PLUMAS BANCORP
For the period ended Sep 30, 2026. Filed Nov 4, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 4, 2026
PLBC$62.46-0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-05.
0001437749-26-025819
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-04.
0001437749-26-034778
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 112 previous paragraphs and 106 current paragraphs.
45 unchanged; 52 reworded; 9 added; 13 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 20 previous and 20 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 (9)
Current report
Interest expense on deposits increased by $197 thousand related to an increase of $24.6 million in average balance of interest-bearing deposits and a 4 basis point increase in the average rate paid on interest-bearing deposits. The average rate paid on interest-bearing deposits increased from 1.56% during the third quarter of 2025 to 1.60% during the current quarter, primarily due to an increase in the average rate paid on time deposits from 1.87% in the third quarter of 2025 to 2.77% during the current quarter. These increases were partially offset by a decrease in the average rate paid on money market deposits from 2.22% in the third quarter of 2025 to 1.79% during the current quarter.
Current report
The average rate paid on interest-bearing liabilities decreased from 1.67% during the third quarter of 2025 to 1.63% during the current quarter, as the increase in the average rate paid on interest-bearing deposits was more than offset by decreases in the average rates paid on repurchase agreements and borrowings. The average rate paid on repurchase agreements decreased from 1.69% during the third quarter of 2025 to 1.54% during the current quarter. The average rate paid on borrowings decreased from 5.20% during the third quarter of 2025 to 4.38% during the current quarter.
Current report
**Non-interest income.**During the three months ended September 30, 2026, non-interest income totaled $2.8 million, an increase of $538 thousand from the three months ended September 30, 2025. The increase was primarily driven by the absence of a $628 thousand loss on the sale of investment securities recognized in the prior-year quarter.
Current report
**Non-interest expense.**During the three months ended September 30, 2026, non-interest expense totaled $15.1 million, an increase of $11 thousand from the three months ended September 30, 2025. The four largest increases were $341 thousand in professional fees, $272 thousand in occupancy and equipment, $222 thousand in salaries and employee benefits, and $178 thousand in loan collection expenses. The largest reduction in non-interest expense was $879 thousand in merger expenses incurred during the third quarter of 2025. Management estimates that approximately $350 thousand of the professional fees and loan collection expenses recognized during the current quarter were nonrecurring in nature.
Current report
Certain comparisons to prior-year periods are impacted by the acquisition of Cornerstone Community Bancorp (“Cornerstone”) on July 1, 2025, as 2026 year-to-date results reflect a full period of combined operations while 2025 year-to-date results reflect only three months of combined operations.
Current report
**Non-interest income.**During the nine months ended September 30, 2026, non-interest income totaled $8.5 million, an increase of $713 thousand from the nine months ended September 30, 2025. The increase was primarily attributable to the absence of a $625 thousand loss on the sale of investment securities during the nine months ended September 30, 2025.
Current report
The following table describes the components of non-interest income for the nine-month periods ended September 30, 2026 and 2025:
Current report
Salary and benefit expense totaled $22.9 million during the current nine-month period and $18.9 million during the nine months ended September 30, 2025. The $4.0 million increase primarily related to the addition of personnel through the Cornerstone Community Bancorp acquisition. Related to an increase in pre-tax income, bonus expense increased by $626 thousand.
Current report
The following table describes the components of non-interest expense for the nine-month periods ended September 30, 2026 and 2025:
Removed paragraphs (13)
Previous report
BUSINESS COMBINATIONS - ACQUISITION OF CORNERSTONE COMMUNITY BANCORP
Previous report
On July 1, 2025 (the “Closing Date”), Plumas Bancorp (the “Company”) completed its previously announced acquisition of Cornerstone Community Bancorp (“Cornerstone”) pursuant to an Agreement and Plan of Merger and Reorganization, dated as of January 28, 2025, by and between the Company and Cornerstone (the “Merger Agreement”). Total book value of assets acquired from Cornerstone, excluding fair value adjustments, were $658 million, gross loans totaled $478 million, and deposits totaled $580 million. Goodwill associated with the acquisition of Cornerstone was $18.7 million; the core deposit intangible was $11.6 million. In addition, the Company recorded a discount on the acquired loans totaling $15.8 million. With the completion of the merger, Plumas Bank adds four branches in Anderson, Red Bluff and Redding (two branches), California.
Previous report
Pursuant to the Merger Agreement, on the Closing Date, Cornerstone merged with and into the Company (the “Merger”) with the Company continuing as the surviving corporation. Immediately following the Merger, Cornerstone’s subsidiary, Cornerstone Community Bank (CCB) merged with and into the Company’s subsidiary, Plumas Bank with Plumas Bank as the surviving bank. Pursuant to the terms of the Merger Agreement, upon the completion of the Merger, each share of Cornerstone common stock outstanding immediately prior was converted into the right to receive 0.6608 shares of common stock of the Company and $9.75 cash, with cash paid in lieu of fractional shares. The total aggregate consideration delivered to holders of Cornerstone common stock in the Merger was 1,003,718 shares of Company common stock and $14.8 million cash. In addition, in accordance with the Merger Agreement, the Company paid approximately $1.3 million to holders of options to purchase Cornerstone common stock that were terminated in connection with the Merger. The Company also assumed options to purchase 35,000 shares of Cornerstone common stock representing, on an as-converted basis, options to purchase 30,803 shares of the Company’s common stock.
Previous report
The accretion of discounts on loans acquired from Cornerstone totaled $1.3 million during the quarter an increase of $800 thousand from $500 thousand during the first quarter of 2026. The increase in accretion during the current quarter relates to an increase in prepayments on this portfolio. Partially offsetting the discount accretion was the reversal of approximately $375 thousand in interest on loans placed on nonaccrual during the current quarter. The average prime interest rate decreased from 7.5% during the second quarter of 2025 to 6.75% during the current quarter. Approximately 15% of the Company's loans are tied to the prime interest rate and most of these reprice within one to three months of a change in prime.
