|
|
| 3,477 |
|
|
| 3,663 |
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| Accrued interest receivable and other assets |
|
| 32,794 |
|
|
| 33,211 |
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|
| 31,415 |
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| Total assets |
| $ | 1,762,190 |
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| $ | 1,702,148 |
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| $ | 1,738,336 |
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| LIABILITIES AND SHAREHOLDERS' EQUITY: |
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| Deposits: |
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| Noninterest-bearing demand |
| $ | 401,807 |
|
| $ | 394,563 |
|
| $ | 410,802 |
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| Interest-bearing demand, MMDA & savings |
|
| 870,953 |
|
|
| 760,883 |
|
|
| 779,939 |
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| Time, $250,000 and over |
|
| 126,943 |
|
|
| 160,389 |
|
|
| 160,704 |
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| Other time |
|
| 168,112 |
|
|
| 193,390 |
|
|
| 201,445 |
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| Total deposits |
|
| 1,567,815 |
|
|
| 1,509,225 |
|
|
| 1,552,890 |
|
|
|
|
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| Junior subordinated debentures |
|
| 15,464 |
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|
| 15,464 |
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|
| 15,464 |
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| Lease liability |
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| 3,122 |
|
|
| 3,615 |
|
|
| 3,796 |
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| Accrued interest payable and other liabilities |
|
| 18,133 |
|
|
| 16,726 |
|
|
| 16,719 |
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| Total liabilities |
|
| 1,604,534 |
|
|
| 1,545,030 |
|
|
| 1,588,869 |
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|
|
|
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| Shareholders' equity: |
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| Preferred stock, no par value; authorized 5,000,000 shares; no shares issued and outstanding |
|
| - |
|
|
| - |
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|
| - |
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| Common stock, no par value; authorized 20,000,000 shares; issued and outstanding 5,461,490 shares at 9/30/26, 5,459,441 shares at 12/31/25, 5,459,441 shares at 9/30/25 |
|
| 48,782 |
|
|
| 48,708 |
|
|
| 48,708 |
|
| Common stock held by deferred compensation trust, at cost; 140,655 shares at 9/30/26, 150,288 shares at 12/31/25, 150,423 shares at 9/30/25 |
|
| (1,101 | ) |
|
| (1,510 | ) |
|
| (1,523 | ) |
| Deferred compensation |
|
| 1,101 |
|
|
| 1,510 |
|
|
| 1,523 |
|
| Retained earnings |
|
| 146,635 |
|
|
| 135,645 |
|
|
| 130,105 |
|
| Accumulated other comprehensive loss |
|
| (37,761 | ) |
|
| (27,235 | ) |
|
| (29,346 | ) |
| Total shareholders' equity |
|
| 157,656 |
|
|
| 157,118 |
|
|
| 149,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| Total liabilities and shareholders' equity |
| $ | 1,762,190 |
|
| $ | 1,702,148 |
|
| $ | 1,738,336 |
|
| 5 |
