WESTFIELD, Mass., Jan. 27, 2026 (GLOBE NEWSWIRE) -- Western New England Bancorp, Inc. (the "Company" or "WNEB") (NasdaqGS: WNEB), the holding company for Westfield Bank (the "Bank"), announced today the unaudited results of operations for the three and twelve months ended December 31, 2025. For the three months ended December 31, 2025, the Company reported net income of $5.2 million, or $0.26 per diluted share, compared to net income of $3.3 million, or $0.16 per diluted share, for the three months ended December 31, 2024. On a linked quarter basis, net income was $5.2 million, or $0.26 per diluted share, as compared to net income of $3.2 million, or $0.16 per diluted share, for the three months ended September 30, 2025. For the twelve months ended December 31, 2025, net income was $15.3 million, or $0.75 per diluted share, compared to net income of $11.7 million, or $0.56 per diluted share, for the twelve months ended December 31, 2024.
The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.07 per share on the Company's common stock. The dividend will be payable on or about February 25, 2026 to shareholders of record on February 11, 2026.
James C. Hagan, President and Chief Executive Officer, commented, "We are pleased to report solid earnings for the fourth quarter of 2025, along with strong loan growth and core deposit growth. Total loans increased $113.2 million, or 5.5%, and core deposits increased $111.9 million, or 7.2%, from December 31, 2024. At December 31, 2025, our non-interest-bearing deposits and total core deposits represented 25.2% and 70.8% of total deposits, respectively. Our loan growth and disciplined approach to managing funding costs have allowed us to expand our net interest margin to 2.91% during the three months ended December 31, 2025. This is the sixth consecutive quarter of growth in both net interest income and net interest margin for the Company. Asset quality remains strong, with nonperforming assets to total assets of 0.19%, total delinquency as a percentage of total loans of 0.14%, and strong loan reserve levels of 393.2% as a percentage of nonaccrual loans."
Hagan concluded, "We remain disciplined in our capital management strategies, and during the twelve months ended December 31, 2025, we repurchased 599,853 shares of common stock with an average price per share of $9.73. Over the last twelve months, book value per share increased $0.86, or 7.6%, to $12.16 and tangible book value per share, a non-GAAP financial measure, increased $0.86, or 8.1%, to $11.49.
We are pleased with our fourth quarter results and are committed to delivering long-term value to shareholders through capital management strategies, which include continued loan growth, share repurchases and quarterly cash dividends."
Key Highlights:
Loans and Deposits
At December 31, 2025, total loans increased $113.2 million, or 5.5%, from $2.1 billion, or 77.9% of total assets, at December 31, 2024 to $2.2 billion, or 79.7% of total assets. The increase was primarily driven by an increase in residential real estate loans, including home equity loans, of $81.2 million, or 10.5%, an increase in commercial and industrial loans of $10.1 million, or 4.8%, and an increase in commercial real estate loans of $23.3 million, or 2.2%. The increase in total loans was partially offset by a decrease in consumer loans of $1.5 million, or 33.3%.
At December 31, 2025, total deposits of $2.4 billion increased $98.3 million, or 4.3%, from December 31, 2024. Core deposits, which the Company defines as all deposits except time deposits, increased $111.9 million, or 7.2%, from $1.6 billion, or 68.9% of total deposits, at December 31, 2024, to $1.7 billion, or 70.8% of total deposits, at December 31, 2025. Time deposits decreased $13.7 million, or 1.9%, from $703.6 million at December 31, 2024 to $689.9 million at December 31, 2025. Brokered time deposits, which are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered time deposits at December 31, 2025. The loan-to-deposit ratio was 92.5% and 91.5% at December 31, 2025 and December 31, 2024, respectively.
Allowance for Credit Losses and Credit Quality
At December 31, 2025, the allowance for credit losses was $20.3 million, or 0.93% of total loans, compared to $19.5 million, or 0.94% of total loans, at December 31, 2024. The allowance for credit losses, as a percentage of nonaccrual loans, was 393.2% and 362.9% at December 31, 2025 and December 31, 2024, respectively. At December 31, 2025, nonaccrual loans totaled $5.2 million, or 0.24% of total loans, compared to $5.4 million, or 0.26% of total loans, at December 31, 2024. Total delinquent loans decreased from $5.0 million, or 0.24% of total loans, at December 31, 2024 to $3.1 million, or 0.14% of total loans, at December 31, 2025. At December 31, 2025 and December 31, 2024, the Company did not have any other real estate owned.
Net Interest Margin
The net interest margin increased eight basis points from 2.81% for the three months ended September 30, 2025 to 2.89% for the three months ended December 31, 2025. The net interest margin, on a tax-equivalent basis, increased eight basis points from 2.83% for the three months ended September 30, 2025 to 2.91% for the three months ended December 31, 2025.
Stock Repurchase Program
On April 22, 2025, the Board of Directors authorized the 2025 Plan, pursuant to which the Company may repurchase up to 1.0 million shares of its common stock, or approximately 4.8%, of the Company's then-outstanding shares of common stock, upon the completion of the 2024 Plan. On June 3, 2025, the Company announced the completion of its 2024 Plan under which the Company repurchased a total of 1.0 million shares at an average price per share of $8.79.
During the three months ended December 31, 2025, the Company repurchased 100,000 shares of its common stock at an average price per share of $11.80. During the twelve months ended December 31, 2025, the Company repurchased 599,853 shares of its common stock under the 2025 Plan and the 2024 Plan, as applicable, at an average price per share of $9.73. As of December 31, 2025, there were 872,465 shares of common stock available for repurchase under the 2025 Plan.
The repurchase of shares under our 2025 Plan is administered through an independent broker. The shares of common stock repurchased under the 2025 Plan have been and will continue to be purchased from time to time at prevailing market prices, through open market or privately negotiated transactions, or otherwise, depending upon market conditions. There is no guarantee as to the exact number, or value, of shares that will be repurchased by the Company, and the Company may discontinue repurchases at any time that the Company's management ("Management") determines additional repurchases are not warranted. The timing and amount of additional share repurchases under the 2025 Plan will depend on a number of factors, including the Company's stock price performance, ongoing capital planning considerations, general market conditions, and applicable legal requirements.
Book Value and Tangible Book Value
The Company's book value per share was $12.16 at December 31, 2025, compared to $11.30 at December 31, 2024, while tangible book value per share, a non-GAAP financial measure, increased $0.86, or 8.1%, from $10.63 at December 31, 2024 to $11.49 at December 31, 2025. See pages 18-20 for the related tangible book value calculation and a reconciliation of GAAP to non-GAAP financial measures.
Net Income for the Three Months Ended December 31, 2025 Compared to the Three Months Ended September 30, 2025
For the three months ended December 31, 2025, the Company reported an increase in net income of $2.0 million, or 64.5%, from $3.2 million, or $0.16 per diluted share, for the three months ended September 30, 2025, to $5.2 million, or $0.26 per diluted share. Net interest income increased $737,000, or 4.1%, the provision for credit losses decreased $1.8 million, and non-interest expense increased $92,000 or 0.6%. Return on average assets and return on average equity were 0.75% and 8.40%, respectively, for the three months ended December 31, 2025, compared to 0.46% and 5.20%, respectively, for the three months ended September 30, 2025.
Net Interest Income and Net Interest Margin
On a sequential quarter basis, net interest income, our primary driver of revenues, increased $737,000, or 4.1%, to $18.8 million for the three months ended December 31, 2025, from $18.1 million for the three months ended September 30, 2025. The increase in net interest income was primarily due to an increase in interest income of $504,000, or 1.7%, and a decrease in interest expense of $233,000, or 2.0%.
The net interest margin was 2.89% for the three months ended December 31, 2025, compared to 2.81% for the three months ended September 30, 2025. The net interest margin, on a tax-equivalent basis, was 2.91% for the three months ended December 31, 2025, compared to 2.83% for the three months ended September 30, 2025. The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased two basis points from 4.67% for the three months ended September 30, 2025 to 4.69% for the three months ended December 31, 2025. The average loan yield, without the impact of tax-equivalent adjustments, increased two basis points from 5.01% for the three months ended September 30, 2025, to 5.03% for the three months ended December 31, 2025. During the same period, average loans increased $54.4 million, or 2.6%, average securities decreased $3.9 million, or 1.0%, and average short-term investments decreased $19.8 million, or 37.9%.
