WEST BANCORPORATION INC
For the period ended Jun 30, 2026. Filed Jul 23, 2026.
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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.
Jun 30, 2026 · Filed Jul 23, 2026
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Item 2. Results of Operations
RESULTS OF OPERATIONS
The following table shows selected financial results and measures for the three and six months ended June 30, 2026 compared with the same periods in 2025.
| Three Months Ended June 30, · Six Months Ended June 30, | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2026 · 2025 · Change · Change % · 2026 · 2025 · Change · Change % | ||||||||||||||
| Net income | $11,073 | $7,979 | $3,094 | 38.78% | $21,645 | $15,821 | $5,824 | 36.81% | ||||||
| Average assets | 4,029,324 | 4,016,490 | 12,834 | 0.32% | 4,028,277 | 3,980,837 | 47,440 | 1.19% | ||||||
| Average stockholders' equity | 273,967 | 234,399 | 39,568 | 16.88% | 271,722 | 232,149 | 39,573 | 17.05% | ||||||
| Return on average assets | 1.10% | 0.80% | 0.30% | 1.08% | 0.80% | 0.28% | ||||||||
| Return on average equity | 16.21% | 13.65% | 2.56% | 16.06% | 13.74% | 2.32% | ||||||||
| Net interest margin (1) | 2.69% | 2.27% | 0.42% | 2.64% | 2.27% | 0.37% | ||||||||
| Efficiency ratio (1) (2) | 48.78% | 56.45% | (7.67)% | 49.31% | 56.41% | (7.10)% | ||||||||
| Dividend payout ratio | 38.38% | 53.08% | (14.70)% | 38.93% | 53.37% | (14.44)% | ||||||||
| Average equity to average assets ratio | 6.80% | 5.84% | 0.96% | 6.75% | 5.83% | 0.92% | ||||||||
| As of June 30, | ||||||||||||||
| 2026 · 2025 · Change | ||||||||||||||
| Nonperforming assets to total assets (2) | 0.00% | 0.00% | 0.00% | |||||||||||
| Equity to assets ratio | 6.97% | 5.94% | 1.03% | |||||||||||
| Tangible common equity ratio | 6.97% | 5.94% | 1.03% | |||||||||||
(1) Amounts are presented on a FTE basis. These are non-GAAP financial measures. For further information, refer to the Non-GAAP Financial Measures section of this report.
(2) A lower ratio is more desirable.
Definitions of ratios:
Return on average assets - annualized net income divided by average assets.
Return on average equity - annualized net income divided by average stockholders' equity.
Net interest margin - annualized tax-equivalent net interest income divided by average interest-earning assets.
Efficiency ratio - noninterest expense (excluding other real estate owned expense and write-down of premises) divided by noninterest income (excluding net securities gains/losses and gains/losses on disposition of premises and equipment) plus tax-equivalent net interest income.
Dividend payout ratio - dividends paid to common stockholders divided by net income.
Average equity to average assets ratio - average equity divided by average assets.
Nonperforming assets to total assets - total nonperforming assets divided by total assets.
Equity to assets ratio - equity divided by assets.
Tangible common equity ratio - common equity less intangible assets (none held) divided by tangible assets.
Net Interest Income
The following tables present average balances and related interest income or interest expense, with the resulting annualized average yield or rate by category of interest-earning assets or interest-bearing liabilities. Interest income and the resulting net interest income
are shown on a FTE basis.
