S&T Bancorp Extends Margin Expansion and Lifts Diluted EPS

The Tip Desk · October 24, 2026 · 4 min read

Net interest income rose to $93.1 million as the FTE net interest margin expanded 7 basis points to 4.06% and diluted earnings reached a record $1.09 a share.

S&T Bancorp, Inc. (STBA), the $9.9 billion holding company for S&T Bank, reported net interest income of $93.1 million in the third quarter of 2026, up from $90.4 million in the second quarter, as the fully taxable equivalent net interest margin expanded for a second consecutive quarter.

The FTE net interest margin widened 7 basis points to 4.06% from 3.99%, matching the 7 basis point expansion recorded in the second quarter. The company said the increase in net interest income was primarily due to higher yields on interest-earning assets and one additional day in the third quarter. The yield on average interest-earning assets rose 9 basis points to 5.73% from 5.64%, which the company attributed primarily to a higher yield on both average securities and average loans.

Average total loans increased $61.2 million to $8.1 billion from $8.0 billion. The yield on total average loans rose 6 basis points to 5.95% from 5.89%. Average interest-bearing deposits increased $31.8 million to $5.9 billion from $5.8 billion. Total interest-bearing liability costs rose 3 basis points to 2.53% from 2.50%, which the company said was mainly due to a higher cost of deposits and borrowings.

Diluted earnings per share was a record $1.09, up from $1.02 in the second quarter. Net income was $38.6 million. The company said diluted earnings per share growth reflected both higher net income and share repurchases of 8.3% of outstanding shares since September 30, 2025. Return on average assets rose to 1.55% from 1.49%, return on average equity to 10.84% from 10.37%, and return on average tangible shareholders’ equity to 14.81% from 14.15%. Pre-provision net revenue to average assets increased 12 basis points to 2.01% from 1.89%.

Noninterest income was relatively unchanged at $14.7 million from $14.9 million. Noninterest expense decreased $1.1 million to $57.6 million from $58.7 million, and the efficiency ratio on an FTE basis improved to 53.23% from 55.52%. The company said other noninterest expense decreased $0.9 million primarily due to normal fluctuations across several expense categories and timing-related items.

Net charge-offs were $2.1 million, or 0.10% of average loans, compared with $1.0 million, or 0.05%, in the second quarter. The provision for credit losses was $1.4 million. The allowance for credit losses was unchanged at $93.3 million, or 1.16% of total portfolio loans, at both September 30, 2026 and June 30, 2026.

Nonperforming assets decreased $3.7 million to $36.5 million, or 0.45% of total loans plus other real estate owned, from $40.2 million, or 0.50%, at June 30, 2026. That followed a $9.7 million decline in the second quarter from 0.63% at March 31, 2026. Nonaccrual commercial loans were $22.0 million, or 0.40% of commercial loans, and nonaccrual consumer loans were $14.4 million, or 0.57% of consumer loans.

Total portfolio loans decreased $4.4 million compared with June 30, 2026, due to lower line utilization and originations. Commercial loans decreased $11.9 million: commercial and industrial fell $51.1 million and commercial construction fell $25.6 million, offset by growth in commercial real estate of $64.8 million. Consumer loans increased $7.5 million. Total assets were $9.9 billion at both September 30 and June 30.

Total deposits decreased $22.2 million compared with June 30, 2026, which the company said was primarily due to seasonality. Noninterest-bearing deposits decreased $32.6 million and savings decreased $8.3 million, offset primarily by an increase in certificates of deposit of $15.0 million. Total borrowings decreased $60.0 million to $215.3 million from $275.3 million. Common equity tier 1 risk-based capital rose to 14.02% from 13.64%, and total risk-based capital rose to 15.89% from 15.51%.

No share repurchases occurred in the third quarter, after 1,074,924 shares for $47.6 million in the second quarter. Since the program began in the fourth quarter of 2025, a total of 3,169,294 shares, representing 8.3% of outstanding shares, were repurchased at an average price of $42.09 per share, totaling $133.4 million. Chief executive officer Chris McComish said the results reflected record earnings per share, record revenue and higher core profitability, and that the company believes it is well-positioned to build on that momentum.