Lake Shore Bancorp (NASDAQ: LSBK) reported unaudited net income of $2.2 million, or $0.29 per diluted share, for Q2 2026, up 13.2% from $1.9 million a year earlier. First-half 2026 net income rose to $4.1 million, or $0.56 per diluted share, a 37.7% increase year over year, according to the company.
Net interest income grew 12.6% year over year in the quarter and 17.0% for the first half, lifting net interest margin to 4.06% in Q2 2026 from 3.84% in Q2 2025. The efficiency ratio improved to 63.77%, annualized return on average assets reached 1.19%, and book value per share increased to $18.41 at June 30, 2026. Non-performing assets fell to 0.20% of total assets, while the bank remained "well capitalized" with a 17.43% Tier 1 leverage ratio and 24.04% total risk-based capital ratio.
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Positive
Net income up 13.2% YoY in Q2 2026 to $2.2 million
First-half 2026 net income up 37.7% YoY to $4.1 million
Net interest income up 12.6% YoY in Q2 and 17.0% YTD
Net interest margin increased to 4.06% in Q2 2026 from 3.84% a year ago
Efficiency ratio improved to 63.77% in Q2 2026 from 66.82% a year earlier
Non-performing assets ratio declined to 0.20% of total assets
Tier 1 leverage 17.43% and total risk-based capital 24.04% at June 30, 2026
Negative
Non-interest income down 6.4% YoY in Q2 2026 to $749,000
Non-interest income down 4.7% YoY for first half 2026 to $1.5 million
Non-interest expense up 5.4% YoY in Q2 2026 to $4.9 million
Non-interest expense up 5.2% YoY for first half 2026 to $10.0 million
Income tax expense up 26.2% YoY in Q2 2026 to $477,000
Income tax expense up 55.0% YoY for first half 2026 to $907,000
News Explained
At June 30, 2026, cash, deposits, and equity had all increased from year-end, while dividends partly offset first-half earnings.
Lake Shore reported unaudited second-quarter 2026 results; at June 30, 2026, cash, deposits, and stockholders’ equity were all above their December 31, 2025 levels.
The reported balances were $72.2 million in cash and equivalents, $578.2 million in deposits, $144.8 million in stockholders’ equity, and $558.3 million in net loans receivable.
First-half net income of $4.1 million was partly offset by $1.3 million of dividends declared and paid, while equity increased to $144.8 million; the disclosure therefore links the equity increase to earnings after distributions.
Credit-loss reserves moved in different directions: the allowance for loan losses fell to $4.7 million from $4.9 million at year-end, while the allowance for unfunded commitments rose to $495,000 from $361,000.
News Market Reaction – LSBK
+0.06%
+0.06%Session close to close
In the Jul 23 session, LSBK gained 0.06%, reflecting a mild positive market reaction.
Earnings history showed both alignment and divergence, including news_id 1044097 at -0.56%. Against ...
Analysis
Earnings history showed both alignment and divergence, including news_id 1044097 at -0.56%. Against that record, the release’s improved margin and credit metrics warrant attention, while low short positioning limits a short-interest explanation.
Key Figures
Q2 net income:$2.2 millionDiluted EPS:$0.29 per diluted shareFirst-half net income:$4.1 million+5 more
8 metrics
Q2 net income$2.2 millionSecond quarter 2026; up 13.2% year over year
Diluted EPS$0.29 per diluted shareSecond quarter 2026; compared with $0.25 in Q2 2025
First-half net income$4.1 millionFirst six months of 2026; up 37.7% year over year
Net interest income$6.9 millionSecond quarter 2026; up 12.6% year over year
Net interest margin4.06%Second quarter 2026; compared with 3.84% in Q2 2025
Efficiency ratio63.77%Quarter ended June 30, 2026; improved from 66.82% in Q2 2025
Book value per share$18.41 per shareAt June 30, 2026; compared with $18.10 at December 31, 2025
Non-performing assets0.20%As a percentage of total assets at June 30, 2026
Net income increased alongside margin expansion and lower non-interest expense.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Pattern Detected
Tag-specific earnings reactions aligned with the positive announcement in three of five events and diverged in two.
