FIRST BANCORP /NC/
For the period ended Sep 30, 2026. Filed Nov 2, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 2, 2026
FBNC$64.60-0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0000811589-26-000153
Item 2. – Management’s Discussion and Analysis of Consolidated Results of Operations and Financial ConditionCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-02.
0000811589-26-000164
Item 2. – Management’s Discussion and Analysis of Consolidated Results of Operations and Financial ConditionThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 138 previous paragraphs and 142 current paragraphs.
63 unchanged; 64 reworded; 14 added; 8 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
Acquisitions
Current report
On July 14, 2026, the Company announced an agreement to acquire First Carolina Bancshares Corporation
Current report
("First Carolina"), the parent company of Carolina Bank & Trust Company ("Carolina Bank"), headquartered in Florence, South Carolina, for approximately $166.0 million calculated on First Bancorp's stock price of $64.22 as of July 13, 2026, comprised of approximately 75% stock and 25% cash. The acquisition, which is subject to customary closing conditions, including regulatory approvals and approval by First Carolina's shareholders, is expected to close by the first quarter of 2027. The consideration payable to First Carolina shareholders consists of 1,967,017 shares of First Bancorp common stock and $40.0 million in cash.
Current report
Carolina Bank currently operates 14 banking locations in South Carolina. First Carolina reported assets of $820 million, gross loans of $589 million and deposits of $702 million as of September 30, 2026. The acquisition would increase the Company's market share in the Pee Dee Region of South Carolina.
Current report
Adjusting for the impact of the $27.9 million loss related to the loss-earnback transaction, our adjusted net income was $116.8 million, or $2.82 per diluted share, for the nine months ended September 30, 2025.
Current report
•For the nine months ended September 30, 2026, the Company recorded $5.6 million in provision for credit losses as compared to $6.8 million for the like period.
Current report
The following table reconciles net income and diluted EPS to adjusted net income and adjusted diluted EPS for the three and nine months ended September 30, 2026 and September 30, 2025:
Current report
•AFS securities decreased $62.5 million, or 3.1%, during the nine months ended September 30, 2026.
Current report
Net Interest Income for the Nine Months Ended September 30, 2026
Current report
Total noninterest income for the three months ended September 30, 2026 was $15.1 million, a $28.1 million increase from the negative $13.0 million recorded for the three months ended September 30, 2025. The change is primarily attributable to the $27.9 million securities loss due to the securities loss-earnback transaction during the third quarter of 2025.
Current report
For the nine months ended September 30, 2026 and 2025, total noninterest income was $46.3 million and $14.3 million, respectively. For the year to date periods, the $27.9 million securities loss due to the securities loss-earnback transaction during the third quarter of 2025 accounts for a majority of the change.
Current report
Total investment securities were $2.5 billion at September 30, 2026, a decrease of $67.5 million from December 31, 2025, mainly attributable to paydowns and increased unrealized losses on the AFS securities portfolio, partially offset by purchases of AFS securities. The composition of our investment portfolio saw an increase of $142.6 million in AFS US Treasury securities and a $204.5 million decrease in AFS Mortgage-back securities from December 31, 2025 to September 30, 2026.
Current report
In the third quarter of 2024, the Company identified borrowers who were potentially impacted by Hurricane Helene and recorded $13.0 million of additional ACL at that time. Throughout 2025 and 2026, the Company continued to periodically evaluate the identified loan portfolio and adjusted risk ratings, nonaccrual status and reserve levels, as applicable. During the third quarter of 2026, the remaining incremental reserve of $1.9 million was removed.
Removed paragraphs (8)
Previous report
•For the six months ended June 30, 2026, the Company recorded $4.3 million in provision for credit losses as compared to $3.3 million for the like period. The lower provision in the like period was significantly impacted by the $5.5 million release of provision related to Hurricane Helene (the release represented a benefit of $4.2 million after-taxes or $0.10 per diluted share). The provision for credit losses in 2026 was impacted by loan growth in 2026 and net charge off activity of $2.4 million.
Previous report
•AFS securities decreased $109.5 million, or 5.3%, during the six months ended June 30, 2026.