The average cost of total funds, including non-interest bearing accounts and borrowings, decreased six basis points from 1.94% for the three months ended September 30, 2025 to 1.88% for the three months ended December 31, 2025. The average cost of core deposits, which the Company defines as all deposits except time deposits, decreased two basis points from 1.04% for the three months ended September 30, 2025, to 1.02% for the three months ended December 31, 2025. The average cost of time deposits decreased five basis points from 3.51% for the three months ended September 30, 2025, to 3.46% for the three months ended December 31, 2025. The average cost of borrowings, including subordinated debt, was 4.96% for the three months ended December 31, 2025, compared to 5.03%, for the three months ended September 30, 2025. Average demand deposits, an interest-free source of funds, increased $14.7 million, or 2.5%, from $581.8 million, or 25.0%, of total average deposits, for the three months ended September 30, 2025, to $596.5 million, or 25.3% of total average deposits, for the three months ended December 31, 2025.
(Reversal of) Provision for Credit Losses
During the three months ended December 31, 2025, the Company recorded a reversal of credit losses of $485,000, compared to a provision for credit losses of $1.3 million during the three months ended September 30, 2025. The $1.8 million decrease in the provision for credit losses was primarily due to a decrease in unfunded commitments of $22.6 million, or 10.6%, and a slight improvement in macroeconomic forecasts. The reversal of credit losses was determined by a number of factors: the continued strong credit performance of the Company's loan portfolio, changes in the loan portfolio mix and Management's consideration of existing economic conditions and the economic outlook from the Federal Reserve Bank's actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.
During the three months ended December 31, 2025, the Company recorded net charge-offs of $41,000, compared to net charge-offs of $43,000 for the three months ended September 30, 2025.
Non-Interest Income
During each of the three months ended December 31, 2025 and September 30, 2025, non-interest income was $3.2 million. Service charges and fees on deposits were $2.6 million for the three months ended September 30, 2025 and the three months ended December 31, 2025. Income from bank-owned life insurance ("BOLI") increased $10,000, or 2.1%, from the three months ended September 30, 2025 to $492,000 for the three months ended December 31, 2025. Income from loan-level swap fees on commercial loans increased $18,000, or 15.4%, from the three months ended September 30, 2025 to the three months ended December 31, 2025. During the three months ended December 31, 2025, the Company reported unrealized losses on marketable equity securities of $7,000, compared to unrealized gains of $22,000 during the three months ended September 30, 2025.
Non-Interest Expense
For the three months ended December 31, 2025, non-interest expense increased $92,000, or 0.6%, to $15.9 million from $15.8 million for the three months ended September 30, 2025.
Salaries and employee benefits increased $164,000, or 1.8%, due to an increase in deferred compensation expense to reflect updated year-end performance award estimates. Occupancy expense increased $75,000, or 6.1%, primarily due to snow removal costs of $54,000. Software related expenses increased $35,000, or 5.4%, FDIC insurance expense increased $22,000, or 5.9%, and other non-interest expense increased of $19,000, or 1.3%. These increases were partially offset by a decrease in advertising expense of $84,000, or 19.4%, a decrease in professional fees of $72,000, or 15.7%, a decrease in debit card processing and ATM network costs of $34,000, or 5.4%, a decrease in data processing of $17,000, or 1.9%, and a decrease in furniture and equipment expense of $16,000, or 3.5%. For the three months ended December 31, 2025 and the three months ended September 30, 2025, the efficiency ratio was 72.1% and 74.2%, respectively.
Income Tax Provision
Income tax expense for the three months ended December 31, 2025 was $1.4 million, with an effective tax rate of 21.3%, compared to $1.0 million, with an effective tax rate of 24.5%, for the three months ended September 30, 2025.
Net Income for the Three Months Ended December 31, 2025 Compared to the Three Months Ended December 31, 2024
The Company reported an increase in net income of $1.9 million, or 58.4%, from $3.3 million, or $0.16 per diluted share, for the three months ended December 31, 2024 to $5.2 million, or $0.26 per diluted share, for the three months ended December 31, 2025. Net interest income increased $3.6 million, or 23.3%, reversal of credit losses decreased $277,000, or 36.4%, non-interest income decreased $81,000, or 2.5%, and non-interest expense increased $944,000, or 6.3%, during the same period. Return on average assets and return on average equity were 0.75% and 8.40%, respectively, for the three months ended December 31, 2025, compared to 0.49% and 5.48%, respectively, for the three months ended December 31, 2024.
Net Interest Income and Net Interest Margin
Net interest income increased $3.6 million, or 23.3%, to $18.8 million, for the three months ended December 31, 2025, from $15.3 million for the three months ended December 31, 2024. The increase in net interest income was due to an increase in interest and dividend income of $2.0 million, or 6.8%, and a decrease in interest expense of $1.6 million, or 12.1%. The increase in interest income was primarily due to the increase in average interest-earnings assets of $67.3 million, or 2.7%, and an increase in the average yield on interest-earning assets of 17 basis points, from the three months ended December 31, 2024 to the three months ended December 31, 2025.
The net interest margin increased 48 basis points from 2.41% for the three months ended December 31, 2024 to 2.89% for the three months ended December 31, 2025. The net interest margin, on a tax-equivalent basis, increased 48 basis points from 2.43%, for the three months ended December 31, 2024 to 2.91% for the three months ended December 31, 2025. The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased 17 basis points from 4.52% for the three months ended December 31, 2024 to 4.69%, for the three months ended December 31, 2025. The average loan yield, without the impact of tax-equivalent adjustments, increased 17 basis points from 4.86% for the three months ended December 31, 2024 to 5.03% for the three months ended December 31, 2025. During the same period, average loans increased $104.0 million, or 5.0%.
The average cost of total funds, including non-interest bearing accounts and borrowings, decreased 32 basis points from 2.20% for the three months ended December 31, 2024 to 1.88% for the three months ended December 31, 2025. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased four basis points from 0.98% for the three months ended December 31, 2024 to 1.02% for the three months ended December 31, 2025. The average cost of time deposits decreased 85 basis points from 4.31% for the three months ended December 31, 2024 to 3.46% for the three months ended December 31, 2025. The average cost of borrowings, including subordinated debt, decreased eight basis points from 5.04% for the three months ended December 31, 2024 to 4.96%, for the three months ended December 31, 2025. Average demand deposits, an interest-free source of funds, increased $17.3 million, or 3.0%, from $579.2 million, or 25.6% of total average deposits, for the three months ended December 31, 2024, to $596.5 million, or 25.3% of total average deposits, for the three months ended December 31, 2025.
Reversal of Credit Losses
During the three months ended December 31, 2025, the Company recorded a reversal of credit losses of $485,000, compared to a reversal of credit losses of $762,000 during the three months ended December 31, 2024. The reversal of credit losses was determined by a number of factors: the continued strong credit performance of the Company's loan portfolio, changes in the loan portfolio mix and Management's consideration of existing economic conditions and the economic outlook from the Federal Reserve Bank's actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.
The Company recorded net charge-offs of $41,000 for the three months ended December 31, 2025, as compared to net recoveries of $128,000 for the three months ended December 31, 2024.
Non-Interest Income
Non-interest income decreased $81,000, or 2.5%, to $3.2 million for the three months ended December 31, 2025, from the three months ended December 31, 2024. During the three months ended December 31, 2025, service charges and fees on deposits increased $252,000, or 11.0%, income from BOLI increased $6,000, or 1.2%, from $486,000 for the three months ended December 31, 2024 to $492,000 for the three months ended December 31, 2025. During the three months ended December 31, 2025, the Company reported $135,000 in other income from loan-level swap fees on commercial loans, compared to $187,000 during the three months ended December 31, 2024.
