Community Heritage Financial, Inc. Reports Third Quarter 2026 Results
MIDDLETOWN, Md., Oct. 27, 2026 /PRNewswire/ -- Community Heritage Financial, Inc. (the "Company" or "CHF") (OTC ID: CMHF), the parent company of Middletown Valley Bank ("MVB" or the "Bank"), reported net income of $4.1 million, or $1.39 diluted earnings per share, for the third quarter of 2026, compared to a net loss of $1.1 million, or $(0.37) diluted earnings per share, for the second quarter of 2026 and net income of $1.9 million, or $0.66 diluted earnings per share, for the third quarter of 2025. Results for the second quarter of 2026 were impacted by a $5.4 million pre-tax loss on the sale of securities associated with the Company's strategic investment portfolio repositioning and approximately $337 thousand of one-time retirement-related costs associated with the retirement of several long-tenured senior officers.
For the first nine months of 2026, net income totaled $5.9 million, or $1.99 diluted earnings per share, compared to $6.3 million, or $2.13 diluted earnings per share, for the same period in 2025. Excluding the second quarter 2026 nonrecurring items associated with the securities portfolio repositioning and executive retirement costs, core earnings1 for the first nine months of 2026 totaled $10.0 million, or $3.38 diluted earnings per share, representing an increase of 59.9% compared to core earnings1 of $6.3 million, or $2.13 diluted earnings per share, for the first nine months of 2025.
"Our third quarter results highlight the strength of our core banking franchise," said BJ Goetz, President and Chief Executive Officer. "Loan growth, expansion of our net interest margin, favorable credit quality metrics, and disciplined balance sheet management produced strong earnings performance during the quarter. The strategic actions completed during the second quarter positioned the Company for enhanced earnings and balance sheet performance moving forward."
Third Quarter 2026 Highlights
- Net income totaled $4.1 million, compared to a net loss of $1.1 million in the linked quarter and net income of $1.9 million in the third quarter of 2025.
- Diluted earnings per share were $1.39, compared to $(0.37) in the second quarter of 2026 and $0.66 in the third quarter of 2025.
- Annualized return on average assets increased to 1.39%, compared to (0.38%) in the second quarter of 2026 and 0.70% in the third quarter of 2025.
- Annualized return on average equity increased to 18.23%, compared to (4.82%) in the second quarter of 2026 and 8.96% in the third quarter of 2025.
- Net interest margin expanded to 3.88%, up from 3.78% in the linked quarter and 3.40% a year ago.
- Gross loans increased to $980.5 million, up $10.4 million, or 1.1%, from June 30, 2026, and up $84.3 million, or 9.4%, from September 30, 2025.
- Credit quality remained strong, with nonperforming assets declining to $1.1 million, or 0.10% of total assets, compared to $2.0 million, or 0.19% of total assets, one year earlier.
- Book value per share was $30.08 and tangible book value per share was $29.52 as of September 30, 2026.
Net Interest Income
Net interest income for the third quarter of 2026 totaled $11.4 million, an increase of $784 thousand, or 7.4%, from the second quarter of 2026 and an increase of $2.2 million, or 24.0%, from the third quarter of 2025. The increase from both prior periods was driven primarily by continued loan and deposit growth and higher earning asset yields, including an improved yield on securities reflective of the second quarter 2026 investment portfolio repositioning.
The Company's net interest margin increased to 3.88% during the third quarter of 2026 from 3.78% during the second quarter of 2026 and 3.40% during the third quarter of 2025. The Company's yield on interest-earning assets increased to 5.71% from 5.55% in the linked quarter and 5.38% a year earlier, while the cost of interest-bearing liabilities declined to 2.61% from 2.85% in the third quarter of 2025.
For the first nine months of 2026, net interest income totaled $32.0 million, an increase of $5.5 million, or 21.0%, from $26.4 million for the first nine months of 2025. The increase reflects strong loan and deposit growth, expansion in earning asset yields, and margin improvement resulting from balance sheet repositioning initiatives.
Provision for Credit Losses
The Company recorded a negative provision for credit losses of $721 thousand during the third quarter of 2026, compared to a provision expense of $344 thousand during the second quarter of 2026 and $961 thousand during the third quarter of 2025. The negative provision reflects favorable credit quality trends, improving asset quality metrics, and net loan loss recoveries during the quarter. Net loan loss recoveries totaled $493 thousand in the third quarter of 2026 compared to $3 thousand during both the linked quarter and the third quarter of 2025. The increase in the third quarter of 2026 reflected a $497 thousand recovery related to a loan charge-off in 2021.
For the first nine months of 2026, the Company recorded a negative provision for credit losses of $454 thousand, compared to provision expense of $1.4 million during the first nine months of 2025. Net recoveries totaled $406 thousand during the first nine months of 2026 compared to $10 thousand during the same period in 2025. Through the nine months of 2026, the Bank recovered a total of $1.2 million related to the 2021 loan charge-off noted above, in addition to other loan loss recoveries of $10 thousand. The loan recoveries were offset by loan charge-offs of $755 thousand, $748 thousand of which was related to a single credit to a borrower that uncovered internal theft by one of its owners.
Noninterest Income
Noninterest income totaled $834 thousand during the third quarter of 2026, compared to a loss of $4.2 million during the second quarter of 2026 and income of $1.1 million during the third quarter of 2025. The linked-quarter improvement was primarily attributable to the absence of the $5.4 million loss on the sale of securities recognized during the second quarter of 2026.
