BAR HARBOR BANKSHARES
For the period ended Mar 31, 2026. Filed May 5, 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.
Mar 31, 2026 · Filed May 5, 2026
BHB$41.01-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-06.
0001104659-25-107763
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsSelected Financial DataConsolidated Loan and Deposit AnalysisAverage Balances and Average Yields/RatesReconciliation of Non-GAAP Financial MeasuresCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-05.
0001104659-26-055671
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsSelected Financial DataConsolidated Loan and Deposit AnalysisAverage Balances and Average Yields/RatesReconciliation of Non-GAAP Financial MeasuresThe 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 86 previous paragraphs and 74 current paragraphs.
44 unchanged; 14 reworded; 15 added; 25 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 46 previous and 24 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 (15)
Current report
Available for Sale Debt Securities
Current report
Available-for-sale debt securities were $598.0 million compared to $597.4 million at the end of the fourth quarter 2025. Net unrealized losses increased to $52.4 million at quarter-end compared to $47.5 million at the end of the fourth quarter 2025 due to the interest rate environment. The total unrealized losses include $6.7 million in unrealized losses on fair value hedged municipal securities. During the quarter there were purchases of $25.2 million, paydowns and calls of $19.3 million and net accretion of $411 thousand. The quarter-to-date weighted average yield of the securities portfolio was 4.05% compared to 4.03% at the end of the fourth quarter 2025. As of the first quarter 2026 and the fourth quarter 2025, the securities portfolio had an average life of 7.6 years and 7.1 years respectively, with an effective duration of 5.4 years and 5.2 years, respectively. At the end of the first quarter 2026 all securities remain classified as available for sale.
Current report
Loans Held for Sale
Current report
Loans held for sale were $11.5 million in the first quarter 2026 compared to $5.3 million in the fourth quarter 2025 as we originated $23.6 million in loans held for sale and sold $16.2 million in loans during the quarter.
Current report
Total loans decreased $20.6 million to $3.6 billion in the first quarter 2026 compared to the fourth quarter 2025 driven primarily by commercial real estate payoffs. Commercial real estate loans decreased $30.2 million primarily due to one early payoff of $14.4 million and $24.4 million in loans that matured and paid off during the quarter. Commercial and industrial loans increased 24% on an annualized basis and included $16.6 million of originations during the quarter. Residential real estate loans decreased $8.1 million during the quarter primarily driven by increased prepayment activity and offset in part by a $12.0 million residential loan purchase. Consumer loans remained relatively flat with a decrease of $348 thousand due to paydowns on home equity lines of credit.
Current report
The allowance for credit losses (“ACL”) on loans remained stable at $34.3 million at the end of the first quarter 2026 compared to $34.1 million at the end of the fourth quarter 2025. The activity in the ACL is reflective of loan portfolio
Current report
changes and credit quality indicators. The allowance for credit losses to total loans coverage ratio for the first quarter 2026 was in line with the fourth quarter 2025 at 0.96% versus 0.94%.
Current report
Other Assets
Current report
Premises and equipment increased in the first quarter 2026 to $58.9 million compared to $58.2 million at the end of the fourth quarter 2025 driven by renovation projects. Bank owned life insurance decreased $6.4 million or 7% driven by death benefit pay outs that occurred at the end of the first quarter 2026, partially offset by increases in cash surrender value. Other assets increased $12.7 million primarily due to a non-cash transfer between loans and other assets as the result of the payoff timing of a loan participation which settled within one day of quarter-end.
Current report
Total deposits were $3.9 billion at the end of the first quarter 2026 compared to $3.8 billion at the end of the fourth quarter of 2025. The increase was driven primarily by $17.2 million in new customer non-maturity deposits. Non-interest bearing demand deposits decreased $19.5 million and was offset by a $15.2 million increase in interest-bearing demand, a $14.0 million increase in savings and a $28.6 million increase in money market deposits. Time deposits increased $8.2 million during the quarter due to $4.8 million in new customer time deposits and an $18.0 million increase in brokered deposits, which was offset in part by maturities.
Current report
Total borrowings decreased $53.9 million in the first quarter 2026 to $215.7 million compared to $269.6 million in the fourth quarter 2025. The decrease was driven by cash inflows from loan payoffs and increased deposits.