During the three months ended December 31, 2025, the Company reported unrealized losses on marketable equity securities of $7,000, compared to unrealized losses of $9,000 during the three months ended December 31, 2024. During the three months ended December 31, 2024, the Company reported a loss of $11,000 from mortgage banking activities and did not have a comparable gain or loss during the three months ended December 31, 2025. During the three months ended December 31, 2024, the Company reported gains on non-marketable equity investments of $300,000 and did not have a comparable gain or loss during the three months ended December 31, 2025.
Non-Interest Expense
For the three months ended December 31, 2025, non-interest expense increased $944,000, or 6.3%, to $15.9 million from $14.9 million for the three months ended December 31, 2024. Salaries and employee benefits increased $920,000, or 10.9%, to $9.4 million, due to an increase in deferred compensation expense to reflect updated year-end performance award estimates, software expenses increased $45,000, or 7.0%, advertising expense increased $39,000, or 12.6%, occupancy expense increased $10,000, or 0.7%, FDIC insurance expense increased $9,000, or 2.3%, net debit card processing and ATM network costs increased $6,000, or 1.0%, and other non-interest expense increased $67,000, or 5.0%. These increases were partially offset by a decrease in professional fees of $83,000, or 17.6%, a decrease in furniture and equipment expense of $68,000, or 13.5%, and a decrease in data processing of $1,000, or 0.1%.
For the three months ended December 31, 2025, the efficiency ratio was 72.1%, compared to 80.6% for the three months ended December 31, 2024. The decrease in the efficiency ratio was driven by an increase net interest income of $3.6 million, or 23.3%, from the three months ended December 31, 2024 to the three months ended December 31, 2025.
Income Tax Provision
Income tax expense for the three months ended December 31, 2025 was $1.4 million, or an effective tax rate of 21.3%, compared to $1.1 million, or an effective tax rate of 24.6%, for the three months ended December 31, 2024.
Net Income for the Twelve Months Ended December 31, 2025 Compared to the Twelve Months Ended December 31, 2024
For the twelve months ended December 31, 2025, the Company reported net income of $15.3 million, or $0.75 per diluted share, compared to $11.7 million, or $0.56 per diluted share, for the twelve months ended December 31, 2024. Net interest income increased $10.3 million, or 17.2%, provision for credit losses increased $1.0 million, non-interest income decreased $387,000, or 3.0%, and non-interest expense increased $4.1 million, or 6.9%, during the same period in 2024. Return on average assets and return on average equity were 0.56% and 6.35% for the twelve months ended December 31, 2025, respectively, compared to 0.45% and 4.93% for the twelve months ended December 31, 2024, respectively.
Net Interest Income and Net Interest Margin
During the twelve months ended December 31, 2025, net interest income increased $10.3 million, or 17.2%, to $70.1 million, compared to $59.8 million for the twelve months ended December 31, 2024. The increase in net interest income was due to an increase in interest income of $8.8 million, or 8.0%, and a decrease in interest expense of $1.5 million, or 3.0%.
The net interest margin for the twelve months ended December 31, 2025 was 2.75%, compared to 2.45% for the twelve months ended December 31, 2024. The net interest margin, on a tax-equivalent basis, was 2.77% for the twelve months ended December 31, 2025, compared to 2.47% for the twelve months ended December 31, 2024. During the twelve months ended December 31, 2024, the Company had fair value hedge income of $1.4 million, which contributed six basis points to the net interest margin. The adjusted net interest margin, excluding income from the fair value hedge, a non-GAAP financial measure, increased 36 basis points from 2.39% for the twelve months ended December 31, 2024 to 2.75% for the twelve months ended December 31, 2025. The fair value hedge matured in October of 2024. See pages 18-20 for the related net interest margin, excluding prepayment penalties and income from the fair value hedge calculation and a reconciliation of GAAP to non-GAAP financial measures.
The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased 15 basis points from 4.50% for the twelve months ended December 31, 2024 to 4.65% for the twelve months ended December 31, 2025. The average yield on loans, without the impact of tax-equivalent adjustments, increased 14 basis points from 4.86% for the twelve months ended December 31, 2024 to 5.00% for the twelve months ended December 31, 2025. During the twelve months ended December 31, 2025, average interest-earning assets increased $108.9 million, or 4.5%, to $2.5 billion, compared to the twelve months ended December 31, 2024, primarily due to an increase in average loans of $73.6 million, or 3.6%, an increase in average short-term investments, consisting of cash and cash equivalents, of $21.5 million, or 64.7%, and an increase in average securities of $13.6 million, or 3.8%.
During the twelve months ended December 31, 2025, the average cost of funds, including non-interest-bearing demand accounts and borrowings, decreased 15 basis points from 2.14% for the twelve months ended December 31, 2024 to 1.99%. For the twelve months ended December 31, 2025, the average cost of core deposits, including non-interest-bearing demand deposits, increased 15 basis points from 0.89% for the twelve months ended December 31, 2024, to 1.04%. The average cost of time deposits decreased 63 basis points from 4.32% for the twelve months ended December 31, 2024 to 3.69% for the twelve months ended December 31, 2025. The average cost of borrowings, which include borrowings and subordinated debt, increased 2 basis points from 5.00% for the twelve months ended December 31, 2024 to 5.02% for the twelve months ended December 31, 2025.
For the twelve months ended December 31, 2025, average demand deposits, an interest-free source of funds, increased $20.9 million, or 3.7%, from $561.3 million, or 25.8% of total average deposits, for the twelve months ended December 31, 2024, to $582.2 million, or 25.1% of total average deposits.
Provision for (Reversal of) Credit Losses
During the twelve months ended December 31, 2025, the Company recorded a provision for credit losses of $335,000, compared to a reversal of credit losses of $665,000 during the twelve months ended December 31, 2024. The $1.0 million increase in the provision for credit losses was primarily due to an increase in total loans of $113.2 million, or 5.5%, as well as an increase in unfunded commitments of $15.0 million, or 8.6%. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company's loan portfolio, changes in the loan portfolio mix and Management's consideration of existing economic conditions and the economic outlook from the Federal Reserve Bank's actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.
The Company recorded net recoveries of $472,000 for the twelve months ended December 31, 2025, as compared to net recoveries of $87,000 for the twelve months ended December 31, 2024. During the twelve months ended December 31, 2025, the Company recorded a recovery of $624,000 on a previously charged-off commercial relationship acquired on October 21, 2016 from Chicopee Bancorp, Inc. As of June 30, 2025, the relationship paid in full.
Non-Interest Income
For the twelve months ended December 31, 2025, non-interest income decreased $387,000, or 3.0%, from $12.9 million during the twelve months ended December 31, 2024 to $12.5 million. During the same period, service charges and fees on deposits increased $715,000, or 7.8%, and income from BOLI increased $52,000, or 2.7%. During the twelve months ended December 31, 2025, the Company reported $347,000 in other income from loan-level swap fees on commercial loans, compared to $261,000 during the same period in 2024. During the twelve months ended December 31, 2025, the Company reported a gain of $243,000 on non-marketable equity investments, compared to a gain of $1.3 million during the twelve months ended December 31, 2024. During the twelve months ended December 31, 2025, the Company reported unrealized gains on marketable equity securities of $35,000, compared to unrealized gains on marketable equity securities of $13,000 during the twelve months ended December 31, 2024. Gains and losses from the investment portfolio vary from quarter to quarter based on market conditions, as well as the related yield curve and valuation changes. During the twelve months ended December 31, 2025, the Company reported $11,000 in gains from mortgage banking activities, compared to $235,000 during the twelve months ended December 31, 2024 due to the sale of fixed rate residential real estate loans. In addition, during the twelve months ended December 31, 2024, the Company reported a loss on the disposal of premises and equipment of $6,000 and did not have a comparable gain or loss during the twelve months ended December 31, 2025.