Excluding the securities loss, core noninterest income1 totaled $1.2 million during the second quarter of 2026. Compared to that amount, third quarter noninterest income declined primarily due to lower mortgage banking revenue and lower earnings on bank-owned life insurance, partially offset by growth in card and merchant service income and deposit service charges.
For the first nine months of 2026, reported noninterest income was a loss of $2.5 million compared to income of $2.9 million for the first nine months of 2025. Excluding the securities loss, core noninterest income1 for the first nine months of 2026 totaled $2.9 million, substantially consistent with the prior year period.
Noninterest Expense
Noninterest expense totaled $7.3 million during the third quarter of 2026, a decrease of $294 thousand, or 3.9%, from the second quarter of 2026 and an increase of $623 thousand, or 9.3%, from the third quarter of 2025. The linked-quarter decrease principally reflected lower salaries and employee benefits expense following the retirement-related costs incurred during the second quarter of 2026, as well as lower occupancy costs.
Compared to the third quarter of 2025, the increase in noninterest expense was primarily attributable to higher salaries and employee benefits, increased data and item processing, which includes costs associated with ongoing technology investments, and higher occupancy expenses.
For the first nine months of 2026, noninterest expense totaled $22.0 million, compared to $19.6 million for the first nine months of 2025. Excluding one-time retirement-related costs, core noninterest expense1 totaled $21.7 million, representing an increase of approximately 10.6% over the prior-year period. The increase was primarily driven by higher personnel costs, data and item processing costs, and occupancy expenses.
Balance Sheet
Total assets were $1.19 billion as of September 30, 2026, compared to $1.19 billion as of June 30, 2026 and $1.09 billion as of September 30, 2025. Total loans increased to $983.7 million, up $10.2 million from June 30, 2026 and $83.9 million from September 30, 2025. Growth in loans over the past twelve months was led by residential real estate, owner-occupied commercial real estate, commercial and industrial lending, and multifamily loans.
Total deposits were $1.06 billion as of September 30, 2026, compared to $1.08 billion as of June 30, 2026 and $982.3 million as of September 30, 2025. The linked-quarter decline primarily reflected customer-specific fluctuations in deposit balances. Year-over-year deposit growth totaled $80.0 million, or 8.1%.
Shareholders' equity totaled $88.7 million as of September 30, 2026, while book value per share increased to $30.08 from $29.46 as of September 30, 2025. Tangible book value per share increased to $29.52 from $28.90 one year earlier.
Asset Quality and Capital
Asset quality metrics continued to improve during the quarter. Nonaccrual loans declined to $1.1 million as of September 30, 2026 from $2.0 million as of September 30, 2025. Nonperforming assets represented 0.10% of total assets, compared to 0.19% one year earlier. The allowance for credit losses represented 1.00% of total loans as of September 30, 2026.
The Company and the Bank remained well-capitalized. As of September 30, 2026, the Bank's common equity tier 1 capital ratio was 11.97%, the total risk-based capital ratio was 13.09%, and the tier 1 leverage ratio was 9.27%.
Non-GAAP Financial Measures
Management has provided non-GAAP financial measures in this press release, including in the following table, and has done so as the Company believes these financial measures provide information that is useful to investors in understanding the Company's performance and performance trends to facilitate comparisons with the performance of others in the industry. These non-GAAP financial measures should not be considered an alternative to GAAP and users should recognize the non-GAAP financial measures presented by the Company might not be comparable to measures of other companies with similar titles. See "Reconciliation of non-GAAP Financial Measures" at the end of the press release.
Three Months Ended | Nine Months Ended | |||||
9/30/2026 | 6/30/20261 | 9/30/2025 | 9/30/20261 | 9/30/2025 | ||
Core earnings1 | $ 4,143,191 | $ 3,018,455 | $ 1,934,396 | $ 10,013,895 | $ 6,285,036 | |
Core earnings PTPP2 | $ 4,883,511 | $ 4,458,637 | $ 3,529,972 | $ 13,111,855 | $ 9,752,210 | |
Noninterest income | $ 834,033 | $ 1,200,957 | $ 1,054,646 | $ 2,866,306 | $ 2,930,147 | |
Noninterest expense | $ 7,315,262 | $ 7,272,279 | $ 6,692,500 | $ 21,659,448 | $ 19,588,876 | |
Provision for credit losses | $ (720,798) | $ 394,791 | $ 960,847 | $ (403,306) | $ 1,357,735 | |
Core earnings1 per common share: | ||||||
Diluted | $ 1.39 | $ 1.02 | $ 0.66 | $ 3.38 | $ 2.13 | |
Annualized return on average assets | 1.39 % | 1.05 % | 0.70 % | 1.16 % | 0.79 % | |
Annualized return on average stockholders' equity | 18.23 % | 13.24 % | 8.96 % | 14.73 % | 10.12 % | |
Forward-Looking Statements
This press release may contain forward-looking statements with respect to the Company's financial condition, results of operations and business. Forward-looking statements can be identified by words such as "expects", "anticipates", "believes", "estimates", "projects", "continue", "plans", "intends", the negative of these words and other comparable terminology. These forward-looking statements may be included in comments regarding future financial performance, expected levels of future revenue and expenses such as credit losses, growth strategies, new business initiatives, and anticipated trends impacting performance. Forward-looking statements are not historical facts nor an assurance of future performance. While we believe the expectations of forward-looking statements to be reasonable, actual results may differ materially as forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and often outside of the control of the Company. Therefore, users should not rely on forward-looking statements.