Previous report
Interest expense on deposits increased by $1.6 million and is broken down by product type as follows: money market accounts - $844 thousand, savings deposits - $29 thousand and time deposits - $747 thousand. The increase in interest expense primarily relates to the growth in money market and time deposits related to the acquisition of Cornerstone. The average rate paid on interest-bearing deposits increased from 1.30% during the second quarter of 2025 to 1.59% during the current quarter and relates to an increase in the percentage of average money market and time deposits to average interest bearing deposits from 58% during the second quarter of 2025 to 68% during the current quarter as well as an increase in the average rate paid on these deposits.
Previous report
The average rate paid on interest bearing liabilities increased from 1.33% during the 2025 quarter to 1.62% in 2026 related to the increase in the cost of interest-bearing deposits and repurchase agreements. The average rate paid on repurchase agreements increased from 0.46% during the second quarter of 2025 to 1.48% during the current quarter. This increase is related to higher rate repurchase agreements acquired in the acquisition of Cornerstone.
Previous report
**Non-interest income.**During the three months ended June 30, 2026, non-interest income totaled $2.8 million, an increase of $390 thousand from the three months ended June 30, 2025. Significant increases in non-interest income during the current quarter were $168 thousand in earnings on Bank Owned Life Insurance (BOLI) and $97 thousand in interchange income. Each of these items benefited from the acquisition of Cornerstone. Additionally, during the current period non-interest income included a gain of $104 thousand on sale of an OREO property.
Previous report
**Non-interest expense.**During the three months ended June 30, 2026, total non-interest expense increased by $3.5 million from $11.0 million during the second quarter of 2025 to $14.5 million during the current quarter. Much of this increase was driven by the acquisition of Cornerstone. Salary and benefit expense increased by $2.0 million which includes an increase in salary expense of $1.2 million primarily related to an increase in Full-Time Equivalent (FTE) employees of 56 to 238 FTE at June 30, 2026 and to a much lesser extent merit and promotional increases. Primarily related to an increase in pre-tax income, bonus expense increased by $315 thousand.
Previous report
Occupancy and equipment expense increased by $598 thousand from $2.0 million during the second quarter of 2025 to $2.6 million during the current quarter, primarily related to the acquisition of Cornerstone and to a lesser extent the sales/leaseback completed during the fourth quarter of 2025. Amortization of Core Deposit Intangible increased by $522 thousand related to the acquisition of Cornerstone. The largest reduction in non-interest expense was $481 thousand in merger expenses incurred during the second quarter of 2025.
Previous report
The following table describes the components of non-interest income for the six-month periods ended June 30, 2026 and 2025:
Previous report
Salary and benefit expense totaled $15.3 million during the current six month period and $11.4 million during the six months ended June 30, 2025. Salary expense increased by $2.1 million, mostly related to an increase in FTE. Related to an increase in pre-tax income, bonus expense increased by $595 thousand. Other significant increases in salary and benefit expense include $316 thousand in payroll taxes and $226 thousand in insurance expense.
Previous report
The following table describes the components of non-interest expense for the six-month periods ended June 30, 2026 and 2025:
Previous report
During the first half of 2026 we recorded a provision for credit losses of $270 thousand consisting of a provision for credit losses on loans of $200 thousand and an increase in the reserve for unfunded commitments of $70 thousand. This compares to a provision for credit losses of $1.1 million during the same period in 2025. The prior-year provision included $931 thousand of specific reserves associated with an agricultural lending relationship that was placed on nonaccrual status during the second quarter of 2025.
Reworded paragraphs (52)
Previous wording
The following discussion and analysis sets forth certain statistical information relating to the Company as of June 30, 2026 and December 31, 2025 and for the six and three-month periods ended June 30, 2026 and 2025. This discussion should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and notes thereto included in Plumas Bancorp’s Annual Report filed on Form 10-K for the year ended December 31, 2025.
Current wording
The following discussion and analysis sets forth certain statistical information relating to the Company as of September 30, 2026 and December 31, 2025 and for the three and nine-month periods ended September 30, 2026 and 2025. This discussion should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and the consolidated financial statements and notes thereto included in Plumas Bancorp’s Annual Report filed on Form 10-K for the year ended December 31, 2025.
Previous wording
**Net Income.**The Company recorded net income of $9.9 million or $1.43 per share during the current quarter, an increase of $3.6 million from $6.3 million or $1.07 per share during the second quarter of 2025. Diluted earnings per share increased to $1.41 per share during the three months ended June 30, 2026 up from $1.05 per share during the quarter ended June 30, 2025. Return on average assets was 1.79% during the current quarter, up from 1.56% during the second quarter of 2025. Return on average equity increased to 15.0% for the three months ended June 30, 2026, up from 13.4% during the second quarter of 2025.
Current wording
****Net Income.****The Company recorded net income of $11.4 million, or $1.64 per share, an increase of $6.2 million from $5.1 million or $0.74 per share, during the third quarter of 2025. Diluted earnings per share increased to $1.61 per share during the three months ended September 30, 2026, up from $0.73 per share during the quarter ended September 30, 2025. Return on average assets was 1.98% during the current quarter, up from 0.90% during the third quarter of 2025. Return on average equity increased to 16.7% during the current quarter, up from 8.5% during the third quarter of 2025.
Previous wording
Net interest income increased by $7.8 million from $18.2 million during the three months ended June 30, 2025, to $26 million during the current quarter. The provision for credit losses decreased from $860 thousand during the second quarter of 2025 to $600 thousand during the current quarter. Non-interest income increased by $390 thousand from $2.4 million during the three months ended June 30, 2025 to $2.8 million during the second quarter of 2026. Non-interest expense increased by $3.5 million from $11.0 million during the second quarter of 2025 to $14.5 million during the current quarter. The provision for income taxes increased by $1.3 million from $2.4 million, during the three months ended June 30, 2025 to $3.7 million during the current quarter. The average effective tax rate was 27.1% in both periods.
