FLORENCE, S.C., Oct. 28, 2026 /PRNewswire/ -- First Reliance Bancshares, Inc. (OTCQX:FSRL), the holding company for First Reliance Bank (collectively, "First Reliance" or the "Company"), today announced its financial results for the third quarter of 2026.
Third Quarter 2026 Highlights
- Net income for the third quarter of 2026 was $2.7 million, or $0.33 per diluted share, compared to $2.7 million, or $0.33 per diluted share, for the third quarter of 2025. For the nine-months ended September 30, 2026, net income totaled $9.0 million, or $1.10 per diluted share, compared to $8.0 million, or $0.96 per diluted share for the same period in 2025. Operating earnings (Non-GAAP) were $2.9 million, or $0.36 per diluted share, for the third quarter of 2026, compared to $2.7 million, or $0.33 per diluted share, for the third quarter of 2025. For the nine-months ended September 30, 2026, operating earnings (Non-GAAP) totaled $9.2 million or $1.13 per diluted share, compared to $6.6 million, or $0.79 per diluted share, for the nine-months ended September 30, 2025.
- Book value per share rose $0.98, or 8.6%, to $12.40 at September 30, 2026, from $11.42 at September 30, 2025. Tangible book value per share (Non-GAAP) increased $0.98, or 8.7%, to $12.31 from $11.33 over the same period.
- Net interest income totaled $9.9 million for the third quarter of 2026, up $430 thousand, or 4.6%, from the same quarter in 2025 and up $12 thousand, or 0.12%, from the second quarter of 2026.
- Net interest margin decreased during the third quarter of 2026 to 3.73%, compared to 3.74% in the second quarter of 2026, and increased 7 basis points compared to the third quarter of 2025.
- Total loans held for investment decreased $8.4 million, or 4.1% annualized, to $812.3 million at September 30, 2026, from $820.7 million at June 30, 2026. Total loan growth for 2026 totaled $32.4 million, or 5.5% annualized.
- Unfunded commitments decreased $7.7 million during the quarter, primarily due to construction loan balances declining. As a result, the unfunded commitment reserve decreased $123 thousand to $506 thousand from $629 thousand at June 30, 2026.
- Total deposits were $922.4 million at September 30, 2026, an increase of $2.1 million, or 0.90% annualized, from $920.3 million at June 30, 2026.
- Nonperforming assets increased by $5.9 million to $6.6 million or 0.59% of total assets, at September 30, 2026, compared with $626 thousand, or 0.06% of total assets, at June 30, 2026. The increase was primarily due to one loan totaling $5.5 million. This loan was sufficiently collateralized and there was no specific allowance for credit loss recorded as of September 30, 2026.
- In June 2026, the Company announced a partnership with Colony Bank (CBAN), headquartered in Fitzgerald, Georgia. Bank regulatory approvals have been received, and shareholders of both companies have approved the merger. The remaining customary closing requirements should be completed and closing is scheduled for November 1, 2026. Systems conversion is scheduled for June 2027. Based on each company's total assets at September 30, 2026, the combined company will have nearly $5.0 billion in total assets.
Rick Saunders, Chief Executive Officer, stated, "Overall the third quarter of 2026 was steady from an earnings standpoint. The margin compressed slightly compared to the second quarter and tangible book value was affected by the increase in the unrealized loss of the securities portfolio as interest rates have risen during the quarter. Net interest margin declined by one basis point compared to the second quarter of 2026. The bank experienced net recoveries in the third quarter of 2026, the fourth quarter in a row. We have received regulatory approval and shareholder approval for our announced partnership with Colony Bank and look forward to joining that team with closing anticipated on November 1, 2026."