________________________________________________________________________________ |
1 A non-GAAP financial measure calculated using methods other than those prescribed by generally accepted accounting principles ("GAAP"). See "Reconciliation of non-GAAP Financial Measures" at the end of the press release. |
2 "PTPP" is a non-GAAP financial measure and represents earnings pre-tax and pre-provision for credit losses. It is calculated by adding income tax expense and the provision for credit losses to net income. See "Reconciliation of non-GAAP Financial Measures" at the end of the press release. |
Community Heritage Financial, Inc.
Robert E. Goetz, Jr. ("BJ")
President & Chief Executive Officer
301-371-3055
John A. Scaldara, Jr.
Executive Vice President and Chief Financial Officer
301-371-3070
Community Heritage Financial, Inc. and Subsidiaries | |||||||
Balance Sheets (unaudited)1 | |||||||
As of Period End | |||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/20251 | 09/30/2025 | |||
ASSETS | |||||||
Cash and due from banks | $ 61,358,390 | $ 76,651,107 | $ 41,117,713 | $ 30,707,438 | $ 28,508,739 | ||
Securities available-for-sale, at fair value | 117,796,751 | 117,130,706 | 51,710,763 | 53,681,375 | 54,390,834 | ||
Securities held-to-maturity | - | - | 85,592,007 | 86,553,557 | 87,642,810 | ||
Less allowance for credit losses | - | - | 50,414 | 78,511 | 73,338 | ||
Total securities held-to-maturity | - | - | 85,541,593 | 86,475,046 | 87,569,472 | ||
Total securities | 117,796,751 | 117,130,706 | 137,252,356 | 140,156,421 | 141,960,306 | ||
Equity securities, at cost | 1,502,700 | 1,027,700 | 2,709,200 | 2,281,700 | 951,700 | ||
Loans | 983,736,202 | 973,493,548 | 947,933,729 | 930,855,154 | 899,798,030 | ||
Less allowance for loan credit losses | 9,851,224 | 10,097,893 | 9,701,472 | 9,842,370 | 9,648,797 | ||
Loans, net | 973,884,978 | 963,395,655 | 938,232,257 | 921,012,784 | 890,149,233 | ||
Loans held for sale | 1,369,793 | 3,078,861 | 3,241,537 | 3,935,463 | 3,782,055 | ||
Premises and equipment | 6,546,991 | 6,331,653 | 6,238,824 | 6,423,885 | 6,335,780 | ||
Right of use asset | 5,958,408 | 5,134,965 | 4,903,838 | 5,014,155 | 1,691,267 | ||
Accrued interest receivable | 3,738,786 | 3,626,025 | 3,607,585 | 3,397,155 | 3,433,569 | ||
Deferred tax assets | 6,617,826 | 5,060,704 | 4,226,269 | 4,452,078 | 4,501,612 | ||
Bank-owned life insurance | 8,062,683 | 8,044,423 | 7,858,667 | 7,837,986 | 7,656,529 | ||
Goodwill | 1,656,507 | 1,656,507 | 1,656,507 | 1,656,507 | 1,656,507 | ||
Other assets | 2,990,830 | 3,556,292 | 2,311,950 | 2,204,457 | 1,836,331 | ||
Total Assets | $ 1,191,484,643 | $ 1,194,694,598 | $ 1,153,356,703 | $ 1,129,080,029 | $ 1,092,463,628 | ||
LIABILITIES and SHAREHOLDERS' EQUITY | |||||||
Liabilities | |||||||
Deposits: | |||||||
Noninterest-bearing demand | $ 259,660,818 | $ 266,326,799 | $ 272,084,060 | $ 257,415,232 | $ 255,052,436 | ||
Interest-bearing | 802,720,497 | 811,348,546 | 724,715,536 | 727,389,108 | 727,289,753 | ||
Total deposits | 1,062,381,315 | 1,077,675,345 | 996,799,596 | 984,804,340 | 982,342,189 | ||
FHLB advances and other borrowings | 15,000,000 | 5,000,000 | 42,000,000 | 33,000,000 | 5,000,000 | ||
Subordinated debt, net | 12,062,131 | 12,059,069 | 12,056,006 | 12,052,944 | 12,049,882 | ||
Lease liabilities | 6,040,218 | 5,218,274 | 4,983,788 | 5,088,540 | 1,760,706 | ||
Accrued interest payable | 690,101 | 484,064 | 720,468 | 473,682 | 709,739 | ||
Other liabilities | 6,627,737 | 5,487,564 | 5,272,313 | 4,809,964 | 4,306,714 | ||
Total Liabilities | 1,102,801,502 | 1,105,924,316 | 1,061,832,171 | 1,040,229,470 | 1,006,169,230 | ||
Shareholders' Equity | |||||||
Common stock | 29,483 | 29,481 | 29,459 | 29,327 | 29,291 | ||
Additional paid-in-capital | 41,802,851 | 41,702,821 | 41,642,026 | 41,649,351 | 41,588,025 | ||
Retained earnings | 57,504,836 | 53,597,510 | 54,931,337 | 52,313,860 | 50,180,223 | ||
Accumulated other comprehensive loss | (10,654,029) | (6,559,530) | (5,078,290) | (5,141,979) | (5,503,141) | ||
