0001171843-26-003069
SEC filingStrong quarter driven by net interest income expansion and mortgage banking growth, with net income up 31% YoY.
Net income for the first quarter of 2026 was $83.0 million, a 31.2% increase compared to $63.2 million in the same period last year. Diluted earnings per share rose to $1.52, up 31.0% from $1.16. The increase was primarily driven by higher net interest income, supported by an increase in average equity and average non-interest-bearing deposits, as noted in management's discussion. Net cash provided by operating activities increased to $70.1 million from $48.0 million, reflecting strong cash generation from operations.
Mortgage banking revenue contributed to the earnings growth, driven by an increase in loans sold into the secondary market. This aligns with management's commentary that the year-over-year increase was primarily due to higher loan sales. Fee income also benefited from the overall increase in transaction volumes.
Management's strategy to offset higher funding costs includes maintaining a lower level of operating expenses and firm pricing discipline for loan products. While salary expenses may have increased, the company's focus on expense management helped support profitability.
Total deposits increased, primarily due to organic growth across nine of the company's eleven markets, with most of that increase attributable to money market products. Management believes the company's liquidity ratios meet or exceed regulatory guidelines, and they review funding sources and uses quarterly to ensure appropriate liquidity levels.
Management believes the allowance for credit losses (ACL) is adequate to absorb all expected future losses over the contractual life of the loan portfolio. While nonperforming loans may have increased, the reserve levels are considered sufficient based on current assessments.
The company maintains a strong capital position, supported by retained earnings. Management continues to focus on balancing growth with risk management, and the outlook remains positive given the strategic initiatives in place.