Previous report
Net Interest Income for the Six Months Ended June 30, 2026
Previous report
Total noninterest income for the three months ended June 30, 2026 was $16.0 million, a 12.2% increase from the $14.3 million recorded for the three months ended June 30, 2025. As compared to the second quarter of 2025, Other Income, net increased $1.0 million and Other service charges, commissions and fees decreased $0.6 million.
Previous report
For the six months ended June 30, 2026 and 2025, total noninterest income was $31.2 million and $27.2 million, respectively. For the year to date periods, a $1.7 million increase in Other income, net coupled with a $1.2 million increase in SBA loan sale gains account for a majority of the change.
Previous report
Total investment securities were $2.4 billion at June 30, 2026, a decrease of $112.9 million from December 31, 2025, as we did not reinvest all proceeds from prepayments and maturities. The composition of our investment portfolio remained substantially the same at June 30, 2026 as at December 31, 2025.
Previous report
In the portions of Western North and South Carolina that were significantly impacted by Hurricane Helene in third quarter of 2024, the Company identified borrowers who were potentially impacted. For December 31, 2025 and June 30, 2026, no incremental reserves were maintained on the commercial loan portfolio as those relationships had been reviewed, risk ratings adjusted and nonaccrual status updated. Therefore, for those relationships, the normal reserving process was applied. For the potentially impacted consumer loans, the Company applied increased reserve rates based upon severe economic factors to the approximately $253 million of loans (primarily Residential 1-4 family real estate) in the most impacted path of Hurricane Helene. This compares to consumer loans totaling $268 million at December 31, 2025. Due to the potential exposure from Hurricane Helene, the ACL on these impacted consumer loans was $1.9 million as of June 30, 2026 and December 31, 2025, adding 2 basis points to the overall ACL as a percent of total loans at both period ends.
Previous report
The following table discloses shares of our common stock repurchased during the three months ended June 30, 2026.
Reworded paragraphs (64)
Previous wording
Highlights of the results for the second quarter and year to date period of 2026 are presented below. Refer also to additional discussion in the "Results of Operations" and "Financial Condition" sections following.
Current wording
Highlights of the results for the third quarter and year to date period of 2026 are presented below. Refer also to additional discussion in the "Results of Operations" and "Financial Condition" sections following.
Previous wording
We earned net income of $50.5 million, or $1.22 diluted EPS, during the second quarter of 2026 compared to net income of $38.6 million, or $0.93 diluted EPS, for the second quarter of 2025 (the "like quarter"). Our increased earnings was driven by a $14.6 million increase in net interest income over the like quarter, resulting primarily from a combination of higher yield on interest earning assets and a lower cost of funds, both of which were driven by the overall interest rate environment throughout the past year.
Current wording
We earned net income of $51.3 million, or $1.24 diluted EPS, during the third quarter of 2026 compared to net income of $20.4 million, or $0.49 diluted EPS, for the third quarter of 2025 (the "like quarter"). Our increased earnings was driven by a $12.3 million increase in net interest income over the like quarter, resulting primarily from a combination of higher yield on interest earning assets and a lower cost of funds, both of which were driven by the overall interest rate environment throughout the past year. Adjusting for the impact of the $27.9 million loss related to a securities loss-earnback transaction in the like quarter, our adjusted net income, which is a non-GAAP financial measure, was $41.8 million, or $1.01 per diluted share, for the third quarter of 2025.
Previous wording
•Net interest income for the second quarter of 2026 was $111.3 million, a 15.1% increase from the $96.7 million recorded in the like quarter. There was a shift in the mix of interest-earning assets between periods, with average loans growing $708.9 million, while average taxable securities contracted $313.3 million and short-term investments contracted $61.1 million.
Current wording
•Net interest income for the third quarter of 2026 was $114.8 million, a 12.0% increase from the $102.5 million recorded in the like quarter. There was a shift in the mix of interest-earning assets between periods, with average loans growing $751.5 million, while average taxable securities contracted $173.5 million and short-term investments contracted $190.1 million.
Previous wording
•Net interest margin ("NIM") increased 39 basis points to 3.71% in the second quarter of 2026 from 3.32% in the like quarter as a result of the higher average balance of loans, improved yields on securities and lower cost of funds, notably money market deposits.
Current wording
•Net interest margin ("NIM") increased 29 basis points to 3.75% in the third quarter of 2026 from 3.46% in the like quarter as a result of the higher average balance of loans, improved yields on securities and lower cost of funds, notably money market deposits.