Total Shareholders' Equity | 88,683,141 | 88,770,282 | 91,524,532 | 88,850,559 | 86,294,398 | ||
Total Liabilities and Shareholders' Equity | $ 1,191,484,643 | $ 1,194,694,598 | $ 1,153,356,703 | $ 1,129,080,029 | $ 1,092,463,628 | ||
1 December 31, 2025 information derived from the audited financial statements. | |||||||
Community Heritage Financial, Inc. and Subsidiaries | ||||||||||
Statements of Income (unaudited) | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/2025 | 09/30/2025 | 09/30/2026 | 09/30/2025 | ||||
Interest Income | ||||||||||
Loans, including fees | $ 15,134,399 | $ 14,254,582 | $ 13,870,716 | $ 13,604,427 | $ 13,086,145 | $ 43,259,697 | $ 37,912,479 | |||
Securities | 1,179,790 | 1,044,498 | 989,011 | 994,358 | 946,231 | 3,213,299 | 2,693,584 | |||
Fed funds sold and other bank deposits | 436,913 | 244,187 | 84,701 | 176,658 | 511,786 | 765,801 | 1,098,017 | |||
Total interest income | 16,751,102 | 15,543,267 | 14,944,428 | 14,775,443 | 14,544,162 | 47,238,797 | 41,704,080 | |||
Interest Expense | ||||||||||
Deposits | 5,126,168 | 4,587,069 | 4,431,541 | 4,873,913 | 5,031,782 | 14,144,778 | 14,195,707 | |||
Subordinated debt | 207,249 | 119,161 | 295,339 | 57,799 | 137,305 | 621,749 | 475,685 | |||
Other borrowed funds | 52,945 | 256,664 | 207,250 | 207,250 | 207,249 | 516,859 | 621,749 | |||
Total interest expense | 5,386,362 | 4,962,894 | 4,934,130 | 5,138,962 | 5,376,336 | 15,283,386 | 15,293,141 | |||
Net interest income | 11,364,740 | 10,580,373 | 10,010,298 | 9,636,481 | 9,167,826 | 31,955,411 | 26,410,939 | |||
Provision for credit losses | (720,798) | 344,377 | (77,299) | 124,140 | 960,847 | (453,720) | 1,357,735 | |||
Net interest income after provision | ||||||||||
for credit losses | 12,085,538 | 10,235,996 | 10,087,597 | 9,512,341 | 8,206,979 | 32,409,131 | 25,053,204 | |||
Noninterest income | ||||||||||
Mortgage banking revenue | 214,578 | 402,775 | 236,836 | 428,177 | 348,561 | 854,189 | 919,016 | |||
Card and merchant services | 343,670 | 344,548 | 313,701 | 337,191 | 333,325 | 1,001,919 | 924,822 | |||
Service charges on deposits | 258,988 | 250,752 | 262,717 | 252,477 | 254,754 | 772,457 | 721,707 | |||
Earnings on bank-owned life insurance | 2,997 | 178,191 | 12,390 | 48,166 | 77,570 | 193,578 | 220,337 | |||
Loss on sale of securities | - | (5,393,148) | - | - | - | (5,393,148) | - | |||
Other | 13,800 | 24,691 | 5,672 | 18,737 | 40,436 | 44,163 | 144,265 | |||
Total noninterest income (loss) | 834,033 | (4,192,191) | 831,316 | 1,084,748 | 1,054,646 | (2,526,842) | 2,930,147 | |||
Noninterest expense | ||||||||||
Salaries and employee benefits | 4,256,036 | 4,658,424 | 3,979,145 | 4,101,261 | 3,861,631 | 12,893,605 | 11,368,892 | |||
Data and item processing | 1,037,662 | 953,718 | 1,030,332 | 1,043,435 | 940,872 | 3,021,712 | 2,697,643 | |||
Occupancy and equipment | 639,360 | 750,870 | 761,855 | 709,382 | 641,092 | 2,152,085 | 1,935,508 | |||
Legal and professional fees | 361,168 | 280,505 | 257,974 | 320,853 | 332,527 | 899,647 | 977,272 | |||
FDIC insurance | 187,500 | 161,334 | 200,001 | 389,431 | 166,176 | 548,835 | 479,979 | |||
Advertising | 112,434 | 109,101 | 97,674 | 74,846 | 91,883 | 319,209 | 278,511 | |||
Other | 721,102 | 695,238 | 744,926 | 769,525 | 658,319 | 2,161,266 | 1,851,071 | |||
Total noninterest expense | 7,315,262 | 7,609,190 | 7,071,907 | 7,408,733 | 6,692,500 | 21,996,359 | 19,588,876 | |||
Income (loss) before income taxes | 5,604,309 | (1,565,385) | 3,847,006 | 3,188,356 | 2,569,125 | 7,885,930 | 8,394,475 | |||
Income tax expense (benefit) | 1,461,118 | (467,233) | 994,757 | 820,106 | 634,729 | 1,988,642 | 2,109,439 | |||
Net income (loss) | $ 4,143,191 | $ (1,098,152) | $ 2,852,249 | $ 2,368,250 | $ 1,934,396 | $ 5,897,288 | $ 6,285,036 | |||
Community Heritage Financial, Inc. and Subsidiaries | ||||||||||
Per Share Data (unaudited) | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/2025 | 09/30/2025 | 09/30/2026 | 09/30/2025 | ||||
Earnings per common share | ||||||||||
Basic | $ 1.41 | $ (0.37) | $ 0.97 | $ 0.81 | $ 0.66 | $ 2.00 | $ 2.15 | |||
