Parke's Third-Quarter Net Interest Income Holds at $23 Million
Net interest income stayed at $23.0 million in the third quarter as year-over-year growth slowed to 14.2% and net interest margin compressed 7 bps to 4.10%.
Parke Bancorp, Inc. (PKBK), the parent of Parke Bank, reported net interest income of $23.0 million for the three months ended September 30, 2026, matching the second-quarter level after a larger year-over-year jump in the prior period. Growth slowed to 14.2% from 28.8% in the second quarter.
Net interest margin compressed 7 bps to 4.10% in the third quarter after remaining flat at 4.17% in the second quarter versus the first. Interest income rose $2.2 million year over year, led by a $2.1 million increase in interest and fees on loans to $37.0 million, which the company attributed to higher market rates and higher average loan balances. Interest expense fell $0.7 million, or 4.3%, to $15.6 million. Deposit interest expense declined to $14.0 million from $15.4 million a year earlier on lower market rates, while interest on borrowings rose to $1.7 million from $1.0 million on higher Federal Home Loan Bank of New York balances.
Net income available to common shareholders was $12.2 million, or $1.04 per basic common share, up 14.5% from $10.6 million, or $0.90 per basic common share, a year earlier. The company said the increase reflected the $2.9 million rise in net interest income and a $0.4 million decline in non-interest expense, partly offset by a $0.6 million increase in the provision for credit losses.
The provision was $1.0 million, compared with $0.4 million a year earlier. The company attributed the increase to faster loan-balance growth in the third quarter than in the same period of 2025. Non-interest income was $1.0 million, up 14.2% from $0.9 million, on higher bank-owned life insurance income and loan fees, partly offset by lower service fees on deposit accounts.
Non-interest expense declined to $6.8 million from $6.9 million in the second quarter. Professional services fell $1.0 million, including a $0.3 million reclassification of OREO-related legal fees into OREO expense and lower BSA consulting. Compensation and OREO expense rose. The efficiency ratio improved to 28.23% from 34.09% a year earlier.
Gross loans increased $60.9 million, or 3.0%, to $2.10 billion at September 30, 2026, from $2.04 billion at December 31, 2025. Total deposits rose only $18.1 million, or 1.0%, to $1.78 billion. Brokered deposits increased $36.9 million, while interest-bearing deposits fell $16.8 million and non-interest-bearing deposits fell $2.0 million. FHLBNY borrowings rose to $165.0 million from $130.0 million at year-end.
Non-accrual loans fell to $5.8 million, or 0.28% of loans, down $5.0 million from $10.8 million at December 31, 2025. OREO rose to $7.2 million from $2.9 million. Nonperforming assets were 0.56% of total assets. The allowance for credit losses was $35.4 million, or 1.69% of loans, versus $34.6 million, or 1.70%, at year-end. The allowance-to-non-accrual ratio rose to 610.3% from 321.0%.
Total assets were $2.33 billion, up 3.7% from December 31, 2025. Equity rose to $356.1 million, primarily due to retained earnings, partially offset by $6.9 million in cash dividends.
President and Chief Executive Officer Vito S. Pantilione said the Federal Reserve increased rates 25 bps during the quarter and that additional increases remain possible. He cited continued loan growth, balance-sheet management, and an expanding net interest margin as drivers of nine-month results, and said Parke Bank remains focused on credit quality, liquidity, and shareholder value through the rest of 2026.
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