Current report
The net interest margin was 3.54% in the first quarter 2026 compared to 3.17% in the same quarter 2025. As loan balances grew year-over-year the yield on loans expanded 8 basis points to 5.50% compared to 5.42% in the same period of 2025. Interest-bearing deposit costs decreased year-over-year to 2.19% compared to 2.52% in the same period of 2025.
Current report
Total interest expense decreased $153 thousand in the first quarter 2026 compared to the first quarter 2025. Deposit costs were down $623 thousand year-over-year. Borrowing costs increased $470 thousand, or 16% year-over-year, driven by the subordinated debt acquired from Woodsville.
Current report
The provision for credit losses on loans in the first quarter 2026 was $305 thousand compared to a recapture of $57 thousand in the same period of 2025. The provision reflects minimal net charge-offs of $42 thousand, portfolio changes and credit quality indicators. There was no provision for investment losses in the current year compared to a $636 thousand provision in the first quarter 2025. We had a loss on available-for-sale debt securities of $1.0 million during the first quarter 2026. The loss relates to a write-down on a previously identified corporate bond with continued deteriorated credit quality.
Current report
Non-interest income increased $1.5 million in the first quarter 2026 to $10.4 million compared to $8.9 million in the same quarter 2025 primarily driven bya $1.3 million gain on death benefit from bank owned life insurance. Trust management fee income increased $199 thousand driven by the 7%, or $183.5 million, increase in assets under management compared to the same period of 2025. Customer service fees increased $577 thousand or 16% compared to the same period of 2025. The increase was offset in part by the previously noted additional write-down on one corporate debt security resulting in a loss on available-for-sale debt securities of $1.0 million during the first quarter 2026
Removed paragraphs (25)
Previous report
Merger Completion with Guaranty Bancorp, Inc.
Previous report
On July 31, 2025, we completed our acquisition of Guaranty Bancorp, Inc. (“Guaranty”), the parent company of Woodsville Guaranty Savings Bank (“Woodsville”), and its results of operations are included in the Company’s consolidated results since the date of acquisition. Therefore, the Company’s third quarter and nine months ended 2025 results reflect increased levels of average balances, net interest income, non-interest income and expense compared to its prior quarter and nine months ended of 2024 results. After purchase accounting fair value adjustments, the acquisition added $658.1 million of total assets, including $413.4 million of loans, as well as $641.2 million of total liabilities, primarily consisting of $531.3 million in deposits and $109.2 million in borrowings. The Company recorded goodwill of $22.3 million and core deposit intangibles of $14.0 million in other intangibles related to the acquisition.
Previous report
With the completion of the acquisition, we increased our presence in New Hampshire with the addition of 9 branches. As of September 30, 2025 we have over 60 branches across Maine and New Hampshire. Our total assets increased to $4.7 billion as of September 30, 2025.
Previous report
Financial Position (September 30, 2025, compared to June 30, 2025 unless otherwise stated)
Previous report
million in borrowings were acquired from Woodsville of which $15.0 million was paid off shortly after acquisition. $119.2 million of the Company’s senior borrowings were paid down within the quarter.
Previous report
Securities
Previous report
Securities available for sale was $597.8 million compared to $521.0 million in the fourth quarter 2024 driven by purchases of $67.7 million, $115.0 million in acquired investments, offset by $40.8 million in acquired investments sold, $73.1 million in paydowns and called securities. The average yield of the total securities portfolio for the third quarter 2025 was 4.14% compared to 3.69% for the fourth quarter 2024 primarily due to the change in the profile of the yield curve and a shift from commercial lending obligation investments to agencies and higher coupon fixed-rate securities. Fair value adjustments were $53.0 million at the end of the third quarter 2025 compared to $62.3 million at the end of the fourth quarter 2024. As of the end of the third quarter 2025 and fourth quarter 2024, respectively, our securities portfolio maintained an average life of 7.4 and 9.0 years with an effective duration of 5.3 and 5.0 years. All securities remain classified as available for sale to provide flexibility in asset funding and other opportunities as they arise.
