EXTON, Pa., July 23, 2026 /PRNewswire/ -- First Resource Bancorp, Inc. (OTCQX: FRSB), reported strong financial performance for the second quarter ended June 30, 2026.
Lauren C. Ranalli, President and CEO, stated, "Our second quarter results highlight the strength and scalability of our franchise. As First Resource Bank continues to grow, we are seeing improvement across virtually every meaningful financial metric, including earnings, net interest margin, returns on assets and equity, book value per share, and credit quality. We believe long-term value creation is achieved through disciplined growth that strengthens profitability and capital alongside the balance sheet. The results reported this quarter reflect the continued execution of that strategy."
Second Quarter 2026 Highlights
- Net income of $2.8 million exceeded the prior year by 46% and the prior quarter by 13%
- Earnings per common share increased to $0.93, up 48% from the prior year
- Annualized return on average equity was 17.82%
- Annualized return on average assets was 1.36%
- Net interest margin expanded 29 basis points to 4.09%
- Efficiency ratio improved to 54.39% compared to 60.05% a year ago
- Net interest income increased 36% year over year
- Total loans grew 3% during the quarter, or 12% on an annualized basis
- Total deposits grew 4% during the quarter, or 15% on an annualized basis
- Noninterest-bearing deposits grew 5% during the quarter, or 18% on an annualized basis
- Book value per share increased 4% to $21.19
- Non-performing assets to total assets decreased to 0.10%
- Paid second quarterly cash dividend of $0.02 per common share
Earnings and Profitability
For the quarter ended June 30, 2026, net income totaled $2.8 million, compared to $1.9 million for the same period a year ago and $2.5 million for the prior quarter. Earnings per share increased to $0.93, up from $0.63 in the second quarter of 2025 and $0.82 in the first quarter of 2026.
For the six months ended June 30, 2026, net income totaled $5.3 million, compared to $3.6 million for the same period in 2025.
Annualized return on average assets rose to 1.36% for the second quarter of 2026, compared to 1.15% for the same period in 2025. Annualized return on average equity increased to 17.82%, up from 14.38% a year ago, reflecting improved operating leverage and balance sheet growth.
Net Interest Income and Net Interest Margin
Net interest income totaled $8.1 million for the second quarter of 2026, representing an increase of $755 thousand, or 10%, compared to the prior quarter and an increase of 36% compared to the same period a year ago. The net interest margin expanded to 4.09%, up from 3.80% in the first quarter of 2026 and 3.72% in the second quarter of 2025.
Ranalli added, "The net interest margin expansion experienced in the second quarter was partially due to a full recovery of past due interest income on a nonaccrual loan that was paid in full during the quarter. This was a positive outcome for both the margin and our credit quality metrics."
Net interest income totaled $15.4 million for the six months ended June 30, 2026, representing an increase of $4.0 million, or 35%, compared to the same period in 2025.
Total interest income increased to $12.8 million for the second quarter of 2026, representing a 6% increase from the prior quarter and a 24% increase compared to the second quarter of 2025. Quarterly growth was driven primarily by a 3% increase in average loan balances in addition to a 20 basis point increase in loan yields. Year-over-year growth reflected a 15% increase in average loan balances and overall higher loan yields.
Total interest income increased to $24.8 million for the six months ended June 30, 2026, representing a 24% increase from the same period in 2025.
Total interest expense for the second quarter of 2026 was relatively unchanged from the prior quarter, as higher money market balances offset lower time deposit balances and a 20 basis point decline in time deposit costs. Compared to the second quarter of 2025, total interest expense increased 8%, driven by higher volumes of interest-bearing deposits and borrowings, partially mitigated by lower deposit rates.
Total interest expense increased to $9.4 million for the six months ended June 30, 2026, representing a 10% increase from the same period in 2025.
Asset Quality, Provision for Credit Losses, and Allowance for Credit Losses on Loans
The provision for credit losses totaled $386 thousand for the second quarter of 2026, compared to $377 thousand in the first quarter of 2026 and $130 thousand in the second quarter of 2025. As of June 30, 2026, the allowance for credit losses represented 0.79% of total loans, compared to 0.73% at December 31, 2025.
Non-performing assets totaled $881 thousand, or 0.10% of total assets, at June 30, 2026, compared to $3.0 million, or 0.37% of total assets, at March 31, 2026. Non-performing assets represented 0.09% and 0.03% of total assets at December 31, 2025, and June 30, 2025, respectively. Two of the Company's three non-accrual loan relationships are fully secured by real estate collateral, while the third required a specific reserve of $127 thousand during the second quarter.