Financial Summary
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Three Months Ended Nine Months Ended
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30 Sep 30 Sep 30
($ in thousands, except per share data) 2026 2026 2026 2025 2025 2026 2025
Earnings:
Net income available to common shareholders $2,738 $2,807 $3,436 $2,926 $2,714 $8,981 $7,980
Operating earnings (Non-GAAP) 2,927 3,089 3,233 2,852 2,714 9,249 6,627
Earnings per common share, diluted (GAAP) 0.33 0.34 0.41 0.36 0.33 1.10 0.96
Operating earnings per common share, diluted (Non-GAAP) 0.36 0.38 0.39 0.35 0.33 1.13 0.79
Total revenue(1) 12,154 12,803 13,025 12,353 12,238 37,982 37,316
Net interest margin 3.73 % 3.74 % 3.77 % 3.71 % 3.66 % 3.75 % 3.58 %
Return on average assets(2) 0.98 % 1.00 % 1.25 % 1.06 % 0.99 % 1.07 % 0.97 %
Return on average assets - Operating Non-GAAP(2) 1.05 % 1.10 % 1.18 % 1.03 % 0.99 % 1.11 % 0.81 %
Return on average equity(2) 11.08 % 11.58 % 14.53 % 12.83 % 12.55 % 12.37 % 12.93 %
Return on average equity - Operating Non-GAAP(2) 11.85 % 12.75 % 13.67 % 12.51 % 12.55 % 12.74 % 10.74 %
Efficiency ratio(3) 74.30 % 71.44 % 64.84 % 71.08 % 69.61 % 70.09 % 69.51 %
Adjusted efficiency ratio - Non-GAAP(3) 72.33 % 68.67 % 66.16 % 71.59 % 69.61 % 69.00 % 72.82 %
As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Balance Sheet:
Total assets $1,113,786 $1,126,912 $1,118,388 $1,093,359 $1,097,846
Total loans receivable 812,347 820,741 801,243 779,935 779,997
Total deposits 922,379 920,329 929,045 948,120 959,300
Total transaction deposits(4) to total deposits 37.96 % 38.29 % 36.83 % 36.59 % 40.68 %
Loans to deposits 88.07 % 89.18 % 86.24 % 82.26 % 81.31 %
Bank Capital Ratios:
Total risk-based capital ratio 14.75 % 14.26 % 14.15 % 13.82 % 13.58 %
Tier 1 risk-based capital ratio 13.66 % 13.16 % 13.04 % 12.72 % 12.48 %
Tier 1 leverage ratio 10.87 % 10.53 % 10.53 % 10.16 % 9.94 %
Common equity tier 1 capital ratio 13.66 % 13.16 % 13.04 % 12.72 % 12.48 %
Asset Quality Ratios:
Nonperforming assets as a percentage of 0.59 % 0.06 % 0.19 % 0.23 % 0.03 %
total assets
Allowance for credit losses as a percentage 1.12 % 1.14 % 1.14 % 1.13 % 1.12 %
of total loans receivable
Annualized net charge-offs as a percentage of (0.00 %) (0.00 %) (0.01 %) (0.03 %) 0.02 %
average total loan receivables
CONDENSED CONSOLIDATED
INCOME STATEMENTS - Unaudited
Three Months Ended Nine Months Ended
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30 Sep 30
($ in thousands, except per share data) 2026 2026 2026 2025 2025 2026 2025
Interest income
Loans $12,297 $12,252 $11,534 $11,518 $11,842 $36,083 $34,792
Investment securities 2,312 2,292 2,413 2,302 2,300 7,017 6,611
Other interest income 282 307 189 406 323 778 1,146
Total interest income 14,891 14,851 14,136 14,226 14,465 43,878 42,549
Interest expense
Deposits 4,081 4,065 3,930 4,215 4,536 12,076 13,707
Other interest expense 927 915 683 393 476 2,525 1,515
Total interest expense 5,008 4,980 4,613 4,608 5,012 14,601 15,222
Net interest income 9,883 9,871 9,523 9,618 9,453 29,277 27,327
Provision for credit losses (341) 123 175 76 90 (43) 885
Net interest income after provision for credit losses 10,224 9,748 9,348 9,542 9,363 29,320 26,442
Noninterest income
Mortgage banking income 1,008 1,764 2,103 1,405 1,577 4,875 4,514
Service fees on deposit accounts 388 361 366 405 412 1,115 1,030
Debit card and other service charges, 531 528 506 527 531 1,565 1,603
commissions, and fees
Income from bank owned life insurance 109 107 104 107 108 320 314
Loss on sale of securities, net - (6) (294) (6) (182)
