PCB BANCORP
For the period ended Jun 30, 2026. Filed Aug 6, 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.
Jun 30, 2026 · Filed Aug 6, 2026
PCB$30.04-0.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-07.
0001423869-26-000018
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0001423869-26-000027
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe 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 142 previous paragraphs and 164 current paragraphs.
97 unchanged; 41 reworded; 11 added; 4 removed; 0 previous and 15 current paragraphs rearranged.
Tables are not compared: 25 previous and 30 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 (11)
Current report
•Gain on sale of loans was $1.2 million for the three months ended June 30, 2026 compared with $1.5 million for the three months ended June 30, 2025;
Current report
(6) Annualized.
Current report
Interest and fees on loans increased primarily due to a 3.7% increase in average balance, partially offset by an 18 basis point decrease in average yield. The decrease in average yield was primarily due to decreases in market rates, net accretion of discount on loans and net amortization of deferred loan fees.
Current report
Interest income on other interest-earning assets decreased primarily due to a 94 basis point decrease in average yield, partially offset by a 24.3% increase in average balance. For the three months ended June 30, 2026 and 2025, the average yield on total other interest-earning assets was 3.79% and 4.73%, respectively.
Current report
Net interest income increased primarily due to a 6.7% increase in average balance of interest-earning assets and a 42 basis point decrease in average cost, partially offset by a 7.6% increase in average balance of interest-bearing liabilities and a 23 basis point decrease in average yield.
Current report
Gain on sale of loans increased primarily due to an increase in level of premium on SBA loans in the secondary market, partially offset by a decrease in sale volume. The Company sold SBA loans of $38.9 million with a gain of $2.6 million and a certain commercial property loan of $1.1 million with a loss of $37 thousand during the six months ended June 30, 2026. The sold commercial property loan was transferred to loans held-for-sale from loans held-for-investment during the three months ended March 31, 2026. During the six months ended June 30, 2025, the Company sold SBA loans of $43.6 million with a gain of $2.4 million.
Current report
Professional fees decreased primarily due to additional professional fees incurred related to evaluating the accounting for a preferred stock purchase option during the three months ended June 30, 2025.
Current report
Professional fees decreased primarily due to additional professional fees incurred related to evaluating the accounting for a preferred stock purchase option during the six months ended June 30, 2025.
Current report
The increases for the three and six months ended June 30, 2026 were primarily due to an increase in loans held-for-investment.
Current report
Qualitative adjustment factors increased for the three and six months ended June 30, 2026 primarily due to updates to risk status ratings that reflected changes in credit quality across loan segments. More specifically, the increases in nonaccrual and classified loans within the commercial and industrial and business property loan segments were the primary contributors to the increase in the overall qualitative reserve.
Current report
Quantitatively measured expected credit loss reserve decreased for the six months ended June 30, 2026 primarily due to improvement in the forecasted national unemployment rate. The Company utilizes the year-over-year percentage change in real GDP and the national unemployment rate based on forward-looking year-end projections published by the Federal Open Market Committee (“FOMC”). Using these forecasted year-end rates as anchors, the Company extrapolates quarterly rates for application in its loss model, which determines probability of default (“PD”) and loss given default (“LGD”) rates.
Removed paragraphs (4)
Previous report
•Gain on sale of loans was $1.4 million for the three months ended March 31, 2026 compared with $887 thousand for the three months ended March 31, 2025;
Previous report
The increase for the three months ended March 31, 2026 was primarily due to increases in loans held-for-investment and overall reserve related to qualitative adjustment factors, partially offset by decreases in quantitatively measured loss reserve requirement and reserves on individually evaluated loans.
Previous report
The decrease in quantitatively measured loss reserve requirement was primarily due to an improved year-over-year change in real GDP forecast. The Company utilizes year-over-year change in real GDP and unemployment rate forecasts published by the Federal Open Market Committee (“FOMC”). The 2026 year-end year-over-year change in forecasted real GDP increased to 2.4% in the March 2026 FOMC meeting from 2.3% in December 2025. The forecasted year-end national unemployment rate was maintained at 4.4% in both March 2026 and December 2025 FOMC meetings. Overall changes in macroeconomic projections resulted in the decreases of probability of default and loss given default rates across majority of the loan segments leading to lower overall expected loss measurements.