Key Terms
net interest margin, efficiency ratio, non-performing assets, tier 1 leverage ratio, +1 more
5 terms
net interest marginfinancial
"Annualized net interest margin was 4.06% for the second quarter of 2026"
Net interest margin measures how much a bank earns from lending and investing compared with what it pays for funding, expressed as a percentage of its interest-earning assets. Think of it like a grocery store’s markup: it shows the gap between buying cost and selling price per dollar of goods — here, the cost is interest paid and the sale is interest received. Investors watch it because a higher margin usually means a bank is more profitable and better at managing interest rate and credit conditions.
efficiency ratiofinancial
"Efficiency ratio improved to 63.77% for the quarter ended June 30, 2026"
A measure of how much a company spends to produce each dollar of revenue, usually shown as operating expenses divided by revenue and expressed as a percentage. Think of it as a household’s budget: a lower percentage means more of each dollar earned stays as profit, while a higher number means costs are eating into returns. Investors use it to judge cost control and compare how efficiently companies turn revenue into earnings, especially in banks and financial firms.
non-performing assetsfinancial
"Non-performing assets as a percentage of total assets decreased to 0.20%"
Loans or other credit exposures that are not producing expected income because borrowers have stopped making scheduled payments for a significant period (commonly around 90 days). Think of it like a business lending money that has gone quiet — the cash flow stops while the lender still carries the debt on its books. High levels of non-performing assets matter to investors because they reduce a lender’s earnings, tie up capital that could be used for growth, and signal higher risk of future losses.
tier 1 leverage ratioregulatory
"with a Tier 1 Leverage ratio of 17.43%"
Tier 1 leverage ratio measures a bank’s core capital — the money that can absorb losses — as a share of its total assets, showing how much of its balance sheet is funded by real loss-absorbing capital rather than borrowed money. Investors use it like a safety gauge: a higher ratio means a bigger cushion against shocks and lower risk of insolvency, similar to how a thicker spare tire reduces the chance of being stranded.
total risk-based capital ratioregulatory
"and a Total Risk-Based Capital ratio of 24.04%"
The total risk-based capital ratio measures a financial firm's cushion against losses by comparing its available capital to its assets after those assets are adjusted for how risky they are. Think of it as the size of a safety net relative to the weight of everything being balanced on it: the bigger the ratio, the more able the firm is to absorb bad outcomes without defaulting or needing help. Investors watch this number because it signals regulatory strength, solvency, and how much room the firm has to pay dividends, lend or grow safely.
DUNKIRK, N.Y., July 22, 2026 (GLOBE NEWSWIRE) -- Lake Shore Bancorp, Inc. (the “Company”) (NASDAQ: LSBK), the holding company for Lake Shore Bank (the “Bank”), reported unaudited net income of $2.2 million, or $0.29 per diluted share, for the second quarter of 2026 compared to net income of $1.9 million, or $0.25 per diluted share, for the second quarter of 2025.For the first six months of 2026, the Company reported unaudited net income of $4.1 million, or $0.56 per diluted share, as compared to $3.0 million, or $0.39 per diluted share, for the first six months of 2025. The Company's financial performance for the second quarter of 2026 was positively impacted primarily by higher net interest income.
"I am pleased with our second quarter results, which reflect disciplined expense management, improved net interest income, and our team’s focused execution of strategic initiatives,” stated Kim C. Liddell, President, CEO, and Director. “These results provide a strong foundation as we continue serving our customers, communities, and shareholders."
