Carter Bankshares, Inc. Announces First Quarter 2026 Financial Results
Rhea-AI Summary
Carter Bankshares (NASDAQ:CARE) reported Q1 2026 net income of $85.8 million, or $3.88 diluted EPS, driven by a completed loan sale that produced $289.5 million in cash and an $80.0 million net gain. Core net interest income rose to $35.9 million and net interest margin widened to 3.07%.
Nonperforming loans fell to $24.0 million, allowance for credit losses to loans declined to 1.41%, and capital ratios strengthened (Tier 1 13.52%).
Positive
- Net income of $85.8 million; EPS $3.88
- Received $289.5 million cash from loan sale
- Recognized $80.0 million net gain on Transaction
- Net interest income $35.9 million; NII +19.2% YoY
- Nonperforming loans reduced by $220.0 million to $24.0 million
- Tier 1 capital ratio increased to 13.52%
Negative
- Noninterest income uplift was non-core from a one-time $65.0 million gain
- Allowance for credit losses to loans declined to 1.41% after an $18.0 million reserve release
- NPL improvement was primarily driven by the loan sale, not solely by organic recoveries
News Market Reaction – CARE
In the Apr 23 session, CARE declined 2.09%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Jan 29 | Q4 2025 earnings | Positive | +2.8% | Higher 2025 earnings, loan growth, NIM expansion, NPL reduction progress. |
| Oct 23 | Q3 2025 earnings | Negative | -6.3% | Net income down, elevated NPL levels despite continued loan growth. |
| Jul 24 | Q2 2025 earnings | Positive | +4.3% | Earnings growth, stronger NII, branch acquisition, and stock repurchase launch. |
| Apr 24 | Q1 2025 earnings | Positive | +2.3% | Higher EPS, loan and deposit growth, improving NIM despite higher NPLs. |
| Jan 23 | Q4 2024 earnings | Positive | +1.4% | Rising earnings, loan and deposit growth, and declining nonperforming loans. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Earnings releases have generally driven positive price reactions when they show progress on growth and credit, with one notable selloff after weaker Q3 2025 results.
Across the last five earnings releases since Jan 23, 2025, Carter Bankshares has consistently highlighted loan growth, net interest margin expansion, and active management of its largest nonperforming credit tied to the Justice Entities. Most quarters saw improving profitability and balance-sheet metrics, with shares typically rising on these updates. The exception was Q3 2025, when lower net income and elevated NPLs coincided with a negative reaction. Today’s Q1 2026 results complete the resolution of that credit and further extend this trajectory.
Key Terms
nonperforming loans financial
net interest margin financial
allowance for credit losses financial
other real estate owned financial
federal home loan bank financial
tier 1 capital ratio financial
efficiency ratio financial
certificate of deposit financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
MARTINSVILLE, VA / ACCESS Newswire / April 23, 2026 / Carter Bankshares, Inc. (the "Company") (NASDAQ:CARE), the holding company of Carter Bank (the "Bank") today announced quarterly net income of
On March 26, 2026, the Bank completed the sale (the "Transaction") of all loans, subsequently reduced to judgments related to various entities in which James C. Justice, II has an interest (such loans, subsequently reduced to judgments, the "Loans"). The Transaction was completed as an absolute, "as-is, where-is" sale to an unaffiliated third party.
The Company received consideration of
Transaction Highlights
Received consideration of
$289.5 million in cash in the Transaction during the quarter;Recognized a net gain on the Transaction of
$80.0 million , comprised of:$65.0 million gain on the Transaction; and$15.0 million net recovery;
Released
$18.0 million of specific reserves related to the Loans;The Transaction was accretive to diluted earnings per share by
$3.50 for the quarter; andThe Transaction increased each of book value per share and tangible book value per share by
$3.49 .
Financial Highlights for the Three Months Ended March 31, 2026
Total portfolio loans decreased
$151.1 million at March 31, 2026 from December 31, 2025 due to the Transaction, partially offset by net loan growth during the first quarter of$58.4 million , or6.1% 7 on an annualized basis, and increased$41.0 million , or1.1% from March 31, 2025;Net interest income totaled
$35.9 million , an increase of$1.3 million , or3.8% compared to the prior quarter, and an increase of$5.8 million , or19.2% compared to the prior year quarter;Net interest margin increased 15 basis points to
3.07% for the first quarter of 2026, compared to2.92% for the prior quarter and increased 39 basis points compared to the prior year quarter;Nonperforming loans ("NPLs") decreased significantly by
$220.0 million to$24.0 million at March 31, 2026 compared to December 31, 2025 due to the Transaction. NPLs to total portfolio loans were0.64% at March 31, 2026,6.29% at December 31, 2025 and7.09% at March 31, 2025;The allowance for credit losses to total portfolio loans was
1.41% at March 31, 2026, compared to1.84% at December 31, 2025 and1.99% at March 31, 2025, primarily reflecting the release of specific reserves of$18.0 million related to the Loans; andThe efficiency ratio was
29.01% for the quarter ended March 31, 2026, compared to77.84% and75.71% for the quarters ended December 31, 2025 and March 31, 2025, respectively. The improvement was primarily driven by the gain on the Transaction, which increased noninterest income for the quarter. The adjusted efficiency ratio (non-GAAP)5 was72.66% ,76.85% , and78.67% for the quarters ended March 31, 2026, December 31, 2025 and March 31, 2025, respectively.
