Northeast Bank Posts $29 Million in Net Income, Raises EPS to $3.42
Key Facts
Northeast Bank reported net income of $29.0 million, or $3.42 per diluted share, for the quarter ended September 30, 2026, compared with $22.5 million and $2.67 per share in the corresponding period of 2025, according to its official earnings release. Net interest income after provision for credit losses rose to $58.122 million from $48.627 million a year earlier. Before provision, net interest income increased to $58.9 million from $48.2 million, a year-over-year rise of $10.7 million. Chief Executive Rick Wayne said the bank entered fiscal 2027 with "strong momentum," citing quarterly net income and loan production. The board declared a cash dividend of one cent per share, as earnings grew and the lending portfolio expanded.
The bank attributed the increase in interest income to growth in loan interest income, which rose $16.7 million year over year. This was driven mainly by higher average balances in the National Lending and Small Business units, despite lower yields on the loan portfolio. Loans generated during the quarter totaled $534.3 million, including $258.6 million originated by the National Lending unit. Wayne described the unit's originations as a record. Total loans, including loans held for sale, increased by $162.837 million, or 3.55%, between June 30 and September 30, 2026. The figures reflect increased lending activity and loan balances during the quarter.
Interest income growth was accompanied by increases in some funding costs. Interest expense on Federal Home Loan Bank advances rose $4.3 million year over year, while interest expense on deposits increased $1.2 million. Net interest margin was 4.57% in the September quarter, compared with 4.59% in the same quarter of 2025. The provision for credit losses also increased $1.2 million from the year-earlier period. The bank recorded a provision of $794 thousand in the quarter ended September 2026, compared with a provision reversal of $435 thousand a year earlier. Net interest income after provision therefore increased year over year as funding costs and the credit provision rose.
Deposits increased $95.3 million, or 2.6%, from June 30 to September 30, 2026. Time deposits rose $143.4 million, or 5.7%, over the same period, a change the bank attributed mainly to brokered time deposits. The release said brokered time deposits increased $151.9 million during the quarter. The two figures differ in the release's reporting of time deposits and brokered time deposits, while total deposits also grew during the period. The deposit increase coincided with a 3.55% rise in total loans since the end of June. The bank did not link these movements in its disclosure to a specific assessment of liquidity risk or a particular effect on margins.
Asset quality indicators improved between the end of June and the end of September. Nonperforming assets were $31.9 million, or 0.6% of assets, on September 30, compared with $34.8 million, or 0.7%, on June 30. Past-due loans were $22.4 million at the end of September, compared with $24.0 million at the end of June. The ratio of past-due loans to total loans fell to 0.48% in September from 0.54% in June and 0.77% in September 2025. The earnings release also reported the past-due loan ratio as 0.5% when rounded to one decimal place. The comparison shows that past-due balances and nonperforming assets declined from their end-of-June levels, while the annual past-due loan ratio was below its level a year earlier.
The bank scheduled a conference call to discuss first-quarter results and business outlook for 10:00 a.m. Eastern Time on October 27, 2026. The cash dividend of $0.01 per share is payable November 23 to shareholders of record on November 9, 2026. The company's release specified that the call would discuss results and business outlook, while the dividend schedule sets the record date two weeks before payment. The dividend announcement follows net income above the corresponding quarter of 2025. The bank also reported growth in loans and deposits between June 30 and September 30. These dates conclude the disclosure with the management discussion of results followed by the scheduled dividend payment to shareholders.