Gain on sale of branches - 2,313
Gain on sale of mortgage servicing right (MSR) - 266 266
Gain on early extinguishment of debt - 140
Gain (loss) on disposal /write down of fixed assets - 382 (200)
Other income 235 172 163 203 157 570 457
Total noninterest income 2,271 2,932 3,502 2,735 2,785 8,705 9,989
Noninterest expense
Compensation and benefits 5,542 5,726 5,447 5,499 5,431 16,715 16,286
Occupancy and equipment 910 724 796 725 736 2,430 2,297
Data processing, technology, and communications 1,217 1,315 1,218 1,216 1,061 3,750 3,360
Professional fees 171 144 77 85 195 392 596
Marketing 70 65 96 71 155 231 453
Other 1,120 1,172 812 1,185 941 3,104 2,947
Total noninterest expense 9,030 9,146 8,446 8,781 8,519 26,622 25,939
Income before provision for income taxes 3,465 3,534 4,404 3,496 3,629 11,403 10,492
Income tax expense 727 727 968 570 915 2,422 2,512
Net income available to common shareholders $2,738 $2,807 $3,436 $2,926 $2,714 $8,981 $7,980
(Subtract gain) / addback loss on fixed assets, net of tax - (320) 151
Subtract gain on sale of branches, net of tax - (1,746)
Subtract gain on sale of MSR, net of tax - (208) (208)
Subtract gain on early extinguishment of debt, net of tax - (111)
Addback expenses related to merger/branch sale, net of tax 189 282 471 208
Addback securities losses, net of tax - 5 246 5 145
Operating net income (non-GAAP) $2,927 $3,089 $3,233 $2,852 $2,714 $9,249 $6,627
Weighted average common shares - basic 7,790 7,784 7,866 7,745 7,902 7,759 7,887
Weighted average common shares - diluted 8,232 8,210 8,302 8,218 8,349 8,198 8,344
Basic net income per common share* $0.35 $0.36 $0.44 $0.38 $0.34 $1.16 $1.01
Diluted net income per common share* $0.33 $0.34 $0.41 $0.36 $0.33 $1.10 $0.96
Operating basic net income per common share (nonGAAP)* $0.38 $0.40 $0.41 $0.37 $0.34 $1.19 $0.84
Operating diluted net income per common share (nonGAAP)* $0.36 $0.38 $0.39 $0.35 $0.33 $1.13 $0.79
*Note that the sum of the quarters may not equal the YTD result due to rounding of earnings per share each quarter, given the weighted average shares
outstanding basic and/or diluted.
Footnotes to table located at the end of this release.
Net income for the three months ended September 30, 2026, was $2.7 million, or $0.33 per diluted common share, compared to $2.7 million, or $0.33 per diluted common share, for the three months ended September 30, 2025. Operating net income (Non-GAAP), for the three months ended September 30, 2026, was $2.9 million, or $0.36 per diluted common share, compared to $2.7 million, or $0.33 per diluted common share for the three months ended September 30, 2025. Net income for the nine months ended September 30, 2026, totaled $9.0 million, or $1.10 per diluted common share, compared to $8.0 million, or $0.96 per diluted common share, at September 30, 2025. On an operating basis, diluted EPS (Non-GAAP) was $1.13 per diluted common share, for the nine months ended September 30, 2026, which includes adding back the impact of securities losses, net of tax, subtracting the gain on the sale of mortgage servicing rights, net of tax, and adding back the impact of merger related expenses, net of tax. The items affecting the nine months ended September 30, 2025, net of tax, include the following: the addback of loss on fixed asset write downs, adding back the impact of expenses related to the branch sales, adding back securities losses, offset by subtracting the gain recognized on the sale of branches and the gain from the early extinguishment of debt, which resulted in $0.79 per diluted common share.