| Data for the three months ended June 30: | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Average Balance · Interest Income/Expense · Yield/Rate | |||||||||||||||||
| 2026 · 2025 · Change · Change-% · 2026 · 2025 · Change · Change-% · 2026 · 2025 · Change | |||||||||||||||||
| Interest-earning assets: | |||||||||||||||||
| Loans: (1) (2) | |||||||||||||||||
| Commercial | $484,499 | $525,827 | $(41,328) | (7.86)% | $7,670 | $8,501 | $(831) | (9.78)% | 6.35% | 6.49% | (0.14)% | ||||||
| Real estate (3) | 2,477,757 | 2,443,107 | 34,650 | 1.42% | 34,055 | 32,844 | 1,211 | 3.69% | 5.51% | 5.39% | 0.12% | ||||||
| Consumer and other | 22,271 | 20,704 | 1,567 | 7.57% | 344 | 349 | (5) | (1.43)% | 6.20% | 6.76% | (0.56)% | ||||||
| Total loans | 2,984,527 | 2,989,638 | (5,111) | (0.17)% | 42,069 | 41,694 | 375 | 0.90% | 5.65% | 5.59% | 0.06% | ||||||
| Securities: | |||||||||||||||||
| Taxable | 349,827 | 429,395 | (79,568) | (18.53)% | 2,097 | 2,685 | (588) | (21.90)% | 2.40% | 2.50% | (0.10)% | ||||||
| Tax-exempt (3) | 115,928 | 122,622 | (6,694) | (5.46)% | 673 | 773 | (100) | (12.94)% | 2.32% | 2.52% | (0.20)% | ||||||
| Total securities | 465,755 | 552,017 | (86,262) | (15.63)% | 2,770 | 3,458 | (688) | (19.90)% | 2.38% | 2.51% | (0.13)% | ||||||
| Deposits with banks | 227,686 | 255,688 | (28,002) | (10.95)% | 2,130 | 2,847 | (717) | (25.18)% | 3.75% | 4.47% | (0.72)% | ||||||
| Securities purchased under | |||||||||||||||||
| agreements to resell | 142,073 | 1,738 | 140,335 | 8,074.51% | 1,580 | 22 | 1,558 | 7,081.82% | 4.46% | 5.08% | (0.62)% | ||||||
| Total interest-earning assets(3) | $3,820,041 | $3,799,081 | $20,960 | 0.55% | 48,549 | 48,021 | 528 | 1.10% | 5.10% | 5.07% | 0.03% | ||||||
| Interest-bearing liabilities: | |||||||||||||||||
| Deposits: | |||||||||||||||||
| Interest-bearing demand | $482,219 | $504,586 | $(22,367) | (4.43)% | 1,638 | 2,111 | (473) | (22.41)% | 1.36% | 1.68% | (0.32)% | ||||||
| Savings and money market | 1,842,052 | 1,721,968 | 120,084 | 6.97% | 13,088 | 14,034 | (946) | (6.74)% | 2.85% | 3.27% | (0.42)% | ||||||
| Time deposits | 492,973 | 623,994 | (131,021) | (21.00)% | 4,458 | 6,531 | (2,073) | (31.74)% | 3.63% | 4.20% | (0.57)% | ||||||
| Total interest-bearing deposits | 2,817,244 | 2,850,548 | (33,304) | (1.17)% | 19,184 | 22,676 | (3,492) | (15.40)% | 2.73% | 3.19% | (0.46)% | ||||||
| Borrowed Funds: | |||||||||||||||||
| Federal funds purchased and | |||||||||||||||||
| other short-term borrowings | — | 1 | (1) | (100.00)% | — | — | — | —% | —% | 4.84% | (4.84)% | ||||||
| Subordinated notes, net | 80,256 | 79,990 | 266 | 0.33% | 1,110 | 1,104 | 6 | 0.54% | 5.55% | 5.54% | 0.01% | ||||||
| Federal Home Loan Bank | |||||||||||||||||
| advances | 270,000 | 270,000 | — | —% | 2,274 | 2,259 | 15 | 0.66% | 3.38% | 3.36% | 0.02% | ||||||
| Long-term debt | 24,203 | 40,648 | (16,445) | (40.46)% | 385 | 504 | (119) | (23.61)% | 6.39% | 4.97% | 1.42% | ||||||
| Total borrowed funds | 374,459 | 390,639 | (16,180) | (4.14)% | 3,769 | 3,867 | (98) | (2.53)% | 4.04% | 3.97% | 0.07% | ||||||
| Total interest-bearing | |||||||||||||||||
| liabilities | $3,191,703 | $3,241,187 | $(49,484) | (1.53)% | 22,953 | 26,543 | (3,590) | (13.53)% | 2.88% | 3.28% | (0.40)% | ||||||
| Net interest income (FTE) (4) | $25,596 | $21,478 | $4,118 | 19.17% | |||||||||||||
| Net interest spread (FTE) | 2.22% | 1.79% | 0.43% | ||||||||||||||