Previous report
The increase in qualitative adjustment factors was primarily due to the updates to risk status ratings for reflecting the credit quality trend of each loan segment and changes in economic condition. Management believes that increased uncertainty from recent global geopolitical events, which have disrupted trade routes, increased energy costs, and added inflationary pressure, is likely to negatively affect overall economic conditions. Management applied additional qualitative adjustments to address these risks that may not be reflected in the quantitative reserves, which were based on macroeconomic forecasts released earlier in the period.
Reworded paragraphs (41)
Previous wording
The following is management’s discussion and analysis of the major factors that influenced the Company’s results of operations and financial condition as of and for the three months ended March 31, 2026. This analysis should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 and with the unaudited consolidated financial statements and notes (unaudited) thereto set forth in this Quarterly Report on Form 10-Q.
Current wording
The following is management’s discussion and analysis of the major factors that influenced the Company’s results of operations and financial condition as of and for the three and six months ended June 30, 2026. This analysis should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 and with the unaudited consolidated financial statements and notes (unaudited) thereto set forth in this Quarterly Report on Form 10-Q.
Previous wording
Within the various economic scenarios considered as of March 31, 2026, the quantitative estimate of the ACL would increase by approximately $20.7 million under sole consideration of a more adverse downside scenario. The quoted sensitivity calculation reflects the sensitivity of the modeled ACL estimate to macroeconomic forecast data, but is absent of qualitative overlays and other qualitative adjustments that are part of the quarterly reserving process and does not necessarily reflect the nature and extent of future changes in the ACL for reasons including increases or decreases in qualitative adjustments, changes in the risk profile and size of the portfolio, changes in the severity of the macroeconomic scenario and the range of scenarios under management consideration.
Current wording
Within the various economic scenarios considered as of June 30, 2026, the quantitative estimate of the ACL would increase by approximately $21.4 million under sole consideration of a more adverse downside scenario. The quoted sensitivity calculation reflects the sensitivity of the modeled ACL estimate to macroeconomic forecast data, but does not necessarily reflect the nature and extent of future changes in the ACL for reasons including increases or decreases in qualitative adjustments, changes in the risk profile and size of the portfolio, changes in the severity of the macroeconomic scenario and the range of scenarios under management consideration.
Previous wording
The following tables present reconciliation of return on average tangible common equity, tangible common equity per common share and tangible common equity to tangible assets ratios to their most comparable GAAP measures as of the dates or for the periods indicated. These non-GAAP measures, which are presented in this Quarterly Report on Form 10-Q, are used by management in its analysis of the Company’s performance.
Current wording
The following tables present a reconciliation of average tangible common equity, annualized return on average tangible common equity, tangible common equity per common share and tangible common equity to tangible assets ratios to their most comparable GAAP measures as of the dates or for the periods indicated. These non-GAAP measures, which are presented in this Quarterly Report on Form 10-Q, are used by management in its analysis of the Company’s performance.
Previous wording
•Net income available for common shareholders was $10.6 million for the three months ended March 31, 2026, an increase of $2.9 million, or 37.3%, from $7.7 million for the three months ended March 31, 2025;
Current wording
•Net income available for common shareholders was $10.4 million for the three months ended June 30, 2026, an increase of $1.4 million, or 16.0%, from $9.0 million for the three months ended June 30, 2025;
Previous wording
▪Recorded a provision for credit losses of $467 thousand for the three months ended March 31, 2026 compared with $1.6 million for the three months ended March 31, 2025;
Current wording
▪Recorded a provision for credit losses of $926 thousand for the three months ended June 30, 2026 compared with $1.8 million for the three months ended June 30, 2025;
Previous wording
•Net interest income was $26.8 million for the three months ended March 31, 2026 compared with $24.3 million for the three months ended March 31, 2025. Net interest margin was 3.36% for the three months ended March 31, 2026 compared with 3.28% for the three months ended March 31, 2025;
Current wording
•Net interest income was $27.5 million for the three months ended June 30, 2026 compared with $26.0 million for the three months ended June 30, 2025. Net interest margin was 3.33% for the three months ended June 30, 2026 compared with 3.33% for the three months ended June 30, 2025;
Previous wording
•Total assets were $3.40 billion at March 31, 2026, an increase of $114.4 million, or 3.5%, from $3.28 billion at December 31, 2025;
Current wording
•Total assets were $3.47 billion at June 30, 2026, an increase of $188.4 million, or 5.7%, from $3.28 billion at December 31, 2025;
Previous wording
•Loans held-for-investment were $2.87 billion at March 31, 2026, an increase of $53.2 million, or 1.9%, from $2.82 billion at December 31, 2025; and
Current wording
•Loans held-for-investment were $2.93 billion at June 30, 2026, an increase of $111.6 million, or 4.0%, from $2.82 billion at December 31, 2025; and
Previous wording
•Total deposits were $2.89 billion at March 31, 2026, an increase of $92.6 million, or 3.3%, from $2.80 billion at December 31, 2025.
