PROVIDENT FINANCIAL HOLDINGS REPORTS FIRST QUARTER OF FISCAL 2027 RESULTS
PROVIDENT FINANCIAL HOLDINGS INC (PROV) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 3756 Central Avenue NEWS RELEASE Riverside, CA 92506 (951) 686-6060 PROVIDENT FINANCIAL HOLDINGS REPORTS FIRST QUARTER OF FISCAL 2027 RESULTS Net Income of $1.57 Million in the September 2026 Quarter, Down 28% from the Sequential Quarter and 6% from the Comparable Qu
How this was made
The 30-second read
Why it matters
The earnings miss may trigger short‑term price pressure, but the improved net interest margin and share buybacks could provide a floor for the stock.
Market read
First‑report earnings for a small‑cap regional bank; relevant for traders focused on banking sector and earnings volatility.
What to watch
Strong loan yield repricing and lower funding costs may improve future profitability
Net Income of $1.57 Million in the September 2026 Quarter, Down 28% from the Sequential Quarter and 6% from the Comparable Quarter Last Year
Net interest income and net interest margin increased, operating expenses declined, and asset quality remained strong, but a $777,000 provision for credit losses and lower sequential non-interest income reduced net income to $1.57 million.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income, quarter ended September 30, 2026GAAP | $1.57M | down 28 percent | down six percent |
| Basic earnings per share, quarter ended September 30, 2026GAAP | $ 0.25 | – | – |
| Diluted earnings per share, quarter ended September 30, 2026GAAP | $ 0.25 | – | – |
| Net interest income, quarter ended September 30, 2026GAAP | $9.77M | – | $840,000 or nine percent |
| Total interest income, quarter ended September 30, 2026GAAP | $14.73M | – | – |
| Interest income: loans receivable, net, quarter ended September 30, 2026GAAP | $13.45M | – | $318,000 or two percent |
| Interest income: investment securities, quarter ended September 30, 2026GAAP | $ 356 | – | $74,000, or 17 percent |
| Interest income: FHLB - San Francisco stock and other equity investments, quarter ended September 30, 2026GAAP | $ 480 | – | $269,000 or 127 percent |
| Interest income: interest-earning deposits, quarter ended September 30, 2026GAAP | $ 442 | – | $68,000 or 18 percent |
| Total interest expense, quarter ended September 30, 2026GAAP | $4.96M | – | – |
| Interest expense: deposits, quarter ended September 30, 2026GAAP | $3.35M | – | $364,000 or 12 percent |
| Interest expense: borrowings, quarter ended September 30, 2026GAAP | $1.61M | – | $623,000, or 28 percent |
| Provision for (recovery of) credit losses, quarter ended September 30, 2026GAAP | $777K | – | – |
| Net interest income after provision for (recovery of) credit losses, quarter ended September 30, 2026GAAP | $8.99M | – | – |
| Total non-interest income, quarter ended September 30, 2026GAAP | $804K | $479,000, or 37 percent | $9,000, or one percent |
| Loan servicing and other fees, quarter ended September 30, 2026GAAP | $74K | – | – |
| Deposit account fees, quarter ended September 30, 2026GAAP | $234K | – | – |
| Card and processing fees, quarter ended September 30, 2026GAAP | $290K | – | – |
| Other non-interest income, quarter ended September 30, 2026GAAP | $ 206 | – | – |
| Total non-interest expense, quarter ended September 30, 2026GAAP | $7.62M | $130,000, or two percent | $15,000 |
| Salaries and employee benefits, quarter ended September 30, 2026GAAP | $4.66M | – | $111,000 or two percent |
| Premises and occupancy, quarter ended September 30, 2026GAAP | $887K | – | – |
| Equipment, quarter ended September 30, 2026GAAP | $ 414 | – | – |
| Professional, quarter ended September 30, 2026GAAP | $ 407 | – | – |
| Sales and marketing, quarter ended September 30, 2026GAAP | $204K | – | – |
| Deposit insurance premiums and regulatory assessments, quarter ended September 30, 2026GAAP | $161K | – | – |
| Other non-interest expense, quarter ended September 30, 2026GAAP | $ 887 | – | – |
| Income before income taxes, quarter ended September 30, 2026GAAP | $2.18M | – | – |
| Provision for income taxes, quarter ended September 30, 2026GAAP | $605K | down 20 percent | down 43 percent |
| Effective tax rate, quarter ended September 30, 2026GAAP | 27.8 percent | – | – |