| Net interest margin (FTE) (4) | 2.69% | 2.27% | 0.42% | ||||||||||||||
| Data for the six months ended June 30: | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Average Balance · Interest Income/Expense · Yield/Rate | |||||||||||||||||
| 2026 · 2025 · Change · Change-% · 2026 · 2025 · Change · Change-% · 2026 · 2025 · Change | |||||||||||||||||
| Interest-earning assets: | |||||||||||||||||
| Loans: (1) (2) | |||||||||||||||||
| Commercial | $481,735 | $530,156 | $(48,421) | (9.13)% | $15,015 | $16,985 | $(1,970) | (11.60)% | 6.29% | 6.46% | (0.17)% | ||||||
| Real estate (3) | 2,473,399 | 2,452,519 | 20,880 | 0.85% | 67,329 | 65,057 | 2,272 | 3.49% | 5.49% | 5.35% | 0.14% | ||||||
| Consumer and other | 22,915 | 20,130 | 2,785 | 13.84% | 707 | 671 | 36 | 5.37% | 6.22% | 6.72% | (0.50)% | ||||||
| Total loans | 2,978,049 | 3,002,805 | (24,756) | (0.82)% | 83,051 | 82,713 | 338 | 0.41% | 5.62% | 5.55% | 0.07% | ||||||
| Securities: | |||||||||||||||||
| Taxable | 356,267 | 430,075 | (73,808) | (17.16)% | 4,240 | 5,473 | (1,233) | (22.53)% | 2.38% | 2.55% | (0.17)% | ||||||
| Tax-exempt (3) | 116,516 | 124,349 | (7,833) | (6.30)% | 1,347 | 1,551 | (204) | (13.15)% | 2.31% | 2.49% | (0.18)% | ||||||
| Total securities | 472,783 | 554,424 | (81,641) | (14.73)% | 5,587 | 7,024 | (1,437) | (20.46)% | 2.36% | 2.53% | (0.17)% | ||||||
| Deposits with banks | 225,969 | 200,384 | 25,585 | 12.77% | 4,177 | 4,464 | (287) | (6.43)% | 3.73% | 4.49% | (0.76)% | ||||||
| Securities purchased under | |||||||||||||||||
| agreements to resell | 143,947 | 874 | 143,073 | N/A | 3,197 | 22 | 3,175 | N/A | 4.48% | 5.08% | (0.60)% | ||||||
| Total interest-earning assets (3) | $3,820,748 | $3,758,487 | $62,261 | 1.66% | 96,012 | 94,223 | 1,789 | 1.90% | 5.07% | 5.06% | 0.01% | ||||||
| Interest-bearing liabilities: | |||||||||||||||||
| Deposits: | |||||||||||||||||
| Interest-bearing demand | $488,677 | $520,131 | $(31,454) | (6.05)% | 3,544 | 4,362 | (818) | (18.75)% | 1.46% | 1.69% | (0.23)% | ||||||
| Savings and money market | 1,834,848 | 1,661,827 | 173,021 | 10.41% | 25,739 | 26,488 | (749) | (2.83)% | 2.83% | 3.21% | (0.38)% | ||||||
| Time | 506,073 | 624,700 | (118,627) | (18.99)% | 9,162 | 13,249 | (4,087) | (30.85)% | 3.65% | 4.28% | (0.63)% | ||||||
| Total interest-bearing deposits | 2,829,598 | 2,806,658 | 22,940 | 0.82% | 38,445 | 44,099 | (5,654) | (12.82)% | 2.74% | 3.17% | (0.43)% | ||||||
| Borrowed funds: | |||||||||||||||||
| Federal funds purchased and | |||||||||||||||||
| other short-term borrowings | — | 1 | (1) | (100.00)% | — | — | — | —% | —% | 4.63% | (4.63)% | ||||||
| Subordinated notes, net | 80,221 | 79,957 | 264 | 0.33% | 2,214 | 2,209 | 5 | 0.23% | 5.57% | 5.57% | —% | ||||||
| Federal Home Loan Bank | |||||||||||||||||
| advances | 270,000 | 270,000 | — | —% | 4,518 | 4,494 | 24 | 0.53% | 3.37% | 3.36% | 0.01% | ||||||
| Long-term debt | 24,822 | 41,293 | (16,471) | (39.89)% | 782 | 1,022 | (240) | (23.48)% | 6.35% | 4.99% | 1.36% | ||||||
| Total borrowed funds | 375,043 | 391,251 | (16,208) | (4.14)% | 7,514 | 7,725 | (211) | (2.73)% | 4.04% | 3.98% | 0.06% | ||||||
| Total interest-bearing | |||||||||||||||||
| liabilities | $3,204,641 | $3,197,909 | $6,732 | 0.21% | 45,959 | 51,824 | (5,865) | (11.32)% | 2.89% | 3.27% | (0.38)% | ||||||
| Net interest income (FTE) (4) | $50,053 | $42,399 | $7,654 | 18.05% | |||||||||||||