"We are very pleased to report the successful resolution of our largest nonperforming credit relationship during the first quarter of 2026," stated Litz H. Van Dyke, Chief Executive Officer. "This Transaction meaningfully strengthened our balance sheet and favorably increased tangible book value by
Van Dyke added, "We continued to deliver strong operating performance during the quarter, highlighted by margin expansion and solid loan growth across our footprint. Annualized loan growth of
Operating Highlights
Credit Quality
Credit quality metrics for the quarter were favorably impacted by the Transaction, driving meaningful improvements in nonperforming assets and overall credit quality trends.
During the quarter, the Company recognized a recovery for credit losses of
At March 31, 2026, nonperforming assets declined to
The allowance for credit losses to total portfolio loans was
The Company recognized net recoveries of
Excluding the impact of the Transaction, underlying credit quality trends remained relatively stable during the first quarter of 2026.
Net Interest Income and Margin
Net interest income (GAAP) for the quarter ended March 31, 2026 totaled
The linked-quarter increase in net interest income, on an FTE basis4 (non-GAAP) was primarily driven by a 12 basis point decline in funding costs and a six basis point increase in the yield on average interest-earning assets. The year-over-year increase was attributable to a 41 basis point decline in funding costs and a seven basis point increase in average interest-earning assets yields.
Net interest income during the first quarter of 2026 benefited from lower rates paid on average interest-bearing liabilities and higher average loan balances compared to both the prior quarter and the prior year quarter. These positive impacts were partially offset by declines in both average balances of and yields on investment securities.
Net interest margin was
During the first quarter of 2026, interest-bearing funding costs declined compared to both the prior quarter and prior year quarter, primarily due to continued reductions in funding costs, as well as stabilization in deposit pricing, partially reflecting the broader interest rate environment.
Noninterest Income
Noninterest income for the quarter ended March 31, 2026 totaled
Compared to the quarter ended March 31, 2025, insurance commissions increased
Noninterest Expense
Noninterest expense for the quarter ended March 31, 2026 totaled
Compared to the prior quarter, the quarter reflected several changes across expense categories. Salaries and employee benefits decreased
Compared to the quarter ended March 31, 2025, salaries and employee benefits increased
The increase in salaries and employee benefits was primarily driven by higher incentive compensation, increased medical costs and annual merit increases, partially offset by higher deferred costs on loan originations. Other noninterest expense increased primarily due to the aforementioned
Financial Condition
Total assets decreased
The allowance for credit losses decreased
On the funding side, FHLB borrowings decreased
At March 31, 2026, approximately
Capitalization and Liquidity
The Company maintained a strong capital and liquidity position at March 31, 2026. Capital levels increased significantly and continued to exceed all applicable regulatory requirements, supported by earnings for the quarter and the impact of the Transaction. The Company remained well capitalized at March 31, 2026.
The Company's Tier 1 capital ratio was
The Company did not repurchase any shares under the current repurchase plan during the three months ended March 31, 2026.
The Transaction also resulted in an increase in book value per share and tangible book value of
At March 31, 2026, funding sources accessible to the Company included borrowing availability at the FHLB equal to
In addition to these funding sources, the Company had
About Carter Bankshares, Inc.
Headquartered in Martinsville, VA, Carter Bankshares, Inc. (NASDAQ:CARE) provides a full range of commercial banking, consumer banking, mortgage and services through its subsidiary Carter Bank. The Company has
Important Note Regarding Non-GAAP Financial Measures
In addition to results presented in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), management uses, and this press release contains or references, certain non-GAAP financial measures, including pre-tax pre-provision income, adjusted net income, adjusted earnings per common share (diluted), tangible book value, adjusted noninterest expense, adjusted efficiency ratio, and interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on a fully taxable equivalent ("FTE") basis. These non-GAAP measures should be read along with the accompanying tables in our definitions and reconciliation of GAAP to non-GAAP financial measures.
Management believes these non-GAAP financial measures are useful because they enhance the ability of investors and management to evaluate and compare the Company's operating results across periods in a meaningful manner. These measures also assist in assessing the Company's underlying operating performance and performance trends and facilitate comparisons with other financial services companies.
The Company believes that presenting interest and dividend income, yield on interest-earning assets, net interest income and net interest margin on an FTE basis improves comparability between income derived from taxable and tax-exempt sources and is consistent with industry practice.
While management believes these non-GAAP measures provide meaningful supplemental information, they should not be considered as an alternative to GAAP results, as more relevant than financial results prepared in accordance with GAAP, or as necessarily comparable to similarly titled non-GAAP measures used by other companies. Non-GAAP financial measures have limitations as analytical tools, and should not be considered in isolation or as a substitute for an analysis of the Company's financial condition or results of operations as reported under GAAP. Investors are encouraged to review the Company's GAAP financial results and all other relevant information when evaluating its performance and financial condition.