Second Quarter 2026 and Year-to-Date Financial Highlights:
Net income increased to $2.2 million during the second quarter of 2026, an increase of $254,000, or 13.2%, when compared to the second quarter of 2025. Net income was positively impacted by an increase in net interest income of $771,000, or 12.6%, when compared to the second quarter of 2025;
Net income increased to $4.1 million during the first half of 2026, an increase of $1.1 million, or 37.7%, when compared to the first half of 2025. Net income was positively impacted by an increase in net interest income of $2.0 million, or 17.0%, when compared to the first half of 2025;
Net interest margin increased to 4.06% during the second quarter of 2026, an increase of four basis points when compared to net interest margin of 4.02% during the first quarter of 2026 and an increase of 22 basis points when compared to net interest margin of 3.84% during the second quarter of 2025;
Efficiency ratio improved to 63.77% for the quarter ended June 30, 2026, a decrease of 5.81% as compared to 69.58% for the quarter ended March 31, 2026 and a decrease of 3.05% when compared to 66.82% for the quarter ended June 30, 2025;
Annualized return on average assets increased to 1.19% for the quarter ended June 30, 2026, an increase of 12 basis points as compared to 1.07% for the quarter ended March 31, 2026, and an increase of eight basis points when compared to 1.11% for the quarter ended June 30, 2025;
Book value per share increased 1.7% to $18.41 per share at June 30, 2026, as compared to $18.10 per share at December 31, 2025;
Non-performing assets as a percentage of total assets decreased to 0.20% at June 30, 2026, as compared to 0.23% at December 31, 2025;and
The Bank's capital position remains "well capitalized" with a Tier 1 Leverage ratio of 17.43% and a Total Risk-Based Capital ratio of 24.04% at June 30, 2026.
Net Interest Income
Net interest income for the second quarter of 2026 increased by $233,000, or 3.5%, to $6.9 million as compared to $6.7 million for the first quarter of 2026 and increased $771,000, or 12.6%, as compared to $6.1 million for the second quarter of 2025. Annualized net interest margin was 4.06% for the second quarter of 2026, as compared to 4.02% for the first quarter of 2026 and 3.84% for the second quarter of 2025.
Net interest income for the first half of 2026 increased $2.0 million, or 17.0%, to $13.6 million as compared to $11.6 million for the first half of 2025. Annualized net interest margin was 4.04% for the first half of 2026, as compared to 3.67% for the first half of 2025.
Interest income for the second quarter of 2026 was $9.4 million, an increase of $333,000, or 3.7%, compared to $9.1 million for the first quarter of 2026, and an increase of $281,000, or 3.1%, compared to $9.1 million for the second quarter of 2025. Interest income was $18.4 million for the first six months of 2026, an increase of $1.0 million, or 5.5%, when compared to $17.5 million for the first six months of 2025.
The increase in interest income from the prior quarter was primarily due to a six basis point increase in the average yield on interest-earning assets and a $16.7 million, or 2.5%, increase in the average balance of interest-earning assets. Interest earned on loans increased by $232,000, or 2.8%, due to an eight basis point increase in the average yield on loans and an $8.1 million, or 1.5%, increase in the average balance of loans. Interest earned on interest-earning deposits increased by $107,000, or 22.8%, due to a $10.7 million, or 19.9%, increase in the average balance of interest-earning deposits and a nine basis point increase in the average yield earned on interest-earning deposits.
The increase in interest income from the prior year quarter was primarily due to a $42.0 million, or 6.6%, increase in the average balance of interest-earning assets, partially offset by a 19 basis point decrease in the average yield on interest-earning assets. During the second quarter of 2026 as compared to the same period in 2025, there was a $306,000, or 113.3%, increase in interest income on interest-earning deposits due to a $37.6 million increase in the average balance of interest-earning deposits. This increase was partially offset by a 42 basis point decrease in the average yield on interest-earning deposits.
Interest income for the first half of 2026 was $18.4 million, an increase of $968,000, or 5.5%, compared to $17.5 million, for the first half of 2025. This increase was primarily due to an increase in the average balance of interest-earning assets of $38.7 million, or 6.1%, when compared to the previous year period. Interest earned on interest-earning deposits increased by $541,000, or 107.3%, primarily due to a $34.1 million, or 134.4%, increase in the average balance of interest-earning deposits. Interest earned on loans increased by $474,000, or 2.9%, due to an increase in the average balance of loans of $5.6 million, or 1.0%, along with an 11 basis points increase in the average yield earned on loans.
Interest expense for the second quarter of 2026 was $2.5 million, an increase of $100,000, or 4.2%, from $2.4 million in the first quarter of 2026, and a decrease of $490,000, or 16.4%, from $3.0 million for the second quarter of 2025. Interest expense for the first six months of 2026 was $4.9 million, a decrease of $1.0 million, or 16.9%, from $5.9 million for the first six months of 2025.