Previous wording
•We remained well-capitalized by all regulatory standards. Risk-based capital ratios contracted slightly during the quarter with a total common equity Tier 1 ratio of 14.09%, Tier 1 risk-based capital ratio of 14.81% and total risk-based capital ratio of 16.06% at June 30, 2026, all down from June 30, 2025.
Current wording
•We remained well-capitalized by all regulatory standards. Risk-based capital ratios expanded during the quarter with a total common equity Tier 1 ratio of 14.26%, Tier 1 risk-based capital ratio of 14.97% and total risk-based capital ratio of 16.22% at September 30, 2026, all down from September 30, 2025.
Previous wording
•The provision for credit losses for the second quarter of 2026 was $1.2 million, compared to $1.0 million of net charge-offs.
Current wording
•The provision for credit losses for the third quarter of 2026 was $1.3 million, compared to $2.1 million of net charge-offs.
Previous wording
•Noninterest income for the quarter ended June 30, 2026 totaled $16.0 million, reflecting an increase from the $14.3 million for the like quarter, primarily from a $1.0 million increase in Other income, net.
Current wording
•Noninterest income for the quarter ended September 30, 2026 totaled $15.1 million, reflecting an increase from the negative $13.0 million for the like quarter, primarily from the $27.9 million loss on the securities loss-earnback transaction in the like quarter.
Previous wording
•Noninterest expense of $62.8 million increased $3.8 million, or 6.5%, from the like quarter. The increase is attributable to a $3.3 million increase in Total personnel expenses and a $1.0 million increase in Other operating expenses.
Current wording
•Noninterest expense of $64.0 million increased $3.8 million, or 6.3%, from the like quarter. The increase is attributable to a $2.6 million increase in Total personnel expense, a $0.9 million increase in Other operating expenses and the $0.5 million of Merger and acquisition expenses related to the Carolina Bank acquisition recognized in the third quarter of 2026.
Previous wording
Overview and Highlights for the Six Months Ended June 30, 2026
Current wording
Overview and Highlights for the Nine Months Ended September 30, 2026
Previous wording
We earned net income of $97.2 million, or $2.35 diluted EPS, during the six months ended June 30, 2026 compared to net income of $75.0 million, or $1.81 diluted EPS, for the six months ended June 30, 2025 (the "like period"). Net interest income increased $28.9 million during the six months ended June 30, 2026 as compared to the like period, driving our increased earnings. This was primarily the result of higher yields on interest earning assets and a lower cost of funds, both of which were driven by this past year's overall interest rate environment.
Current wording
We earned net income of $148.5 million, or $3.59 diluted EPS, during the nine months ended September 30, 2026 compared to net income of $95.3 million, or $2.30 diluted EPS, for the nine months ended September 30, 2025 (the "like period"). Net interest income increased $41.1 million during the nine months ended September 30, 2026 as compared to the like period, driving our increased earnings. This was primarily the result of higher yields on interest earning assets and a lower cost of funds, both of which were driven by this past year's overall interest rate environment.
Previous wording
•Net interest income for the six months ended June 30, 2026 was $218.4 million, a 15.2% increase from the $189.5 million recorded for the like period. The increase in net interest income was driven by higher yields on interest earning assets and lower cost of funds.
Current wording
•Net interest income for the nine months ended September 30, 2026 was $333.2 million, a 14.1% increase from the $292.0 million recorded for the like period. The increase in net interest income was driven by higher yields on interest earning assets and lower cost of funds.
Previous wording
•NIM increased 41 basis points to 3.69% for the six months ended June 30, 2026 from 3.28% for the like period as a result of the higher average balances on loans, yields on loans and securities and lower cost of funds, particularly money market deposits.
Current wording
•NIM increased 37 basis points to 3.71% for the nine months ended September 30, 2026 from 3.34% for the like period as a result of the higher average balances on loans, yields on loans and securities and lower cost of funds, particularly money market deposits.
Previous wording
•Noninterest income for the six months ended June 30, 2026 totaled $31.2 million, an increase of $4.0 million, from the like period primarily related to the $1.7 million increase in Other income, net and the $1.2 million increase in SBA loan sale gains.