Current wording
•Total deposits were $2.92 billion at June 30, 2026, an increase of $127.2 million, or 4.6%, from $2.80 billion at December 31, 2025.
Previous wording
(1) Average balance includes both loans held-for-sale and loans held-for-investment, as well as nonaccrual loans. Net amortization of deferred loan fees of $353 thousand and $266 thousand, respectively, and net accretion of discount on loans of $517 thousand and $872 thousand, respectively, are included in the interest income for the three months ended March 31, 2026 and 2025.
Current wording
(1) Average balance includes both loans held-for-sale and loans held-for-investment, as well as nonaccrual loans. Net amortization of deferred loan fees of $357 thousand and $414 thousand, respectively, and net accretion of discount on loans of $584 thousand and $610 thousand, respectively, are included in the interest income for the three months ended June 30, 2026 and 2025.
Previous wording
Net interest income increased primarily due to a 7.7% increase in average balance of interest-earning assets and a 46 basis point decrease in average cost, partially offset by an 8.9% increase in average balance of interest-bearing liabilities and a 21 basis point decrease in average yield.
Current wording
Net interest income increased primarily due to a 5.8% increase in average balance of interest-earning assets and a 38 basis point decrease in average cost, partially offset by a 6.4% increase in average balance of interest-bearing liabilities and a 25 basis point decrease in average yield.
Previous wording
Interest on investment securities increased primarily due to a 9.7% increase in average balance and a 7 basis point increase in average yield. The increase in average yield was primarily due to a higher yield on newly purchased investment securities. For the three months ended March 31, 2026 and 2025, the average yield on total investment securities was 3.97% and 3.90%, respectively.
Current wording
Interest on investment securities increased primarily due to an 18.3% increase in average balance and a 15 basis point increase in average yield. The increase in average yield was primarily due to a higher yield on newly purchased investment securities. For the three months ended June 30, 2026 and 2025, the average yield on total investment securities was 4.03% and 3.88%, respectively.
Previous wording
Interest expense on deposits decreased primarily due to a 46 basis point decrease in average cost of interest-bearing deposits, partially offset by a 6.5% increase in average balance of interest-bearing deposits. The decrease in average cost was primarily due to a decrease in market rates. For the three months ended March 31, 2026 and 2025, average cost on total interest-bearing deposits was 3.82% and 4.28%, respectively, and average cost on total deposits were 3.10% and 3.44%, respectively.
Current wording
Interest expense on deposits decreased primarily due to a 37 basis point decrease in average cost of interest-bearing deposits, partially offset by a 6.4% increase in average balance of interest-bearing deposits. The decrease in average cost was primarily due to a decrease in market rates. For the three months ended June 30, 2026 and 2025, average cost on total interest-bearing deposits was 3.76% and 4.13%, respectively, and average cost on total deposits were 3.05% and 3.32%, respectively.
Previous wording
Interest expense on other borrowings increased primarily due to a $52.1 million increase in average balance, partially offset by a 71 basis point decrease in average cost.
Current wording
Interest expense on other borrowings increased primarily due to a 7.1% increase in average balance, partially offset by a 63 basis point decrease in average cost.
Previous wording
Interest and fees on loans increased primarily due to a 7.2% increase in average balance, partially offset by a 24 basis point decrease in average yield. The decrease in average yield was primarily due to decreases in market rates and net accretion of discount on loans, partially offset by an increase in net amortization of deferred loan fees.
Current wording
Interest and fees on loans increased primarily due to a 5.4% increase in average balance, partially offset by a 21 basis point decrease in average yield. The decrease in average yield was primarily due to decreases in market rates and net accretion of discount on loans, partially offset by an increase in net amortization of deferred loan fees.