Important Note Regarding Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements made in Mr. Van Dyke's quotations and may include statements relating to our financial condition, market conditions, results of operations, plans, including our strategic plan, brand strategy, and guiding principles and the anticipated results of the foregoing, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, loan pipeline and nonaccrual and nonperforming loans. Forward looking statements are typically identified by words or phrases such as "will likely result," "expect," "anticipate," "estimate," "forecast," "project," "intend," "believe," "assume," "strategy," "trend," "plan," "outlook," "outcome," "continue," "remain," "potential," "opportunity," "comfortable," "current," "position," "maintain," "sustain," "seek," "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may.
These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and often are beyond the Company's control. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. Actual results may differ significantly from those expressed in or implied by these forward-looking statements. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements including, but not limited to the effects of:
market interest rates and the impacts of market interest rates on economic conditions, customer behavior, and the Company's net interest margin, net interest income, funding costs and its deposit, loan and securities portfolios;
inflation, market and monetary fluctuations;
changes in trade policies, tariffs, monetary and fiscal policies and laws of the U.S. government and the related impacts on economic conditions and financial markets, and changes in policies of the Federal Reserve, FDIC and U.S. Department of the Treasury;
changes in accounting policies, practices, or guidance, for example, our adoption of Current Expected Credit Losses ("CECL") methodology, including potential volatility in the Company's operating results due to application of the CECL methodology;
cyber-security threats, attacks or events;
rapid technological developments and changes, including emerging issues related to the development and use of artificial intelligence that could give rise to legal or regulatory action or increase cybersecurity threats;
our ability to resolve our nonperforming assets and our ability to secure collateral on loans that have entered nonaccrual status due to loan maturities and failure to pay in full;
changes in the Company's liquidity and capital positions;
concentrations of loans secured by real estate, particularly commercial real estate ("CRE") loans, and the potential impacts of changes in market conditions on the value of real estate collateral;
increased delinquency and foreclosure rates on CRE loans;
an insufficient allowance for credit losses;
the potential adverse effects of unusual and infrequently occurring events, such as weather-related disasters, terrorist acts, war and other geopolitical conflicts or public health events (such as pandemics), and of any governmental and societal responses thereto; these potential adverse effects may include, without limitation, adverse effects on macroeconomic conditions, the ability of the Company's borrowers to satisfy their obligations to the Company, on the value of collateral securing loans, on the demand for the Company's loans or its other products and services, on incidents of cyberattack and fraud, on the Company's liquidity or capital positions, on risks posed by reliance on third-party service providers, on other aspects of the Company's business operations and on financial markets and economic growth;
a change in spreads on interest-earning assets and interest-bearing liabilities;
regulatory supervision and oversight, including our relationship with regulators and any actions that may be initiated by our regulators;
legislation affecting the financial services industry as a whole, and the Company and the Bank, in particular and changes impacting the rulemaking, supervision, examination and enforcement priorities of the federal banking agencies;
the outcome of pending and future litigation and/or governmental proceedings;
increasing price and product/service competition;
the ability to continue to introduce competitive new products and services on a timely, cost-effective basis;
managing our internal growth and acquisitions;
the possibility that the anticipated benefits from acquisitions cannot be fully realized in a timely manner or at all, or that integrating acquired operations will be more difficult, disruptive or more costly than anticipated;
the soundness of other financial institutions and any indirect exposure related to large bank failures and their impact on the broader market through other customers, suppliers and partners or that the conditions which resulted in the liquidity concerns with those failed banks may also adversely impact, directly or indirectly, other financial institutions and market participants with which the Company has commercial or deposit relationships with;
material increases in costs and expenses;
reliance on significant customer relationships;
general economic or business conditions, including unemployment levels, supply chain disruptions, slowdowns in economic growth, government shutdowns and geopolitical instability and tensions;
significant weakening of the local economies in which we operate;
changes in customer behaviors, including consumer spending, borrowing and saving habits;
changes in deposit flows and loan demand;
our failure to attract or retain key associates;
expansions or consolidations in the Company's branch network, including that the anticipated benefits of the Company's branch acquisitions or the Company's branch network optimization project are not fully realized in a timely manner or at all;
deterioration of the housing market and reduced demand for mortgages; and
re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses.
Many of these factors, as well as other factors, are described in our filings with the Securities and Exchange Commission, including in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2025. All risk factors and uncertainties described herein and therein should be considered in evaluating the Company's forward-looking statements. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events are expressed in or implied by a forward-looking statement may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update, revise or clarify any forward-looking statement to reflect developments occurring after the statement is made, except as required by law.
Carter Bankshares, Inc.