Diluted | $ 1.39 | $ (0.37) | $ 0.97 | $ 0.80 | $ 0.66 | $ 1.99 | $ 2.13 | |||
Common shares outstanding at period end | 2,948,308 | 2,948,143 | 2,945,928 | 2,932,680 | 2,929,053 | 2,948,308 | 2,929,053 | |||
Average common shares outstanding | ||||||||||
Basic | 2,948,267 | 2,946,683 | 2,936,041 | 2,932,562 | 2,929,012 | 2,943,708 | 2,926,865 | |||
Diluted | 2,978,354 | 2,946,683 | 2,947,910 | 2,956,327 | 2,952,922 | 2,966,872 | 2,946,201 | |||
Cash dividends paid per common share | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.24 | $ 0.24 | |||
Community Heritage Financial, Inc. and Subsidiaries | ||||||||||
Selected Financial Data (unaudited) | ||||||||||
As of and for the Three Months Ended | As of and for the Nine Months Ended | |||||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/2025 | 09/30/2025 | 09/30/2026 | 09/30/2025 | ||||
Per Share Data | ||||||||||
Common shares outstanding at period end | 2,948,308 | 2,948,143 | 2,945,928 | 2,932,680 | 2,929,053 | 2,948,308 | 2,929,053 | |||
Book value per share | $ 30.08 | $ 30.11 | $ 31.07 | $ 30.30 | $ 29.46 | $ 30.08 | $ 29.46 | |||
Tangible book value per share1 | $ 29.52 | $ 29.55 | $ 30.51 | $ 29.73 | $ 28.90 | $ 29.52 | $ 28.90 | |||
Capital (bank consolidated only unless noted otherwise) | ||||||||||
Common equity tier 1 (CET1) capital | 11.97 % | 11.72 % | 12.02 % | 11.96 % | 12.15 % | 11.97 % | 12.15 % | |||
Tier 1 capital | 11.97 % | 11.72 % | 12.02 % | 11.96 % | 12.15 % | 11.97 % | 12.15 % | |||
Total risk-based capital | 13.09 % | 12.89 % | 13.16 % | 13.14 % | 13.37 % | 13.09 % | 13.37 % | |||
Tier 1 leverage ratio | 9.27 % | 8.82 % | 9.47 % | 9.48 % | 9.32 % | 9.27 % | 9.32 % | |||
Tangible common equity to tangible assets (CHF)1 | 7.31 % | 7.30 % | 7.80 % | 7.73 % | 7.76 % | 7.31 % | 7.76 % | |||
Asset Quality Data | ||||||||||
Nonaccrual loans | $ 1,147,894 | $ 1,212,877 | $ 1,232,834 | $ 2,025,128 | $ 2,044,469 | $ 1,147,894 | $ 2,044,469 | |||
Non-performing assets | $ 1,147,894 | $ 1,212,877 | $ 1,232,834 | $ 2,025,128 | $ 2,044,469 | $ 1,147,894 | $ 2,044,469 | |||
Non-performing assets plus loans past due 90+ days | $ 1,147,894 | $ 1,220,371 | $ 1,232,834 | $ 2,025,128 | $ 2,044,469 | $ 1,147,894 | $ 2,044,469 | |||
Non-performing loans to loans | 0.12 % | 0.13 % | 0.13 % | 0.22 % | 0.23 % | 0.12 % | 0.23 % | |||
Non-performing assets to total assets | 0.10 % | 0.10 % | 0.11 % | 0.18 % | 0.19 % | 0.10 % | 0.19 % | |||
Net (charge-offs) / recoveries | $ 493,170 | $ 3,450 | $ (90,410) | $ 3,450 | $ 3,450 | $ 406,210 | $ 10,370 | |||
Net (charge-offs) / recoveries to average loans | 0.05 % | 0.00 % | -0.01 % | 0.00 % | 0.00 % | 0.04 % | 0.00 % | |||
ACL - loans2 to total loans | 1.00 % | 1.04 % | 1.02 % | 1.06 % | 1.07 % | 1.00 % | 1.07 % | |||
ACL - loans2 to non-performing assets plus loans past due 90+ days | 858.20 % | 827.44 % | 786.92 % | 486.01 % | 471.95 % | 858.20 % | 471.95 % | |||
Other Data | ||||||||||
Return on average assets | 1.39 % | -0.38 % | 1.02 % | 0.85 % | 0.70 % | 0.68 % | 0.79 % | |||
Return on average equity | 18.23 % | -4.82 % | 12.71 % | 10.63 % | 8.96 % | 8.68 % | 10.12 % | |||
Net interest margin | 3.88 % | 3.78 % | 3.67 % | 3.56 % | 3.40 % | 3.78 % | 3.37 % | |||
Yield on interest-earning assets | 5.71 % | 5.55 % | 5.48 % | 5.45 % | 5.38 % | 5.58 % | 5.33 % | |||
Cost of interest-bearing liabilities | 2.61 % | 2.56 % | 2.61 % | 2.73 % | 2.85 % | 2.60 % | 2.81 % | |||
Loans to deposits ratio | 92.60 % | 90.33 % | 95.10 % | 94.52 % | 91.60 % | 92.60 % | 91.60 % | |||
1 Financial measures are calculated using methods other than those prescribed by generally accepted accounting principles ("GAAP"). Refer to "Reconciliations of Non-GAAP Financial Measures" at the end of the press release. | ||||||||||
2 "ACL-loans" relates to the allowance for credit losses specific to loans outstanding and does not include the allowance for credit losses related to off-balance sheet credit exposure or the allowance for credit losses related to securities held-to-maturity. | ||||||||||