| CONSOLIDATED STATEMENTS OF INCOME |
| For the three and nine months ended September 30, 2026 and 2025 |
| (Dollars in thousands, except per share amounts) |
|
|
| Three months ended |
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| Nine months ended |
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| September 30, |
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| September 30, |
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| 2026 |
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| 2025 |
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| 2026 |
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| 2025 |
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|
| (Unaudited) |
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| (Unaudited) |
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| (Unaudited) |
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| (Unaudited) |
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| INTEREST INCOME: |
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| Interest and fees on loans |
| $ | 19,034 |
|
| $ | 17,174 |
|
| $ | 54,703 |
|
| $ | 49,838 |
|
| Interest on due from banks |
|
| 356 |
|
|
| 1,009 |
|
|
| 792 |
|
|
| 2,065 |
|
| Interest on investment securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. Government sponsored enterprises |
|
| 1,903 |
|
|
| 1,990 |
|
|
| 5,772 |
|
|
| 6,338 |
|
| State and political subdivisions |
|
| 694 |
|
|
| 694 |
|
|
| 2,081 |
|
|
| 2,082 |
|
| Other |
|
| 356 |
|
|
| 538 |
|
|
| 1,397 |
|
|
| 1,772 |
|
| Total interest income |
|
| 22,343 |
|
|
| 21,405 |
|
|
| 64,745 |
|
|
| 62,095 |
|
|
|
|
|
|
|
|
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| INTEREST EXPENSE: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest-bearing demand, MMDA & savings deposits |
|
| 3,276 |
|
|
| 2,868 |
|
|
| 9,221 |
|
|
| 8,249 |
|
| Time deposits |
|
| 2,155 |
|
|
| 3,174 |
|
|
| 7,107 |
|
|
| 9,459 |
|
| Junior subordinated debentures |
|
| 221 |
|
|
| 244 |
|
|
| 655 |
|
|
| 727 |
|
| Total interest expense |
|
| 5,652 |
|
|
| 6,286 |
|
|
| 16,983 |
|
|
| 18,435 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NET INTEREST INCOME |
|
| 16,691 |
|
|
| 15,119 |
|
|
| 47,762 |
|
|
| 43,660 |
|
| PROVISION FOR CREDIT LOSSES |
|
| 250 |
|
|
| 530 |
|
|
| 1,103 |
|
|
| 585 |
|
| NET INTEREST INCOME AFTER |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| PROVISION FOR CREDIT LOSSES |
|
| 16,441 |
|
|
| 14,589 |
|
|
| 46,659 |
|
|
| 43,075 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NON-INTEREST INCOME: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Service charges |
|
| 1,481 |
|
|
| 1,404 |
|
|
| 4,265 |
|
|
| 4,188 |
|
| Other service charges and fees |
|
| 178 |
|
|
| 184 |
|
|
| 528 |
|
|
| 526 |
|
| Gain/(loss) on sale of securities |
|
| - |
|
|
| - |
|
|
| - |
|
|
| (4 | ) |
| Mortgage banking income |
|
| 114 |
|
|
| 149 |
|
|
| 398 |
|
|
| 217 |
|
| Insurance and brokerage commissions |
|
| 301 |
|
|
| 250 |
|
|
| 818 |
|
|
| 745 |
|
| Appraisal management fee income |
|
| 2,883 |
|
|
| 3,601 |
|
|
| 8,547 |
|
|
| 10,616 |
|
| Miscellaneous |
|
| 1,732 |
|
|
| 1,539 |
|
|
| 5,746 |
|
|
| 5,061 |
|
| Total non-interest income |
|
| 6,689 |
|
|
| 7,127 |