investorrelations@carterbank.com
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
BALANCE SHEETS
March 31, | December 31, | March 31, | ||||||||||
(Dollars in Thousands, except share data) | (unaudited) | (audited) | (unaudited) | |||||||||
ASSETS |
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|
| |||||||||
Cash and Due From Banks, including Interest-Bearing Deposits of | $ | 228,318 | $ | 105,163 | $ | 88,999 | ||||||
Securities Available-for-Sale, at Fair Value (amortized cost of | 662,127 | 691,612 | 745,390 | |||||||||
Equity Securities | 10,246 | 10,291 | 10,178 | |||||||||
Loans Held-for-Sale | 341 | 339 | - | |||||||||
Portfolio Loans | 3,728,461 | 3,879,560 | 3,687,495 | |||||||||
Allowance for Credit Losses | (52,503 | ) | (71,491 | ) | (73,518 | ) | ||||||
Portfolio Loans, net | 3,675,958 | 3,808,069 | 3,613,977 | |||||||||
Bank Premises and Equipment, net | 70,968 | 72,497 | 73,944 | |||||||||
Goodwill | 1,193 | 1,193 | - | |||||||||
Core Deposit Intangible | 874 | 940 | - | |||||||||
Other Real Estate Owned, net | 3,443 | 142 | 577 | |||||||||
Other Restricted Stock, at Cost | 8,476 | 16,830 | 5,875 | |||||||||
Bank Owned Life Insurance | 45,247 | 44,811 | 48,224 | |||||||||
Other Assets | 92,079 | 100,035 | 113,123 | |||||||||
Total Assets | $ | 4,799,270 | $ | 4,851,922 | $ | 4,700,287 | ||||||
LIABILITIES | ||||||||||||
Deposits: | ||||||||||||
Noninterest-Bearing Demand | $ | 637,933 | $ | 620,473 | $ | 631,714 | ||||||
Interest-Bearing Demand | 871,398 | 808,171 | 794,059 | |||||||||
Money Market | 514,362 | 553,964 | 528,381 | |||||||||
Savings | 326,929 | 326,182 | 353,394 | |||||||||
Certificates of Deposit | 1,884,628 | 1,902,099 | 1,893,379 | |||||||||
Total Deposits | 4,235,250 | 4,210,889 | 4,200,927 | |||||||||
Federal Home Loan Bank Borrowings | - | 178,500 | 55,000 | |||||||||
Reserve for Unfunded Loan Commitments | 2,774 | 2,992 | 3,072 | |||||||||
Other Liabilities | 56,344 | 39,844 | 39,522 | |||||||||
Total Liabilities | 4,294,368 | 4,432,225 | 4,298,521 | |||||||||
SHAREHOLDERS' EQUITY | ||||||||||||
Common Stock, Par Value | ||||||||||||
Outstanding- 22,159,980 shares at March 31, 2026, 22,083,007 shares at December 31, 2025 and 23,161,993 shares at March 31, 2025 | 22,160 | 22,083 | 23,162 | |||||||||
Additional Paid-in Capital | 74,987 | 74,806 | 92,418 | |||||||||
Retained Earnings | 450,725 | 364,968 | 342,559 | |||||||||
Accumulated Other Comprehensive Loss | (42,970 | ) | (42,160 | ) | (56,373 | ) | ||||||
Total Shareholders' Equity | 504,902 | 419,697 | 401,766 | |||||||||
Total Liabilities and Shareholders' Equity | $ | 4,799,270 | $ | 4,851,922 | $ | 4,700,287 | ||||||
PERFORMANCE RATIOS | ||||||||||||
Return on Average Assets (QTD Annualized) | 7.13 | % | 0.70 | % | 0.78 | % | ||||||
Return on Average Assets (YTD Annualized) | 7.13 | % | 0.66 | % | 0.78 | % | ||||||
Return on Average Shareholders' Equity (QTD Annualized) | 80.05 | % | 8.12 | % | 9.27 | % | ||||||
Return on Average Shareholders' Equity (YTD Annualized) | 80.05 | % | 7.74 | % | 9.27 | % | ||||||
Portfolio Loans to Deposit Ratio | 88.03 | % | 92.13 | % | 87.78 | % | ||||||
Allowance for Credit Losses to Total Portfolio Loans | 1.41 | % | 1.84 | % | 1.99 | % | ||||||
CAPITALIZATION RATIOS | ||||||||||||
Shareholders' Equity to Assets | 10.52 | % | 8.65 | % | 8.55 | % | ||||||
Tier 1 Leverage Ratio | 11.10 | % | 9.43 | % | 9.67 | % | ||||||
Risk-Based Capital - Tier 1 | 13.52 | % | 10.70 | % | 11.01 | % | ||||||
Risk-Based Capital - Total | 14.78 | % | 11.95 | % | 12.27 | % | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
INCOME STATEMENTS
Quarter-to-Date | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