Previous wording
Interest income on other interest-earning assets increased primarily due to a 12.8% increase in average balance. The decrease in interest rate on cash held at the Federal Reserve Bank was offset by an increase in dividend received on FHLB stock. For the three months ended March 31, 2026 and 2025, the average yield on total other interest-earning assets was 4.76% and 4.76%, respectively.
Current wording
Interest income on other interest-earning assets increased primarily due to an 18.5% increase in average balance, partially offset by a 48 basis point decrease in average yield. The decrease in interest rate on cash held at the Federal Reserve Bank was offset by an increase in dividends received on FHLB stock. For the six months ended June 30, 2026 and 2025, the average yield on total other interest-earning assets was 4.26% and 4.74%, respectively.
Previous wording
Provision for credit losses for the three months ended March 31, 2026 was primarily due to increases in loans held-for-investment and overall reserve related to qualitative adjustment factors, partially offset by decreases in quantitatively measured loss reserve requirement and reserves on individually evaluated loans. See further discussion in “Loans Held-For-Investment and Allowance for Credit Losses.”
Current wording
Provision for credit losses for the three and six months ended June 30, 2026 was primarily due to growth in loans held-for-investment. See further discussion in “Loans Held-For-Investment and Allowance for Credit Losses.”
Previous wording
Loan servicing income increased primarily due to a decrease in servicing asset amortization, partially offset by a decrease in servicing fee income. Servicing asset amortization was $417 thousand and $549 thousand, respectively, for the three months ended March 31, 2026 and 2025.
Current wording
Loan servicing income increased primarily due to a decrease in servicing asset amortization, partially offset by a decrease in servicing fee income. Servicing asset amortization was $441 thousand and $490 thousand, respectively, for the three months ended June 30, 2026 and 2025.
Previous wording
Gain on sale of loans increased primarily due to an increase in sale volume, partially offset by a decrease in level of premium on SBA loans in the secondary market. The Company sold SBA loans of $21.8 million with a gain of $1.4 million during the three months ended March 31, 2026. During the three months ended March 31, 2025, the Company sold SBA loans of $16.6 million with a gain of $887 thousand.
Current wording
Gain on sale of loans decreased primarily due to a decrease in sale volume, partially offset by an increase in level of premium on SBA loans in the secondary market. The Company sold SBA loans of $17.1 million with a gain of $1.2 million and a certain commercial property loan of $1.1 million with a loss of $37 thousand during the three months ended June 30, 2026. The sold commercial property loan was transferred to loans held-for-sale from loans held-for-investment during the three months ended March 31, 2026. During the three months ended June 30, 2025, the Company sold SBA loans of $26.9 million with a gain of $1.5 million.
Previous wording
Other income primarily included wire transfer fees of $169 thousand and $153 thousand, respectively, and debit card interchange fees of $102 thousand and $86 thousand, respectively, for the three months ended March 31, 2026 and 2025.
Current wording
Other income primarily included wire transfer fees of $181 thousand and $173 thousand, respectively, and debit card interchange fees of $109 thousand and $117 thousand, respectively, for the three months ended June 30, 2026 and 2025.
Previous wording
Salaries and employee benefits increased primarily due to increases in salaries and group insurance, and a decrease in loan origination cost, which offsets and defers the recognition of salaries and benefits expense. The number of full-time equivalent employees was 264 at March 31, 2026 compared to 257 at March 31, 2025.
Current wording
Salaries and employee benefits increased primarily due to increases in salaries, bonus and vacation accruals, and group insurance. The number of full-time equivalent employees was 274 at June 30, 2026 compared to 266 at June 30, 2025.
Previous wording
Marketing and business promotion increased primarily due to an increase in advertising.
Current wording
Marketing and business promotion decreased primarily due to a decrease in advertising.
Previous wording
Other expenses included $86 thousand and $92 thousand in loan related expenses, $370 thousand and $478 thousand in office expense, and $180 thousand and $183 thousand in armed guard expense for the three months ended March 31, 2026 and 2025, respectively. During the three months ended March 31, 2025, the Company recognized an impairment on operating lease assets of $146 thousand for a sublease contract and recognition of contingent liabilities for legal settlements of $183 thousand.