Previous report
Management recorded an allowance for credit losses on two corporate notes where there was a change in future estimated cash flows during the year ended December 31, 2024. A discounted cash flow approach was used to determine the amount of the allowance. The cash flows expected to be collected, after considering expected prepayments, are discounted at the original effective interest rate. During the third quarter 2025, there was a $241 thousand gain on sale of acquired available-for-sale debt securities, and a $200 thousand write-off of the corporate debt securities compared to $5.6 million in the second quarter in corporate debt securities due to credit deterioration. For the nine months ended September 30, 2025, management wrote down $5.8 million on available-for-sale debt securities and other receivables. The losses were included in net gain (loss) on available-for-sale debt securities in the consolidated statements of income. The losses were driven by credit deterioration caused by fraudulent activity by the borrower on a security initially investment-grade.
Previous report
Total loans were $3.6 billion driven by the acquisition of $413.4 million from Woodsville. Total commercial loans increased to $2.3 billion from $2.1 billion in the fourth quarter 2024 with $143.5 million from the acquisition and organic growth of $75.1 million. Residential real estate loans increased to $1.0 billion driven by $248.5 million in acquired loans. Loans held for sale increased $4.3 million driven by demand for mortgage products with corresponding changes in the interest rate environment.
Previous report
The allowance for credit losses on loans increased $5.2 million to $33.9 million at the end of the third quarter 2025 compared to $28.7 million at the end of the fourth quarter 2024 driven by $4.0 million in reserves on non-PCD loans and $1.6 million in PCD loans from Woodsville. The allowance for credit losses to total loans coverage ratio was 0.95% at the end of third quarter 2025 compared to 0.91% at the end of the fourth quarter 2024. Strong asset quality metrics and general macroeconomic trends impact the loan portfolio and drive ACL levels.
Previous report
Total deposits grew to $4.0 billion at the end of the third quarter of 2025 driven by $531.3 million in acquired deposits related to the Woodsville acquisition complimented by $149.2 million in organic growth compared to the fourth quarter 2024. The increase was driven primarily by the acquisition of Woodsville and the organic growth of $41.4 in interest-bearing demand, $27.9 million in non-interest bearing demand, $30.4 million in money market, and $52.8 million in time accounts.
Previous report
Senior borrowings decreased $110.0 million at the end of third quarter 2025 to $140.0 million as loan paydowns, deposits and proceeds from investment portfolio sales were strategically utilized to decrease borrowing levels. $97.0 million in borrowings were acquired from Woodsville of which $15.0 million were paid off shortly after acquisition. As a result of the acquisition, we acquired $11.2 million of subordinated debt from Woodsville in the third quarter 2025.
Previous report
The net interest margin increased to 3.56% in the third quarter 2025 compared to 3.15% in the same respective quarter 2024. Loan income increased $6.4 million for the third quarter 2025 compared to the third quarter 2024 driven by $4.6 million from the Woodsville acquisition and $1.2 million by rate changes on the commercial portfolio.
Previous report
The net interest margin for the nine months ended September 30, 2025 was 3.32% compared to 3.14% for the nine months ended September 30, 2024.
Previous report
Total interest and dividend income increased by 7.7% to $152.1 million for the nine months ended 2025 compared to $141.2 million in the prior year primarily driven by the same reasons noted for the quarter. Yields on earning assets grew to 5.23% for the nine months ended 2025 compared to 5.19% for the nine months ended 2024. The yield on commercial real estate loans grew to 5.73% for the nine months ended 2025 from 5.57% for the nine months ended 2024. The residential real estate yield increased from 4.12% to 4.23% and the commercial and industrial yield decreased to 6.47% from 6.80% for the nine months ended 2025 and 2024.
Previous report
The net interest margin increased to 3.56% in the third quarter 2025 compared to 3.15% in the same respective quarter 2024. Loan income increased $6.4 million for the third quarter 2025 compared to the third quarter 2024 driven by $4.6 million from the Woodsville acquisition and $1.2 million by rate changes on the commercial portfolio.
Previous report
The net interest margin was 3.32% for the nine months ended 2025 compared to 3.14% in same respective quarter 2024. As average loan balances grew $231.6 million year over year, the yield on loans grew to 5.48% for the six months ended 2025, up from 5.40% in the same period for 2024. Costs of interest-bearing deposits decreased to 2.41% for the nine months ended 2025 compared to 2.59% for the nine months ended 2024.