The increase in interest expense when compared to the previous quarter was primarily due to an increase in the average balance of interest-bearing liabilities of $11.6 million, or 2.5%, along with an increase in the average interest rate paid on interest-bearing liabilities of three basis points. During the second quarter of 2026, as compared to the previous quarter, interest expense on deposits increased by $100,000, or 4.2%, due to a $10.9 million, or 2.3% increase in the average balance of interest-bearing deposits and a three basis point increase in the average interest rate paid on interest-bearing deposit accounts. The increase in interest paid on interest-bearing deposit accounts was impacted by a $12.7 million, or 6.4%, increase in the average balance of time deposits, partially offset by a $2.4 million, or 1.5%, decrease in the average balance of money market accounts. The average interest rate paid on deposit accounts increased three basis points during the second quarter of 2026, when compared to the previous quarter primarily due to a two basis point increase in the average interest rate paid on money market accounts.
The decrease in interest expense when compared to the prior year quarter was primarily due to a 33 basis points decrease in average interest rate paid on interest-bearing liabilities and a $15.1 million, or 3.0%, decrease in the average balance of interest-bearing liabilities. During the second quarter of 2026 as compared to the same period in 2025, interest expense on deposits decreased by $476,000, or 16.1%, due to a 33 basis points decrease in the average interest rate paid on interest-bearing deposit accounts and a $14.3 million, or 2.9%, decrease in the average balance of interest-bearing deposits. The decrease in the average interest rate paid on deposit accounts was primarily due to the decrease in market interest rates, time deposit repricing, and a marginal shift in deposit composition. Average interest-bearing deposit balances decreased 2.9% during the second quarter of 2026 when compared to the second quarter of 2025 due to a decrease in all deposit categories except money market accounts.
Interest expense for the first half of 2026 was $4.9 million, a decrease of $997,000, or 16.9%, from $5.9 million for the first half of 2025. The decrease in interest expense was primarily due to a 35 basis points decrease in average interest rate paid on interest-bearing liabilities and a decrease in the average balance of interest-bearing liabilities of $14.3 million, or 2.9%. During the first half of 2026, there was a $946,000 decrease in interest expense on interest-bearing deposit accounts when compared to the first half of 2025 due to a 33 basis points decrease in the average interest rate paid on interest-bearing deposits along with a decrease in the average balance of interest-bearing deposits of $12.0 million, or 2.5%. The decrease in the average interest rate paid on deposit accounts was primarily due to the decrease in market interest rates, time deposit repricing, and a marginal shift in deposit composition.
Non-Interest Income
Non-interest income was $749,000 for the second quarter of 2026, an increase of $46,000, or 6.5%, as compared to $703,000 for the first quarter of 2026, and a decrease of $51,000, or 6.4%, as compared to $800,000 for the second quarter of 2025. The increase from the prior quarter was primarily due to a $22,000 increase in service charges and fees and a $16,000 increase in debit card fees. The decrease from the prior year quarter was primarily due to a $65,000 decrease in gain on equity securities that were held in the prior year, partially offset by a $28,000 increase in earnings on bank-owned life insurance.
Non-interest income was $1.5 million for the first half of 2026, a decrease of $72,000, or 4.7%, as compared to the first half of 2025. The decrease was primarily due to a $111,000 decrease in gain on equity securities that were held in the prior year and a $14,000 decrease in earnings on annuity assets, partially offset by a $53,000 increase in earnings on bank-owned life insurance and a $12,000 increase in service charges and fees.
Non-Interest Expense
Non-interest expense was $4.9 million for the second quarter of 2026, a decrease of $250,000, or 4.9%, as compared to $5.1 million for the first quarter of 2026, and an increase of $248,000, or 5.4%, as compared to $4.6 million for the second quarter of 2025. The decrease from the prior quarter was primarily due to a decrease in salaries and employee benefits of $216,000, or 6.5%, along with decreases in occupancy and equipment of $77,000, or 10.7%, partially offset by an increase in data processing costs of $65,000, or 18.0%. The increase from the second quarter of 2025 was primarily related to an increase in the cost of health insurance, taxes, and other non-salary benefits of $236,000, or 8.3%, and an increase in occupancy and equipment of $27,000, or 4.4%, partially offset by a decrease in data processing of $31,000, or 6.8%.