Current wording
•Noninterest income for the nine months ended September 30, 2026 totaled $46.3 million, an increase of $32.0 million, from the like period primarily related to the $27.9 million loss from the securities loss-earnback transaction in the like period.
Previous wording
•Noninterest expense increased $6.1 million to $123.0 million for the six months ended June 30, 2026 as compared to the like period, primarily driven by a $5.0 million increase in Personnel expenses and a $1.7 million increase in Other operating expenses.
Current wording
•Noninterest expense increased $10.0 million to $187.0 million for the nine months ended September 30, 2026 as compared to the like period, primarily driven by a $7.7 million increase in Total personnel expense and a $2.6 million increase in Other operating expenses.
Previous wording
Total assets were $13.0 billion at June 30, 2026, a 2.9% increase from December 31, 2025. The increase was driven primarily by deposit growth generating investable funds that were deployed into loans and interest-bearing cash. The primary balance sheet changes are presented below.
Current wording
Total assets were $13.2 billion at September 30, 2026, a 3.8% increase from December 31, 2025. The increase was driven primarily by deposit growth generating investable funds that were deployed into loans and interest-bearing cash. The primary balance sheet changes are presented below.
Previous wording
•Total cash and cash equivalents amounted to $550.3 million at June 30, 2026, representing a $240.7 million increase from December 31, 2025. Interest-bearing cash increased $259.1 million and was partially offset by an $18.3 million decrease in noninterest-bearing cash.
Current wording
•Total cash and cash equivalents amounted to $451.7 million at September 30, 2026, representing a $142.1 million increase from December 31, 2025. Interest-bearing cash increased $157.0 million and was partially offset by an $14.9 million decrease in noninterest-bearing cash.
Previous wording
•Total loans amounted to $9.0 billion at June 30, 2026, reflecting an increase of $266.3 million, or 3.1%, from December 31, 2025.
Current wording
•Total loans amounted to $9.1 billion at September 30, 2026, reflecting an increase of $382.5 million, or 4.4%, from December 31, 2025.
Previous wording
•Total deposits were $11.1 billion at June 30, 2026, an increase of $336.4 million, or 3.13%, from December 31, 2025. Deposit growth during the period arose from both noninterest-bearing deposits, which increased $110.6 million, and interest-bearing deposits, which increased $225.9 million.
Current wording
•Total deposits were $11.1 billion at September 30, 2026, an increase of $377.9 million, or 3.52%, from December 31, 2025. Deposit growth during the period arose from both interest-bearing deposits, which increased $238.4 million and noninterest-bearing deposits, which increased $139.5 million.
Previous wording
•Our on-balance sheet liquidity ratio was 15.7% at June 30, 2026. Available off-balance sheet sources totaled $2.4 billion at quarter end, resulting in a total liquidity ratio of 32.8%.
Current wording
•Our on-balance sheet liquidity ratio was 15.1% at September 30, 2026. Available off-balance sheet sources totaled $3.7 billion at quarter end, resulting in a total liquidity ratio of 38.7%.
Previous wording
Net interest income is our largest source of revenue and is the difference between the interest earned on interest-earning assets (primarily loans and investment securities) and the interest expense incurred in connection with interest-bearing liabilities (deposits and borrowed funds). Changes in the net interest income are the result of changes in volume and the net interest spread which affects NIM. Volume refers to the average dollar levels of interest-earning assets and interest-bearing liabilities. Net interest spread refers to the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. NIM refers to net interest income divided by average interest-earning assets and is influenced by the level and relative mix of interest-earning
Current wording
Net interest income is our largest source of revenue and is the difference between the interest earned on interest-earning assets (primarily loans and investment securities) and the interest expense incurred in connection with interest-bearing liabilities (deposits and borrowed funds). Changes in the net interest income are the result of changes in volume and the net interest spread which affects NIM. Volume refers to the average dollar levels of interest-earning assets and interest-bearing liabilities. Net interest spread refers to the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities. NIM refers to net interest income divided by average interest-earning assets and is influenced by the level and relative mix of interest-earning assets and interest-bearing liabilities. Net interest income is also influenced by external factors such as local economic conditions, competition for loans and deposits, and market interest rates.