Current wording
Other expenses included $229 thousand and $224 thousand in loan related expenses, $846 thousand and $1.1 million in office operating expense, and $385 thousand and $362 thousand in armed guard expense for the six months ended June 30, 2026 and 2025, respectively. During the six months ended June 30, 2025, the Company recognized an impairment on operating lease assets of $228 thousand for a sublease contract and recognition of contingent liabilities for legal settlements of $183 thousand.
Previous wording
Income tax expense was $4.3 million and $3.1 million, respectively, and the effective tax rate was 28.5% and 28.3%, respectively, for the three months ended March 31, 2026 and 2025.
Current wording
Income tax expense was $4.2 million and $3.6 million, respectively, and the effective tax rate was 28.3% and 28.4%, respectively, for the three months ended June 30, 2026 and 2025. For the six months ended June 30, 2026 and 2025, income tax expense was $8.4 million and $6.7 million, respectively, and the effective tax rate was 28.4% and 28.4%, respectively.
Previous wording
The fair value of total investment securities available-for-sale were $170.5 million at March 31, 2026, an increase of $10.5 million, or 6.5%, from $160.0 million at December 31, 2025. The increase was primarily due to purchases of $18.7 million, partially offset by principal paydowns of $6.9 million, net premium amortization of $24 thousand, and a decrease in fair value of securities available-for-sale of $1.3 million.
Current wording
The fair value of total investment securities available-for-sale were $184.3 million at June 30, 2026, an increase of $24.3 million, or 15.2%, from $160.0 million at December 31, 2025. The increase was primarily due to purchases of $41.0 million, partially offset by principal paydowns of $14.8 million, net premium amortization of $72 thousand, and a decrease in fair value of securities available-for-sale of $1.8 million.
Previous wording
As of March 31, 2026 and December 31, 2025, 95.8% and 95.5%, respectively, of the Company's securities available-for-sale at amortized cost basis were issued by U.S. government agency and U.S. GSEs. Because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell these securities before their anticipated recovery, the Company determined that these securities with unrealized losses did not warrant an ACL as of March 31, 2026 and December 31, 2025.
Current wording
As of June 30, 2026 and December 31, 2025, 96.1% and 95.5%, respectively, of the Company's securities available-for-sale at amortized cost basis were issued by U.S. government agency and U.S. GSEs. Because the decline in fair value is attributable to changes in interest rates, and not credit quality, and because the Company does not have the intent to sell these securities and it is likely that it will not be required to sell these securities before their anticipated recovery, the Company determined that these securities with unrealized losses did not warrant an ACL as of June 30, 2026 and December 31, 2025.
Previous wording
Loans held-for-sale were $3.6 million at March 31, 2026, a decrease of $8.5 million, or 70.2%, from $12.1 million at December 31, 2025. The decrease was primarily due to sales of $21.8 million and pay-offs and pay-downs of $149 thousand, partially offset by new funding of $12.4 million and a nonaccrual loan transferred from loans held-for-investment of $1.1 million.
Current wording
Loans held-for-sale were $2.9 million at June 30, 2026, a decrease of $9.1 million, or 75.7%, from $12.1 million at December 31, 2025. The decrease was primarily due to sales of $40.0 million and pay-offs and pay-downs of $258 thousand, partially offset by new funding of $30.0 million and a nonaccrual loan transferred from loans held-for-investment of $1.1 million.
Previous wording
Loans held-for-investment were $2.87 billion at March 31, 2026, an increase of $53.2 million, or 1.9%, from $2.82 billion at December 31, 2025. The increase was primarily due to new funding of term loans of $112.9 million and net increase of lines of credit of $20.1 million, partially offset by pay-downs and pay-offs of term loans of $78.7 million, charge-offs of $76 thousand and a nonaccrual loan transferred to loans held-for-sale of $1.1 million.
Current wording
Loans held-for-investment were $2.93 billion at June 30, 2026, an increase of $111.6 million, or 4.0%, from $2.82 billion at December 31, 2025. The increase was primarily due to new funding of term loans of $290.9 million, partially offset by pay-downs and pay-offs of term loans of $154.5 million, net decrease of lines of credit of $23.6 million, charge-offs of $94 thousand, and a nonaccrual loan transferred to loans held-for-sale of $1.1 million.
Previous wording
(1) Other property types represented less than 5% of total commercial real estate loans as of March 31, 2026 and December 31, 2025.
Current wording
(1) Each of other property types represented less than 5% of total commercial real estate loans as of June 30, 2026 and December 31, 2025.