"We were pleased to meaningfully reduce non-performing assets during the second quarter through the successful resolution of a $2.3 million non-accrual commercial loan relationship, which was collected in full. Our lending strategy emphasizes well-structured loans typically supported by real estate collateral. This approach has historically helped limit credit losses and preserve capital when borrower challenges emerge. The positive resolution of this relationship is a tangible example of the effectiveness of our underwriting philosophy and disciplined approach to credit risk management," stated Ranalli.
Non-Interest Income and Expense
Non-interest income totaled $435 thousand for the quarter, representing a decrease of 20% from the prior quarter and an increase of 17% from the same period last year. Gains on the sale of SBA loans were $108 thousand, compared to $274 thousand in the prior quarter and $26 thousand in the second quarter of 2025. There was no swap referral fee income in the second or first quarters of 2026, compared to $108 thousand in the second quarter of 2025. Service charges increased 35% from the prior quarter, primarily due to late fees collected in connection with the previously discussed non-accrual loan resolution.
Non-interest income totaled $979 thousand for the six months ended June 30, 2026, representing a 36% increase compared to $722 thousand for the same period in 2025. Gains on sale of SBA loans were $383 thousand for the six months ended June 30, 2026, compared to $113 thousand for the same period in 2025. There was no swap referral fee income for the six months ended June 30, 2026, compared to $132 thousand in the same period of 2025.
Non-interest expenses increased 6% from the prior quarter and 22% compared to the second quarter of 2025, reflecting higher costs across most operating categories, including one-time renovation costs for our Exton branch which was built in 2014. The ratio of non-interest expense to average assets was 2.27%, compared to 2.21% in the prior quarter and 2.29% in the second quarter of 2025. The efficiency ratio was 54.39%, compared to 55.77% in the prior quarter and 60.05% in the second quarter of 2025.
Non-interest expenses increased 22% for the six months ended June 30, 2026, compared to the same period in 2025, reflecting higher costs across all operating categories.
Balance Sheet
Total deposits increased $27.4 million, or 4%, during the second quarter of 2026, reflecting a shift in deposit mix. Increases in non-interest-bearing deposits and money market balances were partially offset by decreases in interest-bearing checking and time deposits. On a year-over-year basis, total deposits increased $145.7 million, or 24%, driven by growth across all deposit categories except time deposits. Approximately 81% of total deposits were insured or collateralized as of June 30, 2026.
"We are encouraged by the continued growth of our customer deposit base during the second quarter, which supported 3% loan growth while enabling us to reduce non-core deposits by an additional $12.9 million," stated Ranalli.
Total loans increased $21.6 million, or 3%, during the second quarter of 2026 to $726.9 million, driven primarily by strong growth in commercial real estate loans. Compared to June 30, 2025, total loans increased $102.1 million, or 16%, driven by continued strength in commercial real estate and construction lending.
The following table illustrates the composition of the loan portfolio, net of unearned loan origination fees and costs:
June 30, March 31, December 31, September 30, June 30,
2026 2026 2025 2025 2025
Commercial real
estate $553,196,932 $531,440,586 $525,443,319 $516,826,603 $487,283,100
Commercial
construction 89,742,205 88,293,400 68,110,339 49,287,152 52,208,827
Commercial business 64,907,888 67,016,443 66,353,744 69,578,865 66,271,853
Consumer 19,007,086 18,541,133 18,548,853 19,645,273 19,037,313
Total loans $726,854,111 $705,291,562 $678,456,255 $655,337,893 $624,801,093
Investment securities totaled $31.1 million at June 30, 2026, compared to $31.8 million at March 31, 2026. The Company's held-to-maturity investment portfolio had an amortized cost of $9.0 million and a fair value of $8.4 million, resulting in an unrealized loss of $561 thousand, compared to an unrealized loss of $683 thousand as of March 31, 2026. On an after-tax basis, this unrealized loss totaled $443 thousand, representing approximately 0.7% of total stockholders' equity as of June 30, 2026.
The remainder of the Company's investment portfolio was classified as available-for-sale and had a book value of $23.2 million and a fair value of $22.1 million at June 30, 2026. This resulted in an unrealized loss of $1.1 million, compared to a similar amount at March 31, 2026. The after-tax unrealized loss of $880 thousand is reflected in accumulated other comprehensive loss within stockholders' equity.
Total assets increased 4% during the quarter, driven primarily by loan growth and higher cash balances associated with deposit growth.