(Dollars in Thousands, except per share data) | (unaudited) | (audited) | (unaudited) | |||||||||
Interest Income | $ | 59,185 | $ | 59,298 | $ | 56,007 | ||||||
Interest Expense | 23,251 | 24,694 | 25,869 | |||||||||
NET INTEREST INCOME | 35,934 | 34,604 | 30,138 | |||||||||
Recovery for Credit Losses | (33,917 | ) | (2,178 | ) | (2,025 | ) | ||||||
Recovery for Unfunded Commitments | (218 | ) | (80 | ) | (114 | ) | ||||||
NET INTEREST INCOME AFTER RECOVERY FOR CREDIT LOSSES | 70,069 | 36,862 | 32,277 | |||||||||
NONINTEREST INCOME | ||||||||||||
Gain on the Transaction | 65,000 | - | - | |||||||||
Gains on Sales of Securities, net | 80 | 46 | - | |||||||||
Service Charges, Commissions and Fees | 2,128 | 1,813 | 1,874 | |||||||||
Debit Card Interchange Fees | 2,148 | 1,947 | 2,104 | |||||||||
Insurance Commissions | 954 | 666 | 344 | |||||||||
Bank Owned Life Insurance Income | 436 | 456 | 341 | |||||||||
Other | 228 | 297 | 2,238 | |||||||||
Total Noninterest Income | 70,974 | 5,225 | 6,901 | |||||||||
NONINTEREST EXPENSE | ||||||||||||
Salaries and Employee Benefits | 14,915 | 15,981 | 13,657 | |||||||||
Occupancy Expense, net | 4,861 | 4,336 | 4,472 | |||||||||
FDIC Insurance Expense | 1,510 | 1,527 | 1,430 | |||||||||
Other Taxes | 925 | 876 | 947 | |||||||||
Advertising Expense | 926 | 883 | 911 | |||||||||
Telephone Expense | 292 | 293 | 304 | |||||||||
Professional and Legal Fees | 1,546 | 1,874 | 1,230 | |||||||||
Data Processing | 1,853 | 1,492 | 1,444 | |||||||||
Debit Card Expense | 1,001 | 1,250 | 992 | |||||||||
Other | 3,183 | 2,492 | 2,655 | |||||||||
Total Noninterest Expense | 31,012 | 31,004 | 28,042 | |||||||||
Income Before Income Taxes | 110,031 | 11,083 | 11,136 | |||||||||
Income Tax Provision | 24,274 | 2,603 | 2,183 | |||||||||
Net Income | $ | 85,757 | $ | 8,480 | $ | 8,953 | ||||||
Shares Outstanding, at End of Period | 22,159,980 | 22,083,007 | 23,161,993 | |||||||||
Average Shares Outstanding - Basic & Diluted | 21,846,942 | 21,857,904 | 22,873,800 | |||||||||
PER SHARE DATA | ||||||||||||
Basic Earnings Per Common Share* | $ | 3.88 | $ | 0.38 | $ | 0.39 | ||||||
Diluted Earnings Per Common Share* | $ | 3.88 | $ | 0.38 | $ | 0.39 | ||||||
Book Value | $ | 22.78 | $ | 19.01 | $ | 17.35 | ||||||
Tangible Book Value3 | $ | 22.69 | $ | 18.91 | $ | 17.35 | ||||||
Market Value | $ | 23.32 | $ | 19.66 | $ | 16.18 | ||||||
PROFITABILITY RATIOS (GAAP) | ||||||||||||
Net Interest Margin | 3.07 | % | 2.92 | % | 2.68 | % | ||||||
Efficiency Ratio | 29.01 | % | 77.84 | % | 75.71 | % | ||||||
PROFITABILITY RATIOS (Non-GAAP) | ||||||||||||
Net Interest Margin (FTE)4 | 3.08 | % | 2.93 | % | 2.70 | % | ||||||
Adjusted Efficiency Ratio (Non-GAAP)5 | 72.66 | % | 76.85 | % | 78.67 | % | ||||||
*All outstanding unvested restricted stock awards are considered participating securities for the earnings per share calculation. As such, these shares have been allocated to a portion of net income (
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
NET INTEREST MARGIN (FTE) (QTD AVERAGES)
(Unaudited)
March 31, 2026 | December 31, 2025 | March 31, 2025 | ||||||||||||||||||||||||||||||||||
(Dollars in Thousands) | Average Balance | Income/ Expense | Rate | Average Balance | Income/ Expense | Rate | Average Balance | Income/ Expense | Rate | |||||||||||||||||||||||||||
ASSETS |
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Interest-Bearing Deposits with Banks | $ | 75,984 | $ | 693 | 3.70 | % | $ | 67,998 | $ | 697 | 4.07 | % | $ | 67,387 | $ | 748 | 4.50 | % | ||||||||||||||||||
Tax-Free Investment Securities4 | 11,503 | 83 | 2.93 | % | 11,543 | 83 | 2.85 | % | 11,662 | 84 | 2.92 | % | ||||||||||||||||||||||||