Non-Interest Expense
For the twelve months ended December 31, 2025, non-interest expense increased $4.1 million, or 6.9%, to $62.5 million, compared to $58.4 million for the twelve months ended December 31, 2024. The increase in non-interest expense was primarily due to an increase in salaries and employee benefits of $3.0 million, or 9.3%, due to an increase in deferred compensation expense to reflect updated year-end performance award estimates as well as annual merit increases. Advertising expense increased $385,000, or 30.3%, data processing expense increased $153,000, or 4.4%, FDIC insurance expense increased $144,000, or 9.9%, software related expenses increased $124,000, or 4.9%, debit card and ATM processing fees increased $46,000, or 1.9%, and other non-interest expense increased $410,000, or 8.0%. These increases were partially offset by a decrease in occupancy expense of $11,000 or 0.2%, a decrease in furniture and equipment expense of $87,000, or 4.5%, and a decrease in professional fees of $144,000, or 6.7%.
For the twelve months ended December 31, 2025, the efficiency ratio was 75.6%, compared to 80.4% for the twelve months ended December 31, 2024. The decrease in the efficiency ratio was driven by higher net interest income during the twelve months ended December 31, 2025 compared to the twelve months ended December 31, 2024.
Income Tax Provision
Income tax expense for the twelve months ended December 31, 2025 was $4.5 million, representing an effective tax rate of 22.8%, compared to $3.3 million, representing an effective tax rate of 22.0%, for the twelve months ended December 31, 2024. The increase in income tax expense was due to higher pre-tax income for the twelve months ended December 31, 2025.
Balance Sheet
At December 31, 2025, total assets increased $83.4 million, or 3.1%, from December 31, 2024 to $2.7 billion. The increase in total assets was primarily due to an increase in total loans of $113.2 million, or 5.5%, partially offset by a decrease in cash and cash equivalents of $26.1 million, or 39.2%.
Investments
At December 31, 2025, the investment securities portfolio totaled $365.2 million, or 13.3% of total assets, compared to $366.1 million, or 13.8% of total assets, at December 31, 2024. At December 31, 2025, the Company's available-for-sale securities portfolio, recorded at fair market value, increased $15.1 million, or 9.4%, from $160.7 million at December 31, 2024 to $175.8 million. The held-to-maturity securities portfolio, recorded at amortized cost, decreased $16.2 million, or 7.9%, from $205.0 million at December 31, 2024 to $188.8 million at December 31, 2025.
At December 31, 2025, the Company reported unrealized losses on the available-for-sale securities portfolio of $22.4 million, or 11.3% of the amortized cost basis of the available-for-sale securities portfolio, compared to unrealized losses of $31.2 million, or 16.2% of the amortized cost basis of the available-for-sale securities at December 31, 2024. At December 31, 2025, the Company reported unrealized losses on the held-to-maturity securities portfolio of $30.3 million, or 16.1% of the amortized cost basis of the held-to-maturity securities portfolio, compared to $39.4 million, or 19.2% of the amortized cost basis of the held-to-maturity securities portfolio at December 31, 2024.
The securities in which the Company may invest are limited by regulation. Federally chartered savings banks have authority to invest in various types of assets, including U.S. Treasury obligations, securities of various government-sponsored enterprises, mortgage-backed securities, certain certificates of deposit of insured financial institutions, repurchase agreements, overnight and short-term loans to other banks, corporate debt instruments and marketable equity securities. The securities, with the exception of $10.9 million in corporate bonds, are issued by the United States government or government-sponsored enterprises and are therefore either explicitly or implicitly guaranteed as to the timely payment of contractual principal and interest. These positions are deemed to have no credit impairment, therefore, the disclosed unrealized losses with the securities portfolio relate primarily to changes in prevailing interest rates. In all cases, price improvement in future periods will be realized as the issuances approach maturity.
Management regularly reviews the portfolio for securities in an unrealized loss position. At December 31, 2025 and December 31, 2024, the Company did not record any credit impairment charges on its securities portfolio and attributed the unrealized losses primarily due to fluctuations in general interest rates or changes in expected prepayments and not due to credit quality. The primary objective of the Company's investment portfolio is to provide liquidity and to secure municipal deposit accounts while preserving the safety of principal. The available-for-sale and held-to-maturity portfolios are both eligible for pledging to the Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") as collateral for borrowings. The portfolios are comprised of high-credit quality investments and both portfolios generated cash flows monthly from interest, principal amortization and payoffs, which supports the Bank's objective to provide liquidity.
Total Loans
Total loans increased $113.2 million, or 5.5%, from $2.1 billion, or 77.9% of total assets, at December 31, 2024 to $2.2 billion, or 79.7% of total assets, at December 31, 2025. The increase in total loans was primarily driven by an increase in residential real estate loans, including home equity loans, of $81.2 million, or 10.5%, an increase in commercial and industrial loans of $10.1 million, or 4.8%, and an increase in commercial real estate loans of $23.3 million, or 2.2%. The increase in total loans was partially offset by a decrease in consumer loans of $1.5 million, or 33.3%.
The following table presents a summary of the loan portfolio by the major classification of loans at the periods indicated:
December 31, 2025 December 31, 2024
------------------- -------------------
(Dollars in thousands)
Commercial real estate loans:
Non-owner occupied $ 900,513 $ 880,828
Owner occupied 198,550 194,904
--------------- ---------------
Total commercial real estate
loans 1,099,063 1,075,732
Residential real estate loans:
Residential 719,070 653,802
Home equity 137,801 121,857
--------------- ---------------
Total residential real estate
loans 856,871 775,659
Commercial and industrial loans 221,790 211,656
Consumer loans 2,929 4,391
--------------- ---------------
Total loans 2,180,653 2,067,438
Unamortized premiums and net
deferred loan fees and costs 2,939 2,751
--------------- ---------------
Total loans, including
unamortized premiums and net
deferred loan fees and costs $ 2,183,592 $ 2,070,189
=============== ===============
Credit Quality
Management continues to closely monitor the loan portfolio for any signs of deterioration in borrowers' financial condition and also in light of speculation that commercial real estate values may deteriorate as the market continues to adjust to higher vacancies and interest rates. We continue to proactively take steps to mitigate risk in our loan portfolio.
Total delinquency was $3.1 million, or 0.14% of total loans, at December 31, 2025, compared to $5.0 million, or 0.24% of total loans at December 31, 2024. At December 31, 2025, nonaccrual loans totaled $5.2 million, or 0.24% of total loans, compared to $5.4 million, or 0.26% of total loans, at December 31, 2024. At December 31, 2025 and December 31, 2024, there were no loans 90 or more days past-due and still accruing interest. Total nonperforming assets, defined as nonaccrual loans and other real estate owned, totaled $5.2 million, or 0.19% of total assets, at December 31, 2025, compared to $5.4 million, or 0.20% of total assets, at December 31, 2024. At December 31, 2025 and December 31, 2024, the Company did not have any other real estate owned.
At December 31, 2025, the allowance for credit losses was $20.3 million, or 0.93% of total loans and 393.2% of nonaccrual loans, compared to $19.5 million, or 0.94% of total loans and 362.9% of nonaccrual loans, at December 31, 2024. Total criticized loans, defined as special mention and substandard loans, increased $1.3 million, or 3.4%, from $38.4 million, or 1.9% of total loans, at December 31, 2024 to $39.7 million, or 1.8% of total loans, at December 31, 2025.
Our commercial real estate portfolio is comprised of diversified property types and primarily within our geographic footprint. At December 31, 2025, the commercial real estate portfolio totaled $1.1 billion and represented 50.4% of total loans. Of the $1.1 billion, $900.5 million, or 81.9%, was categorized as non-owner occupied commercial real estate and represented 325.1% of the Bank's total risk-based capital. More details on the diversification of the loan portfolio are available in the supplementary earnings presentation.
Deposits
At December 31, 2025, total deposits were $2.4 billion and increased $98.3 million, or 4.3%, from December 31, 2024. Core deposits, which the Company defines as all deposits except time deposits, increased $111.9 million, or 7.2%, from $1.6 billion, or 68.9% of total deposits, at December 31, 2024, to $1.7 billion, or 70.8% of total deposits, at December 31, 2025. Non-interest-bearing deposits increased $28.9 million, or 5.1%, to $594.5 million, and represent 25.2% of total deposits, money market accounts increased $54.1 million, or 8.2%, to $715.6 million, interest-bearing checking accounts increased $23.9 million, or 15.9%, to $174.2 million, and savings accounts increased $5.0 million, or 2.7%, to $186.6 million.