Previous wording
Net interest income for the second quarter of 2026 amounted to $111.3 million, an increase of $14.6 million, or 15.1%, from the $96.7 million recorded in the second quarter of 2025. The increase was primarily driven by higher yields on interest-earning assets and lower cost of funds.
Current wording
Net interest income for the third quarter of 2026 amounted to $114.8 million, an increase of $12.3 million, or 12.0%, from the $102.5 million recorded in the third quarter of 2025. The increase was primarily driven by higher yields on interest-earning assets and lower cost of funds.
Previous wording
For the second quarter of 2026, average interest-earning assets increased $330.4 million, or 2.8%, from the comparable period of the prior year, with average loans growing $708.9 million, while average securities and short term investments declined by $317.5 million and $61.1 million respectively.
Current wording
For the third quarter of 2026, average interest-earning assets increased $383.7 million, or 3.3%, from the comparable period of the prior year, with average loans growing $751.5 million, while average securities and short term investments declined by $177.7 million and $190.1 million respectively.
Previous wording
The cost of interest bearing deposits decreased 20 basis points from the second quarter of 2025, with the biggest decrease coming from the cost of Money market deposits, which decreased 33 basis points and the cost of Time deposits > $250,000, which decreased 22 basis points.
Current wording
The cost of interest bearing deposits decreased 17 basis points from the third quarter of 2025, with the biggest decrease coming from the cost of Money market deposits, which decreased 29 basis points and the cost of Time deposits > $250,000, which decreased 23 basis points.
Previous wording
These changes resulted in the 39 basis point improvement in our NIM (see discussion below) from the like quarter to 3.71% for the second quarter of 2026.
Current wording
These changes resulted in the 29 basis point improvement in our NIM (see discussion below) from the like quarter to 3.75% for the third quarter of 2026.
Previous wording
The following table presents an analysis of net interest income for the second quarter of 2026 and 2025:
Current wording
The following table presents an analysis of net interest income for the third quarter of 2026 and 2025:
Previous wording
(1) Average loans include nonaccruing loans, the effect of which is to lower the average rate shown.
Current wording
(1)Average loans include nonaccruing loans, the effect of which is to lower the average rate shown.
Previous wording
(2) Includes accretion of discount on acquired loans of $1.1 million and $1.5 million for three months ended June 30, 2026 and 2025, respectively.
Current wording
(2)Includes accretion of discount on acquired loans of $0.8 million and $1.6 million for three months ended September 30, 2026 and 2025, respectively.
Previous wording
(3) Includes tax-equivalent adjustments to reflect the tax benefit that we receive related to tax-exempt securities and loans as reduced by the related nondeductible portion of interest expense.
Current wording
(3)Includes tax-equivalent adjustments to reflect the tax benefit that we receive related to tax-exempt securities and loans as reduced by the related nondeductible portion of interest expense.
Previous wording
Overall, as demonstrated in the table above, the growth in earning assets, a shift to higher-yielding assets, increased yield on assets and a decrease in the cost of liabilities drove the expansion in NIM and net interest income.
Current wording
Overall, as demonstrated in the table above, the growth in earning assets, a mix shift to higher-yielding assets, increased yields on assets and a decrease in the cost of liabilities drove the expansion in NIM and net interest income.
Previous wording
•Net interest income for the second quarter of 2026 was $111.3 million, an increase of $14.6 million from the like quarter. The increase in net interest income was primarily driven by our focused efforts to increase interest-earning assets, to improve the mix of earning assets and to manage deposit costs after the rate cuts by the Federal Reserve between September and December of 2024, which saw the federal funds rate fall 50 basis points and additional rate cuts totaling 75 basis points in the second half of 2025. We also focused on increasing loan yields as new originations were at higher rates than older loans. Further, securities yields increased as a result of the loss-earnback transactions in the third and fourth quarters of 2025 along with continued paydowns and payoffs on lower-yielding bonds.
Current wording
•Net interest income for the third quarter of 2026 was $114.8 million, an increase of $12.3 million from the like quarter.The increase in net interest income was primarily driven by our focused efforts to increase interest-earning assets, to improve the mix of earning assets and to manage deposit costs after the rate cuts by the Federal Reserve between September and December of 2024, which saw the federal funds rate fall 50 basis points and additional rate cuts totaling 75 basis points in the second half of 2025. During September 2026, the Federal Reserve increased the federal funds rate by 0.25%. We also focused on increasing loan yields as new originations were at higher rates than older loans. Further, securities yields increased primarily as a result of the loss-earnback transactions in the third and fourth quarters of 2025 along with continued paydowns and payoffs on lower-yielding bonds.