Previous report
Total interest expense decreased $659 thousand for deposits in the third quarter 2025 compared the third quarter 2024. Deposit costs were up $245 thousand or 1.5% year over year driven by the acquisition of $531.3 million in deposits from Woodsville partially offset by lower cost of funds on interest-bearing deposits yields at 2.12% from 2.35% for the third quarter ended 2024. Borrowing costs decreased $904 thousand or 26.2% driven by the $216.2 million in paydowns offset partially by $97 million in acquisition borrowings accompanied by lower borrowing rates at 4.04% for the third quarter 2025 compared to 4.57% for the third quarter 2024.
Previous report
Total interest expense for the nine months ended September 30, 2025 was $56.3 million compared to $56.5 million for the same period ended 2024 driven by higher cost of funds on deposits. Cost of borrowings decreased $2.1 million driven by the strategic deployment of cash to pay down advances from FHLB.
Previous report
The Company recorded a $4.0 million reserve on non-PCD loans established through provision expense.
Previous report
There was no provision for available-for-sale investments in the third quarter of 2025 and 2024. We have one nonaccrual corporate bond of $8.0 million that we have written-off $5.8 million as of September 30, 2025, of which $4.9 million is recognized in losses on available-for-sale debt securities. At December 31, 2024 we had $9.0 million of corporate bonds that we allocated $568 thousand in related allowance for credit losses. In the first quarter of 2025, a $1.0 million nonaccrual security matured and was transferred to a financing receivable non-cash asset. In the second quarter 2025, the Company determined that it no longer intended to hold the security until the recovery of the amortized cost basis.
Previous report
Non-interest income increased $914 thousand in the third quarter 2025 to $10.6 million compared to $9.7 million in the same quarter 2024 primarily driven by customer service fees which increased $523 thousand driven by the Woodsville acquisition. Customer Derivative income increased $697 thousand year over year driven by timing of swaps and the interest rate environment. Trust management fee income offset decreases $226 thousand driven by financial service income timing.
Previous report
Non-interest income for the nine months ended 2025 was $24.1 million compared to $27.5 million for the same period ended 2024 driven by the write down of one available-for-sale debt security previous discussed above.
Previous report
Non-interest expenses increased $11.8 million to $83.9 million for the nine months ended 2025 compared to the same period of 2024 driven primarily by $6.4 million in acquisition expenses from the Woodsville acquisition and $1.6 million in salaries and benefits mostly due to cost of living increases. Occupancy and equipment costs for the nine months ended 2025 were $10.8 million compared to $10.2 million for the same period 2024 driven by computer processing fees, maintenance contracts and lease expenses.
Previous report
Income tax expense for the nine months ended 2025 was $6.1 million compared to $6.5 million in the same period 2024. The effective tax rate for the nine months ended 2025 was 19% compared to 17% for the same period 2024.
Reworded paragraphs (14)
Previous wording
The following is management’s discussion and analysis of the major factors that influenced our results of operations and financial condition as of and for the three and nine months ended September 30, 2025 and should be read in conjunction with our unaudited consolidated financial statements and condensed notes thereto included elsewhere in this Form 10-Q as well as our audited consolidated financial statements and notes thereto included in our Form 10-K. The following discussion contains "forward-looking statements" that reflect our future plans, estimates, beliefs and expected performance. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results and the differences can be material. Factors that could cause such differences are discussed in the sections titled "Cautionary Statement Regarding Forward-Looking Statements", “Part I, Item 1.A. Risk Factors” for the year ended December 31, 2024, and "Part II, Item 1A. Risk Factors" in this Form 10-Q. All amounts, dollars and percentages presented in this Form 10-Q are rounded and therefore approximate.