Community Heritage Financial, Inc. and Subsidiaries | |||||||||||||||||||
Condensed Average Balance Sheet Analysis (unaudited) | |||||||||||||||||||
Three Months Ended | |||||||||||||||||||
September 30, 2026 | June 30, 2026 | September 30, 2025 | |||||||||||||||||
Average Balance | Interest | Yield / | Average Balance | Interest | Yield / | Average Balance | Interest | Yield / | |||||||||||
ASSETS | |||||||||||||||||||
Interest-earning assets: | |||||||||||||||||||
Loans, including LHFS | $ 982,703,585 | $ 15,134,399 | 6.12 % | $ 954,410,076 | $ 14,254,582 | 5.99 % | $ 883,763,296 | $ 13,086,145 | 5.89 % | ||||||||||
Securities | 130,700,857 | 1,179,790 | 3.61 % | 134,552,222 | 1,044,498 | 3.11 % | 139,178,904 | 946,231 | 2.72 % | ||||||||||
Fed funds sold and other bank deposits | 52,928,673 | 436,913 | 3.27 % | 33,144,617 | 244,187 | 2.96 % | 51,010,040 | 511,786 | 3.98 % | ||||||||||
1,166,333,115 | 16,751,102 | 5.71 % | 1,122,106,915 | 15,543,267 | 5.55 % | 1,073,952,240 | 14,544,162 | 5.38 % | |||||||||||
Noninterest-earning assets | 19,005,279 | 26,319,812 | 22,561,809 | ||||||||||||||||
Total Assets | $ 1,185,338,394 | $ 1,148,426,727 | $ 1,096,514,049 | ||||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||
Demand deposits | $ 611,873,884 | $ 3,506,008 | 2.27 % | $ 562,295,257 | $ 3,013,089 | 2.15 % | $ 541,428,761 | $ 3,332,702 | 2.44 % | ||||||||||
Time deposits | 190,566,104 | 1,620,160 | 3.37 % | 185,241,631 | 1,573,980 | 3.41 % | 184,562,867 | 1,699,080 | 3.65 % | ||||||||||
Interest-bearing deposits | 802,439,988 | 5,126,168 | 2.53 % | 747,536,888 | 4,587,069 | 2.46 % | 725,991,628 | 5,031,782 | 2.75 % | ||||||||||
Borrowings | 17,171,234 | 260,194 | 6.05 % | 29,314,083 | 375,825 | 5.13 % | 23,176,928 | 344,554 | 5.93 % | ||||||||||
Interest-bearing liabilities | 819,611,222 | 5,386,362 | 2.61 % | 776,850,971 | 4,962,894 | 2.56 % | 749,168,556 | 5,376,336 | 2.85 % | ||||||||||
Noninterest-bearing liabilities: | |||||||||||||||||||
Demand deposits | 264,215,906 | 269,761,926 | 255,304,997 | ||||||||||||||||
Other | 11,339,378 | 10,386,224 | 6,424,548 | ||||||||||||||||
Total Liabilities | 1,095,166,506 | 1,056,999,121 | 1,010,898,101 | ||||||||||||||||
Cost of Total Deposits | 1.91 % | 1.81 % | 2.03 % | ||||||||||||||||
Cost of Total Funds (interest- | |||||||||||||||||||
bearing liabilities plus non- | |||||||||||||||||||
interest-bearing deposits) | 1.96 % | 1.87 % | 2.09 % | ||||||||||||||||
Shareholders' equity | 90,171,888 | 91,427,606 | 85,615,948 | ||||||||||||||||
Total Liabilities and Shareholders Equity | $ 1,185,338,394 | $ 1,148,426,727 | $ 1,096,514,049 | ||||||||||||||||
Net interest income / NIM | $ 11,364,740 | 3.88 % | $ 10,580,373 | 3.78 % | $ 9,167,826 | 3.40 % | |||||||||||||
Community Heritage Financial, Inc. and Subsidiaries | |||||||||||||
Condensed Average Balance Sheet Analysis (unaudited) | |||||||||||||
Nine Months Ended | |||||||||||||
September 30, 2026 | September 30, 2025 | ||||||||||||
Average Balance | Interest | Yield / | Average Balance | Interest | Yield / | ||||||||
ASSETS | |||||||||||||
Interest-earning assets: | |||||||||||||
Loans | $ 960,994,637 | $ 43,259,697 | 6.02 % | $ 870,744,610 | $ 37,912,479 | 5.82 % | |||||||
Securities | 135,983,737 | 3,213,299 | 3.15 % | 136,582,535 | 2,693,584 | 2.63 % | |||||||
Fed funds sold and other bank deposits | 33,572,332 | 765,801 | 3.05 % | 38,623,627 | 1,098,017 | 3.80 % | |||||||
1,130,550,706 | 47,238,797 | 5.58 % | 1,045,950,772 | 41,704,080 | 5.33 % | ||||||||
Noninterest-earning assets | 23,859,068 | 22,167,616 | |||||||||||
Total Assets | $ 1,154,409,774 | $ 1,068,118,388 | |||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||
Interest-bearing liabilities: | |||||||||||||
Demand deposits | $ 571,721,252 | $ 9,377,851 | 2.19 % | $ 526,941,332 | $ 9,443,860 | 2.40 % | |||||||
Time deposits | 186,050,082 | 4,766,927 | 3.43 % | 172,910,792 | 4,751,847 | 3.67 % | |||||||
Interest-bearing deposits | 757,771,334 | 14,144,778 | 2.50 % | 699,852,124 | 14,195,707 | 2.71 % | |||||||