Total stockholders' equity increased $2.7 million, or 4%, during the second quarter of 2026, rising from $61.0 million at March 31, 2026, to $63.8 million at June 30, 2026. This increase was driven primarily by net income earned during the quarter. During the quarter, the Company paid a cash dividend of $0.02 per common share. Book value per share increased by $0.89, or 4%, during the second quarter to $21.19 per share at June 30, 2026.
Selected Financial Data:
Consolidated Balance Sheets (unaudited)
June 30, March 31, December 31, September 30, June 30,
2026 2026 2025 2025 2025
Assets:
Cash and due from banks $62,564,468 $52,953,190 $90,422,400 $29,590,356 $34,917,531
Time deposits at other banks 100,000 100,000 100,000 100,000 100,000
Investments 31,068,571 31,759,063 27,634,611 19,065,497 16,473,298
Loans receivable 726,854,111 705,291,562 678,456,255 655,337,893 624,801,093
Allowance for credit losses (5,739,175) (5,338,337) (4,977,305) (4,706,905) (4,733,781)
Premises & equipment 7,258,468 7,312,947 7,360,342 7,467,535 7,561,092
Other assets 18,862,663 18,923,756 18,359,879 18,030,984 18,141,421
Total assets $840,969,106 $811,002,181 $817,356,182 $724,885,360 $697,260,654
Liabilities:
Noninterest-bearing deposits $125,099,120 $119,590,197 $120,359,227 $99,688,828 $99,411,113
Interest-bearing checking 58,644,735 66,652,272 69,271,915 55,875,100 43,620,103
Money market 401,304,624 349,036,565 326,603,007 257,517,175 256,694,537
Time deposits 160,401,444 182,731,610 209,098,258 217,695,517 200,018,778
Total deposits 745,449,923 718,010,644 725,332,407 630,776,620 599,744,531
Short term borrowings - 8,000,000 20,000,000
Long term borrowings 14,162,000 14,162,000 16,012,000 13,887,000 8,210,000
Subordinated debt 10,470,219 10,468,289 10,466,463 8,485,386 8,481,329
Other liabilities 7,124,273 7,338,138 6,777,883 7,320,262 6,830,863
Total liabilities 777,206,415 749,979,071 758,588,753 668,469,268 643,266,723
Stockholders' Equity
Common stock 3,100,773 3,100,773 3,100,773 3,100,773 3,100,773
Additional paid-in capital 19,916,183 19,892,023 19,863,401 19,857,275 19,855,264
Treasury stock (1,290,483) (1,318,700) (1,346,793) (1,375,079) (1,409,115)
Accumulated other comprehensive loss (880,267) (843,939) (630,812) (638,426) (766,374)
Retained earnings 42,916,485 40,192,953 37,780,860 35,471,549 33,213,383
Total stockholders' equity 63,762,691 61,023,110 58,767,429 56,416,092 53,993,931
Total liabilities & stockholders' equity $840,969,106 $811,002,181 $817,356,182 $724,885,360 $697,260,654
Performance Statistics (unaudited)
Three Months Ended
June 30, March 31, December 31, September 30, June 30,
2026 2026 2025 2025 2025
Per Share Data:
Earnings per share - basic $0.93 $0.82 $0.78 $0.75 $0.63
Earnings per share - diluted $0.92 $0.82 $0.78 $0.75 $0.63
Total shares outstanding 3,008,592 3,006,555 3,004,527 3,002,485 3,000,028
Weighted average shares outstanding 3,007,673 3,005,613 3,003,726 3,001,454 2,999,200
Book value per share $21.19 $20.30 $19.56 $18.79 $18.00
Performance Ratios:
Return on average assets * 1.36 % 1.24 % 1.18 % 1.29 % 1.15 %
Return on average equity * 17.82 % 16.64 % 15.87 % 16.19 % 14.38 %
Net interest margin 4.09 % 3.80 % 3.77 % 3.87 % 3.72 %
Non-interest expenses* to average assets 2.27 % 2.21 % 2.15 % 2.21 % 2.29 %
Efficiency ratio 54.39 % 55.77 % 56.25 % 56.11 % 60.05 %
Asset Quality Ratios:
Non-performing loans to total loans 0.12 % 0.43 % 0.11 % 0.00 % 0.03 %
Non-performing assets to total assets 0.10 % 0.37 % 0.09 % 0.00 % 0.03 %
Allowance for credit losses to total loans 0.79 % 0.76 % 0.73 % 0.72 % 0.76 %
* Annualized
Consolidated Income Statements (unaudited)
Three Months Ended
June 30, March 31, December 31, September 30, June 30,
2026 2026 2025 2025 2025
Interest income:
Loans, including fees $12,017,007 $11,182,544 $11,098,085 $10,719,087 $10,126,623
Securities 328,305 280,104 206,991 136,606 118,920
Other 439,133 560,555 599,764 138,292 28,289
Total interest income 12,784,445 12,023,203 11,904,840 10,993,985 10,273,832
Interest expense:
Deposits 4,405,473 4,395,446 4,520,311 4,231,636 4,111,978
Borrowings 119,399 122,789 125,620 77,963 85,822
Subordinated debt 162,556 162,556 137,058 134,682 134,681
Total interest expense 4,687,428 4,680,791 4,782,989 4,444,281 4,332,481
Net interest income 8,097,017 7,342,412 7,121,851 6,549,704 5,941,351