|
|
| 20,302 |
|
|
| 21,349 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NON-INTEREST EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Salaries and employee benefits |
|
| 7,099 |
|
|
| 7,094 |
|
|
| 21,472 |
|
|
| 21,050 |
|
| Occupancy |
|
| 2,442 |
|
|
| 2,278 |
|
|
| 7,289 |
|
|
| 6,364 |
|
| Professional fees |
|
| 604 |
|
|
| 1,395 |
|
|
| 1,849 |
|
|
| 2,461 |
|
| Advertising |
|
| 317 |
|
|
| 266 |
|
|
| 807 |
|
|
| 764 |
|
| Debit card expense |
|
| 494 |
|
|
| 805 |
|
|
| 1,388 |
|
|
| 1,268 |
|
| FDIC insurance |
|
| 202 |
|
|
| 196 |
|
|
| 593 |
|
|
| 578 |
|
| Appraisal management fee expense |
|
| 2,313 |
|
|
| 2,858 |
|
|
| 6,846 |
|
|
| 8,433 |
|
| Miscellaneous |
|
| 2,293 |
|
|
| 2,032 |
|
|
| 6,973 |
|
|
| 6,419 |
|
| Total non-interest expense |
|
| 15,764 |
|
|
| 16,924 |
|
|
| 47,217 |
|
|
| 47,337 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| EARNINGS BEFORE INCOME TAXES |
|
| 7,366 |
|
|
| 4,792 |
|
|
| 19,744 |
|
|
| 17,087 |
|
| INCOME TAXES |
|
| 1,639 |
|
|
| 1,100 |
|
|
| 4,385 |
|
|
| 3,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NET EARNINGS |
| $ | 5,727 |
|
| $ | 3,692 |
|
| $ | 15,359 |
|
| $ | 13,197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| PER SHARE AMOUNTS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic net earnings |
| $ | 1.08 |
|
| $ | 0.70 |
|
| $ | 2.89 |
|
| $ | 2.49 |
|
| Diluted net earnings |
| $ | 1.05 |
|
| $ | 0.67 |
|
| $ | 2.81 |
|
| $ | 2.41 |
|
| Cash dividends |
| $ | 0.21 |
|
| $ | 0.20 |
|
| $ | 0.80 |
|
| $ | 0.76 |
|
| Book value |
| $ | 29.63 |
|
| $ | 28.15 |
|
| $ | 29.63 |
|
| $ | 28.15 |
|
| 6 |
| FINANCIAL HIGHLIGHTS |
| For the three and nine months ended September 30, 2026 and 2025, and the year ended December 31, 2025 |
| (Dollars in thousands) |
|
|
| Three months ended |
|
| Nine months ended |
|
| Year ended |
| |||||||||||
|
|
| September 30, |
|
| September 30, |
|
| December 31, |
| |||||||||||
|
|
| 2026 |
|
| 2025 |
|
| 2026 |
|
| 2025 |
|
| 2025 |
| |||||
|
|
| (Unaudited) |
|
| (Unaudited) |
|
| (Unaudited) |
|
| (Unaudited) |
|
| (Audited) |
| |||||
| SELECTED AVERAGE BALANCES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
| Available for sale securities |
| $ | 395,089 |
|
| $ | 411,583 |
|
| $ | 404,472 |
|
| $ | 420,159 |
|
| $ | 418,469 |
|
| Loans |
|
| 1,284,318 |
|
|
| 1,170,760 |
|
|
| 1,253,303 |
|
|
| 1,156,515 |
|
|
| 1,165,212 |
|
| Earning assets |
|
| 1,721,230 |
|
|
| 1,676,108 |
|
|
| 1,690,030 |
|
|
| 1,642,637 |
|
|
| 1,653,293 |
|
| Assets |
|
| 1,764,858 |
|
|
| 1,718,077 |
|
|
| 1,735,746 |
|
|
| 1,683,667 |
|
|
| 1,695,711 |
|
| Deposits |
|
| 1,575,059 |
|
|
| 1,545,829 |
|
|
| 1,548,838 |
|
|
| 1,516,925 |
|
|
| 1,525,479 |
|
| Shareholders' equity |
|
| 159,714 |
|
|
| 142,490 |
|
|
| 163,038 |
|
|
| 140,882 |
|
|
| 148,795 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| SELECTED KEY DATA: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net interest margin (tax equivalent) (1) |
|
| 3.85 | % |
|
| 3.58 | % |
|
| 3.78 | % |
|
| 3.55 | % |
|
| 3.57 | % |
| Return on average assets |
|
| 1.29 | % |
|
| 0.85 | % |
|
| 1.18 | % |
|
| 1.05 | % |
|
| 1.17 | % |
| Return on average shareholders' equity |
|
| 14.23 | % |
|
| 10.28 | % |