Borrowings | 29,500,325 | 1,138,608 | 5.15 % | 26,871,375 | 1,097,434 | 5.45 % | |||||||
Interest-bearing liabilities | 787,271,659 | 15,283,386 | 2.60 % | 726,723,499 | 15,293,141 | 2.81 % | |||||||
Noninterest-bearing liabilities: | |||||||||||||
Demand deposits | 265,015,831 | 251,454,884 | |||||||||||
Other | 11,255,789 | 6,873,118 | |||||||||||
Total Liabilities | 1,063,543,279 | 985,051,501 | |||||||||||
Cost of Total Deposits | 1.85 % | 2.00 % | |||||||||||
Cost of Total Funds (interest- | |||||||||||||
bearing liabilities plus non- | |||||||||||||
interest-bearing deposits) | 1.94 % | 2.09 % | |||||||||||
Shareholders' equity | 90,866,495 | 83,066,887 | |||||||||||
Total Liabilities and Shareholders Equity | $ 1,154,409,774 | $ 1,068,118,388 | |||||||||||
Net interest income / NIM | $ 31,955,411 | 3.78 % | $ 26,410,939 | 3.37 % | |||||||||
Community Heritage Financial, Inc. and Subsidiaries | |||||||
Loan and Deposit Composition (unaudited) | |||||||
As of Period End | |||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/2025 | 09/30/2025 | |||
Loans: | |||||||
Commercial real estate: | |||||||
Construction and land development | $ 71,760,956 | $ 77,375,812 | $ 84,428,311 | $ 87,098,819 | $ 80,671,698 | ||
Multifamily | 26,489,201 | 23,752,016 | 23,033,500 | 23,416,919 | 22,749,443 | ||
Farmland | 42,101,228 | 47,470,183 | 30,473,035 | 30,057,354 | 29,121,486 | ||
Other: | |||||||
Owner occupied | 160,819,100 | 152,971,360 | 152,110,763 | 147,006,921 | 142,991,662 | ||
Non-owner occupied | 186,297,924 | 184,240,299 | 178,593,573 | 177,115,227 | 170,462,324 | ||
Residential, including home equity | 344,933,650 | 339,069,899 | 329,551,095 | 322,126,792 | 314,145,221 | ||
Commercial and industrial | 146,958,177 | 144,278,828 | 145,316,304 | 139,246,435 | 135,174,298 | ||
Consumer | 1,163,813 | 976,461 | 936,235 | 1,181,301 | 868,300 | ||
Gross loans | 980,524,049 | 970,134,858 | 944,442,816 | 927,249,768 | 896,184,432 | ||
Net deferred loan costs | 3,212,153 | 3,358,690 | 3,490,913 | 3,605,386 | 3,613,598 | ||
$ 983,736,202 | $ 973,493,548 | $ 947,933,729 | $ 930,855,154 | $ 899,798,030 | |||
Deposits: | |||||||
Noninterest-bearing demand | $ 259,660,818 | $ 266,326,799 | $ 272,084,060 | $ 257,415,232 | $ 255,052,436 | ||
Interest-bearing: | |||||||
NOW 1 | 234,796,311 | 240,228,075 | 197,158,536 | 199,685,709 | 202,974,127 | ||
Savings | 74,520,077 | 77,224,221 | 75,285,399 | 71,859,873 | 71,308,729 | ||
Money market 1 | 301,187,670 | 304,000,976 | 271,791,739 | 272,585,155 | 266,564,412 | ||
Time | 192,216,439 | 189,895,274 | 180,479,862 | 183,258,371 | 186,442,485 | ||
Total interest-bearing | 802,720,497 | 811,348,546 | 724,715,536 | 727,389,108 | 727,289,753 | ||
Total Deposits | $ 1,062,381,315 | $ 1,077,675,345 | $ 996,799,596 | $ 984,804,340 | $ 982,342,189 | ||
1 Includes transaction accounts enrolled in the Bank's reciprocal deposit program. | |||||||
Community Heritage Financial, Inc. and Subsidiaries | ||||||||||
Reconciliation of GAAP to non-GAAP Financial Measurements (unaudited) | ||||||||||
Three Months Ended | Nine Months Ended | |||||||||
09/30/2026 | 06/30/2026 | 03/31/2026 | 12/31/2025 | 09/30/2025 | 09/30/2026 | 09/30/2025 | ||||
Financial Measurements: | ||||||||||
Core Earnings | ||||||||||
Net income (loss) (GAAP) | $ 4,143,191 | $ (1,098,152) | $ 2,852,249 | $ 2,368,250 | $ 1,934,396 | $ 5,897,288 | $ 6,285,036 | |||
Adjustments to net income to exclude non-core items: | ||||||||||
Loss on sale of securities | - | 5,393,148 | - | - | - | 5,393,148 | - | |||
Elimination of ACL - HTM securities | - | (50,414) | - | - | - | (50,414) | - | |||
Retirement costs | - | 336,911 | - | - | - | 336,911 | - | |||
Tax effect of adjustments to net income | - | (1,563,038) | - | - | - | (1,563,038) | - | |||
Core earnings (Non-GAAP) | $ 4,143,191 | $ 3,018,455 | $ 2,852,249 | $ 2,368,250 | $ 1,934,396 | $ 10,013,895 | $ 6,285,036 | |||
Income tax expense (benefit) | 1,461,118 | (467,233) | 994,757 | 820,106 | 634,729 | 1,988,642 | 2,109,439 | |||
Provision for credit losses | (720,798) | 344,377 | (77,299) | 124,140 | 960,847 | (453,720) | 1,357,735 | |||