Previous wording
Management believes that the projections used are reasonable and align with the Company’s expectation of the economic environment over the next 4 quarters.
Current wording
The forecasted 2026 year-end national unemployment rate improved to 4.3% in the June 2026 FOMC meeting from 4.4% in both the March 2026 and December 2025 FOMC meetings. The forecasted 2026 year-end year-over-year percentage change in real GDP decreased to 2.2% in the June 2026 FOMC meeting from 2.4% in the March 2026 FOMC meeting and 2.3% in the December 2025 FOMC meeting. Although the FOMC’s most recent year-end GDP projection declined, changes in unemployment rate projections had a greater impact to the Company’s forecast models. As a result, lower PD and LGD rates were applied across most loan segments, leading to a lower overall expected loss measurement. Management believes that the projections used are reasonable and align with the Company’s expectations regarding the economic environment over the next four quarters.
Previous wording
Loans individually evaluated for impairment totaled $49.0 million and $53.2 million, respectively, and related reserve totaled $120 thousand and $206 thousand, respectively, at March 31, 2026 and December 31, 2025.
Current wording
Loans individually evaluated for impairment totaled $29.2 million and $53.2 million, respectively, and related reserve totaled $226 thousand and $206 thousand, respectively, at June 30, 2026 and December 31, 2025.
Previous wording
The increase in nonaccrual loans held-for-investment was primarily due to a loan placed on nonaccrual status of $1.6 million, partially offset by paydowns and a loan transferred to loans held-for-sale of $1.1 million, payoffs of $173 thousand and charge-offs of $71 thousand during the three months ended March 31, 2026.
Current wording
The increase in nonaccrual loans held-for-investment was primarily due to a loan placed on nonaccrual status of $2.6 million, partially offset by paydowns and a loan transferred to loans held-for-sale of $1.1 million, payoffs of $560 thousand and charge-offs of $95 thousand during the six months ended June 30, 2026.
Previous wording
Loans are generally placed on nonaccrual status when they become 90 days past due, unless management believes the loan is well secured and in the process of collection. In all cases, loans are placed on nonaccrual if collection of principal or interest is considered doubtful. Past due loans may or may not be adequately collateralized, but collection efforts are continuously pursued. Loans may be restructured by management when a borrower experiences changes to their financial condition, causing an inability to meet the original repayment terms, and where management believes the borrower will eventually overcome those circumstances and repay the loan in full. Additional income of approximately $163 thousand would have been recorded during the three months ended March 31, 2026 had these loans been paid in accordance with their original terms throughout the periods indicated.
Current wording
Loans are generally placed on nonaccrual status when they become 90 days past due, unless management believes the loan is well secured and in the process of collection. In all cases, loans are placed on nonaccrual if collection of principal or interest is considered doubtful. Past due loans may or may not be adequately collateralized, but collection efforts are continuously pursued. Loans may be restructured by management when a borrower experiences changes to their financial condition, causing an inability to meet the original repayment terms, and where management believes the borrower will eventually overcome those circumstances and repay the loan in full. Additional income of approximately $181 thousand and $365 thousand would have been recorded during the three and six months ended June 30, 2026, respectively, had these loans been paid in accordance with their original terms throughout the periods indicated.
Previous wording
The increase in retail time deposits was primarily due to new accounts of $116.8 million and renewals of the matured accounts of $388.8 million, partially offset by matured and closed accounts of $485.0 million.
Current wording
The increase in retail time deposits was primarily due to new accounts of $209.4 million and renewals of the matured accounts of $694.0 million, partially offset by matured and closed accounts of $873.5 million.
Previous wording
As of March 31, 2026 and December 31, 2025, total deposits were comprised of 19.8% and 19.9%, respectively, of noninterest-bearing demand accounts, 23.6% and 24.2%, respectively, of savings, NOW and money market accounts, and 56.6% and 55.9%, respectively, of time deposits.
Current wording
As of June 30, 2026 and December 31, 2025, total deposits were comprised of 19.5% and 19.9%, respectively, of noninterest-bearing demand accounts, 24.2% and 24.2%, respectively, of savings, NOW and money market accounts, and 56.3% and 55.9%, respectively, of time deposits.
Previous wording
Deposits from certain officers, directors and their related interests with which they are associated held by the Company were $9.6 million and $8.9 million, respectively, at March 31, 2026 and December 31, 2025.
