third quarter 2026
Filed Oct 23, 2026Republic Bancorp reported third-quarter net income of $31.1 million and Diluted EPS of $1.59, with Core Banking net interest income up 8% and net interest margin expanding 25 basis points to 4.03%.
Third-quarter net income increased 4%, Core Banking net income increased 15%, and Core Banking net interest income increased 8% with margin expansion. These gains were partly offset by lower Republic Processing Group earnings, a $2.0 million Core Banking provision charge versus a prior-year credit, and higher Core Banking nonperforming-loan and delinquency ratios.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net income, three months ended September 30other | $31.1M | – | 4% |
| Diluted EPS, three months ended September 30other | $1.59 | – | 5% |
| Income before income tax expense, three months ended September 30other | $39.63M | – | 5% |
| Return on average assets, three months ended September 30other | 1.74% | – | 3% |
| Return on average equity, three months ended September 30other | 10.48 | – | (4)% |
| Net income, nine months ended September 30other | $106.5M | – | (2)% |
| Diluted EPS, nine months ended September 30other | 5.44 | – | (2)% |
| Income before income tax expense, nine months ended September 30other | $137.6M | – | — % |
| Return on average assets, nine months ended September 30other | 2.01% | – | (1)% |
| Return on average equity, nine months ended September 30other | 12.34 | – | (10)% |
| Core Banking net income, three months ended September 30other | $22.8M | – | 15% |
| Core Banking net interest income, three months ended September 30other | $66.1M | – | 8% |
| Total Core Bank net interest income, three months ended September 30other | $66.06M | – | – |
| Total Core Bank net interest margin, three months ended September 30other | 4.03% | – | 0.25% |
| Core Banking provision for expected credit losses, three months ended September 30other | $2.0 million net charge | – | – |
| Core Banking noninterest income, three months ended September 30other | $10.9M | – | 4% |
| Core Banking noninterest expense, three months ended September 30other | $45.9M | – | (3)% |
| Republic Processing Group net income, three months ended September 30other | $8.3M | – | – |
| Republic Credit Solutions net income, three months ended September 30other | $6.2M | – | (15)% |
| Total Company allowance for credit losses on loans, September 30other | $93.09M | – | 15% |
| Total Company allowance to loans, September 30other | 1.73% | – | 0.22% |
| Core Banking nonperforming loans to total loans, September 30other | 0.63% | – | – |
| Core Banking nonperforming assets to total loans including OREO, September 30other | 0.65 | – | – |
| Core Banking delinquent loans to total loans, September 30other | 0.27 | – | – |
| Core Banking net charge-offs to average loans, September 30other | 0.04 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Traditional BankingNet interest margin was 4.18% versus 3.89%, while average loan balances were $4,695,106 (dollars in thousands) versus $4,569,970 (dollars in thousands). | $62,346 (dollars in thousands) net interest income | – | – |
| Warehouse LendingAverage outstanding Warehouse lines of credit increased to $585 million from $575 million, while weighted-average yield declined 69 basis points to 6.33%. | $3,711 (dollars in thousands) net interest income | – | – |
| Republic Processing GroupNet income was $8.3 million compared with $9.9 million; Republic Credit Solutions revenue growth was more than offset by higher non-interest expenses and higher provisions. | not reported | – | – |
| Republic Credit SolutionsNet income was $6.2 million versus $7.2 million, as net interest income and program-fee growth were more than offset by higher marketing costs and provision expense related to LOC II growth. | not reported | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
What drove it
- Core Banking net interest income increased $4.8 million, or 8%, supported by a 35 basis point reduction in funding costs, favorable earning-asset mix trends, and disciplined pricing execution.
- Traditional Banking average loans increased $125 million, or 3%, to $4.70 billion, driven primarily by strong demand across commercial lending categories.
- The Republic Payment Solutions program generated approximately $180 million of lower-cost average deposits during the quarter and contributed incremental fee income.
- Core Banking interest-bearing deposit cost declined to 1.99% from 2.32%, while average FHLB advances declined $235 million, or 63%, and their weighted-average cost declined 49 basis points to 3.84%.
- Core Banking noninterest expense decreased $1.2 million, or 3%, with technology and interchange-related expenses down a combined $639,000, or 7%.
Concerns
- Core Banking provision expense was a $2.0 million net charge, compared with a $479,000 net credit in the third quarter of 2025.
- Core Banking nonperforming loans to total loans increased to 0.63% from 0.42%, and delinquent loans to total loans increased to 0.27% from 0.21%.
- Warehouse Lending net interest income declined to $3,711 (dollars in thousands) from $3,805 (dollars in thousands), and its net interest margin declined to 2.51 from 2.62.
- Mortgage banking income decreased $842,000, or 41%, primarily due to lower mortgage origination activity.
- Republic Processing Group net income declined to $8.3 million from $9.9 million; Republic Credit Solutions provision expense increased with LOC II growth.