Previous wording
•The Company’s NIM for the second quarter of 2026 was 3.71%, an increase of 39 basis points from the like quarter. Within interest-earning assets, the 2025 securities loss-earnback transactions resulted in an increase of 30 basis points on the yield on total securities as compared to the like quarter. In addition, loan yields increased 14 basis points to 5.67%. Following the rate cuts by the Federal Reserve in the second half of 2025, the rate on interest-bearing deposits fell 20 basis points from the like quarter.
Current wording
•The Company’s NIM for the third quarter of 2026 was 3.75%, an increase of 29 basis points from the like quarter. Within interest-earning assets, the yield on total securities increased 21 basis points as compared to the like quarter. In addition, loan yields increased 6 basis points to 5.75%. With the rate cuts by the Federal Reserve in the second half of 2025 were partially offset by the rate increase in September 2026, the rate on interest-bearing deposits fell 17 basis points from the like quarter.
Previous wording
•Average interest-earning assets increased $330.4 million for the three months ended June 30, 2026, including a shift to higher-yielding assets. Average loans for the three months ended June 30, 2026 were $708.9 million higher than the same period in 2025. In addition, interest rates on loans increased 14 basis points to 5.67% for the second quarter of 2026, collectively resulting in an increase of $12.9 million in interest income on loans.
Current wording
•Average interest-earning assets increased $383.7 million for the three months ended September 30, 2026, including a shift to higher-yielding assets. Average loans for the three months ended September 30, 2026 were $751.5 million higher than the same period in 2025. In addition, interest rates on loans increased 6 basis points to 5.75% for the third quarter of 2026, collectively resulting in an increase of $12.2 million in interest income on loans.
Previous wording
•Average securities for the three months ended June 30, 2026 contracted $317.5 million from the like quarter, but the yields on securities increased 0.30% to 2.70% for the second quarter of 2026, resulting in an increase in interest income on securities of $0.1 million.
Current wording
•Average securities for the three months ended September 30, 2026 contracted $177.7 million from the like quarter, but the yields on securities increased 0.21% to 2.76% for the third quarter of 2026, resulting in an increase in interest income on securities of $0.3 million.
Previous wording
•Average short-term investments for the three months ended June 30, 2026 contracted $61.1 million from the same period in 2025 and yields fell 0.64% to 3.99%, resulting in a $1.4 million decrease in interest income on short-term investments.
Current wording
•Average short-term investments for the three months ended September 30, 2026 contracted $190.1 million from the same period in 2025 and yields fell 0.56% to 4.08%, resulting in a $2.8 million decrease in interest income on short-term investments.
Previous wording
•Due to the impact of the aforementioned Federal Reserve rate cuts in 2024 and 2025 and the resulting decreased market rates partially offset by higher average balances, deposit interest expense for the three months ended June 30, 2026 decreased $2.6 million compared to the same period in 2025. Average interest-bearing deposit balances increased $192.7 million while rates on those deposits decreased 20 basis points as compared to the like quarter. The deposit changes were driven primarily by money market deposits as the average balance increased $307.2 million while the rate on those deposits fell 33 basis points, together accounting for $1.7 million of the decrease in interest expense.
Current wording
•Due to the impact of the aforementioned Federal Reserve rate cuts in 2024 and 2025 and the resulting decreased market rates partially offset by the September 2026 rate increase and higher average balances, deposit interest expense for the three months ended September 30, 2026 decreased $2.1 million compared to the same period in 2025. Average interest-bearing deposit balances increased $196.5 million while rates on those deposits decreased 17 basis points as compared to the like quarter. The deposit changes were driven primarily by money market deposits as the average balance increased $290.6 million while the rate on those deposits fell 29 basis points, together accounting for $1.4 million of the decrease in interest expense.