Time deposits decreased $13.7 million, or 1.9%, from $703.6 million at December 31, 2024 to $689.9 million at December 31, 2025. Brokered time deposits, which are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered time deposits at December 31, 2025. We continue our disciplined and focused approach to core relationship management and customer outreach to meet funding requirements and liquidity needs, with an emphasis on retaining a long-term core customer relationship base by competing for and retaining deposits in our local market. At December 31, 2025, the Bank's uninsured deposits totaled $697.6 million, or 29.5% of total deposits, compared to $643.6 million, or 28.4% of total deposits, at December 31, 2024.
The table below is a summary of our deposit balances for the periods noted:
December 31, September 30, December 31,
2025 2025 2024
--------------- --------------- ---------------
(Dollars in thousands)
Core Deposits:
Demand accounts $ 594,516 $ 590,152 $ 565,620
Interest-bearing
accounts 174,227 176,823 150,348
Savings accounts 186,597 186,823 181,618
Money market
accounts 715,620 702,712 661,478
----------- ----------- -----------
Total Core
Deposits $ 1,670,960 $ 1,656,510 $ 1,559,064
----------- ----------- -----------
Time Deposits: 689,948 693,365 703,583
----------- ----------- -----------
Total Deposits: $ 2,360,908 $ 2,349,875 $ 2,262,647
=========== =========== ===========
FHLB and Subordinated Debt
At December 31, 2025, total borrowings decreased $17.1 million, or 13.9%, from $123.1 million at December 31, 2024 to $106.1 million. At December 31, 2025, short-term borrowings increased $7.9 million, or 146.2%, to $13.3 million, compared to $5.4 million at December 31, 2024. Long-term borrowings decreased $25.0 million, or 25.5%, from $98.0 million at December 31, 2024 to $73.0 million at December 31, 2025. At December 31, 2025 and December 31, 2024, borrowings also consisted of $19.8 million in fixed-to-floating rate subordinated notes.
As of December 31, 2025, the Company had $538.6 million of additional borrowing capacity at the FHLB, $349.0 million of additional borrowing capacity under the FRB Discount Window and $25.0 million of other unsecured lines of credit with correspondent banks.
Capital
At December 31, 2025, shareholders' equity was $247.6 million, or 9.1% of total assets, compared to $235.9 million, or 8.9% of total assets, at December 31, 2024. The change was primarily attributable to net income of $15.3 million and a decrease in accumulated other comprehensive loss of $6.6 million, partially offset by cash dividends paid of $5.7 million and the repurchase of shares at a cost of $6.2 million. At December 31, 2025, total shares outstanding were 20,372,786. The Company's regulatory capital ratios continue to be strong and in excess of regulatory minimum requirements to be considered well-capitalized as defined by regulators and internal Company targets.
December 31, 2025 December 31, 2024
----------------------- -----------------------
Company Bank Company Bank
----------- ---------- ----------- ----------
Total Capital (to Risk
Weighted Assets) 14.19% 13.48% 14.38% 13.65%
Tier 1 Capital (to
Risk Weighted
Assets) 12.21% 12.46% 12.37% 12.64%
Common Equity Tier 1
Capital (to Risk
Weighted Assets) 12.21% 12.46% 12.37% 12.64%
Tier 1 Leverage Ratio
(to Adjusted Average
Assets) 9.13% 9.32% 9.14% 9.34%
Dividends
Although the Company has historically paid quarterly dividends on its common stock and currently intends to continue to pay such dividends, the Company's ability to pay such dividends depends on a number of factors, including restrictions under federal laws and regulations on the Company's ability to pay dividends, and as a result, there can be no assurance that dividends will continue to be paid in the future.
About Western New England Bancorp, Inc.
Western New England Bancorp, Inc. is a Massachusetts-chartered stock holding company and the parent company of Westfield Bank, CSB Colts, Inc., Elm Street Securities Corporation, WFD Securities, Inc. and WB Real Estate Holdings, LLC. Western New England Bancorp, Inc. and its subsidiaries are headquartered in Westfield, Massachusetts and operate 25 banking offices throughout western Massachusetts and northern Connecticut. To learn more, visit our website at www.westfieldbank.com.
Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the Company's financial condition, liquidity, results of operations, future performance, and business. Forward-looking statements may be identified by the use of such words as "believe," "expect," "anticipate," "should," "planned," "estimated," and "potential." Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition, results of operations and business that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to:
-- unpredictable changes in general economic or political conditions,
financial markets, fiscal, monetary and regulatory policies, including
actual or potential stress in the banking industry;
-- unstable political and economic conditions, including changes in tariff
policies, which could materially impact credit quality trends and the
ability to generate loans and gather deposits;
-- inflation and governmental responses to inflation, including potential
future increases in interest rates that reduce margins;
-- the effect on our operations of governmental legislation and regulation,
including changes in accounting regulation or standards, the nature and
timing of the adoption and effectiveness of new requirements under the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Basel
guidelines, capital requirements and other applicable laws and
regulations;
-- significant changes in accounting, tax or regulatory practices or
requirements;
-- new legal obligations or liabilities or unfavorable resolutions of
litigation;
-- disruptive technologies in payment systems and other services
traditionally provided by banks;
-- the highly competitive industry and market area in which we operate;
-- operational risks or risk management failures by us or critical third
parties, including without limitation with respect to data processing,
information systems, cybersecurity, technological changes, vendor issues,
business interruption, and fraud risks;
-- failure or circumvention of our internal controls or procedures;
-- changes in the securities markets which affect investment management
revenues;
-- increases in Federal Deposit Insurance Corporation deposit insurance
premiums and assessments;
-- the soundness of other financial services institutions which may
adversely affect our credit risk;
-- certain of our intangible assets may become impaired in the future;
-- the duration and scope of potential pandemics, including the emergence of
new variants and the response thereto;
-- new lines of business or new products and services, which may subject us
to additional risks;
-- changes in key management personnel which may adversely impact our
operations;
-- severe weather, natural disasters, acts of war or terrorism and other
external events which could significantly impact our business; and
-- other risk factors detailed from time to time in our SEC filings.