Noninterest income, for the three months ended September 30, 2026, was $2.3 million, a decrease of $514 thousand from $2.8 million for the same period in 2025. Mortgage banking income totaled $1.0 million in the third quarter of 2026 compared to $1.6 million in the third quarter of 2025.
For the nine months ended September 30, 2026, noninterest income decreased $1.3 million compared with the same period in 2025. The decline was due to the $2.3 million gain on the sale of branches and the $140 thousand gain on early debt extinguishment recognized in 2025. These two items were partially offset by a $361 thousand increase in mortgage banking income, a $266 thousand gain on the sale of mortgage servicing rights, a $113 thousand increase in other income, no fixed-asset write-down in 2026, and a $176 thousand reduction in losses on securities sold.
Noninterest expense was $9.0 million for the three months ended September 30, 2026, up $511 thousand from $8.5 million for the same period in 2025. The increase was driven by $174 thousand rise in occupancy and equipment costs, $156 thousand in data processing, technology and communications, and $179 thousand in other expense, primarily related to merger expenses.
Noninterest expense was $26.6 million for the nine months ended September 30, 2026, up $683 thousand from the prior-year period. The increase was primarily driven by a $429 thousand rise in compensation and benefits related to incentives and stock compensation expense. Data processing, technology, and communication expenses increased $390 thousand. These increases were partially offset by a $222 thousand decrease in marketing expenses.
Operating adjustments - 3Q 2026 & 2Q 2026
During the second quarter of 2026, the Company announced the partnership with Colony Bank (CBAN) headquartered in Fitzgerald, Georgia. The Company incurred $240 thousand, in the third quarter of 2026, and $354 thousand, in the second quarter of 2026, of merger-related expenses.
Operating adjustments - 1Q 2026
During the first quarter of 2026, the Company sold mortgage servicing rights (MSRs) related to approximately $565.9 million underlying mortgage loans for an initial gain of $266 thousand, net of direct expenses. The Company also sold securities at a net loss of $6 thousand.
Operating adjustments - 4Q 2025
During the fourth quarter of 2025, the Company sold property in Florence which resulted in a gain of $382 thousand and sold five securities resulting in a net loss of $294 thousand.
There were no operating adjustments in 3Q 2025.
NET INTEREST INCOME AND MARGIN - Unaudited - QTD
For the Three Months Ended
September 30, 2026
June 30, 2026
September 30, 2025
Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/
($ in thousands) Balance Expense Rate Balance Expense Rate Balance Expense Rate
Assets
Interest-earning assets
Federal funds sold and interest- $29,431 $219 2.95 % $31,859 $261 3.28 % $35,237 $296 3.33 %
bearing deposits
Investment securities 185,452 2,313 4.95 % 194,063 2,292 4.74 % 193,519 2,300 4.72 %
Nonmarketable equity securities 4,139 63 6.05 % 4,147 46 4.49 % 1,795 26 5.84 %
Loans held for sale 10,891 168 6.13 % 16,354 318 7.80 % 12,381 301 9.65 %
Loans 820,547 12,128 5.86 % 811,650 11,934 5.90 % 780,426 11,542 5.87 %
Total interest-earning assets 1,050,460 14,891 5.62 % 1,058,073 14,851 5.63 % 1,023,358 14,465 5.61 %
Allowance for credit losses (9,367) (9,181) (8,509)
Noninterest-earning assets 78,153 78,237 80,739
Total assets $1,119,246 $1,127,129 $1,095,588
Liabilities and Shareholders' Equity
Interest-bearing liabilities
NOW accounts $105,532 $168 0.63 % $101,523 $163 0.64 % $123,107 $230 0.74 %
Savings & money market 401,950 2,544 2.51 % 429,446 2,679 2.50 % 410,051 2,893 2.80 %