Current wording
Deposits from certain officers, directors and their related interests with which they are associated held by the Company were $12.6 million and $8.9 million, respectively, at June 30, 2026 and December 31, 2025.
Previous wording
Shareholders’ equity was $396.7 million at March 31, 2026, an increase of $6.7 million, or 1.7%, from $390.0 million at December 31, 2025. The increase was primarily due to net income of $10.7 million and proceeds from stock option exercises of $112 thousand, partially offset by dividends declared on common stock of $3.1 million, repurchases of common stock of $193 thousand, preferred stock dividends of $86 thousand and an increase in accumulated other comprehensive loss of $895 thousand.
Current wording
Shareholders’ equity was $400.5 million at June 30, 2026, an increase of $10.4 million, or 2.7%, from $390.0 million at December 31, 2025. The increase was primarily due to net income of $21.2 million and proceeds from stock option exercises of $313 thousand, partially offset by dividends declared on common stock of $6.3 million, repurchases of common stock of $3.8 million, preferred stock dividends of $173 thousand and an increase in accumulated other comprehensive loss of $1.3 million.
Previous wording
To avoid restrictions on dividends, share repurchases and discretionary compensation payments to executives, the federal banking agencies require a banking organization to maintain a capital conservation buffer of 2.50% in common tier 1 capital, in addition to the minimum capital ratios adequacy requirements. The capital conservation buffer increases the minimum common equity Tier 1 capital ratio to 7%, the minimum Tier 1 capital (to risk-weighted assets) ratio to 8.5% and the minimum total capital ratio (to risk-weighted assets) to 10.5% for banking organizations seeking to avoid the limitations on dividends, share repurchases and discretionary compensation payments to executives. The Company’s and the Bank’s capital conservation buffers were 6.98% and 6.69%, respectively, as of March 31, 2026, and 6.96% and 6.72%, respectively, as of December 31, 2025.
Current wording
To avoid restrictions on dividends, share repurchases and discretionary compensation payments to executives, the federal banking agencies require a banking organization to maintain a capital conservation buffer of 2.50% in common tier 1 capital, in addition to the minimum capital ratios adequacy requirements. The capital conservation buffer increases the minimum common equity Tier 1 capital ratio to 7%, the minimum Tier 1 capital (to risk-weighted assets) ratio to 8.5% and the minimum total capital ratio (to risk-weighted assets) to 10.5% for banking organizations seeking to avoid the limitations on dividends, share repurchases and discretionary compensation payments to executives. The Company’s and the Bank’s capital conservation buffers were 6.91% and 6.58%, respectively, as of June 30, 2026, and 6.96% and 6.72%, respectively, as of December 31, 2025.
Previous wording
The purchase option may not be exercised during the ECIP Period unless and until the Company meets at least one of the Threshold Conditions: (1) an average of at least 60% of the Company’s loan originations qualify as “Deep Impact Lending” over any 16 consecutive quarters, (2) an average of at least 85% of the Company’s total originations qualify as “Qualified Lending” over any 24 quarters or (3) the Series C Preferred Stock has a dividend rate of no more than 0.5% at each of six consecutive “Reset Dates,” in each case as defined in Option Agreement and the terms of the Series C Preferred. In addition to satisfying a Threshold Condition, the Option Agreement requires that the Company meet certain other eligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of the original ECIP purchase agreement and the terms of the Series C Preferred Stock, maintaining qualification as either a certified community development financial institution or a minority depository institution and satisfying other legal and regulatory criteria.
Current wording
The purchase option may not be exercised during the ECIP Period unless and until the Company meets at least one of the Threshold Conditions: (1) an average of at least 60% of the Company’s loan originations qualify as “Deep Impact Lending” over any 16 consecutive quarters, (2) an average of at least 85% of the Company’s total originations qualify as “Qualified Lending” over any 24 quarters or (3) the Series C Preferred Stock has a dividend rate of no more than 0.5% at each of six consecutive “Reset Dates,” in each case as defined in the Option Agreement and the terms of the Series C Preferred. In addition to satisfying a Threshold Condition, the Option Agreement requires that the Company meet certain other eligibility conditions in order to exercise the purchase option in the future, including compliance with the terms of the original ECIP purchase agreement and the terms of the Series C Preferred Stock, maintaining qualification as either a certified community development financial institution or a minority depository institution and satisfying other legal and regulatory criteria.