Current wording
The following is management’s discussion and analysis of the major factors that influenced our results of operations and financial condition as of and for the three months ended March 31, 2026 and should be read in conjunction with our unaudited consolidated financial statements and condensed notes thereto included elsewhere in this Form 10-Q as well as our audited consolidated financial statements and notes thereto included in our Form 10-K. The following discussion contains "forward-looking statements" that reflect our future plans, estimates, beliefs and expected performance. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results and the differences can be material. Factors that could cause such differences are discussed in the sections titled "Cautionary Statement Regarding Forward-Looking Statements", “Part I, Item 1.A. Risk Factors” in the Form 10-K, and "Part II, Item 1A. Risk Factors" in this Form 10-Q. All amounts, dollars and percentages presented in this Form 10-Q are rounded and therefore approximate.
Previous wording
adjustments that have the effect of excluding or including amounts, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Non-GAAP financial measures do not include operating and other statistical measures or ratios or statistical measures calculated using exclusively either financial measures calculated in accordance with GAAP, operating measures or other measures that are not non-GAAP financial measures or both.
Current wording
Our accounting and reporting policies conform to GAAP and the prevailing practices in the financial services industry. However, we also evaluate our performance by reference to certain additional financial measures discussed in this Form 10-Q that we identify as being “non-GAAP financial measures.” In accordance with SEC rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Non-GAAP financial measures do not include operating and other statistical measures or ratios or statistical measures calculated using exclusively either financial measures calculated in accordance with GAAP, operating measures or other measures that are not non-GAAP financial measures or both.
Previous wording
Earnings*(quarter ended September 30, 2025, compared to the same period of 2024 unless otherwise stated)*
Current wording
Financial Highlights*(quarter ended March 31, 2026, compared to the same period of 2025 unless otherwise stated)*
Previous wording
Total cash and cash equivalents were $136.7 million at the end of the third quarter 2025, compared to $72.2 million at the end of the fourth quarter 2024. Interest-earning deposits held with other banks increased at the end of the third quarter 2025 to $94.0 million, compared to $37.9 million at the end of the fourth quarter and yielded 4.49% and 4.92%, respectively. The change in cash balances was driven by pay downs in loans and the acquisition of Woodsville cash.
Current wording
Total cash and cash equivalents were $82.2 million at the end of the first quarter 2026, compared to $80.8 million at the end of the fourth quarter 2025. Interest-earning deposits with other banks increased to $46.6 million at the end of the first quarter 2026, compared to $35.9 million at the end of the fourth quarter 2025 and yielded 3.90% and 4.53%, respectively. The increase in cash balances was driven primarily by loan payoffs during the quarter.
Previous wording
Federal Home Loan Bank stock decreased to $8.6 million at the end of the third quarter 2025 compared to $12.2 million at the fourth quarter 2024. The acquisition of $4.4 million in FHLB stock was offset by net redemptions of $8.0 million in FHLB stock primarily driven by the strategic deployment of cash to pay down advances from the FHLB.
Current wording
Federal Home Loan Bank stock decreased $1.7 million to $9.6 million at the end of the first quarter 2026 compared to $11.3 million at the end of the fourth quarter 2025 primarily driven by the decrease in wholesale borrowings.
Previous wording
The Company's book value per share was $31.22 as of the end of the third quarter 2025 compared to $30.00 at the end of the fourth quarter 2024. Tangible book value per share (non-GAAP) was $21.70 at the end of the third quarter 2025, compared to $21.93 at the end of the fourth quarter 2024.
Current wording
The Company's book value per share was $32.13 at the end of the first quarter 2026 compared to $31.88 at the end of the fourth quarter 2025. Tangible book value per share (non-GAAP) was $22.71 at the end of the first quarter 2026, compared to $22.41 at the end of the fourth quarter 2025.
Previous wording
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS AND NINE MONTHS ENDED SEPTEMBER 30, 2025 AND SEPTEMBER 30, 2024
Current wording
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2026 AND MARCH 31, 2025
Previous wording
Third quarter 2025 GAAP net income was $8.9 million or $0.54 per diluted share and adjusted earnings (Non-GAAP) was $15.4 million or $0.95 per diluted share compared to GAAP net income and adjusted earnings (Non-GAAP) of $12.2 million or $0.80 per diluted share in the third quarter of 2024.
Current wording
First quarter 2026 GAAP net income was $13.5 million, or $0.81 per diluted share, and adjusted earnings (Non-GAAP) was $14.7 million, or $0.88 per diluted share, compared to GAAP net income of $10.2 million, or $0.66 per diluted share, and adjusted earnings (Non-GAAP) of $10.5 million or $0.68 per diluted share in the first quarter of 2025.