Taxable Investment Securities | 733,785 | 5,582 | 3.09 | % | 767,913 | 6,165 | 3.19 | % | 807,891 | 6,655 | 3.34 | % | ||||||||||||||||||||||||
Total Securities | 745,288 | 5,665 | 3.08 | % | 779,456 | 6,248 | 3.18 | % | 819,553 | 6,739 | 3.33 | % | ||||||||||||||||||||||||
Commercial Real Estate | 2,132,911 | 31,687 | 6.03 | % | 2,088,480 | 31,822 | 6.05 | % | 1,891,376 | 29,180 | 6.26 | % | ||||||||||||||||||||||||
Commercial & Industrial | 224,422 | 3,946 | 7.13 | % | 208,819 | 3,122 | 5.93 | % | 212,851 | 3,220 | 6.14 | % | ||||||||||||||||||||||||
Residential Mortgages | 829,413 | 8,728 | 4.27 | % | 828,866 | 9,076 | 4.34 | % | 811,508 | 8,499 | 4.25 | % | ||||||||||||||||||||||||
Other Consumer | 26,526 | 279 | 4.27 | % | 28,468 | 349 | 4.86 | % | 28,329 | 419 | 6.00 | % | ||||||||||||||||||||||||
Construction | 466,197 | 8,096 | 7.04 | % | 450,531 | 7,923 | 6.98 | % | 432,761 | 7,268 | 6.81 | % | ||||||||||||||||||||||||
Other | 231,620 | - | - | % | 240,527 | - | - | % | 283,839 | - | - | % | ||||||||||||||||||||||||
Total Loansa | 3,911,089 | 52,736 | 5.47 | % | 3,845,691 | 52,292 | 5.39 | % | 3,660,664 | 48,586 | 5.38 | % | ||||||||||||||||||||||||
Other Restricted Stock, at Cost | 15,969 | 245 | 6.22 | % | 13,772 | 220 | 6.34 | % | 6,499 | 112 | 6.99 | % | ||||||||||||||||||||||||
Total Interest-Earning Assets | 4,748,330 | 59,339 | 5.07 | % | 4,706,917 | 59,457 | 5.01 | % | 4,554,103 | 56,185 | 5.00 | % | ||||||||||||||||||||||||
Noninterest Earning Assets | 129,942 | 125,545 | 121,766 | |||||||||||||||||||||||||||||||||
Total Assets | $ | 4,878,272 | $ | 4,832,462 | $ | 4,675,869 | ||||||||||||||||||||||||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||||||
Interest-Bearing Demand | $ | 818,471 | $ | 2,709 | 1.34 | % | $ | 817,489 | $ | 3,046 | 1.48 | % | $ | 744,895 | $ | 3,386 | 1.84 | % | ||||||||||||||||||
Money Market | 567,093 | 2,975 | 2.13 | % | 547,874 | 3,198 | 2.32 | % | 525,463 | 3,319 | 2.56 | % | ||||||||||||||||||||||||
Savings | 327,138 | 111 | 0.14 | % | 329,663 | 107 | 0.13 | % | 355,123 | 113 | 0.13 | % | ||||||||||||||||||||||||
Certificates of Deposit | 1,897,557 | 15,760 | 3.37 | % | 1,907,556 | 16,726 | 3.48 | % | 1,918,195 | 18,205 | 3.85 | % | ||||||||||||||||||||||||
Total Interest-Bearing Deposits | 3,610,259 | 21,555 | 2.42 | % | 3,602,582 | 23,077 | 2.54 | % | 3,543,676 | 25,023 | 2.86 | % | ||||||||||||||||||||||||
Federal Home Loan Bank Borrowings | 160,033 | 1,556 | 3.94 | % | 144,402 | 1,476 | 4.06 | % | 69,833 | 702 | 4.08 | % | ||||||||||||||||||||||||
Federal Funds Purchased | - | - | - | % | 1 | - | - | % | - | - | - | % | ||||||||||||||||||||||||
Other Borrowings | 10,870 | 140 | 5.22 | % | 11,033 | 141 | 5.07 | % | 10,417 | 144 | 5.61 | % | ||||||||||||||||||||||||
Total Borrowings | 170,903 | 1,696 | 4.02 | % | 155,436 | 1,617 | 4.13 | % | 80,250 | 846 | 4.28 | % | ||||||||||||||||||||||||
Total Interest-Bearing Liabilities | 3,781,162 | 23,251 | 2.49 | % | 3,758,018 | 24,694 | 2.61 | % | 3,623,926 | 25,869 | 2.90 | % | ||||||||||||||||||||||||
Noninterest-Bearing Liabilities | 662,638 | 660,217 | 660,437 | |||||||||||||||||||||||||||||||||
Shareholders' Equity | 434,472 | 414,227 | 391,506 | |||||||||||||||||||||||||||||||||
Total Liabilities and Shareholders' Equity | $ | 4,878,272 | $ | 4,832,462 | $ | 4,675,869 | ||||||||||||||||||||||||||||||
Net Interest Income4 | $ | 36,088 | $ | 34,763 | $ | 30,316 | ||||||||||||||||||||||||||||||
Net Interest Margin4 | 3.08 | % | 2.93 | % | 2.70 | % | ||||||||||||||||||||||||||||||
a Nonaccruing loans are included in the daily average loan amounts outstanding.