What to watch
- Whether the higher-rate environment provides the stated incremental near-term growth to Core Banking net interest income.
- Traditional Banking loan growth, including Construction and Land Development loans, which increased $43 million and drove higher formula-related reserve requirements.
- Warehouse Lending utilization, which moderated to 49% from 54% as committed lines increased to $1.19 billion from $1.06 billion.
- Credit performance, including nonperforming loans, delinquent loans, net charge-offs, and the allowance-to-loans ratio.
- The ongoing deposit, liquidity, fee-income, and funding effects of the Republic Payment Solutions program.
Balance sheet and cash flow
- The Company had approximately $7.08 billion in total assets as of September 30, 2026.
- Total Company gross loans were $5,386,149 (dollars in thousands) as of September 30, 2026, compared with $5,281,374 (dollars in thousands) as of September 30, 2025.
- Total Core Bank period-end loan balances were $5,231,537 (dollars in thousands) as of September 30, 2026, compared with $5,168,132 (dollars in thousands) as of September 30, 2025.
- Total Company allowance for credit losses on loans was $93,093 (dollars in thousands) as of September 30, 2026, compared with $79,865 (dollars in thousands) as of September 30, 2025.
Analysis
Republic reported third-quarter net income of $31.1 million and Diluted EPS of $1.59, up 4% and 5%, respectively, from the third quarter of 2025. Income before income tax expense increased 5% to $39,633 (dollars in thousands). The nine-month comparison was weaker, with net income of $106,506 (dollars in thousands), down 2%, and Diluted EPS of 5.44, down 2%. Third-quarter ROA improved to 1.74% from 1.69%, while ROE declined to 10.48 from 10.91.
Core Banking was the principal source of quarterly improvement. Core Banking net income increased 15% to $22.8 million, and net interest income increased 8% to $66.1 million. Total Core Bank net interest margin expanded to 4.03% from 3.78%, reflecting a 35 basis point reduction in funding costs, favorable earning-asset mix, and pricing actions. Traditional Banking drove the improvement, with net interest income of $62,346 (dollars in thousands) and a 4.18% margin, while Warehouse Lending net interest income declined to $3,711 (dollars in thousands) and margin declined to 2.51.
Loan and funding activity supported net interest income but also increased credit provisioning. Traditional Banking average loans increased $125 million, or 3%, to $4.70 billion, while period-end Traditional Banking loans increased $135,646 (dollars in thousands), or 3%. The Company reduced average FHLB advances by $235 million, or 63%, following the March 2026 prepayment of $220 million of higher-cost advances. The new RPS program generated approximately $180 million of lower-cost average deposits. Core Banking provision expense shifted to a $2.0 million net charge from a $479,000 net credit, and Core Banking nonperforming loans to total loans increased to 0.63% from 0.42%.
Expense control aided Core Banking profitability. Core Banking noninterest expense declined $1.2 million, or 3%, as technology and interchange-related expenses declined a combined $639,000, or 7%, following the new core operating-system contract. Core Banking noninterest income increased 4% to $10.9 million, supported by higher service-charge activity, although mortgage banking income declined $842,000, or 41%. Republic Processing Group was the offset to Core Banking strength, with net income declining to $8.3 million from $9.9 million as higher RCS provisions and operating expenses exceeded growth in net interest income and program fees.
The release provided no quantified financial guidance. Management stated that, based on the current interest-rate risk position, the higher-rate environment will provide incremental growth to Core Bank net interest income over the near term. The key reported variables are the durability of net interest margin expansion, commercial loan demand, RPS deposit growth, Warehouse utilization, and the credit-cost effects associated with Traditional Banking and RCS LOC II portfolio growth.
Management, verbatim
Republic delivered another quarter of solid financial performance, reflecting the strength, consistency and earnings power of our Core Banking (1) franchise.
Logan Pichel, President and Chief Executive Officer of the Bank
Despite operating in a lower-rate environment for most of the past year, our Core Banking segment increased its third quarter 2026 net interest income by $4.8 million, or 8%, over the third quarter of 2025, while expanding its net interest margin 25 basis points to 4.03%.
Logan Pichel, President and Chief Executive Officer of the Bank
Not in the filing
stated, not guessed- Total revenue was not reported.
- GAAP versus non-GAAP designation was not provided for reported earnings metrics.
- Gross profit and gross margin were not reported.
- Operating income and operating margin were not reported.
- Tax rate was not reported.
- Operating cash flow and free cash flow were not reported.
- Cash balance and total debt were not reported.
- Share repurchases and dividends were not reported.
- Quantified forward revenue, margin, expense, tax-rate, or earnings guidance was not reported.
- Prior-quarter comparisons were not reported for the presented key metrics.
- A previous outlook section was not provided.】【”】【
- numbers_verified_from_document
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.