third quarter of 2026
Filed Oct 23, 2026Primis Financial Corp. Reports Strong Results for the Third Quarter of 2026 Declares Quarterly Cash Dividend of $0.10 Per Share
Third-quarter GAAP net income, net interest income and net interest margin improved from the prior-year quarter, while loan growth, improving nonperforming assets and higher tangible book value supported the result. Mortgage disruption reduced the retail mortgage pipeline and revenue versus the second quarter, noninterest expense increased from the prior-year quarter, and the Company recorded a provision for credit losses versus a recovery a year earlier.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income, three months ended September 30GAAP | $8.67M | – | – |
| Net income available to Primis' common shareholders, three months ended September 30GAAP | $8.67M | – | – |
| Operating net income available to Primis' common shareholders, three months ended September 30non-GAAP | $8.67M | – | up 27% |
| Net income available to Primis' common shareholders, nine months ended September 30GAAP | $25.41M | – | – |
| Operating net income available to Primis' common shareholders, nine months ended September 30non-GAAP | $22.34M | – | up 211% |
| Earnings per common share - diluted, three months ended September 30GAAP | $ 0.35 | – | – |
| Operating earnings per common share - diluted, three months ended September 30non-GAAP | $ 0.35 | – | – |
| Earnings per common share - diluted, nine months ended September 30GAAP | $ 1.03 | – | – |
| Operating earnings per common share - diluted, nine months ended September 30non-GAAP | $ 0.90 | – | up 211% |
| Net interest income, three months ended September 30GAAP | $36.31M | – | up 25% |
| Net interest income, nine months ended September 30GAAP | $102.1M | – | – |
| Net interest margin, three months ended September 30GAAP | 3.66 % | – | – |
| Core net interest margin, three months ended September 30non-GAAP | 3.59% | expansion of 14 basis points linked-quarter | – |
| Noninterest income, three months ended September 30GAAP | $12.92M | – | – |
| Mortgage banking income, three months ended September 30GAAP | $8.02M | – | decreased 10% |
| Gain on sale of loans, three months ended September 30GAAP | $1.47M | – | – |
| Noninterest expense, three months ended September 30GAAP | $37.16M | – | – |
| Core operating expense burden, three months ended September 30non-GAAP | $24.15M | – | – |
| Income before income taxes, three months ended September 30GAAP | $10.93M | – | – |
| Income tax expense, three months ended September 30GAAP | $2.25M | – | – |
| Provision for (recovery of) credit losses, three months ended September 30GAAP | $1.15M | – | – |
| Return on average assets, three months ended September 30GAAP | 0.80 % | – | – |
| Operating return on average assets, three months ended September 30non-GAAP | 0.80 % | – | – |
| Efficiency ratio, three months ended September 30GAAP | 75.47 % | – | – |
| Total assetsGAAP | $4.30B | – | – |
| Loans held for investmentGAAP | $3.50B | flat compared to June 30, 2026 | increased 9% |
| Total depositsGAAP | $3.47B | – | up $0.1 billion, or 4% |
| Cash and cash equivalentsGAAP | $165.1M | – | – |
| Federal Home Loan Bank advancesGAAP | $220M | – | – |
| Subordinated debt and notesGAAP | $69.41M | – | – |
| Tangible common equitynon-GAAP | $342.4M | – | – |
| Tangible common equity to tangible assetsnon-GAAP | 8.14 % | – | – |
| Tangible book value per common sharenon-GAAP | $ 13.81 | – | an increase of $2.10, or 18% |
| Non-performing assets as a percent of total assets, excluding SBA guaranteesother | 1.43 % | – | – |
| Allowance for credit losses to total loansother | 1.30 % | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Core Community BankCore Bank loan growth of 11% annualized in the third quarter of 2026, with a pipeline of $160 million as of September 30, 2026. Cost of deposits was 1.63% versus 1.73% in the same quarter in 2025. | not separately reported | – | – |
| Primis MortgageClosed mortgage volume was $347 million, up 12.5% year-over-year, while pre-tax losses were approximately $0.3 million compared with earnings of $1.9 million in the third quarter of 2025. | Mortgage banking income of $ 8,022 | – | decreased 10% to $8.0 million compared to $8.9 million in the same quarter in 2025 |
| Mortgage WarehouseOutstanding loan balances were $501 million, down 8% from $544 million at June 30, 2026 and up 53% from $327 million at September 30, 2025. Average loan balances were $427 million. | not separately reported | – | – |
| Panacea FinancialLoans held for investment were $603 million at September 30, 2026, up 14% annualized from $583 million at June 30, 2026. Customer deposits totaled $207 million, up 56% from September 30, 2025. | not separately reported | – | – |
| Digital PlatformThe platform ended the third quarter with approximately $1.0 billion of deposits at a 3.80% cost of deposits, compared to $1.0 billion at September 30, 2025 with a cost of 4.07%. | not separately reported | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
early in 2027 outlook
- NoteThe Company expects approximately $3.0 million of annualized savings from vendor consolidation and statement services beginning early in 2027.