Although we believe that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from the results discussed in these forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake any obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent required by law
WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Net Income and Other Data
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended Twelve Months Ended
----------------------------------------------------------------------------------- --------------------------------
December 31, September 30, June 30, March 31, December 31, December 31,
2025 2025 2025 2025 2024 2025 2024
INTEREST AND
DIVIDEND INCOME:
Loans $ 27,491 $ 26,690 $ 26,214 $ 24,984 $ 25,183 $ 105,379 $ 98,898
Securities 2,588 2,617 2,588 2,422 2,273 10,215 8,649
Other
investments 164 166 169 191 214 690 687
Short-term
investments 294 560 641 840 916 2,335 1,598
Total interest
and dividend
income 30,537 30,033 29,612 28,437 28,586 118,619 109,832
---------- ---------- ---------- ---------- ---------- ---------- ----------
INTEREST EXPENSE:
Deposits 10,296 10,403 10,437 11,376 11,443 42,512 42,236
Short-term
borrowings 85 39 47 54 60 225 600
Long-term debt 1,073 1,245 1,232 1,219 1,557 4,769 6,164
Subordinated
debt 254 254 254 254 253 1,016 1,015
Total interest
expense 11,708 11,941 11,970 12,903 13,313 48,522 50,015
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net interest
and dividend
income 18,829 18,092 17,642 15,534 15,273 70,097 59,817
(REVERSAL OF)
PROVISION FOR
CREDIT LOSSES (485) 1,293 (615) 142 (762) 335 (665)
Net interest
and dividend
income after
(reversal of)
provision for
credit losses 19,314 16,799 18,257 15,392 16,035 69,762 60,482
NON-INTEREST
INCOME:
Service charges
and fees on
deposits 2,553 2,552 2,528 2,284 2,301 9,917 9,202
Income from
bank-owned
life
insurance 492 482 516 473 486 1,963 1,911
Unrealized
(loss) gain on
marketable
equity
securities (7) 22 25 (5) (9) 35 13
Gain (loss) on
mortgage
banking
activities - - 4 7 (11) 11 235
Gain on
non-marketable
equity
investments - - 243 - 300 243 1,287
Loss on
disposal of
premises and
equipment - - - - - - (6)
Other income 135 117 95 - 187 347 261
Total
non-interest
income 3,173 3,173 3,411 2,759 3,254 12,516 12,903
---------- ---------- ---------- ---------- ---------- ---------- ----------
NON-INTEREST
EXPENSE:
Salaries and
employee
benefits 9,373 9,209 8,831 8,413 8,453 35,826 32,786
Occupancy 1,312 1,237 1,265 1,412 1,302 5,226 5,237
Furniture and
equipment 437 453 491 487 505 1,868 1,955
Data processing 899 916 933 882 900 3,630 3,477
Software 687 652 645 659 642 2,643 2,519
Debit/ATM card
processing
expense 599 633 674 577 593 2,483 2,437
Professional
fees 388 460 623 546 471 2,017 2,161
FDIC insurance 398 376 399 431 389 1,604 1,460
Advertising 349 433 443 429 310 1,654 1,269
Other 1,428 1,409 1,352 1,348 1,361 5,537 5,127
Total
non-interest
expense 15,870 15,778 15,656 15,184 14,926 62,488 58,428
---------- ---------- ---------- ---------- ---------- ---------- ----------
INCOME BEFORE
INCOME TAXES 6,617 4,194 6,012 2,967 4,363 19,790 14,957
INCOME TAX
PROVISION 1,408 1,027 1,422 664 1,075 4,521 3,291
NET INCOME $ 5,209 $ 3,167 $ 4,590 $ 2,303 $ 3,288 $ 15,269 $ 11,666
========== ========== ========== ========== ========== ========== ==========
Basic earnings
per share $ 0.26 $ 0.16 $ 0.23 $ 0.11 $ 0.16 $ 0.76 $ 0.56
Weighted average
shares
outstanding 20,060,358 20,110,492 20,210,650 20,385,481 20,561,749 20,194,877 20,899,573
Diluted earnings
per share $ 0.26 $ 0.16 $ 0.23 $ 0.11 $ 0.16 $ 0.75 $ 0.56
Weighted average
diluted shares
outstanding 20,206,539 20,240,975 20,312,881 20,514,098 20,701,276 20,321,755 21,016,358
Other Data:
Return on
average assets
(1) 0.75% 0.46% 0.69% 0.35% 0.49% 0.56% 0.45%
Return on
average equity
(1) 8.40% 5.20% 7.76% 3.94% 5.48% 6.35% 4.93%
Efficiency ratio 72.13% 74.20% 74.36% 83.00% 80.56% 75.64% 80.35%
Adjusted
efficiency
ratio
(non-GAAP) (2) 72.11% 74.27% 75.32% 82.98% 81.85% 75.89% 81.80%
Net interest
margin 2.89% 2.81% 2.80% 2.49% 2.41% 2.75% 2.45%
Net interest
margin, on a
fully
tax-equivalent
basis 2.91% 2.83% 2.82% 2.51% 2.43% 2.77% 2.47%
(1) Annualized.
(2) The adjusted efficiency ratio (non-GAAP) represents
the ratio of operating expenses divided by the sum
of net interest and dividend income and non-interest
income, excluding realized and unrealized gains and
losses on securities, gain on non-marketable equity
investments, and loss on disposal of premises and
equipment.
WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands)
(Unaudited)
December September
31, 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Cash and cash
equivalents $ 40,381 $ 82,942 $ 93,308 $ 110,579 $ 66,450
Securities
available-for-sale,
at fair value 175,800 179,234 178,785 167,800 160,704
Securities held to
maturity, at
amortized cost 188,800 193,446 197,671 201,557 205,036
Marketable equity
securities, at fair
value 632 471 444 414 397
Federal Home Loan
Bank of Boston and
other restricted
stock - at cost 5,359 5,818 5,818 5,818 5,818
Loans 2,183,592 2,131,308 2,092,631 2,079,561 2,070,189
Allowance for credit
losses (20,297) (20,542) (19,733) (19,669) (19,529)
--------- --------- --------- --------- ---------
Net loans 2,163,295 2,110,766 2,072,898 2,059,892 2,050,660
Bank-owned life
insurance 79,019 78,527 78,045 77,529 77,056
Goodwill 12,487 12,487 12,487 12,487 12,487
Core deposit
intangible 1,063 1,156 1,250 1,344 1,438
Other assets 69,644 70,683 70,443 71,864 73,044
--------- --------- --------- --------- ---------
TOTAL ASSETS $2,736,480 $2,735,530 $2,711,149 $2,709,284 $2,653,090
========= ========= ========= ========= =========
Total deposits $2,360,908 $2,349,875 $2,330,113 $2,328,593 $2,262,647
Short-term
borrowings 13,270 2,980 4,040 4,520 5,390
Long-term debt 73,000 98,000 98,000 98,000 98,000
Subordinated debt 19,790 19,781 19,771 19,761 19,751
Securities pending
settlement 242 - - 2,093 8,622
Other liabilities 21,633 21,254 19,797 18,641 22,770
--------- --------- --------- --------- ---------
TOTAL LIABILITIES 2,488,843 2,491,890 2,471,721 2,471,608 2,417,180
--------- --------- --------- --------- ---------
TOTAL SHAREHOLDERS'
EQUITY 247,637 243,640 239,428 237,676 235,910
--------- --------- --------- --------- ---------
TOTAL LIABILITIES
AND SHAREHOLDERS'
EQUITY $2,736,480 $2,735,530 $2,711,149 $2,709,284 $2,653,090
========= ========= ========= ========= =========
WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
Other Data
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
2025 2025 2025 2025 2024
Shares
outstanding at
end of period 20,372,786 20,491,966 20,494,501 20,774,319 20,875,713
Operating
results:
Net interest
income $ 18,829 $ 18,092 $ 17,642 $ 15,534 $ 15,273
(Reversal of)
provision for
credit losses (485) 1,293 (615) 142 (762)
Non-interest
income 3,173 3,173 3,411 2,759 3,254
Non-interest
expense 15,870 15,778 15,656 15,184 14,926
Income before
provision for
income taxes 6,617 4,194 6,012 2,967 4,363
Income tax
provision 1,408 1,027 1,422 664 1,075
Net income 5,209 3,167 4,590 2,303 3,288
Performance
Ratios:
Net interest
margin 2.89% 2.81% 2.80% 2.49% 2.41%
Net interest
margin, on a
fully
tax-equivalent
basis 2.91% 2.83% 2.82% 2.51% 2.43%
Interest rate
spread 2.21% 2.13% 2.10% 1.74% 1.63%
Interest rate
spread, on a
fully
tax-equivalent
basis 2.23% 2.14% 2.12% 1.76% 1.65%
Return on
average
assets 0.75% 0.46% 0.69% 0.35% 0.49%
Return on
average
equity 8.40% 5.20% 7.76% 3.94% 5.48%
Efficiency
ratio (GAAP) 72.13% 74.20% 74.36% 83.00% 80.56%
Adjusted
efficiency
ratio
(non-GAAP)
(1) 72.11% 74.27% 75.32% 82.98% 81.85%
Per Common Share
Data:
Basic earnings
per share $ 0.26 $ 0.16 $ 0.23 $ 0.11 $ 0.16
Earnings per
diluted share 0.26 0.16 0.23 0.11 0.16
Cash dividend
declared 0.07 0.07 0.07 0.07 0.07
Book value per
share 12.16 11.89 11.68 11.44 11.30
Tangible book
value per
share
(non-GAAP)
(2) 11.49 11.22 11.01 10.78 10.63
Asset Quality:
30-89 day
delinquent
loans $ 2,098 $ 3,123 $ 2,525 $ 2,459 $ 3,694
90 days or more
delinquent
loans 1,047 1,425 1,328 2,027 1,301
Total
delinquent
loans 3,145 4,548 3,853 4,486 4,995
Total
delinquent
loans as a
percentage of
total loans 0.14% 0.21% 0.18% 0.22% 0.24%
Nonaccrual
loans $ 5,162 $ 5,649 $ 5,752 $ 6,014 $ 5,381
Nonaccrual
loans as a
percentage of
total loans 0.24% 0.27% 0.27% 0.29% 0.26%
Nonperforming
assets as a
percentage of
total assets 0.19% 0.21% 0.21% 0.22% 0.20%
Allowance for
credit losses
as a
percentage of
nonaccrual
loans 393.20% 363.64% 343.06% 327.05% 362.93%
Allowance for
credit losses
as a
percentage of
total loans 0.93% 0.96% 0.94% 0.95% 0.94%
Net loan
charge-offs
(recoveries) $ 41 $ 43 $ (585) $ 29 $ (128)
Net loan
charge-offs
(recoveries)
as a
percentage of
average loans 0.00% 0.00% (0.03)% 0.00% (0.01)%
___________________________
___________________________
1. The adjusted efficiency ratio (non-GAAP) represents the ratio of
operating expenses divided by the sum of net interest and dividend income
and non-interest income, excluding realized and unrealized gains and
losses on securities, gains on non-marketable equity investments, and
loss on disposal of premises and equipment.