Time deposits 165,173 1,370 3.29 % 152,404 1,223 3.22 % 168,116 1,413 3.33 %
Total interest-bearing deposits 672,655 4,082 2.41 % 683,373 4,065 2.39 % 701,274 4,536 2.57 %
FHLB advances and other 69,511 688 3.93 % 69,780 673 3.87 % 20,652 217 4.17 %
borrowings
Subordinated debentures 19,806 238 4.77 % 19,799 242 4.90 % 19,775 259 5.19 %
Total interest-bearing 761,972 5,008 2.61 % 772,952 4,980 2.58 % 741,701 5,012 2.68 %
liabilities
Noninterest bearing deposits 244,211 244,109 253,702
Other liabilities 14,231 13,139 13,666
Shareholders' equity 98,832 96,929 86,519
Total liabilities and $1,119,246 $1,127,129 $1,095,588
shareholders' equity
Net interest income (tax $9,883 3.01 % $9,871 3.05 % $9,453 2.93 %
equivalent) / interest
rate spread
Net Interest Margin 3.73 % 3.74 % 3.66 %
Cost of funds, including 1.97 % 1.96 % 2.00 %
noninterest-bearing deposits
Net interest income for the three months ended September 30, 2026, was $9.9 million, compared with $9.5 million for the same period in 2025. The increase reflected a $426 thousand rise in interest income and a $4 thousand decrease in interest expense. Net interest margin improved to 3.73% from 3.66% a year earlier. Loans and securities generated the largest increases in income compared with the prior year, while lower yields on all interest-bearing liabilities also contributed to the margin improvement. In addition, the total cost of funds, including noninterest-bearing deposits, decreased to 1.97% in the third quarter of 2026, compared to 2.00% in the third quarter of 2025.
NET INTEREST INCOME AND MARGIN - Unaudited - YTD
For the Nine Months Ended
September 30, 2026
September 30, 2025
Average Income/ Yield/ Average Income/ Yield/
($ in thousands) Balance Expense Rate Balance Expense Rate
Assets
Interest-earning assets
Federal funds sold and interest-bearing deposits $28,415 $645 3.04 % $37,905 $1,066 3.76 %
Investment securities 192,393 7,017 4.88 % 186,815 6,611 4.73 %
Nonmarketable equity securities 3,764 133 4.73 % 1,717 80 6.24 %
Loans held for sale 12,573 650 6.91 % 16,065 1,018 8.47 %
Loans 807,064 35,433 5.87 % 777,837 33,774 5.81 %
Total interest-earning assets 1,044,209 43,878 5.62 % 1,020,339 42,549 5.58 %
Allowance for credit losses (9,147) (8,564)
Noninterest-earning assets 79,598 80,756
Total assets $1,114,660 $1,092,531
Liabilities and Shareholders' Equity
Interest-bearing liabilities
NOW accounts $100,677 $486 0.64 % $142,638 $702 0.66 %
Savings & money market 420,262 7,835 2.49 % 421,621 8,892 2.82 %
Time deposits 157,149 3,755 3.19 % 161,259 4,113 3.41 %
Total interest-bearing deposits 678,088 12,076 2.38 % 725,518 13,707 2.53 %
FHLB advances and other borrowings 61,956 1,801 3.89 % 19,407 622 4.28 %
Subordinated debentures 19,798 724 4.89 % 22,649 893 5.27 %
Total interest-bearing liabilities 759,842 14,601 2.57 % 767,574 15,222 2.65 %
Noninterest bearing deposits 244,814 229,737
Other liabilities 13,197 12,922
Shareholders' equity 96,807 82,298
Total liabilities and shareholders' equity $1,114,660 $1,092,531
Net interest income (tax equivalent) / interest $29,277 3.05 % $27,327 2.93 %
rate spread
Net Interest Margin 3.75 % 3.58 %
Cost of funds,including noninterest bearing deposits 1.94 % 2.04 %
Net interest income was $29.3 million for the nine months ended September 30, 2026, an increase of $2.0 million from $27.3 million for the same period in 2025. Net interest margin rose year over year to 3.75% from 3.58%. Yields improved on investment securities and loans, while yields declined across all interest-bearing liability categories. The total cost of funds, including noninterest-bearing deposits, decreased to 1.94% from 2.04% in 2025.