Capital returns
- The Board of Directors declared a dividend of $0.10 per share payable on November 20, 2026 to shareholders of record on November 6, 2026.
- This is Primis' sixtieth consecutive quarterly dividend.
What drove it
- Net interest income was $36.3 million, up 25%, with net interest margin of 3.66% versus 3.18% in the same quarter of 2025.
- Interest income included approximately $0.7 million of recoveries from a previously charged-off loan. Adjusted net interest income was $35.6 million, up 23% from the prior-year period.
- Earning asset growth funded at attractive incremental margins drove net interest margin expansion, according to the Company.
- Yield on investments increased 135 basis points year-over-year, largely due to the portfolio restructuring in the fourth quarter of 2025.
- Third-quarter noninterest income included $0.9 million of recoveries from a previously charged-off loan and $0.4 million in payouts from a bank-owned life insurance policy.
- Gain on sale income was $1.5 million, compared to $0.2 million in the third quarter of 2025.
- Nonperforming assets excluding SBA-guaranteed balances decreased to $61 million from $63 million at June 30, 2026.
Concerns
- Management said unprecedented headwinds reduced the retail mortgage pipeline 37% and reduced revenue by $2.3 million versus the second quarter.
- Pre-tax losses related to Primis Mortgage were approximately $0.3 million, compared with earnings of $1.9 million in the third quarter of 2025.
- Noninterest expense was $ 37,155 versus $ 32,313 in the third quarter of 2025.
- The Company recorded a $ 1,149 provision for credit losses versus a $ (49 ) recovery of credit losses in the third quarter of 2025.
- Core net charge-offs as a percentage of average loans were 17 basis points, up 14 basis points from the same period a year ago.
- Mortgage warehouse balances decreased to $501 million at September 30, 2026 from $544 million at June 30, 2026.
What to watch
- Retail mortgage pipeline and the revenue impact from lower mortgage volumes.
- Whether core loan growth and the $160 million Core Bank pipeline translate into continued balance-sheet growth.
- Net interest margin after the approximately $0.7 million interest recovery in the third quarter.
- Credit costs, core net charge-offs and the allowance for credit losses as the loan portfolio grows.
- Execution of approximately $3.0 million of annualized vendor consolidation and statement-services savings expected beginning early in 2027.
- Funding mix, including noninterest-bearing deposits, deposit costs and Federal Home Loan Bank advances.
Balance sheet and cash flow
- Cash and cash equivalents were $ 165,085 at September 30, 2026.
- Total assets were $ 4,299,526 at September 30, 2026.
- Total deposits were $ 3,472,631 at September 30, 2026.
- Federal Home Loan Bank advances were $ 220,000 at September 30, 2026.
