PEOPLES BANCORP INC. ANNOUNCES RESULTS FOR THE THIRD QUARTER 2026
PEOPLES BANCORP INC (PEBO) filed an SEC Form 8-K — Results of Operations and Financial Condition. Filed by: Peoples Bancorp, Inc (Commission File No.: 000-16772) Pursuant to the Rule 425 under the Securities Act of 1933, as amended and deemed filed pursuant to Rule 14a-12 of the Securities Exchange Act of 1934, as amended Subject Company: Capital Bancorp Inc. (Commission File
How this was made
The 30-second read
Why it matters
The earnings beat and margin expansion suggest short‑term upside, while the pending acquisitions add longer‑term execution risk.
Market read
First‑time earnings release for PEBO with modest but positive surprise; likely to generate short‑term buying pressure.
What to watch
Pending mergers with Citizens and Capital could introduce integration risk and dilute near‑term earnings.
Peoples Bancorp Inc. Announces Results for the Third Quarter 2026
Third-quarter net income, diluted EPS, net interest income and net interest margin increased from both the linked and prior-year quarters, while provision expense declined. Fee income excluding gains and losses improved, asset quality metrics were stable or improved in several areas, and capital ratios increased. Offsetting items included $4.8 million of net losses, higher expenses, classified-loan growth, and acquisition-related costs.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net interest income, three months ended September 30, 2026GAAP | $93.84M | $1.1 million | $2.5 million, or 3% |
| Net interest margin, three months ended September 30, 2026other | 4.31% | – | increased 15 basis points |
| Provision for credit losses, three months ended September 30, 2026GAAP | $3.57M | decreased $1.1 million | – |
| Total non-interest income, three months ended September 30, 2026GAAP | $25.64M | – | – |
| Total non-interest income excluding net gains and losses, three months ended September 30, 2026non-GAAP | $30.47M | increased $1.5 million, or 5% | increased $3.6 million |
| Net loss on investment securities, three months ended September 30, 2026GAAP | −$4.51M | – | – |
| Net loss on asset disposals and other transactions, three months ended September 30, 2026GAAP | −$311K | – | – |
| Total non-interest expense, three months ended September 30, 2026GAAP | $74.54M | increased $1.8 million | increased $4.6 million |
| Core non-interest expense, three months ended September 30, 2026non-GAAP | $73.04M | – | – |
| Income before income taxes, three months ended September 30, 2026GAAP | $41.38M | – | – |
| Income tax expense, three months ended September 30, 2026GAAP | $8.77M | – | – |
| Effective tax rate, three months ended September 30, 2026GAAP | 21.2% | – | – |
| Net income, three months ended September 30, 2026GAAP | $32.61M | – | – |
| Earnings per common share, diluted, three months ended September 30, 2026GAAP | $ 0.91 | – | – |
| Earnings per common share, basic, three months ended September 30, 2026GAAP | $ 0.92 | – | – |
| Return on average assets, three months ended September 30, 2026GAAP | 1.36% | – | – |
| Return on average assets adjusted for non-core items, three months ended September 30, 2026non-GAAP | 1.57% | – | – |
| Return on average stockholders' equity, three months ended September 30, 2026GAAP | 10.44% | – | – |
| Return on average tangible equity, three months ended September 30, 2026non-GAAP | 15.84% | – | – |
| Efficiency ratio, three months ended September 30, 2026non-GAAP | 58.50% | – | – |
| Efficiency ratio adjusted for non-core items, three months ended September 30, 2026non-GAAP | 57.30% | – | – |
| Pre-provision net revenue, three months ended September 30, 2026non-GAAP | $49.77M | – | – |
| Net interest income, nine months ended September 30, 2026GAAP | $277.0M | – | increased $12.8 million |
| Net interest margin, nine months ended September 30, 2026other | 4.23% | – | increased eight basis points |
| Provision for credit losses, nine months ended September 30, 2026GAAP | $17.97M | – | – |
| Total non-interest income, nine months ended September 30, 2026GAAP | $74.28M | – | – |
| Total non-interest income excluding net gains and losses, nine months ended September 30, 2026non-GAAP | $88.14M | – | increased $6.6 million, or 8% |
| Total non-interest expense, nine months ended September 30, 2026GAAP | $218.9M | – | increased $7.9 million |
| Net income, nine months ended September 30, 2026GAAP | $89.56M | – | – |
| Earnings per common share, diluted, nine months ended September 30, 2026GAAP | $ 2.49 | – | – |
| Total assets, September 30, 2026GAAP | $9.65B | – | – |
| Total loans and leases, September 30, 2026GAAP | $6.84B | increased $19.2 million, or 1% annualized | increased $112.1 million, or 2% |
| Total deposits, September 30, 2026GAAP | $7.44B | – | – |
| Total stockholders' equity, September 30, 2026GAAP | $1.23B | decreased $8.6 million, or 1% | increased $45.1 million, or 4% |
| Tangible equity to tangible assets, September 30, 2026non-GAAP | 9.06% | – | – |
| Common equity tier 1 capital ratio, September 30, 2026other | 12.81% | – | – |
| Total risk-based capital ratio, September 30, 2026other | 14.29% | – | – |
| Leverage ratio, September 30, 2026other | 10.67% | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Capital returns
- Cash dividends declared per common share were $ 0.42 for the three months ended September 30, 2026, compared to $ 0.42 for the three months ended June 30, 2026 and $ 0.41 for the three months ended September 30, 2025.