Less: income tax expense (benefit) | - | (1,563,038) | - | - | - | (1,563,038) | - | |||
Core earnings PTPP (Non-GAAP) | $ 4,883,511 | $ 4,458,637 | $ 3,769,707 | $ 3,312,496 | $ 3,529,972 | $ 13,111,855 | $ 9,752,210 | |||
Core earnings basic earnings per share (Non-GAAP) | $ 1.41 | $ 1.02 | $ 0.97 | $ 0.81 | $ 0.66 | $ 3.40 | $ 2.15 | |||
Core earnings diluted earnings per share (Non-GAAP) | $ 1.39 | $ 1.02 | $ 0.97 | $ 0.80 | $ 0.66 | $ 3.38 | $ 2.13 | |||
Core Earnings Ratios, annualized (Non-GAAP): | ||||||||||
Return on average assets | 1.39 % | 1.05 % | 1.02 % | 0.85 % | 0.70 % | 1.16 % | 0.79 % | |||
Return on average stockholders' equity | 18.23 % | 13.24 % | 12.71 % | 10.63 % | 8.96 % | 14.73 % | 10.12 % | |||
Noninterest expense to average assets | 2.45 % | 2.51 % | 2.49 % | 2.67 % | 2.42 % | 2.51 % | 2.39 % | |||
Provision for Credit Losses | ||||||||||
Provision for credit losses (GAAP) | $ (720,798) | $ 344,377 | $ (77,299) | $ 124,140 | $ 960,847 | $ (453,720) | $ 1,357,735 | |||
Adjustment to provision for credit losses: | ||||||||||
Elimination of ACL - HTM securities | $ - | $ 50,414 | $ - | $ - | $ - | $ 50,414 | $ - | |||
Provision for credit losses (Non-GAAP) | $ (720,798) | $ 394,791 | $ (77,299) | $ 124,140 | $ 960,847 | $ (403,306) | $ 1,357,735 | |||
Noninterest Income | ||||||||||
Noninterest income (GAAP) | $ 834,033 | $ (4,192,191) | $ 831,316 | $ 1,084,748 | $ 1,054,646 | $ (2,526,842) | $ 2,930,147 | |||
Adjustment to noninterest income: | ||||||||||
Loss on sale of securities | - | 5,393,148 | - | - | - | 5,393,148 | - | |||
Noninterest income (Non-GAAP) | $ 834,033 | $ 1,200,957 | $ 831,316 | $ 1,084,748 | $ 1,054,646 | $ 2,866,306 | $ 2,930,147 | |||
Salaries and Benefits | ||||||||||
Salaries and benefits (GAAP) | $ 4,256,036 | $ 4,658,424 | $ 3,979,145 | $ 4,101,261 | $ 3,861,631 | $ 12,893,605 | $ 11,368,892 | |||
Adjustment to salaries and benefits: | ||||||||||
Retirement costs | - | (336,911) | - | - | - | (336,911) | - | |||
Salaries and benefits (Non-GAAP) | $ 4,256,036 | $ 4,321,513 | $ 3,979,145 | $ 4,101,261 | $ 3,861,631 | $ 12,556,694 | $ 11,368,892 | |||
Noninterest Expense | ||||||||||
Noninterest expense (GAAP) | $ 7,315,262 | $ 7,609,190 | $ 7,071,907 | $ 7,408,733 | $ 6,692,500 | $ 21,996,359 | $ 19,588,876 | |||
Adjustment to noninterest expense: | ||||||||||
Retirement costs | - | (336,911) | - | - | - | (336,911) | - | |||
Noninterest expense (Non-GAAP) | $ 7,315,262 | $ 7,272,279 | $ 7,071,907 | $ 7,408,733 | $ 6,692,500 | $ 21,659,448 | $ 19,588,876 | |||
Tangible Common Equity to Tangible Assets | ||||||||||
Total shareholders' equity (GAAP) | $ 88,683,141 | $ 88,770,282 | $ 91,524,532 | $ 88,850,559 | $ 86,294,398 | |||||
Intangible assets | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | |||||
Total shareholders' equity (Non-GAAP) | $ 87,026,634 | $ 87,113,775 | $ 89,868,025 | $ 87,194,052 | $ 84,637,891 | |||||
Total assets (GAAP) | $ 1,191,484,643 | $ 1,194,694,598 | $ 1,153,356,703 | $ 1,129,080,029 | $ 1,092,463,628 | |||||
Intangible assets | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | |||||
Total assets (Non-GAAP) | $ 1,189,828,136 | $ 1,193,038,091 | $ 1,151,700,196 | $ 1,127,423,522 | $ 1,090,807,121 | |||||
Tangible common equity to tangible assets (Non-GAAP) | 7.31 % | 7.30 % | 7.80 % | 7.73 % | 7.76 % | |||||
Tangible Book Value per Share | ||||||||||
Total shareholders' equity (GAAP) | $ 88,683,141 | $ 88,770,282 | $ 91,524,532 | $ 88,850,559 | $ 86,294,398 | |||||
Intangible assets | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | (1,656,507) | |||||
Tangible shareholders' equity (Non-GAAP) | $ 87,026,634 | $ 87,113,775 | $ 89,868,025 | $ 87,194,052 | $ 84,637,891 | |||||
Common shares outstanding | 2,948,308 | 2,948,143 | 2,945,928 | 2,932,680 | 2,929,053 | |||||
Tangible book value per share (Non-GAAP) | $ 29.52 | $ 29.55 | $ 30.51 | $ 29.73 | $ 28.90 | |||||
SOURCE Community Heritage Financial, Inc.
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