| Net interest margin, quarter ended September 30, 2026other | 3.32 % | Up 11 Basis Points | increased 32 basis points |
| Net interest spread, quarter ended September 30, 2026other | 3.15 % | – | – |
| Efficiency ratio, quarter ended September 30, 2026other | 72.05 % | – | – |
| Return on average assets, quarter ended September 30, 2026other | 0.52 % | – | – |
| Return on average stockholders' equity, quarter ended September 30, 2026other | 4.93 % | – | – |
| Total loans originated for investment, quarter ended September 30, 2026other | $45.42M | – | – |
| Total assets, September 30, 2026GAAP | $1.21B | – | – |
| Cash and cash equivalents, September 30, 2026GAAP | $53.24M | – | – |
| Investment securities, September 30, 2026other | $85.25M | – | – |
| Loans held for investment, net, September 30, 2026GAAP | $1.04B | – | – |
| Total deposits, September 30, 2026GAAP | $897.7M | Down 1% | – |
| Borrowings, September 30, 2026GAAP | $172.0M | – | – |
| Total stockholders' equity, September 30, 2026GAAP | $125.4M | – | – |
| Allowance for credit losses on loans held for investment, September 30, 2026GAAP | $6.59M | – | – |
| Non-performing assets to total assets, September 30, 2026other | 0.04 % | Unchanged | – |
| Non-performing loans, September 30, 2026other | $ 504 | – | – |
| Allowance for credit losses on loans to gross loans held for investment, September 30, 2026other | 0.64 % | – | – |
Capital returns
- The Company repurchased 86,431 shares of its common stock at an average cost of $18.30 per share during the quarter ended September 30, 2026.
- The Company paid a quarterly cash dividend of $0.14 per share.
- As of September 30, 2026, a total of 88,174 shares remained available for future purchase under the Company’s current repurchase program.
What drove it
- Net interest income increased $840,000 or nine percent from the comparable quarter last year, reflecting a $581,000 increase in income from interest-earning assets and a $259,000 decrease in funding costs.
- Interest income on loans receivable rose $318,000 or two percent, primarily due to a higher average loan yield, partly offset by a lower average loan balance.
- The yield on loans receivable increased 17 basis points to 5.22 percent from 5.05 percent, primarily due to adjustable-rate loans repricing.
- Interest expense on borrowings decreased $623,000, or 28 percent, due to lower average borrowings and a 58 basis point reduction in the average cost of borrowings.
- The $777,000 provision for credit losses was primarily driven by a longer expected life of the loan portfolio attributable primarily to higher interest rates and a modest increase in the loan portfolio balance.
- Non-interest income declined sequentially due primarily to a lower gain on other equity investments resulting mainly from the Visa share conversion in the prior quarter.
Concerns
- The Company recorded a $777,000 provision for credit losses, compared with a $95,000 recovery in the sequential quarter and a $626,000 recovery in the comparable quarter last year.
- Classified assets were $4.1 million at September 30, 2026, compared to $2.5 million at June 30, 2026.
- Transaction account balances decreased $11.3 million, or two percent, to $545.9 million, while time deposits decreased $1.4 million to $351.8 million during the first quarter of fiscal 2027.
- Non-interest income decreased $479,000, or 37 percent, sequentially to $804,000.
What to watch
- The expected life of the loan portfolio and its effect on the allowance for credit losses and provision for credit losses.
- Deposit balances, the mix of transaction accounts and time deposits, and the cost of deposits.
- Net interest margin following adjustable-rate loan repricing and maturities of higher-cost FHLB advances.
- Classified assets, non-performing loans, and any loan charge-offs.
- The level of non-interest income following the prior-quarter Visa share conversion gain.
Balance sheet and cash flow
- Cash and cash equivalents were $ 53,245 at September 30, 2026, compared to $ 49,210 at June 30, 2026.
- Loans held for investment, net were $ 1,036,695 at September 30, 2026, compared to $ 1,032,682 at June 30, 2026.
- Total deposits were $ 897,728 at September 30, 2026, compared to $ 910,383 at June 30, 2026.