CONDENSED CONSOLIDATED BALANCE SHEETS - Unaudited
As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Assets
Cash and cash equivalents:
Cash and due from banks $2,786 $4,036 $4,236 $4,031 $5,072
Interest-bearing deposits with banks 29,094 22,991 26,477 28,101 26,695
Total cash and cash equivalents 31,880 27,027 30,713 32,132 31,767
Investment securities:
Investment securities available for sale 187,897 188,825 200,886 196,043 199,674
Other investments 3,687 4,400 3,682 1,764 1,527
Total investment securities 191,584 193,225 204,568 197,807 201,201
Mortgage loans held for sale 10,428 18,135 15,636 12,280 13,336
Loans receivable:
Loans 812,347 820,741 801,243 779,935 779,997
Less allowance for credit losses (9,122) (9,334) (9,105) (8,827) (8,741)
Loans receivable, net 803,225 811,407 792,138 771,108 771,256
Property and equipment, net 24,085 24,321 24,454 24,348 23,313
Mortgage servicing rights 9,849 9,481 8,728 14,656 14,421
Bank owned life insurance 19,349 19,240 19,134 19,029 18,922
Deferred income taxes 8,273 6,944 6,438 6,117 6,221
Other assets 15,113 17,132 16,579 15,882 17,409
Total assets $1,113,786 $1,126,912 1,118,388 1,093,359 1,097,846
Liabilities
Deposits $922,379 $920,329 $929,045 $948,120 $959,300
Federal Home Loan Bank advances 60,000 75,000 60,000 20,000 15,000
Federal funds and repurchase agreements 112
Subordinated debentures 9,500 9,492 9,484 9,476 9,469
Junior subordinated debentures 10,310 10,310 10,310 10,310 10,310
Reserve for unfunded commitments 506 629 728 822 767
Other liabilities 13,106 12,736 12,937 11,565 13,498
Total liabilities 1,015,913 1,028,496 1,022,504 1,000,293 1,008,344
Shareholders' equity
Preferred stock - Series D non-cumulative, no par 1 1 1 1 1
value
Common Stock - $.01 par value; 20,000,000 shares 89 89 89 88 88
authorized
Treasury stock, at cost (8,802) (8,635) (8,536) (8,085) (7,883)
Nonvested restricted stock (847) (1,241) (1,592) (1,949) (2,359)
Additional paid-in capital 56,973 57,041 57,026 56,869 56,931
Retained earnings 59,558 56,821 54,014 50,578 47,652
Accumulated other comprehensive loss (9,099) (5,660) (5,118) (4,436) (4,928)
Total shareholders' equity 97,873 98,416 95,884 93,066 89,502
Total liabilities and shareholders' equity $1,113,786 $1,126,912 $1,118,388 $1,093,359 $1,097,846
Cash and cash equivalents totaled $31.9 million at September 30, 2026, compared with $27.0 million at June 30, 2026. Cash held at the Federal Reserve Bank was $28.3 million, compared with $22.4 million at June 30, 2026.
First Reliance had no held-to-maturity (HTM) securities for any reported period. All debt securities were classified as available-for-sale (AFS), with balances of $187.9 million at September 30, 2026, and $199.7 million at September 30, 2025. The unrealized loss on these securities was $12.1 million at September 30, 2026, compared with $7.5 million at June 30, 2026, an increase of $4.6 million before taxes during the third quarter of 2026.
Deposits increased $2.1 million, or 0.90% annualized, as of September 30, 2026, primarily due to higher demand deposit accounts, money market account balances and time deposits. The increase was partially offset by decreases in noninterest-bearing deposits and savings accounts. See the table on page 10 for details.
The Company had $60.0 million in outstanding borrowings with the Federal Home Loan Bank (FHLB) of Atlanta at September 30, 2026, down from $75.0 million at June 30, 2026. The Company had remaining credit availability in excess of $262.0 million with the FHLB of Atlanta, subject to collateral requirements.
First Reliance also has access to approximately $16.5 million through the Federal Reserve Bank discount window with posted collateral. There are currently no borrowings against the Federal Reserve Bank discount window.