Previous wording
The Company began paying quarterly dividends on the Series C Preferred Stock at 2% beginning in the three months ended June 30, 2024 and the dividend rate decreased to 0.50% from the three months ended March 31, 2025. Dividends on the Series C Preferred Stock totaled $86 thousand and $40 thousand for the three months ended March 31, 2026 and 2025, respectively.
Current wording
The Company began paying quarterly dividends on the Series C Preferred Stock at 2% beginning in the three months ended June 30, 2024 and the dividend rate decreased to 0.50% from the three months ended March 31, 2025. Dividends on the Series C Preferred Stock totaled $87 thousand and $87 thousand for the three months ended June 30, 2026 and 2025, respectively. For the six months ended June 30, 2026 and 2025, dividends on the Series C Preferred Stock totaled $173 thousand and $127 thousand, respectively.
Showing the first 40 of 41 pairs. Open the source sections for the rest.
Rearranged current paragraphs (15)
Current report — wording carried from elsewhere
(1) Average balance includes both loans held-for-sale and loans held-for-investment, as well as nonaccrual loans. Net amortization of deferred loan fees of $710 thousand and $680 thousand, respectively, and net accretion of discount on loans of $1.1 million and $1.5 million, respectively, are included in the interest income for the six months ended June 30, 2026 and 2025.
Current report — wording carried from elsewhere
(2) The yield on municipal bonds has not been computed on a tax-equivalent basis.
Current report — wording carried from elsewhere
(3) Net interest spread is calculated by subtracting average rate on interest-bearing liabilities from average yield on interest-earning assets.
Current report — wording carried from elsewhere
(4) Net interest margin is calculated by dividing net interest income by average interest-earning assets.
Current report — wording carried from elsewhere
(5) Cost of funds is calculated by dividing annualized interest expense on total interest-bearing liabilities by the sum of average total interest-bearing liabilities and noninterest-bearing demand deposits.
Current report — wording carried from elsewhere
The following table presents the components of net interest income for the periods indicated:
Current report — wording carried from elsewhere
Interest on investment securities increased primarily due to a 14.1% increase in average balance and an 11 basis point increase in average yield. The increase in average yield was primarily due to a higher yield on newly purchased investment securities. For the six months ended June 30, 2026 and 2025, the average yield on total investment securities was 4.00% and 3.89%, respectively.
Current report — wording carried from elsewhere
Interest expense on deposits decreased primarily due to a 41 basis point decrease in average cost of interest-bearing deposits, partially offset by a 6.4% increase in average balance of interest-bearing deposits. The decrease in average cost was primarily due to a decrease in market rates. For the six months ended June 30, 2026 and 2025, average cost on total interest-bearing deposits was 3.79% and 4.20%, respectively, and average cost on total deposits were 3.07% and 3.38%, respectively.
Current report — wording carried from elsewhere
Interest expense on other borrowings increased primarily due to a 75.3% increase in average balance, partially offset by a 64 basis point decrease in average cost.
Current report — wording carried from elsewhere
The following table presents the components of noninterest income for the periods indicated:
Current report — wording carried from elsewhere
Loan servicing income increased primarily due to a decrease in servicing asset amortization, partially offset by a decrease in servicing fee income. Servicing asset amortization was $858 thousand and $1.0 million, respectively, for the six months ended June 30, 2026 and 2025.
Current report — wording carried from elsewhere
Other income primarily included wire transfer fees of $350 thousand and $326 thousand, respectively, and debit card interchange fees of $211 thousand and $203 thousand, respectively, for the six months ended June 30, 2026 and 2025.
Current report — wording carried from elsewhere
Other expenses included $143 thousand and $132 thousand in loan related expenses, $476 thousand and $613 thousand in office operating expense, and $205 thousand and $179 thousand in armed guard expense for the three months ended June 30, 2026 and 2025, respectively. During the three months ended June 30, 2025, the Company recognized an impairment on operating lease assets of $82 thousand for a sublease contract.
Current report — wording carried from elsewhere
The following table presents the components of noninterest expense for the periods indicated:
Current report — wording carried from elsewhere
Salaries and employee benefits increased primarily due to increases in salaries, bonus and vacation accruals, and group insurance. The number of full-time equivalent employees was 274 at June 30, 2026 compared to 266 at June 30, 2025.