2. Tangible book value per share (non-GAAP) represents the value of the
Company's tangible assets divided by its current outstanding shares.
The following table sets forth the information relating to our average balances and net interest income for the three months ended December 31, 2025, September 30, 2025 and December 31, 2024 and reflects the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.
Three Months Ended
--------------------------------------------------------------------------------------------------------
December 31, 2025 September 30, 2025 December 31, 2024
---------------------------------- --------------------------------- ---------------------------------
Average Average Average
Average Yield/ Average Yield/ Average Yield/
Balance Interest Cost(8) Balance Interest Cost(8) Balance Interest Cost(8)
---------- --------- ----------- ---------- -------- ----------- ---------- -------- -----------
(Dollars in thousands)
ASSETS:
Interest-earning assets
Loans(1)(2) $2,166,804 $27,616 5.06% $2,112,394 $26,810 5.04% $2,062,822 $25,311 4.88%
Securities(2) 370,210 2,588 2.77 374,082 2,617 2.78 361,476 2,273 2.50
Other investments 14,752 164 4.41 14,993 166 4.39 15,924 214 5.35
Short-term
investments(3) 32,544 294 3.58 52,380 560 4.24 76,795 916 4.75
--------- ------ --------- ------ --------- ------
Total
interest-earning
assets 2,584,310 30,662 4.71 2,553,849 30,153 4.68 2,517,017 28,714 4.54
------ ------ ------
Total
non-interest-earning
assets 156,258 157,127 155,538
--------- --------- ---------
Total assets $2,740,568 $2,710,976 $2,672,555
========= ========= =========
LIABILITIES AND EQUITY:
Interest-bearing
liabilities
Interest-bearing
checking accounts $ 163,174 371 0.90 $ 161,171 453 1.12 $ 149,231 264 0.70
Savings accounts 187,428 43 0.09 187,279 42 0.09 179,122 38 0.08
Money market accounts 723,501 3,889 2.13 703,084 3,784 2.14 654,965 3,553 2.16
Time deposit accounts 686,966 5,993 3.46 692,742 6,124 3.51 700,324 7,588 4.31
--------- ------ --------- ------ --------- ------
Total
interest-bearing
deposits 1,761,069 10,296 2.32 1,744,276 10,403 2.37 1,683,642 11,443 2.70
Borrowings 112,904 1,412 4.96 121,389 1,538 5.03 147,748 1,870 5.04
------ ------ ------
Interest-bearing
liabilities 1,873,973 11,708 2.48 1,865,665 11,941 2.54 1,831,390 13,313 2.89
--------- ------ --------- ------ --------- ------
Non-interest-bearing
deposits 596,462 581,835 579,168
Other
non-interest-bearing
liabilities 24,231 22,014 23,380
--------- --------- ---------
Total
non-interest-bearing
liabilities 620,693 603,849 602,548
--------- --------- ---------
Total liabilities 2,494,666 2,469,514 2,433,938
Total equity 245,902 241,462 238,617
--------- --------- ---------
Total liabilities and
equity $2,740,568 $2,710,976 $2,672,555
========= ========= =========
Less: Tax-equivalent
adjustment(2) (125) (120) (128)
------ ------ ------
Net interest and
dividend income $18,829 $18,092 $15,273
====== ====== ======
Net interest rate
spread(4) 2.21% 2.13% 1.63%
Net interest rate
spread, on a
tax-equivalent
basis(5) 2.23% 2.14% 1.65%
Net interest margin(6) 2.89% 2.81% 2.41%
Net interest margin, on
a tax-equivalent
basis(7) 2.91% 2.83% 2.43%
Ratio of average
interest-earning
assets to average
interest-bearing
liabilities 137.91% 136.89% 137.44%
The following tables set forth the information relating to our average balances and net interest income for the twelve months ended December 31, 2025 and 2024 and reflect the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.
Twelve Months Ended December 31,
----------------------------------------------------------------------
2025 2024
--------------------------------- ---------------------------------
Average Average
Average Yield/ Average Yield/
Balance Interest Cost Balance Interest Cost
--------- ----------- --------- -----------
(Dollars in thousands)
ASSETS:
Interest-earning assets
Loans(1)(2) $2,108,767 $105,866 5.02% $2,035,149 $ 99,369 4.88%
Securities(2) 371,206 10,215 2.75 357,631 8,649 2.42
Other investments 14,907 690 4.63 14,669 687 4.68
Short-term
investments(3) 54,770 2,335 4.26 33,254 1,598 4.81
--------- ------- --------- -------
Total
interest-earning
assets 2,549,650 119,106 4.67 2,440,703 110,303 4.52
------- -------
Total
non-interest-earning
assets 156,591 155,056
--------- ---------
Total assets $2,706,241 $2,595,759
========= =========
LIABILITIES AND EQUITY:
Interest-bearing
liabilities
Interest-bearing
checking accounts $ 155,831 1,497 0.96% $ 136,861 1,022 0.75%
Savings accounts 186,780 180 0.10 182,678 166 0.09
Money market accounts 704,654 15,242 2.16 631,197 12,242 1.94
Time deposit accounts 693,208 25,593 3.69 666,917 28,806 4.32
--------- ------- --------- -------
Total
interest-bearing
deposits 1,740,473 42,512 2.44 1,617,653 42,236 2.61
Short-term borrowings
and long-term debt 119,764 6,010 5.02 155,560 7,779 5.00
------- -------
Total
interest-bearing
liabilities 1,860,237 48,522 2.61 1,773,213 50,015 2.82
--------- ------- --------- -------
Non-interest-bearing
deposits 582,168 561,264
Other
non-interest-bearing
liabilities 23,472 24,541
--------- ---------
Total
non-interest-bearing
liabilities 605,640 585,805
--------- ---------
Total liabilities 2,465,877 2,359,018
Total equity 240,364 236,741
--------- ---------
Total liabilities and
equity $2,706,241 $2,595,759
========= =========
Less: Tax-equivalent
adjustment (2) (487) (471)
------- -------
Net interest and
dividend income $ 70,097 $ 59,817
======= =======
Net interest rate spread
(4) 2.04% 1.68%
Net interest rate
spread, on a
tax-equivalent basis
(5) 2.06% 1.70%
Net interest margin (6) 2.75% 2.45%
Net interest margin, on
a tax-equivalent basis
(7) 2.77% 2.47%
Ratio of average
interest-earning
assets to average interest-bearing
liabilities 137.06% 137.64%
(1) Loans, including nonaccrual loans, are net of deferred loan origination costs and unadvanced funds.