| Net interest spread (FTE) | 2.18% | 1.79% | 0.39% | ||||||||||||||
| Net interest margin (FTE) (4) | 2.64% | 2.27% | 0.37% | ||||||||||||||
(1)Average loan balances include nonaccrual loans. Interest income recognized on nonaccrual loans has been included.
(2)Interest income on loans includes amortization of loan fees and costs and prepayment penalties collected, which are not material.
(3)Tax-exempt income has been adjusted to a tax-equivalent basis using a federal income tax rate of 21 percent and is adjusted to reflect the effect of the nondeductible interest expense associated with owning tax-exempt securities and loans.
(4)Net interest income (FTE) and net interest margin (FTE) are non-GAAP financial measures. For further information, refer to the Non-GAAP Financial Measures section of this report.
The Company's largest component of net income is net interest income, which is the difference between interest earned on interest-earning assets, consisting primarily of loans and securities, and interest paid on interest-bearing liabilities, consisting of deposits and borrowings. Fluctuations in net interest income can result from the combination of changes in the average balances of asset and liability categories and changes in interest rates. Interest rates earned and paid are also affected by general economic conditions, particularly changes in market interest rates, and by competitive factors, government policies and actions of regulatory authorities. The FOMC decreased the target federal funds interest rate by a total of 75 basis points from September through December of 2025, which impacts the comparability of net interest margin between 2026 and 2025.
Net interest margin on a FTE basis, a non-GAAP financial measure, is a measure of the net return on interest-earning assets and is computed by dividing annualized tax-equivalent net interest income by total average interest-earning assets for the period. The net interest margin for the three and six months ended June 30, 2026 increased 42 and 37 basis points, respectively, compared to the three and six months ended June 30, 2025. Tax-equivalent net interest income for the three and six months ended June 30, 2026 increased $4,118 and $7,654, respectively, when compared to the same periods in 2025.
Tax-equivalent interest income on loans increased $375 and $338, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025. The increase in tax-equivalent interest income on loans during the three and six months ended June 30, 2026 compared to the same periods in 2025 was driven primarily by an increase in loan yields, partially offset by a decrease in the average loan balances. The yield on the loan portfolio increased by 6 and 7 basis points, respectively, for the three and six months ended June 30, 2026 compared to the same periods in 2025. The average balance of loans for the three and six months ended June 30, 2026 decreased $5,111 and $24,756, respectively, compared to the three and six months ended June 30, 2025. While the fixed-rate loan portfolio has benefited from higher prevailing market rates for originations and renewals compared to the roll-off rates, the yield on the variable-rate loan portfolio has decreased due to reductions in the prime rate and SOFR rates driven by the reductions in the federal funds rate since September 2025.
