Oct 22, 2026 earnings call — Balanced loan and deposit growth; stable margin
Net interest margin remained at 4.37% and loans held for investment ended the quarter at just over $5 billion.
Revenue $0.1B (est $0.1B) · EPS $0.56 (est $0.54)
Key quotes
"We generated balanced growth across commercial, residential mortgage and consumer portfolios, maintained stable credit performance and continued to deploy capital in a disciplined manner despite a competitive operating environment."
"Growth in the quarter of approximately $81 million or 6% annualized was primarily focused within the relationship-based core deposit portfolios of the Community Bank with CD balances slightly down from a planned reduction in higher cost deposits."
"During the quarter, our CET1 ratio increased by another 44 basis points to 11.53%."
Analyst Q&A 5
margin drivers and expense outlook
Q (Brendan Nosal · Hovde Group): He asked whether the loan and rate dynamics mean margin can keep expanding beyond the fourth quarter. He also asked about expense run rate going forward, given the $41.5 million reference.
A: Management said asset-side momentum is good and the balance sheet should behave neutral to near-term rate changes assuming a non-time deposit beta in the 30% to 40% range. They noted the third quarter was a bit elevated for idiosyncratic reasons and expect fourth quarter expenses nearer to the $41 million run rate seen in Q1 and Q2.
"The balance sheet will behave pretty neutral to those changes in rates, as I mentioned in my prepared remarks, under the assumption that the non-time deposit beta is in that 30% to 40% range." — John Stewart (CFO)
C&I growth and capital plans
Q (Damon Del Monte · KBW): He asked whether C&I growth came from customers drawing on lines or from new relationships. He also asked about capital priorities: buybacks, M&A, or supporting organic growth, and whether tech spending could rise in 2027.
A: They said line-of-credit usage has been very stable and growth came from expanding existing C&I customers plus new opportunities, helped by some market disruption among competitors. Management said capital generation is strong—about 100 basis points of CET1 improvement over the last year—and all options (buybacks, dividends, partnerships) remain under review while the focus stays on accelerating organic growth; they also said major tech investments over the last 3 years are in the rearview mirror so no significant step-up in tech spend is expected.
"Our line of credit usage has been actually very stable." — Lynn Kerber
loan pricing and securities reinvestment
Q (Nathan Race · Piper Sandler): He asked about current competitive pricing on commercial and equipment loans and whether remixing could lift loan yields if rates stop rising. He also asked what comes off the securities book and expected reinvestment yields, and whether they will hire more commercial or treasury staff.
A: For commercial, they said they exited just under 7% and expect that level into Q4 barring rate changes, and they are being selective with pricing to manage NIM. On securities, they said about $20 million to $25 million a quarter comes off the book with reinvestment around 4.75% to 4.80%, and early Q4 reinvestments are above 5%. They said hiring of commercial/treasury producers is being evaluated opportunistically as part of the budget process.
"But as far as commercial goes, we exited just under 7%, barring any rate changes, I think that that's what we would expect as we move forward in Q4." — Lynn Kerber
fee income seasonality and CRE mix
Q (Brandon Rud · Stephens): He asked whether fee income should step down in the fourth quarter versus the strong Q3 levels. He also asked Lynn to explain the targeted reduction in parts of the CRE portfolio.
A: They said the baseline assumption is that Q3 fee levels (helped by mortgage) will not hold into the seasonally slower period of Q4. On CRE, they said they are not exiting real estate but are managing concentrations and shifting toward other segments like C&I where appetite exists, balancing diversification and exposure.
"It just wouldn't be our baseline assumption into a seasonally slower period in mortgage that we hold the levels you saw in Q3." — John Stewart (CFO)
loan growth, repricing, fee growth
Q (Brian Martin · Brean Capital): He asked where any stronger fourth-quarter loan growth would come from and about the longer-term growth outlook. He also asked to confirm the loan repricing pace and where fee income should improve next year, plus tax rate normalization.
A: They said new origination cadence has been good this year, but payoffs were elevated (customers selling properties) and they expect payoffs to moderate in Q4. They confirmed the loan repricing is about $150 million per quarter looking out over the next 4 to 6 quarters. For fees, they highlighted growth focus in treasury management investment and wealth (new Head of Wealth), and they said the tax rate should return to a more normalized level in Q4 and thereafter.
"I mean, if we look out over the next 4 to 6 quarters, it's about that level each quarter looking out." — John Stewart (CFO)