- Dividends paid were $15.1 million during the third quarter of 2026.
- Dividend payout ratio was 46.36% for the three months ended September 30, 2026, compared to 54.04% for the three months ended June 30, 2026 and 49.72% for the three months ended September 30, 2025.
- Treasury stock was 996,472 common shares at September 30, 2026, compared to 1,215,120 common shares at December 31, 2025.
What drove it
- Higher loan income increased net interest income compared with the linked quarter.
- Higher investment and loan yields increased net interest margin compared with the linked quarter.
- Lower deposit and borrowing costs drove year-over-year increases in net interest income and net interest margin.
- Non-interest income excluding net gains and losses increased with lease income, swap fee income, deposit account service charges, trust and investment income, and bank owned life insurance income.
- Third-quarter loan growth was led by construction loans, commercial and industrial loans, and home equity lines of credit.
- Core deposits increased through interest-bearing demand accounts and money market deposit accounts.
- Provision for credit losses declined because of reductions in reserves for individually analyzed loans and leases and updates to prepayment, curtailment, and funding rates, partly offset by higher net charge-offs.
Concerns
- Net losses on investment securities and asset disposals and other transactions were $ (4,512) and $ (311), respectively, in the third quarter of 2026.
- Classified loans increased $30.1 million, or 21%, compared to June 30, 2026, primarily because of loan downgrades.
- Annualized net charge-offs were 0.35% of average total loans, compared to 0.31% for the linked quarter, reflecting increased commercial and industrial loan net charge-offs associated with one customer relationship.
- Total non-interest expense increased $1.8 million from the linked quarter, including increases in professional fees, salaries and employee benefits, marketing expense, and operating lease expense.
- Accumulated other comprehensive loss increased $28.5 million during the third quarter of 2026 due to changes in the market value of available-for-sale investment securities.
- Acquisition-related expenses were $1.5 million in the third quarter of 2026.
What to watch
- Progress and closing conditions for the pending Citizens transaction valued at approximately $76.6 million and the pending Capital transaction valued at approximately $728.1 million.
- Further changes in classified loans, commercial and industrial loan charge-offs, and the allowance for credit losses.
- Net interest margin after the reported lift from higher investment and loan yields and lower deposit and borrowing costs.
- The impact of available-for-sale investment security sales and market-value changes on accumulated other comprehensive loss and stockholders' equity.
- Loan and core-deposit mix, particularly commercial and industrial loans, construction loans, money market deposits, retail certificates of deposit, and brokered deposits.
Balance sheet and cash flow
- Total cash and cash equivalents were $ 300,775 at September 30, 2026, compared to $ 188,951 at December 31, 2025.
- Cash and cash equivalents increased $111.8 million when compared to December 31, 2025.
- Available-for-sale investment securities were $ 805,119 at September 30, 2026, compared to $ 984,367 at December 31, 2025.
- Held-to-maturity investment securities were $ 878,076 at September 30, 2026, compared to $ 922,837 at December 31, 2025.
- Short-term borrowings were $ 704,120 at September 30, 2026, compared to $ 435,926 at December 31, 2025.
- Long-term borrowings were $ 155,054 at September 30, 2026, compared to $ 204,138 at December 31, 2025.
- Liquid and liquefiable assets totaled $667.9 million at September 30, 2026.
- Total borrowing capacity available through the FHLB, FRB, and federal funds was $654.3 million at September 30, 2026.
- Contingent sources of liquidity totaled $3.8 billion at September 30, 2026.