Previous wording
Total interest and dividend income increased by 15.1% or $7.3 million to $55.9 million in the third quarter 2025 compared to $48.6 million in the prior year primarily driven by the repricing of commercial adjustable-rate loans and $265.3 million higher loan balances within the commercial real estate portfolio driven by $117.8 million in acquired loans. Yields on earning assets grew to 5.36% compared to 5.24% in the third quarter 2024. The yield on commercial real estate loans grew to 5.88% in the third quarter 2025 from 5.67% in the third quarter 2024. Total loan yield growth was partially offset by a decrease in the commercial and industrial yields to 6.45% for the third quarter 2025 from 6.98% in the third quarter 2024. Consumer yield remained flat at 7.23% for the third quarter 2025 and 2024 respectively.
Current wording
Total interest and dividend income increased by 16%, or $7.7 million, to $55.3 million in the first quarter 2026 compared to $47.5 million in the prior year. Yields on earning assets grew to 5.27% in the first quarter 2026 compared to 5.16% in the first quarter 2025. The increase was driven by year-over-year loan yield expansion primarily due to the acquisition of $413.4 million in loans from the acquisition of Woodsville. The yield on commercial real estate loans grew to 5.68% in the first quarter 2026 from 5.58% in the first quarter 2025. The residential loan yield increased to 4.64% for the first quarter 2026 from 4.22% in the first quarter of 2025. Total loan yield growth was partially offset by a decrease in the commercial and industrial yield to 6.13% for the first quarter 2026 from 6.57% in the first quarter 2025 driven by the decrease in rates of adjustable-rate loans.
Previous wording
Non-interest expenses increased $8.0 million to $32.7 million in the third quarter 2025 compared to $24.8 million in the third quarter 2024 driven by $5.0 million in acquisition expenses related to Woodsville. Salaries and benefits increased $1.6 million to $15.9 million in the third quarter 2025 compared to $14.4 million in the third quarter 2024 primarily due to cost-of-living adjustments, additional salary from the Woodsville acquisition, and employee insurance costs. Occupancy and equipment increased $474 thousand driven by higher computer processing fees and maintenance contract costs. Professional services fees decreased $145 thousand driven by timing, while marketing increased $221 thousand and amortization of intangibles increased $233 thousand due to the acquisition at the end of the third quarter 2025. Other expenses increased $520 thousand for the third quarter 2025 compared to the third quarter 2024 due primarily to increases in software expenses. Gain on sale of property increased year-over-year by $206 thousand driven by the sale of two properties in the third quarter 2025.
Current wording
Non-interest expenses increased $5.2 million to $29.8 million in the first quarter 2026 compared to $24.7 million in the first quarter 2025 driven by $1.5 million in expenses related to the Woodsville acquisition. Salaries and benefits increased $2.0 million to $15.8 million in the first quarter 2026 compared to $13.7 million in the first quarter 2025 primarily due to additional salary costs associated with the retained Woodsville personnel. Occupancy and equipment increased $711 thousand driven primarily by higher maintenance contract costs from the acquisition of Woodsville. Amortization of intangibles increased $349 thousand due to the acquisition of Woodsville. Other expenses increased $854 thousand for the first quarter 2026 compared to the first quarter 2025 primarily due to increases in software expenses. Loss on sale of premises and equipment was $134 thousand in the first quarter 2026 driven by a building sale.
Previous wording
Income tax expense was $2.2 million for the third quarter 2025 compared to $1.4 million for the third quarter of 2024, respectively. Our GAAP effective tax rate third quarter 2025 and the third quarter 2024 was 20% compared to 10% and the effective tax rate on adjusted earnings was 22% and 20%, respectively. The prior year decrease in taxes and tax rate represents a one-time multiple year tax refund on tax exempt loan income and a state apportionment adjustment.
Current wording
Income tax expense was $3.6 million for the first quarter 2026 compared to $2.5 million for the first quarter of 2025, respectively. Our GAAP effective tax rate for the first quarter 2026 was 21.09% and 19.57% in the first quarter 2025 and the effective tax rate on adjusted earnings (Non-GAAP) was 21.89% and 22.98%, respectively.