(2) Loan and securities income are presented on a tax-equivalent basis using a tax rate of 21%. The tax-equivalent adjustment is deducted from tax-equivalent net interest and dividend income to agree to the amount reported on the consolidated statements of net income.
(3) Short-term investments include federal funds sold.
(4) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(5) Net interest rate spread, on a tax-equivalent basis, represents the difference between the tax-equivalent weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.
(6) Net interest margin represents net interest and dividend income as a percentage of average interest-earning assets.
(7) Net interest margin, on a tax-equivalent basis, represents tax-equivalent net interest and dividend income as a percentage of average interest-earning assets.
(8) Annualized.
Reconciliation of Non-GAAP to GAAP Financial Measures
The Company believes that certain non-GAAP financial measures provide information to investors that is useful in understanding its results of operations and financial condition. Because not all companies use the same calculation, this presentation may not be comparable to other similarly titled measures calculated by other companies. A reconciliation of these non-GAAP financial measures is provided below.
For the quarter ended
---------------------------------------------------------------
12/31/2025 9/30/2025 6/30/2025 3/31/2025 12/31/2024
(Dollars in thousands)
Loan interest (no tax
adjustment) $ 27,491 $ 26,690 $ 26,214 $ 24,984 $ 25,183
Tax-equivalent
adjustment 125 120 121 121 128
Loan interest
(tax-equivalent
basis) $ 27,616 $ 26,810 $ 26,335 $ 25,105 $ 25,311
=========== =========== =========== =========== ===========
Loan interest
(tax-equivalent
basis) $ 27,616 $ 26,810 $ 26,335 $ 25,105 $ 25,311
Less:
Prepayment
penalties and
fees - 34 425 - -
----------- ----------- ----------- ----------- -----------
Adjusted loan income,
excluding prepayment
penalties
(tax-equivalent
basis) (non-GAAP) $ 27,616 $ 26,776 $ 25,910 $ 25,105 $ 25,311
=========== =========== =========== =========== ===========
Average loans $ 2,166,804 $ 2,112,394 $ 2,081,319 $ 2,073,486 $ 2,062,822
Average loan yield
(no tax adjustment) 5.03% 5.01% 5.05% 4.89% 4.86%
Average loan yield
(no tax adjustment),
excluding prepayment
penalties
(non-GAAP) 5.03% 5.01% 4.97% 4.89% 4.86%
Average loan yield
(tax-equivalent) 5.06% 5.04% 5.08% 4.91% 4.88%
Average loan yield
(tax-equivalent
basis), excluding
prepayment penalties
(non-GAAP) 5.06% 5.03% 4.99% 4.91% 4.88%
Net interest income
(no tax adjustment) $ 18,829 $ 18,092 $ 17,642 $ 15,534 $ 15,273
Tax equivalent
adjustment 125 120 121 121 128
Net interest income
(tax-equivalent
basis) $ 18,954 $ 18,212 $ 17,763 $ 15,655 $ 15,401
=========== =========== =========== =========== ===========
Net interest income
(no tax adjustment) $ 18,829 $ 18,092 $ 17,642 $ 15,534 $ 15,273
Less:
Prepayment
penalties - 34 425 - -
Income from fair
value hedge - - - - 74
Adjusted net interest
income (non-GAAP) $ 18,829 $ 18,058 $ 17,217 $ 15,534 $ 15,199
=========== =========== =========== =========== ===========
Average
interest-earning
assets $ 2,584,310 $ 2,553,849 $ 2,530,077 $ 2,529,715 $ 2,517,017
Net interest margin
(no tax adjustment) 2.89% 2.81% 2.80% 2.49% 2.41%
Net interest margin
(tax-equivalent
basis) 2.91% 2.83% 2.82% 2.51% 2.43%
Adjusted net interest
margin, excluding
prepayment penalties
and income from fair
value hedge (no tax
adjustment)
(non-GAAP) 2.89% 2.81% 2.73% 2.49% 2.40%
For the quarter ended
---------------------------------------------------------------------
12/31/2025 9/30/2025 6/30/2025 3/31/2025 12/31/2024
-------------- ----------- ----------- ----------- --------------
(Dollars in thousands, except per share data)
Book Value per
Share (GAAP) $ 12.16 $ 11.89 $ 11.68 $ 11.44 $ 11.30
---------------
Non-GAAP
adjustments:
Goodwill (0.61) (0.61) (0.61) (0.60) (0.60)
Core deposit
intangible (0.06) (0.06) (0.06) (0.06) (0.07)
Tangible Book
Value per
Share
(non-GAAP) $ 11.49 $ 11.22 $ 11.01 $ 10.78 $ 10.63
====== ====== ====== ====== ======
Efficiency
Ratio:
---------------
Non-interest
Expense
(GAAP) $ 15,870 $15,778 $15,656 $15,184 $ 14,926
Net Interest
Income (GAAP) $ 18,829 $18,092 $17,642 $15,534 $ 15,273
Non-interest
Income (GAAP) $ 3,173 $ 3,173 $ 3,411 $ 2,759 $ 3,254
Non-GAAP
adjustments:
Unrealized
losses (gains)
on marketable
equity
securities 7 (22) (25) 5 9
Gain on
non-marketable
equity
investments - - (243) - (300)
Non-interest
Income for
Adjusted
Efficiency
Ratio
(non-GAAP) $ 3,180 $ 3,151 $ 3,143 $ 2,764 $ 2,963
Total Revenue
for Adjusted
Efficiency
Ratio
(non-GAAP) $ 22,009 $21,243 $20,785 $18,298 $ 18,236
====== ====== ====== ====== ======
Efficiency
Ratio (GAAP) 72.13% 74.20% 74.36% 83.00% 80.56%
Adjusted
Efficiency
Ratio
(Non-interest
Expense
(GAAP)/Total
Revenue for
Adjusted
Efficiency
Ratio
(non-GAAP)) 72.11% 74.27% 75.32% 82.98% 81.85%
For the twelve months ended
-------------------------------
12/31/2025 12/31/2024
(Dollars in thousands)
Loan income (no tax adjustment) $ 105,379 $ 98,898
Tax-equivalent adjustment 487 471
Loan income (tax-equivalent basis) $ 105,866 $ 99,369
================ =============
Net interest income (no tax adjustment) $ 70,097 $ 59,817
Tax equivalent adjustment 487 471
Net interest income (tax-equivalent basis) $ 70,584 $ 60,288
================ =============
Net interest income (no tax adjustment) $ 70,097 $ 59,817
Less:
Prepayment penalties 459 8
Income from fair value hedge - 1,398
---------------- -------------
Adjusted net interest income (non-GAAP) $ 69,638 $ 58,411
================
Average interest-earning assets $ 2,549,650 $ 2,440,703
Net interest margin (no tax adjustment) 2.75% 2.45%
Net interest margin (tax-equivalent basis) 2.77% 2.47%
Adjusted net interest margin, excluding
prepayment penalties and income from fair
value hedge (no tax adjustment)
(non-GAAP) 2.73% 2.39%
Adjusted Efficiency Ratio:
-------------------------------------------
Non-interest Expense (GAAP) $ 62,488 $ 58,428
Net Interest Income (GAAP) $ 70,097 $ 59,817
Non-interest Income (GAAP) $ 12,516 $ 12,903
Non-GAAP adjustments:
Unrealized gains on marketable equity
securities (35) (13)
Loss on disposal of premises and
equipment, net - 6
Gain on non-marketable equity
investments (243) (1,287)
Non-interest Income for Adjusted Efficiency
Ratio (non-GAAP) $ 12,238 $ 11,609
Total Revenue for Adjusted Efficiency Ratio
(non-GAAP) $ 82,335 $ 71,426
================ =============
Efficiency Ratio (GAAP) 75.64% 80.35%
Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP)) 75.89% 81.80%
For further information contact:
James C. Hagan, President and CEO
Guida R. Sajdak, Executive Vice President and CFO
Meghan Hibner, First Vice President and Investor Relations Officer
413-568-1911
(END) Dow Jones Newswires
January 27, 2026 16:05 ET (21:05 GMT)