Non-interest expense was $10.0 million for the first half of 2026, an increase of $493,000, or 5.2%, as compared to $9.5 million for the first half of 2025. The increase related primarily to an increase in the cost of health insurance, taxes, and other non-salary benefits of $628,000, or 10.9%, partially offset by a decrease in data processing costs of $130,000, or 14.2% and professional services of $37,000, or 6.5%, as a result of management's efforts to optimize operating expenses.
Income Tax Expense
Income tax expense was $477,000 for the second quarter of 2026, an increase of $47,000, or 10.9%, as compared to $430,000 for the first quarter of 2026, and an increase of $99,000, or 26.2%, as compared to $378,000 for the second quarter of 2025. The effective tax rate was 18.0% for the second quarter of 2026 as compared to 18.3% for the first quarter of 2026 and 16.5% for the second quarter of 2025. The increase in income tax expense from the prior quarter and prior year quarter was primarily related to the increase in pre-tax income earned during the current quarter. The increase from the prior year quarter was also due to an increase in the effective tax rate, which was primarily due to an increase in taxable income earned during the second quarter of 2026.
Income tax expense was $907,000 for the first half of 2026, an increase of $322,000, or 55.0%, as compared to $585,000 for the first half of 2025. The effective tax rate was 18.1% for the first half of 2026 and 16.4% for the first half of 2025. The increase in income tax expense from the first half of 2025 was primarily related to the increase in pre-tax income earned during the first half of 2026. The increase in the effective tax rate during the first half of 2026 was primarily due to an increase in taxable income earned during the first half of 2026.
Credit Quality
The Company’s allowance for credit losses on loans was $4.7 million as of June 30, 2026 as compared to $4.9 million as of December 31, 2025. The Company’s allowance for credit losses on unfunded commitments was $495,000 as of June 30, 2026 as compared to $361,000 as of December 31, 2025. Non-performing assets as a percent of total assets decreased to 0.20% at June 30, 2026 as compared to 0.23% at December 31, 2025, primarily due to a decrease in non-performing assets of $250,000, or 14.9%. The Company’s allowance for credit losses on loans as a percent of loans at amortized cost was 0.84% and 0.87% and its allowance for credit losses on loans as a percent of non-performing loans was 331.85% and 290.71% at June 30, 2026 and December 31, 2025, respectively.
The Company recorded $119,000 provision for credit losses during the second quarter of 2026 and recorded a net provision for credit losses of $5,000 for the first half of 2026. Of the amount recorded for the second quarter of 2026, $170,000 related to a provision recorded to the allowance for credit losses for unfunded commitments, and $51,000 related to a credit recorded to the allowance for credit losses on the loan portfolio. For the first half of 2026, $134,000 related to a provision recorded to the allowance for credit losses for unfunded commitments, and $137,000 related to a credit recorded to the allowance for credit losses on the loan portfolio, net of charge-offs and recoveries. The increase in the allowance for credit losses on unfunded commitments and the corresponding provision for credit losses recognized during the first half of 2026 was primarily the result of an increase in outstanding unfunded commitments between the periods. The decrease in the allowance for credit losses on the loan portfolio was primarily related to a decrease in the calculated reserve rates, including the expected quantitative losses inclusive of forecasted economic trends, and the qualitative factor loss rates related to economic factors. The decrease primarily related to the commercial real estate and residential mortgage loan pools, partially offset by an increase in the calculation of expected losses for the commercial loan pool.
Balance Sheet Summary
Total assets at June 30, 2026 were $736.7 million, a $9.3 million increase, or 1.3%, as compared to $727.3 million at December 31, 2025. Cash and cash equivalents increased by $8.0 million, or 12.4%, from $64.3 million at December 31, 2025 to $72.2 million at June 30, 2026. The increase in cash and cash equivalents was primarily due to an increase in deposits of $5.0 million, or 0.9%, partially offset by an increase in loans receivable of $2.9 million, or 0.5%. Securities available for sale were $53.6 million at June 30, 2026 as compared to $56.1 million at December 31, 2025 representing a decrease primarily due to a decrease in the market value of the portfolio and paydowns received during the first half of 2026. Net loans receivable at June 30, 2026 and December 31, 2025 were $558.3 million and $555.4 million, respectively. Total deposits at June 30, 2026 were $578.2 million, an increase of $5.0 million, or 0.9%, compared to $573.3 million at December 31, 2025. The Company's uninsured deposits as a percentage of total deposits were 10.9% and 11.3%, at June 30, 2026 and December 31, 2025, respectively.