COMMON STOCK SUMMARY - Unaudited
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As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
(shares in thousands) 2026 2026 2026 2025 2025
Voting common shares outstanding 8,913 8,905 8,896 8,804 8,794
Treasury shares outstanding (1,019) (1,010) (1,003) (972) (954)
Total common shares outstanding 7,894 7,895 7,893 7,832 7,840
Book value per common share $12.40 $12.47 $12.15 $11.88 $11.42
Tangible book value per common $12.31 $12.38 $12.06 $11.79 $11.33
share - Non-GAAP(5)
Stock price:
High $20.12 $18.75 $16.03 $13.70 $10.21
Low $18.20 $13.03 $12.00 $10.00 $9.36
Period end $19.13 $18.43 $13.90 $12.26 $10.10
ASSET QUALITY MEASURES - Unaudited
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As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Nonperforming Assets
Commercial
Owner occupied RE $6,338 $332 $1,357 $1,573 $36
Non-owner occupied RE -
Construction -
Commercial business 12 24 27 31 38
Consumer
Real estate 165 208 69 36 226
Home equity -
Construction -
Other 47 62 65 71 69
Nonaccruing loan modifications -
Total nonaccrual loans $6,562 $626 $1,518 $1,711 $369
Loans past due 90 days or more & accruing interest - 592 744
Other assets repossessed - 6
Total nonperforming assets $6,562 $626 $2,110 $2,461 $369
Nonperforming assets as a percentage of:
Total assets 0.59 % 0.06 % 0.19 % 0.23 % 0.03 %
Total loans receivable 0.81 % 0.08 % 0.26 % 0.32 % 0.05 %
Accruing loan modifications $467 $526 $555 $668 $683
Three Months Ended
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Allowance for Credit Losses
Balance, beginning of period $9,334 $9,105 $8,827 $8,741 $8,535
Loans charged-off 44 10 8 15 48
Recoveries of loans previously charged-off 50 17 17 80 6
Net charge-offs (recoveries) (6) (7) (9) (65) 42
Provision (release) for credit losses (218) 222 269 21 248
Balance, end of period $9,122 $9,334 $9,105 $8,827 $8,741
Allowance for credit losses to gross loans 1.12 % 1.14 % 1.14 % 1.13 % 1.12 %
receivable
Allowance for credit losses to nonaccrual loans 139.01 % 1491.67 % 599.78 % 515.87 % 2368.83 %
Nonperforming assets increased in the third quarter of 2026 to $6.6 million or 0.59% of total assets from $626 thousand, or 0.06% of total assets, at June 30, 2026. This increase was primarily the result of one owner-occupied loan totaling $5.5 million that has moved to nonaccrual in the third quarter of 2026. This loan was supported by sufficient collateral and no allowance for credit losses recorded in the third quarter of 2026. During the third quarter of 2026, the allowance for credit losses decreased $212 thousand, reflecting a $218 thousand release from the provision for credit losses and $6 thousand in net recoveries. In the third quarter of 2025, the Company recorded $42 thousand in net charge-offs and increased the allowance for credit losses through a $248 thousand provision for credit losses. The allowance was 1.12% of total loans at September 30, 2025.
Footnotes to table located at the end of this release.
LOAN COMPOSITION - Unaudited
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As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Commercial real estate $471,395 $480,996 $475,483 $466,293 $471,002
Consumer real estate 252,762 251,864 238,369 230,379 220,767
Commercial and industrial 79,622 78,375 76,142 71,212 71,802
Consumer and other 8,568 9,506 11,249 12,051 16,426
Total loans, net of deferred fees 812,347 820,741 801,243 779,935 779,997
Less allowance for credit losses 9,122 9,334 9,105 8,827 8,741
Total loans, net $803,225 $811,407 $792,138 $771,108 $771,256
DEPOSIT COMPOSITION - Unaudited
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As of
Sep 30 Jun 30 Mar 31 Dec 31 Sep 30
($ in thousands) 2026 2026 2026 2025 2025
Noninterest-bearing $236,426 $249,674 $247,577 $254,618 $292,107
Interest-bearing:
DDA and NOW accounts 113,738 102,681 94,579 92,310 98,135
Money market accounts 369,448 368,363 394,279 419,683 360,621
Savings 33,991 35,206 36,168 37,416 38,279
Time, less than $250,000 123,147 120,402 103,678 104,671 126,195
Time, $250,000 and over 45,629 44,003 52,764 39,422 43,963
Total deposits $922,379 $920,329 $929,045 $948,120 $959,300
Footnotes to tables:
(1)
Total revenue is the sum of net interest income and noninterest income.
