Avidbank Posts Net Income of $10.2 Million in Third Quarter of 2026
Key Facts
Avidbank Holdings reported net income of $10.2 million, or $0.94 per diluted share, in the third quarter of 2026, according to results published via Access Newswire. Net income was $7.6 million, or $0.71 per share, in the second quarter of the year. The company reported a net loss of $37.7 million, or $4.12 per share, in the third quarter of 2025. The figures mark a return to profitability year over year, following a loss in the same period. The official disclosure did not include a comparison with analyst estimates, so it does not establish that earnings exceeded expectations.
Net interest income was $28.7 million in the third quarter, up $6.0 million, or 27%, from the same period in 2025, the company said. Sequentially, net interest income rose $2.0 million, which the company described as 30% growth on an annualized basis compared with the second quarter. It attributed the year-over-year increase to higher average loans and securities yields, along with lower deposit costs and average short-term borrowings. It linked the quarterly increase to a temporary rise in deposits and cash, as well as higher average loans and securities balances. Return on average assets was 1.42%, compared with 1.20% in the second quarter and negative 6.35% in the third quarter of last year.
The company ended September with assets of $2.97 billion, up from $2.66 billion at the end of June and $2.36 billion a year earlier, according to its disclosure. Loans, net of deferred fees, totaled $2.28 billion on September 30. Loans increased $58.4 million from the end of June and $323.9 million from their level on September 30, 2025. Period-end deposits rose $290.1 million from June 30, an annualized rate of 50%. Year over year, period-end deposits increased $562.9 million, or 27%, while average deposits rose $449.9 million, or 22%.
Chief Executive Mark Mordell said the bank continued to grow loans and deposits and delivered strong profitability, but noted that a large share of the deposit increase came from a customer who temporarily placed a large amount. He added: "We expect this deposit to leave in the fourth quarter." The company said the deposit increase supported net interest income, but the cash associated with it weighed on net interest margin. The margin was 4.07% in the third quarter, down 19 basis points from the second quarter, while remaining 17 basis points above its level in the third quarter of 2025. The company estimated that a $205 million increase in average interest-bearing cash affected the margin by about 17 basis points, attributing this mainly to the temporary deposit inflow.
On asset quality, nonperforming loans were 0.70% of total loans on September 30, compared with 0.65% on June 30 and 0.14% on September 30, 2025. The company attributed the quarterly increase to a $1.5 million land loan classified as nonaccrual. On funding, Avidbank issued $30 million in new subordinated notes and redeemed $22 million in callable notes. The new notes carry a fixed interest rate of 7.00% for the first five years and mature on September 1, 2036. Book value per share was $27.24 at the end of September, up $0.27 from June and $2.24 from a year earlier.
The company's shares, AVBH, closed at $31.57 on October 26, down 0.41% for the session after trading between $31.51 and $32.00, according to Investing.com data. The previous recorded close, on October 23, was $31.70. The results were released after the market closed on October 26, so that day's share move does not reflect investor trading on the disclosure. Available closing data do not support the claim that the shares rose 3.9% following the results announcement. The company said it will hold a call to discuss its third-quarter results on October 27, 2026, at 11 a.m. Eastern time, or 8 a.m. Pacific time.