Current wording
Net interest income increased by $1.3 million from $25.2 million during the three months ended September 30, 2025, to $26.5 million during the current quarter. The provision for credit losses decreased from $5.4 million during the third quarter of 2025 to $150 thousand during the current quarter. Non-interest income increased by $538 thousand from $2.2 million during the three months ended September 30, 2025, to $2.8 million during the third quarter of 2026. Non-interest expense was flat compared to the third quarter of 2025 at $15.1 million.The provision for income taxes increased $877 thousand to $2.6 million during the current quarter from $1.8 million during the third quarter of 2025, due to higher pre-tax earnings. The effective tax rate declined to 18.9% from 25.6% in the prior-year quarter, related to the purchase of $14.5 million in green energy tax credits.
Previous wording
Net interest income before provision for credit losses. Driven primarily by growth in the loan portfolio mostly related to the acquisition of Cornerstone, net interest income increased by $7.8 million from $18.2 million during the three months ended June 30, 2025, to $26.0 million for the three months ended June 30, 2026. The increase in net interest income includes an increase of $9.7 million in interest income partially offset by an increase of $1.9 million in interest expense.
Current wording
Net interest income before provision for credit losses. Net interest income increased by $1.3 million from $25.2 million during the three months ended September 30, 2025, to $26.5 million for the three months ended September 30, 2026. The increase in net interest income reflects an increase of $1.3 million in interest income and a $113 thousand decrease in interest expense.
Previous wording
Interest and fees on loans increased by $9.2 million to $24.8 million related to an increase in average balance and an increase in yield. Average loan balances increased by $484 million, while the average yield on these loans increased by 47 basis points from 6.14% during the second quarter of 2025 to 6.61% during the current quarter. The increase in yield relates to several factors including the accretion of discount on purchased loans, the repricing of a portion of our commercial real estate loans most of which reprice every five years from the date of origination, the reversal of $344 thousand in accrued interest on a large loan relationship during the second quarter of 2025 and growth in fixed rate SBA loans which totaled $123 million at June 30, 2026, and $75 million at June 30, 2025. The weighted average rate earned on this portfolio at June 30, 2026, was 8.1%.
Current wording
Interest and fees on loans increased by $1.2 million to $24.8 million related to an increase in average balance and an increase in yield. Average loan balances increased by $26 million, while the average yield on these loans increased by 21 basis points from 6.35% during the third quarter of 2025 to 6.56% during the current quarter. The increase in yield relates to several factors including the amortization of discount on purchased loans, the repricing of a portion of our commercial real estate loans most of which reprice every five years from the date of origination, and growth in fixed rate SBA loans which totaled $132 million at September 30, 2026, and $94 million at September 30, 2025. The weighted average rate earned on this portfolio at September 30, 2026, was 8.0%. The average prime interest rate decreased from 7.46% during the third quarter of 2025 to 6.79% during the current quarter. Loans indexed to the prime interest rate were approximately 19% of the Company’s variable rate loan portfolio; these loans reprice within one day to three months of a change in the prime rate.
Previous wording
Interest earned on investment securities increased by $484 thousand related to an increase in yield on investment securities of 21 basis points to 4.29% and an increase in average balance of $24 million. The increase in investment yields is consistent with the partial restructuring of the investment portfolio during the fourth quarter of 2025 and market conditions. Average investment securities increased from $442 million during the three months ended June 30, 2025 to $466 million during the current period.
Current wording
Interest earned on investment securities increased by $283 thousand related to an increase in yield on investment securities of 29 basis points to 4.35% partially offset by a decrease in average balance of $6 million. The increase in investment yields is consistent with the partial restructuring of the investment portfolio during the fourth quarter of 2025 and market conditions. Average investment securities decreased from $482 million during the three months ended September 30, 2025 to $476 million during the current period.
Previous wording
Interest earned on cash balances increased by $78 thousand related to an increase in average balance of $17 million partially offset by a decrease in average rate paid on cash balances of 73 basis points from 4.47% during the second quarter of 2025 to 3.74% during the current quarter. This decline in yield was mostly related to a decline in rate paid on balances held at the Federal Reserve Bank of San Francisco (FRB). The average rate earned on FRB balances decreased from 4.40% during the second quarter of 2025 to 3.65% during the current quarter.
Current wording
Interest earned on cash balances decreased by $224 thousand related to a decrease in average balance of $2 million and a decrease in average rate earned on cash balances of 74 basis points from 4.50% during the third quarter of 2025 to 3.8% during the current quarter. This decline in yield was mostly related to a decline in rate earned on balances held at the FRB. The average rate earned on FRB balances decreased from 4.36% during the third quarter of 2025 to 3.69% during the current quarter.
Previous wording
Net interest margin for the three months ended June 30, 2026, increased 30 basis points to 5.13%, up from 4.83% for the same period in 2025.
Current wording
Net interest margin for the three months ended September 30, 2026, increased 22 basis points to 5.05%, up from 4.83% for the same period in 2025.
Previous wording
**Provision for credit losses.**During the three months ended June 30, 2026, the provision for credit losses totaled $600 thousand consisting of a provision for credit losses on loans of $601 thousand and a decrease in the reserve for unfunded commitments of $1 thousand. This compares to a provision for credit losses of $1.1 million consisting of a provision for credit losses on loans of $1.1 million and a decrease in the reserve for unfunded commitments of $40 thousand during the six months ended June 30, 2025. See “Analysis of Asset Quality and Allowance for Loan Losses” for a discussion of loan quality trends and the provision for credit losses.
Current wording
****Provision for credit losses.****During the three months ended September 30, 2026, the provision for credit losses totaled $150 thousand consisting entirely of a provision for credit losses on loans. This compares to a provision for credit losses of $5.4 million consisting of a provision for credit losses on loans of $5.1 million and an increase in the reserve for unfunded commitments of $250 thousand during the three months ended September 30, 2025. The higher provision recorded during 2025 was primarily attributable to the Day 1 CECL provision on non-PCD loans and to a lesser extent the establishment of a reserve for unfunded commitments acquired in the Cornerstone Community Bancorp acquisition. See “Analysis of Asset Quality and Allowance for Credit Losses” for a discussion of loan quality trends and the provision for credit losses.