Previous wording
As of September 30, 2025, available same-day liquidity totaled approximately $1.0 billion, including cash, borrowing capacity at FHLB and the Federal Reserve Discount Window and various lines of credit. Additional sources of liquidity include cash flows from operations, wholesale deposits, cash flow from our amortizing securities and loan portfolios. As of September 30, 2025, we had unused borrowing capacity at the FHLB of $384.7 million, unused borrowing capacity at the Reserve Bank of $98.0 million and unused lines of credit totaling $41.0 million, in addition to $136.7 million in cash.
Current wording
As of March 31, 2026, available same-day liquidity totaled approximately $1.0 billion, including cash, borrowing capacity at FHLB and the Federal Reserve Discount Window and various lines of credit. Additional sources of liquidity include cash flows from operations, wholesale deposits, cash flow from our amortizing securities and loan portfolios. As of March 31, 2026, we had unused borrowing capacity at the FHLB of $451.5 million, unused borrowing capacity at the Reserve Bank of $94.5 million and unused lines of credit totaling $41.0 million, in addition to $82.2 million in cash.
Previous wording
The Bank maintains a liquidity contingency plan approved by the Bank’s Board of Directors. This plan addresses the steps that would be taken in the event of a liquidity crisis, and identifies other sources of liquidity available to us. Our management believes the level of liquidity is sufficient to meet current and future funding requirements. However, changes in economic conditions, including consumer savings habits and availability or access to the brokered deposit market could potentially have a significant impact on our liquidity position.
Current wording
The Bank maintains a liquidity contingency plan approved by the Bank’s Board of Directors. This plan addresses the steps that would be taken in the event of a liquidity crisis, and identifies other sources of liquidity available to us. Our management believes the level of liquidity is sufficient to meet current and future funding requirements. However, changes
Previous wording
We expect to continue our current practice of paying quarterly cash dividends with respect to our common stock subject to our Board of Directors’ discretion to modify or terminate this practice at any time and for any reason without prior notice. We believe our quarterly dividend rate per share as approved by our Board of Directors, enables us to balance our multiple objectives of managing our business and returning a portion of our earnings to our shareholders. Historically, and a practice we intend to continue, our principal cash expenditure is the payment of dividends on our common stock, if as and when declared by our Board of Directors. Dividends were paid to our shareholders in the aggregate amount of $15.0
Current wording
We expect to continue our current practice of paying quarterly cash dividends with respect to our common stock subject to our Board of Directors’ discretion to modify or terminate this practice at any time and for any reason without prior notice. We believe our quarterly dividend rate per share as approved by our Board of Directors, enables us to balance our multiple objectives of managing our business and returning a portion of our earnings to our shareholders. Historically, and a practice we intend to continue, our principal cash expenditure is the payment of dividends on our common stock, if as and when declared by our Board of Directors. Dividends were paid to our shareholders in the aggregate amount of $5.4 million and $4.6 million for the three months ended March 31, 2026 and 2025, respectively. All dividends declared and distributed by us will be in compliance with applicable state corporate law and regulatory requirements.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
in economic conditions, including consumer savings habits and availability or access to the brokered deposit market could potentially have a significant impact on our liquidity position.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Our accounting and reporting policies conform to GAAP and the prevailing practices in the financial services industry. However, we also evaluate our performance by reference to certain additional financial measures discussed in this Form 10-Q that we identify as being “non-GAAP financial measures.” In accordance with SEC rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to
Previous report — wording carried elsewhere
At September 30, 2025 year-to-date GAAP net income was $25.2 million or $1.60 per diluted share and adjusted earnings (Non-GAAP) was $36.6 million or $2.33 per diluted share compared to GAAP net income of $32.5 million or $2.13 per diluted share and adjusted earnings (Non-GAAP) of $32.2 million or $2.11 per diluted share in the nine months ended September 30, 2024.
Previous report — wording carried elsewhere
million and $13.3 million for the nine months ended September 30, 2025 and 2024, respectively. All dividends declared and distributed by us will be in compliance with applicable state corporate law and regulatory requirements.