Previous wording
Net interest income for the six months ended June 30, 2026 amounted to $218.4 million, an increase of $28.9 million, or 15.2%, from the $189.5 million recorded in the six months ended June 30, 2025. As described above, the rate cuts by the Federal Reserve in the second half of 2024 and third quarter of 2025 decreased market rates which had resulting impacts on the rates we paid or received in 2024 and 2025. Similar to the impact during the three months ended June 30, 2026, the increase in net interest income for the six months ended June 30, 2026 was also driven by lower cost of funds, and increased yields on interest-earning assets. Our NIM increased to 3.69% for the six months ended June 30, 2026 from 3.28% for the six months ended June 30, 2025.
Current wording
Net interest income for the nine months ended September 30, 2026 amounted to $333.2 million, an increase of $41.1 million, or 14.1%, from the $292.0 million recorded in the nine months ended September 30, 2025. As described above, the rate cuts by the Federal Reserve in the second half of 2024 and third quarter of 2025, partially offset by the September 2026 increase, resulted in a decrease in market rates which had resulting impacts on the rates we paid or received in 2024 and 2025. Similar to the impact during the three months ended September 30, 2026, the increase in net interest income for the nine months ended September 30, 2026 was also driven by lower cost of funds, and increased yields on interest-earning assets. Our NIM increased to 3.71% for the nine months ended September 30, 2026 from 3.34% for the nine months ended September 30, 2025.
Previous wording
The following table presents an analysis of net interest income for the six months ended June 30, 2026 and 2025.
Current wording
The following table presents an analysis of net interest income for the nine months ended September 30, 2026 and 2025.
Previous wording
(2) Includes accretion of discount on acquired loans of $2.1 million and $3.2 million for six months ended June 30, 2026 and 2025, respectively.
Current wording
(2) Includes accretion of discount on acquired loans of $2.9 million and $4.8 million for nine months ended September 30, 2026 and 2025, respectively.
Previous wording
•During the second half of 2025, the Federal Reserve decreased the fed funds rate a total of 75 basis points. The average prime rate was 6.75% for the six months ended June 30, 2026, compared to 7.50% for the prior year period. During 2025 and 2026, the yield curve has been positively sloping beyond three years, although longer term treasury rates are still fairly close to fed funds rates.
Current wording
•During the second half of 2025, the Federal Reserve decreased the fed funds rate a total of 75 basis points. The average prime rate was 6.76% for the nine months ended September 30, 2026, compared to 7.49% for the prior year period. During 2025 and 2026, the yield curve has generally been more positively sloped than in immediate prior years.
Previous wording
•Average loan volumes for the six months ended June 30, 2026 were $691.7 million higher than the same period in 2025 due to organic loan growth. In addition, interest rates on loans increased 10 basis points to 5.62% for the six months ended June 30, 2026, collectively resulting in an increase in loan interest income of $23.2 million.
Current wording
•Average loan volumes for the nine months ended September 30, 2026 were $711.9 million higher than the same period in 2025 due to organic loan growth. In addition, interest rates on loans increased 8 basis points to 5.66% for the nine months ended September 30, 2026, collectively resulting in an increase in loan interest income of $35.4 million.
Showing the first 40 of 64 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Adjusted net income and adjusted diluted EPS are non-GAAP financial measures that exclude the effect of the $0.5 million Merger and acquisition expenses in the three and nine months ended September 30, 2026 and the $27.9 million Securities loss resulting from the securities loss-earnback transaction for the three and nine months ended September 30, 2025, from the GAAP basis net income and diluted EPS for those periods. Management believes these non-GAAP financial measures provide additional information that is useful to investors in evaluating our performance and may facilitate comparisons with other institutions in the banking industry as well as period-to-period comparisons. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, are not audited, and may not be comparable to other similarly titled financial measures used by other companies. Investors should not consider non-GAAP measures in isolation or as a substitute for analysis of the Company’s results or financial condition as reported under GAAP.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
assets and interest-bearing liabilities. Net interest income is also influenced by external factors such as local economic conditions, competition for loans and deposits, and market interest rates.
Previous report — wording carried elsewhere
The ACL reflects our estimate of life of loan expected credit losses that will result from the inability of our borrowers to make required loan payments. We use systematic methodologies to determine the ACL for loans and the allowance for certain off-balance-sheet credit exposures. We consider the effects of past events, current conditions,
Previous report — wording carried elsewhere
also maintain available lines of credit from the FHLB and the Federal Reserve, as well as federal funds lines from several correspondent banks which are summarized below.