Previous wording
**Provision for income taxes.**The provision for income taxes increased by $1.3 million from $2.4 million, during the three months ended June 30, 2025 to $3.7 million during the current quarter. The average effective tax rate was 27.1% in both periods. The percentages for 2026 and 2025 differ from statutory rates as tax exempt items of income such as earnings on BOLI and municipal securities interest decrease taxable income while non-deductible merger transaction costs incurred during the 2025 quarter effectively increase taxable income.
Current wording
**Provision for income taxes.**The provision for income taxes increased $877 thousand to $2.6 million during the current quarter from $1.8 million during the third quarter of 2025, due to higher pre-tax earnings. The percentages for 2026 and 2025 differ from statutory rates as tax exempt items of income such as earnings on BOLI and municipal securities interest decrease taxable income while non-deductible merger transaction costs incurred during the 2025 quarter effectively increase taxable income. The effective tax rate declined to 18.9% from 25.6% in the prior-year quarter, related to the purchase of $14.5 million in green energy tax credits at a discount resulting in a $1.1 million reduction in the provision for income taxes in the third quarter of 2026.
Previous wording
RESULTS OF OPERATIONS FOR THE six MONTHS ENDED June 30, 2026
Current wording
RESULTS OF OPERATIONS FOR THE nine MONTHS ENDED September 30, 2026
Previous wording
**Net Income.**The Company recorded net income of $19.7 million or $2.83 per share during the current six-month period, an increase of $6.2 million from $13.5 million or $2.28 per share earned during the six months ended June 30, 2025. Earnings per diluted share increased to $2.79 during the six months ended June 30, 2026, up $0.54 from $2.25 during the first six months of 2025. Return on average assets was 1.79% during the six months ended June 30, 2026, up from 1.67% during the first half of 2025. Return on average equity increased to 14.9% for the six months ended June 30, 2026, up from 14.7% during the first half of 2025.
Current wording
****Net Income.****The Company recorded net income of $31.1 million or $4.46 per share during the current nine-month period, an increase of $12.5 million from $18.6 million or $2.98 per share earned during the nine months ended September 30, 2025. Earnings per diluted share increased to $4.40 during the nine months ended September 30, 2026, up $1.46 from $2.94 during the first nine months of 2025. Return on average assets was 1.85% during the nine months ended September 30, 2026, up from 1.35% during the first nine months of 2025. Return on average equity increased to 15.5% for the nine months ended September 30, 2026, up from 12.2% during the first nine months of 2025.
Previous wording
Net interest income increased by $14.4 million from $36.7 million during the six months ended June 30, 2025, to $51.1 million during the current period. The provision for credit losses decreased from $1.1 million during the first half of 2025 to $270 thousand during the current period. Non-interest income increased by $174 thousand from $5.6 million during the six months ended June 30, 2025 to $5.7 million during the first half of 2026. Non-interest expense increased by $7.3 million from $22.5 million during the first half of 2025 to $29.8 million during the current period. The provision for income taxes increased by $1.9 million from $5.2 million, or 27.8% of pre-tax income, during the six months ended June 30, 2025 to $7.1 million, or 26.5% of pre-tax income, during the current period.
Current wording
Net interest income increased by $15.8 million from $61.9 million during the nine months ended September 30, 2025, to $77.7 million during the current period. The provision for credit losses decreased from $6.5 million during the first nine months of 2025 to $420 thousand during the current period. Non-interest income increased by $713 thousand from $7.8 million during the nine months ended September 30, 2025, to $8.5 million during the first nine months of 2026. Non-interest expense increased by $7.3 million from $37.6 million during the first nine months of 2025 to $44.9 million during the current period. The provision for income taxes increased by $2.8 million from $7.0 million, or 27.2% of pre-tax income, during the nine months ended September 30, 2025, to $9.8 million, or 23.9% of pre-tax income, during the current period.
Previous wording
Net interest income before provision for credit losses. Net interest income for the six months ended June 30, 2026 was $51.1 million, an increase of $14.4 million from the $36.7 million earned during the same period in 2025. The increase in net interest income includes an increase of $18.5 million in interest income partially offset by an increase of $4.1 million in interest expense.
Current wording
Net interest income before provision for credit losses. Net interest income for the nine months ended September 30, 2026 was $77.7 million, an increase of $15.8 million from the $61.9 million earned during the same period in 2025. The increase in net interest income includes an increase of $19.8 million in interest income partially offset by an increase of $4.0 million in interest expense.
Previous wording
Interest and fees on loans increased by $17.7 million related to increases in average balance and yield. The average balance of loans during the six months ended June 30, 2026 was $1.5 billion, an increase of $490 million from $1.0 billion during the same period in 2025. The average yield on loans increased by 38 basis points from 6.15% during the first six months of 2025 to 6.53% during the current period. Included in interest and fees on loans for the six months ended June 30, 2026 was $1.8 million of discount accretion related to loans acquired in the Cornerstone acquisition. As the acquisition closed on July 1, 2025, no comparable accretion income was recognized during the first six months of 2025.
Current wording
Interest and fees on loans increased by $18.9 million related to increases in average balance and yield. The average balance of loans during the nine months ended September 30, 2026 was $1.5 billion, an increase of $333 million from $1.2 billion during the same period in 2025. Average loan balances during the first nine months of 2026 reflect a full period of loans acquired in the Cornerstone Community Bancorp acquisition, while the comparable 2025 period reflects only a partial period following the acquisition. The average yield on loans increased by 30 basis points from 6.24% during the first nine months of 2025 to 6.54% during the current period.
Previous wording
Interest on investment securities increased by $973 thousand related to an increase in yield of 18 basis points to 4.28% and an increase in average balance of $27 million to $470 million. The increase in investment yield is consistent with the partial restructuring of the investment portfolio during the fourth quarter of 2025 and market conditions.
Current wording
Interest on investment securities increased by $1.3 million related to an increase in yield of 22 basis points to 4.30% and an increase in average balance of $16 million to $472 million. The increase in investment yield is consistent with the partial restructuring of the investment portfolio during the fourth quarter of 2025 and market conditions.
Previous wording
Interest on cash balances declined by $195 thousand related to a decline in yield. The rate earned on cash balances declined by 73 basis points to 3.77%. The average balance in interest bearing cash remained unchanged at $53.8 million.