|
| 12.60 | % |
|
| 12.52 | % |
|
| 13.33 | % |
| Average shareholders' equity to total average assets |
|
| 9.05 | % |
|
| 8.29 | % |
|
| 9.39 | % |
|
| 8.37 | % |
|
| 8.77 | % |
|
|
| September 30, 2026 |
|
| September 30, 2025 |
|
| December 31, 2025 |
| |||
|
|
| (Unaudited) |
|
| (Unaudited) |
|
| (Audited) |
| |||
|
|
|
|
|
|
|
|
|
|
| |||
| ALLOWANCE FOR CREDIT LOSSES: |
|
|
|
|
|
|
|
|
| |||
| Allowance for credit losses on loans |
| $ | 10,698 |
|
| $ | 10,206 |
|
| $ | 10,126 |
|
| Allowance for credit losses on unfunded commitments |
|
| 1,668 |
|
|
| 1,176 |
|
|
| 1,403 |
|
| Provision for credit losses (2) |
|
| 1,103 |
|
|
| 585 |
|
|
| 938 |
|
| Charge-offs (2) |
|
| (491 | ) |
|
| (533 | ) |
|
| (852 | ) |
| Recoveries (2) |
|
| 225 |
|
|
| 234 |
|
|
| 347 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ASSET QUALITY: |
|
|
|
|
|
|
|
|
|
|
|
|
| Non-accrual loans |
| $ | 4,347 |
|
| $ | 5,113 |
|
| $ | 4,176 |
|
| 90 days past due and still accruing |
|
| - |
|
|
| - |
|
|
| - |
|
| Other real estate owned |
|
| - |
|
|
| - |
|
|
| - |
|
| Total non-performing assets |
| $ | 4,347 |
|
| $ | 5,113 |
|
| $ | 4,176 |
|
| Non-performing assets to total assets |
|
| 0.25 | % |
|
| 0.29 | % |
|
| 0.25 | % |
| Allowance for credit losses on loans to non-performing assets |
|
| 246.10 | % |
|
| 199.61 | % |
|
| 242.48 | % |
| Allowance for credit losses on loans to total loans |
|
| 0.82 | % |
|
| 0.86 | % |
|
| 0.84 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| LOAN RISK GRADE ANALYSIS: |
|
|
|
|
|
|
|
|
|
|
|
|
| Percentage of loans by risk grade |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Risk Grade 1 (excellent quality) |
|
| 0.15 | % |
|
| 0.30 | % |
|
| 0.24 | % |
| Risk Grade 2 (high quality) |
|
| 20.22 | % |
|
| 20.24 | % |
|
| 19.42 | % |
| Risk Grade 3 (good quality) |
|
| 73.77 | % |
|
| 71.60 | % |
|
| 72.92 | % |
| Risk Grade 4 (management attention) |
|
| 5.25 | % |
|
| 6.94 | % |
|
| 6.71 | % |
| Risk Grade 5 (watch) |
|
| 0.23 | % |
|
| 0.41 | % |
|
| 0.30 | % |
| Risk Grade 6 (substandard) |
|
| 0.38 | % |
|
| 0.51 | % |
|
| 0.41 | % |
| Risk Grade 7 (doubtful) |
|
| 0.00 | % |
|
| 0.00 | % |
|
| 0.00 | % |
| Risk Grade 8 (loss) |
|
| 0.00 | % |
|
| 0.00 | % |
|
| 0.00 | % |
At September 30, 2026, including non-accrual loans, there were no relationships exceeding $1.0 million in either the Watch or Substandard risk grade. At September 30, 2025, including non-accrual loans, there was one relationship exceeding $1.0 million in the Watch risk grade, which totaled $1.4 million; there were no relationships exceeding $1.0 million in the Substandard risk grade. At December 31, 2025, including non-accrual loans, there were no relationships exceeding $1.0 million in either the Watch or Substandard risk grade.
(1) This amount reflects the tax benefit that the Company receives related to its tax-exempt loans and securities, which carry interest rates lower than similar taxable investments due to their tax-exempt status. This amount has been computed using an effective tax rate of 22.58% and is reduced by the related nondeductible portion of interest expense.
(2) For the nine months ended September 30, 2026 and 2025, and the year ended December 31, 2025.
| 7 |