The yield on the Company's loan portfolio is affected by the portfolio's loan mix, the interest rate environment, the effects of competition, the level of nonaccrual loans and reversals of previously accrued interest on charged-off loans. The political and economic environments can also influence the volume of new loan originations and the mix of variable-rate versus fixed-rate loans. The yield on the loan portfolio is expected to increase in flat and rising rate environments as variable-rate loans reprice at higher rates and renewals and new originations are priced at prevailing market rates, which exceed the roll-off rate of principal repayments on existing loans. In a declining rate environment, the yield on variable-rate loans will decline; however, as long as market rates remain higher than the yield on the fixed-rate portfolio, renewals and originations will continue to increase the yield on the fixed-rate portfolio.
Tax-equivalent interest income on securities decreased $688 and $1,437, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025. The decrease was primarily due to a decrease in average balances of securities. This decrease in average balances of securities was driven by a sale of securities in November 2025 and calls and principal paydowns on securities. In June 2025, the Company began investing in securities purchased under agreements to resell. Changes in the yield on this short-term investment program, along with deposits in banks, are driven by changes in short-term market rates, including changes in the federal funds rate.
Interest expense on deposits decreased $3,492 and $5,654, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025. The decrease in the interest expense on deposits was primarily due to the decline in interest rates paid on deposits of 46 and 43 basis points, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025. The decrease in rates paid was primarily driven by the reductions in the federal funds rate since September of 2025. The average balance of interest-bearing deposits decreased $33,304 for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, and increased $22,940 for the six months ended June 30, 2026, compared to the six months ended June 30, 2025.
Interest expense on borrowed funds decreased $98 and $211, respectively, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025. The average balance of borrowed funds decreased $16,180 and $16,208, respectively, for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025. The largest driver of the decrease in average borrowed funds balances was the decrease in average balances on long-term debt, which decreased by $16,445 and $16,471, respectively for the three and six months ended June 30, 2026, compared to the same periods in 2025. This decrease in average long-term debt balances was due to principal payments on the long-term debt.
Credit Loss Expense and the Related Allowance for Credit Losses
The credit loss expense recorded on the income statement represents a charge made to earnings to maintain an adequate allowance for credit losses. The adequacy of the allowance for credit losses is evaluated quarterly by management and reviewed by the Board of Directors. The allowance for credit losses is management's estimate of expected lifetime losses in the loan portfolio as of the balance sheet date. The Company recorded no credit loss expense for loans or unfunded commitments for the three and six months ended June 30, 2026 and 2025. Management believed the allowance for credit losses at June 30, 2026 was adequate to absorb expected losses in the loan portfolio as of that date.
Factors management considers in establishing an appropriate allowance include: the borrower's financial condition; the value and adequacy of loan collateral; the condition of the local economy and the borrower's specific industry; the levels and trends of loans by segment; and a review of delinquent and classified loans. The quarterly evaluation of the allowance focuses on factors such as specific loan reviews, changes in the components of the loan portfolio given the current and forecasted economic conditions, and historical loss experience. Any one of the following conditions may result in the review of a specific loan: concern about whether the customer's cash flow or net worth is sufficient to repay the loan; delinquency status; criticism of the loan in a regulatory examination; the suspension of interest accrual; or other factors, including whether the loan has other special or unusual characteristics that suggest special monitoring is warranted. The Company's concentration risks include geographic concentrations in central and eastern Iowa and southern Minnesota. The local economies in those markets are composed primarily of major financial service companies, healthcare providers, educational institutions, technology and agribusiness companies, and state and local governments.
West Bank has a significant portion of its loan portfolio in commercial real estate loans, commercial lines of credit, commercial term loans, and construction and land development loans. West Bank's typical commercial borrower is a small- or medium-sized, privately owned business entity. Compared to residential mortgages or consumer loans, commercial loans typically have larger balances and repayment usually depends on the borrowers' successful business operations. Commercial loans generally are not fully repaid over the loan period and may require refinancing or a large payoff at maturity. When the economy turns downward, commercial borrowers may not be able to repay their loans, and the value of their assets, which are usually pledged as collateral, may decrease rapidly and significantly.