- Borrowings were $ 172,039 at September 30, 2026, compared to $ 157,046 at June 30, 2026.
- Total available borrowing capacity across all sources was approximately $464.2 million at September 30, 2026.
- The Bank remained well capitalized under all applicable regulatory capital requirements.
Analysis
Provident Financial Holdings reported first-quarter fiscal 2027 net income of $1.57 million, or $0.25 per diluted share, compared with $2.18 million, or $0.35 per diluted share, in the sequential quarter and $1.68 million, or $0.25 per diluted share, in the comparable quarter last year. The sequential decline primarily reflected a $777,000 provision for credit losses, versus a $95,000 recovery in the fourth quarter of fiscal 2026, and a $479,000 decrease in non-interest income. The comparable-quarter decline reflected the provision for credit losses versus a $626,000 recovery a year earlier.
Core spread results strengthened. Net interest income was $9.77 million, up $840,000 or nine percent from $8.93 million in the comparable quarter last year, while net interest margin rose to 3.32 percent from 3.00 percent and 3.21 percent in the sequential quarter. Loan interest income increased to $13.45 million as the loan yield reached 5.22 percent, supported by adjustable-rate loan repricing. Borrowing expense declined to $1.61 million from $2.23 million in the comparable quarter last year as average borrowings and their average cost declined.
Expense discipline was evident, with total non-interest expense of $7.62 million versus $7.63 million in the comparable quarter last year and $7.75 million sequentially. The efficiency ratio was 72.05 percent, compared with 78.35 percent a year earlier and 73.15 percent in the sequential quarter. Non-interest income was $804,000, slightly below $813,000 a year earlier and down from $1.28 million sequentially, with the latter comparison affected by a lower gain on other equity investments following the Visa share conversion in the prior quarter.
Credit quality measures remained low, with non-performing assets of $504,000, or 0.04 percent of total assets, and no loan charge-offs during the quarter. However, the allowance for credit losses on loans held for investment increased to $6.59 million, or 0.64 percent of gross loans held for investment, from $5.85 million, or 0.57 percent, at June 30, 2026. Classified assets rose to $4.1 million from $2.5 million at June 30, 2026. Loans held for investment, net were $1.04 billion, while total deposits were $897.7 million, down from $910.4 million at June 30, 2026.
Capital allocation included the repurchase of 86,431 shares at an average cost of $18.30 per share and a quarterly cash dividend of $0.14 per share. The Company had 88,174 shares remaining under its repurchase authorization. The release provided no forward financial guidance. Management highlighted liquidity, including approximately $464.2 million of total available borrowing capacity across all sources at September 30, 2026.
Management, verbatim
Our results for the first quarter reflected a higher provision for credit losses to build our allowance for credit losses, as an increase in interest rates extended the expected life of the loan portfolio. However, credit quality remains excellent.
Donavon P. Ternes, President and Chief Executive Officer
In a highly competitive environment, we maintained positive operating momentum, with increased net interest income, an expanded net interest margin and well-managed operating expenses. Together with our opportunistic share repurchases at prices below book value and consistent cash dividend, we remain focused on delivering long-term shareholder value.
Donavon P. Ternes, President and Chief Executive Officer
Not in the filing
stated, not guessed- Total revenue was not reported.
- Gross margin was not reported.
- Operating income was not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Forward financial guidance was not provided.
- Reportable operating segments were not provided.
- Non-GAAP financial measures were not provided.
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
Provident Financial Holdings (NASDAQ:PROV) filed a Form 8‑K reporting its Q1 FY2027 results, showing a modest profit decline and higher credit loss provisions.
Ticker impact
Q1 FY2027 net income $1.57M down 28% QoQ, higher credit loss provision and lower non‑interest income.
likely pressure as market prices in weaker earnings and higher provisions
The decline in profit and higher allowance suggest deteriorating loan performance, which may weigh on the stock.
Market effects
regional bank earnings pressure may affect peer valuations
US regional banking sector
limited to US banking investors
Counterpoint
Net interest margin expansion and share repurchases below book value could support upside despite earnings miss
Key entities
- companyProvident Financial Holdings
NASDAQ‑listed regional bank reporting Q1 FY2027 earnings
