Camden National's Net Interest Margin Widens to 3.41%

The Tip Desk · November 8, 2026 · 3 min read

Net interest income rose 5% to $55.4 million as core deposits grew 7% and average borrowings fell 26%, lifting the fully taxable-equivalent margin 15 basis points.

Camden National Corporation (CAC), Northern New England’s largest publicly traded bank holding company, reported net interest income of $55.4 million for the quarter ended September 30, 2026, up 5% from the prior quarter, as the fully taxable-equivalent net interest margin expanded 15 basis points to 3.41%.

That margin move accelerated from the second quarter, when the margin had widened only 2 basis points to 3.26%. Average deposits rose 3% in the third quarter, supporting a 26% reduction in average borrowings and lower funding costs. Core net interest margin, a non-GAAP measure, expanded 13 basis points to 3.10%.

Net income was $22.8 million, or $1.34 a share, up 8% and 7% from a year earlier. Those figures were 1% below the record second-quarter results of $23.0 million and $1.35 a share. Return on average assets was 1.31% and return on average equity 12.36%.

Total deposits increased 5% to $5.85 billion at September 30. On a non-GAAP basis, core deposits grew 7% to $5.2 billion and accounted for 88% of the total. The company said seasonal flows and customer acquisition allowed it to optimize higher-cost deposits and borrowings. Borrowings stood at $374.4 million, down from $571.1 million at June 30. Interest on borrowings fell 48% to $1.5 million. Cash, cash equivalents and restricted cash rose to $248.6 million from $99.9 million.

Total loans were essentially unchanged at $5.00 billion after 1% growth in the second quarter. Home equity loans grew 7% and residential mortgages 1%, while commercial real estate and commercial loans declined 2% and 3%, which the company attributed primarily to several large prepayments. The loan-to-deposit ratio was 86%, compared with 90% at June 30.

Provision expense was $1.9 million, up from $710,000 in the second quarter. The company said the increase reflected macroeconomic factors that lifted the allowance for credit losses 1 basis point to 0.92% of loans, as well as higher reserves on unfunded credit commitments. Non-performing loans were 0.16% of total loans, down from 0.24% at June 30. Annualized net charge-offs were 0.07% of average loans.

Non-interest income fell 8% to $13.2 million, reversing a 21% increase in the second quarter. The company said the decline was primarily due to lower mortgage banking and bank-owned life insurance income from quarter-end fair-value adjustments. Underlying activity remained solid, it said, with higher debit card income and assets under administration of $2.6 billion, up 1%.

Non-interest expense rose less than 1% to $37.5 million. The GAAP efficiency ratio improved to 54.60% from 55.42%; the non-GAAP ratio was 52.44%.

Unrealized losses on the available-for-sale portfolio increased $32.6 million to $77.5 million as rates rose. Tangible book value per share was $31.40, compared with $31.64 at June 30. The company did not repurchase shares in the third quarter. It declared a $0.42 cash dividend. Common Equity Tier 1 was 12.53%.