Current wording
Interest on cash balances declined by $419 thousand due to decreases in both average balance and yield. The rate earned on cash balances declined by 74 basis points to 3.76%. The average balance in interest-bearing cash declined by $798 thousand to $71.4 million.
Previous wording
Primarily related to an increase in balance and rate paid on deposits and repurchase agreements, interest expense increased from $4.5 million during the six months ended June 30, 2025 to $8.6 million during the current period. The average rate paid on interest bearing liabilities increased from 1.24% during the 2025 period to 1.61% in 2026.
Current wording
Primarily related to an increase in balance and rate paid on deposits and repurchase agreements, interest expense increased from $9.1 million during the nine months ended September 30, 2025 to $13.1 million during the current period. The average rate paid on interest-bearing liabilities increased from 1.43% during the 2025 period to 1.62% in 2026.
Previous wording
Interest expense on deposits increased by $3.3 million and is broken down by product type as follows: money market accounts - $1.6 million, savings deposits - $100 thousand and time deposits - $1.6 million. The average rate paid on interest-bearing deposits increased from 1.21% during the six months ended June 30, 2025 to 1.55% during the current period. Average interest-bearing deposits totaled $972 million during the first half of 2026, an increase of $274 million from $698 million during the first half of 2025.
Current wording
Interest expense on deposits increased by $3.5 million and is broken down by product type as follows: money market accounts - $1.2 million, savings deposits - $91 thousand and time deposits - $2.2 million. The average rate paid on interest-bearing deposits increased from 1.35% during the nine months ended September 30, 2025 to 1.57% during the current period. Average interest-bearing deposits totaled $986 million for the first nine months of 2026, an increase of $190 million from $796 million during the first nine months of 2025. Average interest-bearing deposit balances for the first nine months of 2026 reflect a full period of deposits acquired in the Cornerstone Community Bancorp acquisition, while the comparable 2025 period reflects only a partial period following the acquisition.
Previous wording
Interest expense on repurchase agreements increased by $683 thousand related to an increase in average balance of $67.7 million and an increase in rate paid of 1.33%.
Current wording
Interest expense on repurchase agreements increased by $621 thousand related to an increase in average balance of $41.7 million and an increase in rate paid of 40 basis points. The increase in average balances was primarily attributable to repurchase agreements acquired in the Cornerstone acquisition.
Previous wording
Net interest margin for the six months ending June 30, 2026 increased 19 basis points to 5.08%, up from 4.89% for the same period in 2025.
Current wording
Net interest margin for the nine months ended September 30, 2026 increased 20 basis points to 5.07%, up from 4.87% for the same period in 2025.
Previous wording
The following table presents for the six-month periods indicated the distribution of consolidated average assets, liabilities and shareholders' equity. It also presents the amounts of interest income from interest earning assets and the resultant annualized yields expressed in both dollars and annualized yield percentages, as well as the amounts of interest expense on interest bearing liabilities and the resultant cost expressed in both dollars and annualized rate percentages. Average balances are based on daily averages. Nonaccrual loans are included in the calculation of average loans while nonaccrued interest thereon is excluded from the computation of yields earned:
Current wording
The following table presents for the nine-month periods indicated the distribution of consolidated average assets, liabilities and shareholders' equity. It also presents the amounts of interest income from interest earning assets and the resultant annualized yields expressed in both dollars and annualized yield percentages, as well as the amounts of interest expense on interest bearing liabilities and the resultant cost expressed in both dollars and annualized rate percentages. Average balances are based on daily averages. Nonaccrual loans are included in the calculation of average loans while nonaccrued interest thereon is excluded from the computation of yields earned:
Previous wording
The following table sets forth changes in interest income and interest expense for the six-months ended June 30, 2026, and the amount of change attributable to variances in volume, rates and the combination of volume and rates based on the relative changes of volume and rates:
Current wording
The following table sets forth changes in interest income and interest expense for the nine-months ended September 30, 2026, and the amount of change attributable to variances in volume, rates and the combination of volume and rates based on the relative changes of volume and rates:
Previous wording
**Provision for credit losses.**During the first half of 2026 the provision for credit losses totaled $270 thousand consisting of a provision for credit losses on loans of $200 thousand and an increase in the reserve for unfunded commitments of $70 thousand. This compares to a provision for credit losses of $1.1 million consisting of a provision for credit losses on loans of $1.1 million and a decrease in the reserve for unfunded commitments of $40 thousand during the six months ended June 30, 2025. See “Analysis of Asset Quality and Allowance for Loan Losses” for a discussion of loan quality trends and the provision for credit losses.
Current wording
****Provision for credit losses.****During the first nine months of 2026 the provision for credit losses totaled $420 thousand consisting of a provision for credit losses on loans of $350 thousand and an increase in the reserve for unfunded commitments of $70 thousand. This compares to a provision for credit losses of $6.5 million consisting of a provision for credit losses on loans of $6.3 million and an increase in the reserve for unfunded commitments of $211 thousand during the nine months ended September 30, 2025. The higher provision recorded during 2025 was primarily attributable to the Day 1 CECL provision on non-PCD loans and to a lesser extent the establishment of a reserve for unfunded commitments acquired in the Cornerstone Community Bancorp acquisition. See “Analysis of Asset Quality and Allowance for Credit Losses” for a discussion of loan quality trends and the provision for credit losses.
Previous wording
**Non-interest income.**During the six months ended June 30, 2026, non-interest income totaled $5.7 million, an increase of $174 thousand from the six months ended June 30, 2025. Significant increases in non-interest income during the current period were $278 thousand in FHLB dividends, $327 thousand in earnings on BOLI and $238 thousand in interchange income. Each of these items benefited from the acquisition of Cornerstone. Additionally, the FHLB paid a special dividend of $252 thousand during the first quarter of 2026. These increases were mostly offset by a $1.1 million settlement related to the Dixie Fire during the first quarter of 2025.
Current wording
Increases in non-interest income during the current period were $342 thousand in earnings on life insurance policies, $296 thousand in FHLB dividends, and $253 thousand in interchange income. Each of these items benefited from the acquisition of Cornerstone. These increases were mostly offset by a $1.1 million settlement related to the Dixie Fire during the first quarter of 2025.