Analysis
Peoples reported third-quarter 2026 net income of $32.6 million and diluted earnings per common share of $0.91, compared with $28.0 million and $0.78 in the linked quarter and $29.5 million and $0.83 in the prior-year quarter. Net interest income was $93.8 million, up $1.1 million from the linked quarter and up $2.5 million, or 3%, from the third quarter of 2025. Net interest margin reached 4.31%, versus 4.23% in the linked quarter and 4.16% in the prior-year quarter. Management attributed the sequential improvement to higher investment and loan yields and the year-over-year improvement to lower deposit and borrowing costs.
Fee-based activity improved. Total non-interest income excluding net gains and losses rose $1.5 million, or 5%, from the linked quarter and was 25% of total revenue, compared with 24% for the linked quarter. Lease income, other non-interest income, deposit account service charges, trust and investment income, and bank owned life insurance income contributed to the sequential increase. The quarter also included a $4.8 million net loss, including a $4.5 million net loss from the sale of $58.5 million of available-for-sale securities. Peoples stated that the sales were part of managing its balance sheet under $10 billion in assets ahead of the Citizens merger.
Expense growth moderated operating leverage. Total non-interest expense was $74.5 million, up $1.8 million from the linked quarter and $4.6 million from the prior-year quarter. The sequential increase reflected acquisition-related professional fees, higher sales-based incentives, marketing expense, and operating lease expense. The efficiency ratio was 58.5%, compared with 58.3% in the linked quarter and 57.1% a year earlier, while the efficiency ratio adjusted for non-core items was 57.3%. Acquisition-related expenses were $1.5 million, including $0.9 million associated with Citizens and $1.0 million associated with Capital recognized as of September 30, 2026.
Credit indicators were mixed but broadly stable. The provision for credit losses was $3.6 million, down from $4.7 million in the linked quarter and $7.3 million a year earlier. Nonperforming assets declined to $37.0 million, or 0.54% of total loans and OREO, from $41.1 million and 0.60% in the linked quarter. Criticized loans declined to $256.0 million, but classified loans increased to $170.9 million from $140.8 million, primarily from downgrades. Annualized net charge-offs rose to 0.35% from 0.31% in the linked quarter, while the allowance for credit losses as a percent of total loans was 1.11%.
Balance-sheet trends showed modest loan and core-deposit growth. Period-end total loans and leases increased $19.2 million, or 1% annualized, from the linked quarter, led by construction, commercial and industrial, and home equity lines of credit. Core deposits also increased $19.2 million, supported by interest-bearing demand and money market deposit accounts. Total stockholders' equity declined $8.6 million from June 30, 2026, as a $28.5 million increase in accumulated other comprehensive loss and $15.1 million of dividends paid more than offset $32.6 million of net income. The common equity tier 1 capital ratio increased to 12.81%, and liquidity included $667.9 million of liquid and liquefiable assets, $654.3 million of available borrowing capacity, and $3.8 billion of contingent sources of liquidity.
Management, verbatim
We are very pleased with our strong performance for the third quarter of 2026, highlighted by continued improvement in our net interest margin, net interest income, our fee-based revenue streams, and overall profitability.
Tyler Wilcox, President and Chief Executive Officer
Our results reflect disciplined execution, and we remain committed to maintaining our momentum through the fourth quarter to close the year in a strong financial position.
Tyler Wilcox, President and Chief Executive Officer
Not in the filing
stated, not guessed- Forward financial guidance was not provided.
- Previous-release outlook was not provided, so no comparison with prior guidance is available.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Share repurchases were not reported.
- Reportable operating-segment revenue was not reported.
- Gross margin was not reported.
- Non-GAAP earnings per share was not reported.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
The filing provides the first public disclosure of Peoples Bancorp's Q3 2026 financial results and details two pending merger transactions.
Ticker impact
Peoples Bancorp Inc. filed its Q3 2026 earnings on Form 8‑K, reporting $32.6 M net income and EPS $0.91, up from the prior quarter.
upward pressure as investors price in stronger earnings and margin expansion
The company disclosed higher net income, higher EPS, and a rising net interest margin, all fresh data that can move the share price.
Market effects
Positive earnings may lift peer regional banks and the broader community banking sector.
U.S. regional banking stocks could see modest gains.
Limited to U.S. banking sector; no broader macro impact.
Counterpoint
If the acquisition‑related expenses are larger than expected, the earnings boost may be temporary.
Key entities
- companyPeoples Bancorp Inc.
U.S. regional bank reporting Q3 2026 results.
- companyCitizens National Corporation
Target of a pending cash‑and‑stock acquisition.
- companyCapital Bancorp, Inc.
Target of a pending all‑stock acquisition.
