Earnings

CB Financial Extends Net Interest Income Gains

The Tip Desk · October 26, 2026 · 3 min read

Net interest and dividend income rose 14.5% to $15.0 million in the third quarter as GAAP NIM reached 3.75%.

CB Financial Services, Inc. (CBFV), the holding company of Community Bank, a Pennsylvania-chartered commercial bank, reported net interest and dividend income of $15.0 million for the three months ended September 30, 2026, up $1.9 million, or 14.5%, from $13.1 million a year earlier. GAAP net interest margin rose to 3.75% from 3.64% a year earlier; fully tax-equivalent NIM was 3.79%, up 12 bps.

The increase marked a sixth consecutive quarterly rise in net interest and dividend income. Versus the three months ended June 30, 2026, NIM improved to 3.75% from 3.68%. The company said the margin gain came from earning-asset yield rising to 5.44% from 5.34%, as cash, securities and loan yields increased. Cost of funds rose to 1.75% from 1.72% on Specialty Treasury growth in interest-bearing demand and money market deposits.

GAAP net income was $5.3 million, or $0.99 a share, compared with a $5.7 million loss, or $1.07 a share, a year earlier. Adjusted diluted EPS was $0.91. Adjusted return on average assets was 1.15% and adjusted return on average equity was 11.95%.

Average loans were $1.16 billion, up $37.8 million from $1.12 billion a year earlier. Average loan yield was 5.69%, up 1 bp from 5.68%, despite a 50 bp reduction in the federal funds target rate since September 2025. The company said the yield held as lower-yielding consumer loans declined after the indirect automobile product was discontinued and those funds were redeployed into higher-yielding commercial loans. Interest income on loans was $16.6 million.

Interest income on investment securities was $4.1 million, up 38.0% from $3.0 million a year earlier, on a 48 bp increase in average yield and a $72.6 million increase in average balances. The company attributed the yield lift primarily to a third-quarter 2025 repositioning in which $129.6 million of lower-yielding securities were sold for an after-tax realized loss of $9.3 million and replaced with higher-yielding instruments.

Average interest-bearing deposits were $1.13 billion, up $113.5 million, or 11.1%, from $1.02 billion a year earlier. The cost of interest-bearing deposits fell 20 bps to 2.06% from 2.26%. Interest expense on deposits was $5.9 million. Interest expense on borrowed funds was $703,000 as short-term borrowings replaced maturing brokered deposits.

The company recorded a $69,000 recovery of provision for credit losses, including a $399,000 loan recovery tied to a $17.8 million decline in loan principal, offset by a $330,000 provision on unfunded commitments. A year earlier it recorded a $259,000 provision. Net charge-offs were $59,000, or 0.02% of average loans annualized.

Nonperforming loans were $3.2 million, or 0.28% of total loans, after a $2.0 million commercial real estate loan paid off. The allowance for credit losses was $10.0 million, or 0.86% of loans, and covered 311.8% of nonperforming assets. Total loans were $1.16 billion. Commercial loans were 63.2% of the portfolio. Excluding a $15.5 million decline in indirect automobile loans, total loans increased $15.1 million, or 1.3%, since December 31, 2025.

Organic deposits were $1.33 billion, up $89.6 million, or 7.2%, from $1.24 billion at year-end 2025. Interest-bearing demand deposits rose $73.7 million and money market deposits $27.7 million. Brokered deposits fell $88.5 million, or 89.8%, to $10.0 million as the bank used FHLB borrowings. Short-term borrowings were $79.0 million.

Noninterest expense was $10.3 million. Versus the second quarter it decreased $126,000 on lower salaries and data processing, partly offset by higher Pennsylvania shares tax, contracted services, legal and advertising. The board declared a $0.28 quarterly cash dividend, payable about November 27, 2026. Common Equity Tier 1 capital was 14.10% of risk-weighted assets.