Previous wording
**Non-interest expense.**Primarily driven by the acquisition of Cornerstone, non-interest expense increased by $7.3 million from $22.5 million during the first half of 2025 to $29.8 million during the current period. The four largest increases were $3.8 million in salary and benefit expense, $1.3 million in occupancy and equipment expense, $1.1 million in amortization of core deposit intangible and $637 thousand in other.
Current wording
**Non-interest expense.**Non-interest expense increased by $7.3 million from $37.6 million during the first nine months of 2025 to $44.9 million during the current period. The four largest increases were $4.0 million in salary and benefit expense, $1.5 million in occupancy and equipment expense, $1.0 million in amortization of core deposit intangible and $644 thousand in professional fees.
Previous wording
Primarily related to the acquisition of Cornerstone and to a lesser extent the sales/leaseback completed during the fourth quarter of 2025, occupancy and equipment expenses increased by $1.2 million from $4.1 million during the first six months of 2025 to $5.3 million during the current period. Amortization of Core Deposit Intangible increased by $1.1 million related to the acquisition of Cornerstone. Other expense increased by $637 thousand related to a $726 thousand loss associated with two fraudulent wire transfers during the first quarter of 2026. The largest reduction in non-interest expense was $1.1 million in merger expenses incurred during the first half of 2025.
Current wording
Primarily related to the acquisition of Cornerstone and to a lesser extent the sales/leaseback completed during the fourth quarter of 2025, occupancy and equipment expenses increased by $1.5 million from $6.5 million during the first nine months of 2025 to $8 million during the current period. Amortization of Core Deposit Intangible increased by $1 million related to the acquisition of Cornerstone. Other expense increased by $603 thousand primarily related to a $726 thousand loss associated with two fraudulent wire transfers during the first quarter of 2026. The largest reduction in non-interest expense was $1.9 million in merger expenses incurred during the first nine months of 2025.
Previous wording
**Provision for income taxes.**The provision for income taxes increased by $1.9 million from $5.2 million, or 27.8% of pre-tax income, during the six months ended June 30, 2025 to $7.1 million, or 26.5% of pre-tax income, during the current period. The percentages for 2026 and 2025 differ from statutory rates as tax exempt items of income such as earnings on BOLI and municipal securities interest decrease taxable income while non-deductible merger transaction costs incurred during the 2025 period effectively increase taxable income.
Current wording
**Provision for income taxes.**The provision for income taxes increased by $2.8 million from $7.0 million, or 27.2% of pre-tax income, during the nine months ended September 30, 2025, to $9.8 million, or 23.9% of pre-tax income, during the current period. The percentages for 2026 and 2025 differ from statutory rates as tax exempt items of income such as earnings on BOLI and municipal securities interest decrease taxable income while non-deductible merger transaction costs incurred during the 2025 period effectively increase taxable income. Additionally, the effective tax rate declined related to the purchase of $14.5 million in green energy tax credits at a discount resulting in a $1.1 million reduction in the provision for income taxes in the third quarter of 2026.
Previous wording
Total assets were $2.3 billion on June 30, 2026, an increase of $39 million from December 31, 2025. The largest component of this increase was $55 million in cash and cash equivalents. The largest decline was $11 million in investment securities. Total liabilities increased by $28 million related to an increase of $76 million in deposits partially offset by a decline of $39 million in repurchase agreements and $7 million in all other liabilities. Total shareholders' equity increased by $11 million.
Current wording
Total assets were $2.3 billion on September 30, 2026, an increase of $28 million from December 31, 2025. The largest component of this increase was $34 million in cash and cash equivalents. The largest decline was $16 million in net loans. Total liabilities increased by $26 million related to an increase of $57 million in deposits and $11 million in accrued interest payable and other liabilities partially offset by a decline of $36 million in repurchase agreements and $5 million in all other liabilities. Total shareholders' equity increased by $1 million.
Previous wording
**Loan Portfolio.**Gross loans totaled $1.5 billion on June 30, 2026, and December 31, 2025. Increases of $23 million in commercial real estate loans, $9 million in construction loans and $1 million in equity lines of credit were offset by declines of $15 million in agricultural loans, $10 million in automobile loans, $6 million in commercial loans, and $2 million in other loans. Although the Company offers a broad array of financing options, it continues to concentrate its focus on small to medium sized commercial businesses. These loans offer diversification as to industries and types of businesses, thus limiting material exposure in any industry concentrations. The Company offers both fixed and floating rate loans and obtains collateral in the form of real property, business assets and deposit accounts, but looks to business and personal cash flows as its primary source of repayment. In the fourth quarter of 2023 we terminated our indirect automobile loan program. Ending this program, which was our lowest yielding loan segment, also improved our loan loss risk profile since this program had historically higher charge-off rates. Terminating this program also improved our consumer compliance risk profile.
Current wording
**Loan Portfolio.Gross loans were $1.5 billion at September 30, 2026 and December 31, 2025. Increases in loans included $14 million in construction loans, $13 million in commercial real estate loans, and $1 million in equity lines. These increases were more than offset by a decrease of $18 million in agricultural loans, $14 million in automobile loans, $8 million in commercial loans, and $3 million in other loans. **Although the Company offers a broad array of financing options, it continues to concentrate its focus on small to medium sized commercial businesses. These loans offer diversification as to industries and types of businesses, thus limiting material exposure in any industry concentrations. The Company offers both fixed and floating rate loans and obtains collateral in the form of real property, business assets and deposit accounts, but looks to business and personal cash flows as its primary source of repayment. In the fourth quarter of 2023 the Company terminated the indirect automobile loan program. Ending this program, which was the lowest yielding loan segment, also improved the loan loss risk profile since this program had historically higher charge-off rates. Terminating this program also improved the consumer compliance risk profile.