(2)
Annualized for the respective period.
(3)
Noninterest expense divided by the sum of net interest income and noninterest income.
(4)
Includes noninterest-bearing and interest-bearing DDA and NOW accounts.
(5) The tangible book value per share is calculated as total shareholders' equity less intangible
assets, divided by period-end
outstanding common shares.
ABOUT FIRST RELIANCE
Founded in 1999, First Reliance Bancshares, Inc. (OTCQX: FSRL), is based in Florence, South Carolina and has assets of approximately $1.11 billion. The Company employs approximately 160 professionals and has locations throughout South Carolina. First Reliance has redefined community banking with a commitment to making customers' lives better, its founding principle. Customers of the Company have given it a 92% customer satisfaction rating, well above the bank industry average of 82%. First Reliance is also one of two companies throughout South Carolina to receive the Best Places to Work in South Carolina award all 20 years since the program began. We believe that this recognition confirms that our associates are engaged and committed to our brand and the communities we serve. The Company offers a full range of personalized community banking products and services for individuals, small businesses, and corporations. The Company also offers a full suite of digital banking services, Treasury Services, a Customer Service Guaranty, a Mortgage Service Guaranty, and First Reliance Wealth Strategies.
FORWARD-LOOKING STATEMENTS
Certain statements in this news release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to future plans and expectations, and are thus prospective. Such forward-looking statements include, but are not limited to, statements with respect to our plans, objectives, expectations and intentions and other statements that are not historical facts, and other statements identified by words such as "believes," "expects," "anticipates," "estimates," "intends," "plans," "targets," and "projects," as well as similar expressions. Such statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate. Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this forward-looking information should not be construed as a representation by the Company or any person that the future events, plans, or expectations contemplated by the Company will be achieved.
The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements: (1) competitive pressures among depository and other financial institutions may increase significantly and have an effect on pricing, spending, third-party relationships and revenues; (2) the strength of the United States economy in general and the strength of the local economies in which we conduct operations may be different than expected resulting in, among other things, a deterioration in the credit quality or a reduced demand for credit, including the resultant effect on the Company's loan portfolio and allowance for credit losses; (3) the rate of delinquencies and amounts of charge-offs, the level of allowance for credit loss, the rates of loan growth, or adverse changes in asset quality in our loan portfolio, which may result in increased credit risk-related losses and expenses; (4) the risk that the preliminary financial information reported herein and our current preliminary analysis will be different when our review is finalized; (5) changes in the U.S. legal and regulatory framework including, but not limited to, the Dodd-Frank Act and regulations adopted thereunder; (6) adverse conditions in the stock market, the public debt market and other capital markets (including changes in interest rate conditions) could have a negative impact on the Company, including the value of its MSR asset; (7) the business related to acquisitions may not be integrated successfully or such integration may take longer to accomplish than expected; (8) the expected cost savings and any revenue synergies from acquisitions may not be fully realized within expected timeframes; and (9) disruption from acquisitions may make it more difficult to maintain relationships with clients, associates or suppliers. Moreover, a trade war or other governmental action related to tariffs or international trade agreements or policies, as well as other potential epidemics or pandemics, have the potential to negatively impact ours and/or our customers' costs, demand for our customers' products, and/or the U.S. economy or certain sectors thereof and, thus, adversely affect our business, financial condition, and results of operations. All subsequent written and oral forward-looking statements concerning the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. We do not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.
Contact:
Robert Haile
SEVP & Chief Financial Officer
(843) 656-5000
rhaile@firstreliance.com
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SOURCE First Reliance Bancshares, Inc.