While management uses available information to recognize losses on loans, further reduction in the carrying amounts of loans may be necessary based on changes in circumstances, changes in the overall economy in the markets we currently serve, or later acquired information. Identifiable sectors within the general economy are subject to additional volatility, which at any time may have a substantial impact on the loan portfolio. In addition, regulatory agencies, as integral parts of their examination processes, periodically review the credit quality of the loan portfolio and the level of the allowance for credit losses. Such agencies may require West Bank to recognize additional charge-offs or provisions for credit losses based on such agencies' review of information available to them at the time of their examinations.
West Bank's policy is to charge off loans when, in management's opinion, a loan or a portion of a loan is deemed uncollectible. Commercially reasonable efforts are made to maximize subsequent recoveries. The following table summarizes the activity in the Company's allowance for credit losses on loans for the three and six months ended June 30, 2026 and 2025 and related ratios.
| Three Months Ended June 30, · Six Months Ended June 30, | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2026 · 2025 · Change · 2026 · 2025 · Change | ||||||||
| Balance at beginning of period | $30,523 | $30,526 | $(3) | $30,525 | $30,432 | $93 | ||
| Charge-offs | — | — | — | (19) | — | (19) | ||
| Recoveries | 7 | 13 | (6) | 24 | 107 | (83) | ||
| Net (charge-offs) recoveries | 7 | 13 | (6) | 5 | 107 | (102) | ||
| Provision for credit losses charged | ||||||||
| (credited) to operations | — | — | — | — | — | — | ||
| Balance at end of period | $30,530 | $30,539 | $(9) | $30,530 | $30,539 | $(9) | ||
| Average loans outstanding | $2,984,527 | $2,989,638 | $2,978,048 | $3,002,805 | ||||
| Ratio of annualized net (charge-offs) | ||||||||
| recoveries during the period to | ||||||||
| average loans outstanding | 0.00% | 0.00% | 0.00% | 0.01% | ||||
| Ratio of allowance for credit losses for | ||||||||
| loans to average loans outstanding | 1.02% | 1.02% | 1.03% | 1.02% | ||||
| Ratio of allowance for credit losses for | ||||||||
| loans to total loans at end of period | 1.03% | 1.03% | 1.03% | 1.03% | ||||
Noninterest Income
The following tables show the variance from the prior year in the noninterest income categories shown in the Consolidated Statements of Income.
| Three Months Ended June 30, | ||||
|---|---|---|---|---|
| Noninterest income: | 2026 | 2025 | Change | Change % |
| Service charges on deposit accounts | $476 | $486 | $(10) | (2.06)% |
| Debit card interchange income | 514 | 478 | 36 | 7.53% |
| Trust services | 1,048 | 801 | 247 | 30.84% |
| Increase in cash value of bank-owned life insurance | 313 | 295 | 18 | 6.10% |
| Other income | 245 | 350 | (105) | (30.00)% |
| Total noninterest income | $2,596 | $2,410 | $186 | 7.72% |
| Six Months Ended June 30, | ||||
| Noninterest income: | 2026 | 2025 | Change | Change % |
| Service charges on deposit accounts | $984 | $957 | $27 | 2.82% |
| Debit card interchange income | 986 | 924 | 62 | 6.71% |
| Trust services | 2,058 | 1,578 | 480 | 30.42% |
| Increase in cash value of bank-owned life insurance | 621 | 577 | 44 | 7.63% |
| Other income | 501 | 617 | (116) | (18.80)% |
| Total noninterest income | $5,150 | $4,653 | $497 | 10.68% |
The increase in trust services revenue in the three and six months ended June 30, 2026, compared to the same periods in 2025, was primarily due to the growth in trust assets and trust accounts since June 30, 2025.