Previous wording
Commercial real estate loans (“CRE”) comprised 68% of the lending portfolio at June 30, 2026. CRE loans were 44% owner-occupied, 43% investor-owned, and 13% multi-family. Concentrations by real estate type within the CRE portfolio, excluding multi-family, were 14% Office, 13% Mixed Commercial Real Estate, 13% Retail, 11% Hospitality, 9% Industrial, 8% Gas Stations, 6% Residential, 5% Special Purpose, and 5% Medical Buildings, with all remaining concentrations below 5%. There were no rent-controlled properties within the multi-family category. Office facilities are typically small and located in more rural areas. 22% of CRE loans were located in northern Nevada and 54% were located in northern California. Non-accrual loans totaled $21.9 million at June 30, 2026, of which approximately 32% were CRE. Substandard loans totaled $42.8 million at June 30, 2026, of which approximately 32% were CRE.
Current wording
Commercial real estate loans (“CRE”) comprised 68% of the lending portfolio at September 30, 2026. CRE loans were 44% owner-occupied, 43% investor-owned, and 13% multi-family. Concentrations by real estate type within the CRE portfolio, excluding multi-family, were 14% Office, 13% Mixed Commercial Real Estate, 12% Retail, 10% Hospitality, 9% Industrial, 9% Gas Stations, 6% Residential, 5% Special Purpose, and 5% Medical Buildings, with all remaining concentrations below 5%. Office facilities are typically small and located in more rural areas. 22% of CRE loans were located in northern Nevada and 54% were located in northern California. Of the $21.1 million in non-accrual balances at September 30, 2026, approximately 29% were CRE. Of the $40.4 million in substandard balances at September 30, 2026, approximately 29% were CRE.
Previous wording
The rates of interest charged on variable rate loans are set at specific increments in relation to the Company's lending rate or other indexes such as the published prime interest rate or U.S. Treasury rates and vary with changes in these indexes. The frequency in which variable rate loans reprice can vary from one day to several years. On June 30, 2026, and December 31, 2025, approximately 79% and 80%, respectively of the Company's loan portfolio was comprised of variable rate loans. Loans indexed to the prime interest rate were approximately 20% of the Company’s variable rate loan portfolio on June 30, 2026; these loans reprice within one day to three months of a change in the prime rate. The remainder of the Company's variable rate loans mostly consist of commercial real estate loans tied to U.S. Treasury rates and reprice every five years. Approximately 77% of the variable rate loans are indexed to the five-year T-Bill rate and reprice every five years. While real estate mortgage, agricultural, commercial and consumer lending remain the foundation of the Company's historical loan mix, some changes in the mix have occurred due to the changing economic environment and the resulting change in demand for certain loan types
Current wording
The rates of interest charged on variable rate loans are set at specific increments in relation to the Company's lending rate or other indexes such as the published prime interest rate or U.S. Treasury rates and vary with changes in these indexes. The frequency in which variable rate loans reprice can vary from one day to several years. On September 30, 2026, and December 31, 2025, approximately 79% and 80%, respectively of the Company's loan portfolio was comprised of variable rate loans. Loans indexed to the prime interest rate were approximately 19% of the Company’s variable rate loan portfolio on September 30, 2026; these loans reprice within one day to three months of a change in the prime rate. The remainder of the Company's variable rate loans mostly consist of commercial real estate loans tied to U.S. Treasury rates and reprice every five years. Approximately 78% of the variable rate loans are indexed to the five-year T-Bill rate and reprice every five years. While real estate mortgage, agricultural, commercial and consumer lending remain the foundation of the Company's historical loan mix, some changes in the mix have occurred due to the changing economic environment and the resulting change in demand for certain loan types
Previous wording
**Analysis of Asset Quality and Allowance for Credit Losses.**The Company attempts to minimize credit risk through its underwriting and credit review policies. The Company’s credit review process includes internally prepared credit reviews as well as contracting with an outside firm to conduct periodic credit reviews. The Company’s management and lending officers evaluate the loss exposure of classified and nonaccrual loans on a quarterly basis, or more frequently as loan conditions change. The Management Asset Resolution Committee (MARC) reviews the asset quality of criticized and past due loans monthly and reports the findings to the full Board of Directors. In management's opinion, this loan review system helps facilitate the early identification of potential criticized loans. MARC also provides guidance for the maintenance and timely disposition of OREO properties including developing financing and marketing programs to incent individuals to purchase OREO. MARC consists of the Bank’s Chief Executive Officer, Chief Financial Officer, Chief Banking Officer, Regional President and Chief Credit Officer, and the activities are governed by a formal written charter. The MARC meets monthly and reports to the Board of Directors.
Current wording
**Analysis of Asset Quality and Allowance for Credit Losses.**The Company attempts to minimize credit risk through its underwriting and credit review policies. The Company’s credit review process includes internally prepared credit reviews as well as contracting with an outside firm to conduct periodic credit reviews. The Company’s management and lending officers evaluate the loss exposure of classified and nonaccrual loans on a quarterly basis, or more frequently as loan conditions change. The Management Asset Resolution Committee (MARC) reviews the asset quality of criticized and past due loans monthly and reports the findings to the full Board of Directors. In management's opinion, this loan review system helps facilitate the early identification of potential criticized loans. MARC also provides guidance for the maintenance and timely disposition of OREO properties including developing financing and marketing programs to incent individuals to purchase OREO. MARC consists of the Bank’s Chief Executive Officer, Chief Financial Officer, Regional Presidents and Chief Credit Officer, and the activities are governed by a formal written charter. The MARC meets monthly and reports to the Board of Directors.
Previous wording
Nonperforming assets (which are comprised of nonperforming loans, other real estate owned (“OREO”) and repossessed vehicle holdings) at June 30, 2026, were $23.6 million, up from $15.3 million at December 31, 2025. Nonperforming assets as a percentage of total assets increased to 1.04% at June 30, 2026, up from 0.68% at December 31, 2025. OREO totaled $135 thousand at June 30, 2026, and $226 thousand at December 31, 2025.
Current wording
Nonperforming assets (which are comprised of nonperforming loans, other real estate owned (“OREO”) and repossessed vehicle holdings) at September 30, 2026, were $21.3 million, up from $15.3 million at December 31, 2025. Nonperforming assets as a percentage of total assets increased to 0.94% at September 30, 2026, up from 0.68% at December 31, 2025. OREO totaled $135 thousand at September 30, 2026, and $226 thousand at December 31, 2025.
