BCB Bancorp Posts $132.5 Million Loss After Credit Overhaul

The Tip Desk · October 29, 2026 · 4 min read

A $115.0 million credit-loss provision and a $59.9 million deferred-tax valuation allowance produced a $6.92-a-share loss as the bank sold $204.3 million of problem loans.

BCB Bancorp, Inc. (BCBP), the holding company for BCB Community Bank, reported a net loss attributable to common stockholders of $132.5 million for the third quarter of 2026, or $6.92 a share, compared with a $14.8 million loss, or $0.85 a share, in the second quarter.

The company said the loss was primarily driven by a $115.0 million provision for credit losses and a $59.9 million valuation allowance against deferred tax assets. The income tax provision was $23.5 million, versus $1.5 million a year earlier. Management said the allowance reflected recent operating results, including losses on loan sales and loans moved to held-for-sale at the lower of cost or market.

The provision rose from $19.0 million in the second quarter and $4.1 million in the third quarter of 2025. Net charge-offs were $89.7 million, versus $16.9 million a year earlier.

To de-risk the balance sheet, the bank sold $204.3 million of problem loans, mostly criticized or classified, producing a $42.3 million charge-off. The sold book included about $179.7 million of commercial and multifamily real estate loans, $14.6 million of commercial and industrial loans and $10.0 million of construction loans. It also transferred $100.9 million of loans to held-for-sale — $70.2 million of cannabis loans, $29.8 million of commercial real estate and $874 thousand of commercial and industrial loans — and recorded a related $44.2 million charge-off. Excluding those sales and transfers, charge-offs were $3.2 million in commercial business and $1.0 million in Business Express.

Management completed a comprehensive review of the commercial and multifamily real estate portfolio and added reserves for that segment. The allowance for credit losses on loans rose $25.3 million, or 56.2%, to $70.3 million at September 30, 2026, equal to 313.4% of non-accrual loans and 3.12% of gross loans held for investment.

Non-accrual loans fell to $22.4 million, or 1.00% of gross loans held for investment, from $61.2 million, or 2.33%, at June 30. Criticized and classified loans declined to $198.9 million, or 8.84%, from $367.4 million, or 13.96%.

Gross loans receivable held for investment decreased $475.0 million, or 17.4%, to $2.252 billion from $2.691 billion at December 31, 2025, on sales, held-for-sale transfers, payoffs, paydowns and charge-offs. Commercial and multifamily loans were down $287.2 million, cannabis $65.2 million, construction $55.1 million and commercial business $42.3 million. $67.6 million remained in loans held for sale.

The company completed a $98.0 million underwritten equity raise that generated $91.4 million of net proceeds, including the underwriters’ option. About $20 million of proceeds were retained at the holding company. The bank’s leverage capital ratio was 9.0% and consolidated leverage was 8.4% at September 30.

Net interest margin held at 3.03%, matching the second quarter. The year-ago margin was 2.88%. The company said the year-over-year expansion came from a 29 basis-point drop in the cost of interest-bearing liabilities to 2.77%, which exceeded a 9 basis-point decline in the yield on earning assets to 5.14%.

Interest income fell $4.7 million, or 10.8%, to $38.4 million as average interest-earning assets dropped $302.7 million, or 9.3%, to $2.962 billion. Interest expense fell $3.6 million to $15.8 million. Non-interest income rose $2.4 million to $5.2 million, led by a $3.3 million gain on sale of OREO. Non-interest expense increased $5.2 million, or 31.6%, to $21.8 million, with professional fees up $2.1 million, salaries and benefits up $1.6 million and other expenses up $1.4 million tied to loan-sale costs.

Total deposits were $2.609 billion at September 30. Cash and cash equivalents rose to $500.3 million from $276.6 million at year-end 2025, on loan-sale proceeds and the capital raise. Total assets were $3.021 billion.

President and Chief Executive Officer Thomas M. O’Brien said the company raised capital, completed loan sales and increased the allowance after credit reviews, and that the capital raise allowed it to absorb recognized losses while maintaining solid capital ratios. He said the work toward a safer institution is “far from complete” and that the company remains focused on returning the bank to sustainable profitability. The bank appointed Eleni Willis as chief risk officer and said it expects to name a new chief audit officer before year-end.