Provision for credit losses 386,010 377,167 368,729 189,087 130,416
Net interest income after provision for credit losses 7,711,007 6,965,245 6,753,122 6,360,617 5,810,935
Non-interest income:
Service charges and other fees 175,655 130,399 116,476 107,182 97,887
BOLI income 69,341 68,580 69,075 68,585 66,998
Gain on sale of SBA loans 108,308 274,352 26,326
Swap referral fee income - 69,890 96,813 107,925
Other 81,640 70,899 81,363 76,913 73,275
Total non-interest income 434,944 544,230 336,804 349,493 372,411
Non-interest expense
Salaries & benefits 2,769,316 2,657,536 2,635,943 2,370,422 2,253,069
Occupancy & equipment 424,243 349,732 313,743 316,684 318,631
Professional fees 176,904 173,999 137,279 143,108 192,378
Advertising 124,258 126,442 87,011 104,356 113,923
Data processing 246,663 245,419 240,384 213,565 207,430
FDIC premium expense 180,310 191,252 166,763 135,382 128,019
Other 719,020 653,955 614,101 587,553 577,942
Total non-interest expense 4,640,714 4,398,335 4,195,224 3,871,070 3,791,392
Income before federal income tax expense 3,505,237 3,111,140 2,894,702 2,839,040 2,391,954
Federal income tax expense 721,573 638,956 585,391 580,874 488,827
Net income $2,783,664 $2,472,184 $2,309,311 $2,258,166 $1,903,127
Consolidated Income Statements (unaudited)
Six Months Ended
June 30, June 30,
2026 2025
Interest income:
Loans, including fees $23,199,551 $19,709,716
Securities 608,409 235,292
Other 999,688 75,710
Total interest income 24,807,648 20,020,718
Interest expense:
Deposits 8,800,919 8,114,973
Borrowings 242,188 163,125
Subordinated debt 325,112 269,363
Total interest expense 9,368,219 8,547,461
Net interest income 15,439,429 11,473,257
Provision for credit losses 763,177 304,513
Net interest income after provision for credit losses 14,676,252 11,168,744
Non-interest income:
Service charges and other fees 306,054 207,247
BOLI income 137,921 132,848
Gain on sale of SBA loans 382,660 113,186
Swap referral fee income 132,126
Other 152,539 136,118
Total non-interest income 979,174 721,525
Non-interest expense
Salaries & benefits 5,426,852 4,380,106
Occupancy & equipment 773,975 653,329
Professional fees 350,903 342,554
Advertising 250,700 222,644
Data processing 492,082 411,922
FDIC premium expense 371,562 259,194
Other 1,372,975 1,111,101
Total non-interest expense 9,039,049 7,380,850
Income before federal income tax expense 6,616,377 4,509,419
Federal income tax expense 1,360,529 919,068
Net income $5,255,848 $3,590,351
About First Resource Bancorp, Inc.
First Resource Bancorp, Inc. is the holding company of First Resource Bank. First Resource Bank is a locally owned and operated Pennsylvania state-chartered bank with three full-service branches, serving the banking needs of businesses, professionals and individuals in the Delaware Valley. The Bank offers a full range of deposit and credit services with a high level of personalized service. First Resource Bank also offers a broad range of traditional financial services and products, competitively priced and delivered in a responsive manner to small businesses, professionals and residents in the local market. For additional information visit our website at www.firstresourcebank.com. Member FDIC.
This press release contains statements that are not of historical facts and may pertain to future operating results or events or management's expectations regarding those results or events. These are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts. When used in this press release, the words "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", or words of similar meaning, or future or conditional verbs, such as "will", "would", "should", "could", or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are either beyond our control or not reasonably capable of predicting at this time. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the results discussed in these forward-looking statements. Readers of this press release are accordingly cautioned not to place undue reliance on forward-looking statements. First Resource Bank disclaims any intent or obligation to update publicly any of the forward-looking statements herein, whether in response to new information, future events or otherwise.
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