- Tangible common equity was $ 342,357 at September 30, 2026, or 8.14 % of tangible assets.
Analysis
Primis reported third-quarter net income available to common shareholders of $8.7 million, or $0.35 per diluted share, compared with $6.8 million, or $0.28 per diluted share, in the third quarter of 2025. Operating net income available to common shareholders was also $8.7 million, or $0.35 per diluted share, and was up 27% year-over-year. Nine-month GAAP net income available to common shareholders was $25.4 million compared with $31.9 million, while nine-month operating net income was $22.3 million compared with $7.2 million. The Company stated that year-to-date results in both years benefited from investment gains in the second quarter.
The primary earnings driver was net interest income of $36.3 million, up 25% from $29.0 million. Net interest margin reached 3.66%, compared with 3.18% a year earlier and 3.45% in the second quarter. The Company identified robust earning asset growth funded at attractive incremental margins as the driver of margin expansion. Third-quarter interest income included approximately $0.7 million of recoveries from a previously charged-off loan. Adjusted for that recovery, net interest income was $35.6 million and net interest margin was 3.59%.
Balance-sheet trends reflected loan and deposit growth alongside a reduction in mortgage warehouse balances from the prior quarter. Loans held for investment were $3.5 billion, up 9% from $3.2 billion at September 30, 2025, while deposits were $3.5 billion, up $0.1 billion, or 4%, from the same period. Core Bank loan growth was 11% annualized, Panacea loans held for investment were $603 million, and mortgage portfolio loans generated by Primis Mortgage reached $156 million. Asset quality improved year-over-year: nonperforming assets excluding SBA guarantees were 1.43% of total assets, compared with 2.07%, although the Company recorded a $1.1 million provision for credit losses and core net charge-offs were 17 basis points.
Noninterest income was $12.9 million, down from $22.0 million in the second quarter but above $12.0 million a year earlier. Mortgage banking income declined 10% to $8.0 million. Management attributed pressure to unprecedented headwinds that reduced the retail mortgage pipeline 37% and reduced revenue by $2.3 million versus the second quarter. Noninterest expense was $37.2 million compared with $32.3 million a year earlier, while core operating expense burden was $24.2 million compared with $24.9 million in the second quarter. The Company expects approximately $3.0 million of annualized savings from vendor consolidation and statement services beginning early in 2027.
Capital strengthened during the period. Tangible common equity was $342.4 million and tangible common equity to tangible assets was 8.14%, compared with 7.48% at September 30, 2025. Tangible book value per common share was $13.81, an increase of $2.10, or 18%, from the prior-year level. The Board declared a $0.10 per share dividend payable November 20, 2026 to shareholders of record on November 6, 2026. The release did not provide formal revenue, expense, margin, tax-rate, or earnings guidance beyond the expected annualized savings beginning early in 2027.
Management, verbatim
The progress we have made over the past year is substantial. A core margin of 3.59% with expansion of 14 basis points linked-quarter is a testament to the value of our Core Bank franchise which continues to drive slow and steady growth at attractive margins. Our core earnings engine delivered a solid quarter in the face of unprecedented headwinds that reduced our retail mortgage pipeline 37% and reduced revenue by $2.3 million versus the second quarter. In a steady environment for retail mortgage, we would have been at our 1.00% ROAA target this quarter as expected. We are already making changes to close the gap during this period of lower volumes while preserving our ability to benefit when volumes eventually recover.
Dennis J. Zember, Jr., President and Chief Executive Officer of the Company
Not in the filing
stated, not guessed- Operating cash flow
- Free cash flow
- Share repurchases
- Formal forward revenue guidance
- Formal forward net interest margin guidance
- Formal forward operating-expense guidance
- Formal forward tax-rate guidance
- Gross margin
- Reported effective tax rate
- Segment revenue for Core Community Bank
- Segment revenue for Mortgage Warehouse
- Segment revenue for Panacea Financial
- Segment revenue for Digital Platform
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.