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
LOANS AND LOANS HELD-FOR-SALE
(Unaudited)
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Commercial | ||||||||||||
Commercial Real Estate | $ | 2,127,928 | $ | 2,114,314 | $ | 1,915,863 | ||||||
Commercial and Industrial | 245,455 | 231,921 | 234,024 | |||||||||
Total Commercial Loans | 2,373,383 | 2,346,235 | 2,149,887 | |||||||||
Consumer | ||||||||||||
Residential Mortgages | 815,263 | 822,141 | 801,253 | |||||||||
Other Consumer | 26,264 | 28,416 | 28,804 | |||||||||
Total Consumer Loans | 841,527 | 850,557 | 830,057 | |||||||||
Construction | 513,551 | 465,613 | 459,285 | |||||||||
Other | - | 217,155 | 248,266 | |||||||||
Total Portfolio Loans | 3,728,461 | 3,879,560 | 3,687,495 | |||||||||
Loans Held-for-Sale | 341 | 339 | - | |||||||||
Total Loans | $ | 3,728,802 | $ | 3,879,899 | $ | 3,687,495 | ||||||
ASSET QUALITY DATA
(Unaudited)
For the Periods Ended | ||||||||||||
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Nonaccrual Loans | ||||||||||||
Commercial Real Estate | $ | 21,649 | $ | 23,861 | $ | 9,733 | ||||||
Commercial and Industrial | 91 | 1,013 | 1,070 | |||||||||
Residential Mortgages | 1,766 | 4,623 | 5,326 | |||||||||
Other Consumer | 28 | 25 | 38 | |||||||||
Construction | 437 | 440 | 213 | |||||||||
Other | - | 214,020 | 245,064 | |||||||||
Total Nonperforming Loans | 23,971 | 243,982 | 261,444 | |||||||||
Other Real Estate Owned | 3,443 | 142 | 577 | |||||||||
Total Nonperforming Assets | $ | 27,414 | $ | 244,124 | $ | 262,021 | ||||||
Nonperforming Loans to Total Portfolio Loans | 0.64 | % | 6.29 | % | 7.09 | % | ||||||
Nonperforming Assets to Total Portfolio Loans plus Other Real Estate Owned | 0.73 | % | 6.29 | % | 7.10 | % | ||||||
Allowance for Credit Losses to Total Portfolio Loans | 1.41 | % | 1.84 | % | 1.99 | % | ||||||
Allowance for Credit Losses to Nonperforming Loans | 219.03 | % | 29.30 | % | 28.12 | % | ||||||
Net Loan (Recoveries) / Charge-offs QTD | $ | (14,929 | ) | $ | 93 | $ | 57 | |||||
Net Loan (Recoveries) / Charge-offs YTD | $ | (14,929 | ) | $ | 472 | $ | 57 | |||||
Net Loan (Recoveries) / Charge-offs (Annualized) to Average Portfolio Loans QTD | (1.55 | )% | 0.01 | % | 0.01 | % | ||||||
Net Loan (Recoveries) / Charge-offs (Annualized) to Average Portfolio Loans YTD | (1.55 | )% | 0.01 | % | 0.01 | % | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
ALLOWANCE FOR CREDIT LOSSES
(Unaudited)
Quarter-to-Date | ||||||||||||
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Balance Beginning of Period | $ | 71,491 | $ | 73,762 | $ | 75,600 | ||||||
Recovery for Credit Losses | (33,917 | ) | (2,178 | ) | (2,025 | ) | ||||||
Charge-offs: | ||||||||||||
Commercial Real Estate | - | - | - | |||||||||
Commercial and Industrial | - | - | 7 | |||||||||
Residential Mortgages | - | - | - | |||||||||
Other Consumer | 138 | 164 | 171 | |||||||||
Construction | - | - | 1 | |||||||||
Other | - | - | - | |||||||||
Total Charge-offs | 138 | 164 | 179 | |||||||||
Recoveries: | ||||||||||||
Commercial Real Estate | - | - | - | |||||||||
Commercial and Industrial | - | - | 3 | |||||||||
Residential Mortgages | 2 | 2 | 8 | |||||||||
Other Consumer | 65 | 69 | 110 | |||||||||
Construction | - | - | 1 | |||||||||
Other | 15,000 | - | - | |||||||||
Total Recoveries | 15,067 | 71 | 122 | |||||||||
Total Net (Recoveries) / Charge-offs | (14,929 | ) | 93 | 57 | ||||||||
Balance End of Period | $ | 52,503 | $ | 71,491 | $ | 73,518 | ||||||
CARTER BANKSHARES, INC.
CONSOLIDATED SELECTED FINANCIAL DATA
DEFINITIONS AND RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES:
(Unaudited)
1 Pre-tax Pre-provision Income (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Net Interest Income | $ | 35,934 | $ | 34,604 | $ | 30,138 | ||||||
Noninterest Income | 70,974 | 5,225 | 6,901 | |||||||||
Noninterest Expense | 31,012 | 31,004 | 28,042 | |||||||||
Pre-tax Pre-provision Income (Non-GAAP) | $ | 75,896 | $ | 8,825 | $ | 8,997 | ||||||
2 Adjusted Net Income (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands, except per share data) | March 31, | December 31, | March 31, | |||||||||
Net Income | $ | 85,757 | $ | 8,480 | $ | 8,953 | ||||||
Gain on the Transaction | (65,000 | ) | - | - | ||||||||
Specific Reserves Released Related to the Transaction | (18,035 | ) | - | - | ||||||||
Net Recoveries Related to the Transaction | (15,000 | ) | - | - | ||||||||
Gains on Sales of Securities, net | (80 | ) | (46 | ) | - | |||||||
Equity Security Unrealized Fair Value Loss (Gain) | 45 | (22 | ) | (137 | ) | |||||||