Noninterest Expense
The following tables show the variance from the prior year in the noninterest expense categories shown in the Consolidated Statements of Income. In addition, accounts within the “other expenses” category that represent a significant portion of the total or a significant variance are shown below.
| Three Months Ended June 30, | ||||
|---|---|---|---|---|
| Noninterest expense: | 2026 | 2025 | Change | Change % |
| Salaries and employee benefits | $7,987 | $7,343 | $644 | 8.77% |
| Occupancy and equipment | 2,006 | 2,034 | (28) | (1.38)% |
| Technology and software | 822 | 791 | 31 | 3.92% |
| Data processing | 545 | 643 | (98) | (15.24)% |
| FDIC insurance | 444 | 670 | (226) | (33.73)% |
| Professional fees | 298 | 303 | (5) | (1.65)% |
| Other expenses: | ||||
| Business development | 270 | 199 | 71 | 35.68% |
| Insurance expense | 235 | 291 | (56) | (19.24)% |
| Trust | 214 | 175 | 39 | 22.29% |
| Consulting fees | 62 | 52 | 10 | 19.23% |
| Marketing | 32 | 25 | 7 | 28.00% |
| Low income housing projects amortization | 136 | 134 | 2 | 1.49% |
| New markets tax credit project amortization and management fees | — | 76 | (76) | (100.00)% |
| All other | 716 | 749 | (33) | (4.41)% |
| Total other expenses | 1,665 | 1,701 | (36) | (2.12)% |
| Total noninterest expense | $13,767 | $13,485 | $282 | 2.09% |
| Six Months Ended June 30, | ||||
| Noninterest expense: | 2026 | 2025 | Change | Change % |
| Salaries and employee benefits | $15,619 | $14,347 | $1,272 | 8.87% |
| Occupancy and equipment | 4,012 | 3,997 | 15 | 0.38% |
| Technology and software | 1,596 | 1,577 | 19 | 1.20% |
| Data processing | 1,141 | 1,260 | (119) | (9.44)% |
| FDIC insurance | 917 | 1,257 | (340) | (27.05)% |
| Professional fees | 576 | 611 | (35) | (5.73)% |
| Other expenses: | ||||
| Business development | 506 | 414 | 92 | 22.22% |
| Insurance expense | 474 | 585 | (111) | (18.97)% |
| Trust | 457 | 377 | 80 | 21.22% |
| Consulting fees | 135 | 131 | 4 | 3.05% |
| Marketing | 65 | 36 | 29 | 80.56% |
| Low income housing projects amortization | 285 | 285 | — | —% |
| New markets tax credit project amortization and management fees | — | 152 | (152) | (100.00)% |
| All other | 1,449 | 1,519 | (70) | (4.61)% |
| Total other | 3,371 | 3,499 | (128) | (3.66)% |
| Total noninterest expense | $27,232 | $26,548 | $684 | 2.58% |
Salaries and employee benefits increased for the three and six months ended June 30, 2026, compared to the same periods in 2025, due to normal annual merit increases and an increase in incentive compensation related accruals. FDIC insurance expense decreased for the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025, primarily due to a decrease in the assessment rate. New markets tax credit project amortization declined with the expiration of the related tax credit.
Income Tax Expense
The Company recorded income tax expense of $3,277 (22.8 percent of pre-tax income) and $6,179 (22.2 percent of pre-tax income) for the three and six months ended June 30, 2026, respectively, compared with $2,365 (22.9 percent of pre-tax income) and $4,558 (22.4 percent of pre-tax income) for the three and six months ended June 30, 2025, respectively. The tax rates for the first six months of 2026 and 2025 were impacted by total year-to-date tax credits of approximately $280 and $330, respectively. The Company's consolidated income tax rate differs from the federal statutory income tax rate in each period, primarily due to tax-exempt interest income, the tax-exempt increase in cash value of bank-owned life insurance, disallowed interest expense, and state income taxes. Additionally, for the six months ended June 30, 2026 and 2025, a tax benefit of $243 and $85, respectively, was recorded as a result of the increase in fair value of restricted stock over the vesting period.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.