Previous wording
Nonperforming loans were $23.5 million at June 30, 2026 and $15.1 million at December 31, 2025. Nonperforming loans as a percentage of total loans increased to 1.55% at June 30, 2026, up from 1.00% at December 31, 2025. The increase in nonperforming loans during the period was primarily attributable to one larger lending relationship and several smaller credits. These loans have been individually evaluated as appropriate under the Company's allowance methodology and are generally supported by collateral values that management believes are sufficient based on current information. Included in nonperforming loans was one loan totaling $1.6 million which was past due 90 days at June 30, 2026 and still accruing interest. This loan was paid in full in July 2026.
Current wording
Nonperforming loans were $21.1 million at September 30, 2026 and $15.1 million at December 31, 2025. Nonperforming loans as a percentage of total loans increased to 1.41% at September 30, 2026, up from 1.00% at December 31, 2025. The increase in nonperforming loans during the period was primarily attributable to one larger lending relationship and several smaller credits. These loans have been individually evaluated as appropriate under the Company's allowance methodology and are generally supported by collateral values that management believes are sufficient based on current information.
Previous wording
Net charge-offs totaled $419 thousand and $137 thousand during the six months ended June 30, 2026 and 2025, respectively. The allowance for credit losses totaled $19.7 million at June 30, 2026, and $20.0 million at December 31, 2025. Specific reserves related to collateral dependent loans totaled $2.4 million and $1.5 million at June 30, 2026, and December 31, 2025, respectively. The allowance for credit losses as a percentage of total loans was 1.30% at June 30, 2026, and 1.32% at December 31, 2025.
Current wording
Net charge-offs totaled $567 thousand and $219 thousand during the nine months ended September 30, 2026 and 2025, respectively. The allowance for credit losses totaled $19.7 million at September 30, 2026, and $20.0 million at December 31, 2025. Specific reserves related to collateral dependent loans totaled $2.7 million and $1.5 million at September 30, 2026, and December 31, 2025, respectively. The allowance for credit losses as a percentage of total loans was 1.32% at September 30, 2026, and 1.32% at December 31, 2025.
Previous wording
The following table provides a summary of the change in the number and balance of OREO properties for the six months ended June 30, 2026 and 2025 (dollars in thousands):
Current wording
The following table provides a summary of the change in the number and balance of OREO properties for the nine months ended September 30, 2026 and 2025 (dollars in thousands):
Previous wording
The investment portfolio at June 30, 2026, consisted of $377 million in securities of U.S. Government-sponsored agencies and U.S. Government agencies, and 155 municipal securities totaling $89 million. The investment portfolio at December 31, 2025, consisted of $388 million in securities of U.S. Government-sponsored agencies and U.S. Government agencies, and 156 municipal securities totaling $89 million.
Current wording
**Investment Portfolio and Federal Reserve Balances.**Total investment securities were $475 million as of September 30, 2026, and $477 million at December 31, 2025. The investment portfolio at September 30, 2026, consisted of $394 million in securities of U.S. Government-sponsored agencies and U.S. Government agencies, and 155 municipal securities totaling $81 million. The investment portfolio at December 31, 2025, consisted of $388 million in securities of U.S. Government-sponsored agencies and U.S. Government agencies, and 156 municipal securities totaling $89 million.
Previous wording
**Investment Portfolio and Federal Reserve Balances.**Total investment securities were $466 million as of June 30, 2026, and $477 million at December 31, 2025. Unrealized losses on available-for-sale investment securities totaling $19.3 million were recorded, net of $5.7 million in tax benefit, as accumulated other comprehensive loss within shareholders' equity at June 30, 2026. No investment securities were sold during the six months ended June 30, 2026. During six months ending June 30, 2025 we sold $1.2 million in available for sale investment securities recording a net gain on sale of $3 thousand.
Current wording
Unrealized losses on available-for-sale investment securities totaling $44.4 million were recorded, net of $13.1 million in tax benefit, as accumulated other comprehensive loss within shareholders' equity at September 30, 2026. No investment securities were sold during the nine months ended September 30, 2026. Unrealized losses on available-for-sale investment securities totaling $14.9 million were recorded, net of $4.4 million in tax benefits, as accumulated other comprehensive loss within shareholders' equity at December 31, 2025. During the nine months ended September 30, 2025, the Company sold 90 available-for-sale investment securities for proceeds of $88,009,000, recording a $625,000 loss on sale. The unrealized losses at September 30, 2026 and December 31, 2025 were not attributable to credit-related factors.
Previous wording
There were no Federal funds sold at June 30, 2026, and December 31, 2025; however, the Bank maintained interest earning balances at the Federal Reserve Bank totaling $99 million at June 30, 2026, and $39 million at December 31, 2025. The balance on June 30, 2026, earns interest at the rate of 3.65%.
Current wording
There were no Federal funds sold at September 30, 2026, and December 31, 2025; however, the Bank maintained interest earning balances at the Federal Reserve Bank totaling $76 million at September 30, 2026, and $39 million at December 31, 2025. The balance on September 30, 2026, earns interest at the rate of 3.90%.
Showing the first 40 of 52 pairs. Open the source sections for the rest.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
In connection with the acquisition of Cornerstone, the Company assumed $12 million of subordinated debentures, including $2 million of 4.75% Fixed‑to‑Floating Rate Subordinated Notes due November 30, 2035 (the “2035 Notes”). The 2035 Notes, which were issued in 2020, have a fixed interest rate of 4.75% for the first ten years and thereafter a quarterly variable interest rate equal to the then current three-month term Secured Overnight Financing Rate (“SOFR”) plus 4.14%. The remaining subordinated notes were called in 2025 and are no longer outstanding. Interest expense recognized on the subordinated notes for the six months ended June 30, 2026, was $97 thousand.
Previous report — wording carried elsewhere
Unrealized losses on available-for-sale investment securities totaling $14.9 million were recorded, net of $4.4 million in tax benefits, as accumulated other comprehensive loss within shareholders' equity at December 31, 2025.