Losses (Gains) on Sales and Write-downs of Bank Premises, net | 1 | 188 | (3 | ) | ||||||||
Losses (Gains) on Sales and Write-downs of OREO, net | 569 | (51 | ) | 81 | ||||||||
1035 Exchange fee on BOLI | - | 133 | 275 | |||||||||
Gain on BOLI death benefit6 | - | - | (1,882 | ) | ||||||||
FHLB Early Prepayment Credit | (130 | ) | - | - | ||||||||
Severance Pay | - | 55 | - | |||||||||
Total Tax Effect | 20,502 | (54 | ) | (45 | ) | |||||||
Modified Endowment Contract (MEC) | - | 121 | - | |||||||||
Tax Effect on BOLI Surrender | - | 254 | - | |||||||||
Adjusted Net Income (Non-GAAP) | $ | 8,629 | $ | 9,058 | $ | 7,242 | ||||||
Average Shares Outstanding - diluted | 21,846,942 | 21,857,904 | 22,873,800 | |||||||||
Adjusted Earnings Per Common Share (diluted) (Non-GAAP) | $ | 0.40 | $ | 0.41 | $ | 0.32 | ||||||
3 Tangible Book Value (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands, except per share data) | March 31, | December 31, | March 31, | |||||||||
Total Shareholders Equity | $ | 504,902 | $ | 419,697 | $ | 401,766 | ||||||
Less: goodwill and other intangible assets, net of deferred tax liability | (2,052 | ) | (2,122 | ) | - | |||||||
Tangible Shareholders' Equity (Non-GAAP) | 502,850 | 417,575 | 401,766 | |||||||||
Shares Outstanding | 22,159,980 | 22,083,007 | 23,161,993 | |||||||||
Tangible Book Value (Non-GAAP) | $ | 22.69 | $ | 18.91 | $ | 17.35 | ||||||
4 Net interest income has been computed on a fully taxable equivalent basis ("FTE") using
Net Interest Income (FTE) (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Interest and Dividend Income (GAAP) | $ | 59,185 | $ | 59,298 | $ | 56,007 | ||||||
Tax Equivalent Adjustment4 | 154 | 159 | 178 | |||||||||
Interest and Dividend Income (FTE) (Non-GAAP) | 59,339 | 59,457 | 56,185 | |||||||||
Average Earning Assets | $ | 4,748,330 | $ | 4,706,917 | $ | 4,554,103 | ||||||
Yield on Interest-earning Assets (GAAP) | 5.05 | % | 5.00 | % | 4.99 | % | ||||||
Yield on Interest-earning Assets (FTE) (Non-GAAP) | 5.07 | % | 5.01 | % | 5.00 | % | ||||||
Net Interest Income (GAAP) | $ | 35,934 | $ | 34,604 | $ | 30,138 | ||||||
Tax Equivalent Adjustment4 | 154 | 159 | 178 | |||||||||
Net Interest Income (FTE) (Non-GAAP) | 36,088 | 34,763 | 30,316 | |||||||||
Average Earning Assets | $ | 4,748,330 | $ | 4,706,917 | $ | 4,554,103 | ||||||
Net Interest Margin (GAAP) | 3.07 | % | 2.92 | % | 2.68 | % | ||||||
Net Interest Margin (FTE) (Non-GAAP) | 3.08 | % | 2.93 | % | 2.70 | % | ||||||
5Adjusted Efficiency Ratio (Non-GAAP) | Quarter-to-Date | |||||||||||
(Dollars in Thousands) | March 31, | December 31, | March 31, | |||||||||
Noninterest Expense | $ | 31,012 | $ | 31,004 | $ | 28,042 | ||||||
Less: (Losses) Gains on sales and write-downs of Branch Premises, net | (1 | ) | (188 | ) | 3 | |||||||
Less: (Losses) Gains on Sales and write-downs of OREO, net | (569 | ) | 51 | (81 | ) | |||||||
Less: 1035 Exchange fee on BOLI | - | (133 | ) | (275 | ) | |||||||
Less: Severance Pay | - | (55 | ) | - | ||||||||
Adjusted Noninterest Expense (Non-GAAP) | $ | 30,442 | $ | 30,679 | $ | 27,689 | ||||||
Net Interest Income | $ | 35,934 | $ | 34,604 | $ | 30,138 | ||||||
Plus: Taxable Equivalent Adjustment4 | 154 | 159 | 178 | |||||||||
Net Interest Income (FTE) (Non-GAAP) | $ | 36,088 | $ | 34,763 | $ | 30,316 | ||||||
Less: Gains on Sales of Securities, net | (80 | ) | (46 | ) | - | |||||||
Less: Equity Security Unrealized Fair Value Loss (Gain) | 45 | (22 | ) | (137 | ) | |||||||
Less: Gain on BOLI death benefit6 | - | - | (1,882 | ) | ||||||||
Less: Gain on the Transaction | (65,000 | ) | - | - | ||||||||
Less: FHLB Early Prepayment Credit | (130 | ) | - | - | ||||||||
Plus: Noninterest Income | 70,974 | 5,225 | 6,901 | |||||||||
Net Interest Income (FTE) (Non-GAAP) plus Adjusted Noninterest Income | $ | 41,897 | $ | 39,920 | $ | 35,198 | ||||||
Efficiency Ratio (GAAP) | 29.01 | % | 77.84 | % | 75.71 | % | ||||||
Adjusted Efficiency Ratio (Non-GAAP) | 72.66 | % | 76.85 | % | 78.67 | % | ||||||
6The Gain on BOLI death benefit is tax-exempt. | ||||||||||||
7Annualized Loan Growth (Non-GAAP) | Quarter-to-Date | |||||||
(Dollars in Thousands) | March 31, | December 31, | ||||||
Portfolio Loans | $ | 3,728,461 | $ | 3,879,560 | ||||
Less: Loans Related to the Transaction | (209,484 | ) | ||||||
Adjusted Loans (Non-GAAP) | $ | 3,937,945 | ||||||
Annualized Portfolio Loan Growth (GAAP) | (15.80 | )% | ||||||
Annualized Loan Growth (Non-GAAP) in % | 6.10 | % | ||||||
SOURCE: Carter Bankshares, Inc.
View the original press release on ACCESS Newswire