Stockholders’ equity at June 30, 2026 was $144.8 million, a $3.1 million increase, or 2.2%, as compared to $141.6 million at December 31, 2025. The increase in stockholders’ equity was primarily attributed to net income of $4.1 million, partially offset by dividends declared and paid of $1.3 million during the first half of 2026.
About Lake Shore
Lake Shore Bancorp is the holding company of Lake Shore Bank, a New York chartered, community-oriented financial institution headquartered in Dunkirk, New York. The Bank has ten full-service branch locations in Western New York, including four in Chautauqua County and six in Erie County. The Bank offers a broad range of retail and commercial lending and deposit services. Lake Shore Bancorp’s common stock is traded on the NASDAQ Global Market as “LSBK”. Additional information about Lake Shore Bancorp is available at www.mylsbank.com.
Safe-Harbor
This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are based on current expectations, estimates and projections about the Company’s and the Bank’s industry, and management’s beliefs and assumptions. Words such as anticipates, expects, intends, plans, believes, estimates and variations of such words and expressions are intended to identify forward-looking statements. Such statements reflect management’s current views of future events and operations. These forward-looking statements are based on information currently available to the Company as of the date of this release. It is important to note that these forward-looking statements are not guarantees of future performance and involve and are subject to significant risks, contingencies, and uncertainties, many of which are difficult to predict and are generally beyond our control including, but not limited to, data loss or other security breaches, including a breach of our operational or security systems, policies or procedures, including cyber-attacks on us or on our third party vendors or service providers, economic conditions, the effect of changes in monetary and fiscal policy, inflation, tariffs, unanticipated changes in our liquidity position, climate change, public health issues, geopolitical conflict, increased unemployment, deterioration in the credit quality of the loan portfolio and/or the value of the collateral securing repayment of loans, reduction in the value of investment securities, the cost and ability to attract and retain key employees, regulatory or legal developments, tax policy changes, and our ability to implement and execute our business plan and strategy and expand our operations. These factors should be considered in evaluating forward looking statements and undue reliance should not be placed on such statements, as our financial performance could differ materially due to various risks or uncertainties. We do not undertake to publicly update or revise our forward-looking statements if future changes make it clear that any projected results expressed or implied therein will not be realized.
Source: Lake Shore Bancorp, Inc. Category: Financial
Investor Relations/Media Contact Kim C. Liddell President, CEO, and Director Lake Shore Bancorp, Inc. 31 East Fourth Street Dunkirk, New York 14048 (716) 366-4070 ext. 1012
Selected Financial Condition Data
June 30,
December 31,
2026
2025
(Unaudited)
(Dollars in thousands)
Total assets
$
736,652
$
727,323
Cash and cash equivalents
72,237
64,280
Securities available for sale, at fair value
53,567
56,138
Loans receivable, net
558,317
555,441
Deposits
578,240
573,277
Stockholders’ equity
144,761
141,639
Statements of Income
Three Months Ended
Six Months Ended
June 30,
June 30,
2026
2025
2026
2025
(Unaudited)
(Dollars in thousands, except per share amounts)
Interest income
$
9,388
$
9,107
$
18,442
$
17,474
Interest expense
2,495
2,985
4,890
5,887
Net interest income
6,893
6,122
13,552
11,587
Provision for credit losses
119
—
5
48
Net interest income after provision for credit losses
6,774
6,122
13,547
11,539
Total non-interest income
749
800
1,452
1,524
Total non-interest expense
4,873
4,625
9,996
9,503
Income before income taxes
2,650
2,297
5,003
3,560
Income tax expense
477
378
907
585
Net income
$
2,173
$
1,919
$
4,096
$
2,975
Basic and diluted earnings per share(1)
$
0.29
$
0.25
$
0.56
$
0.39
Dividends declared and paid per share(1)
$
0.09
$
—
$
0.18
$
0.13
Selected Financial Ratios
Return on average assets(2)
1.19
%
1.11
%
1.13
%
0.87
%
Return on average equity(2)
6.04
%
8.37
%
5.71
%
6.52
%
Average interest-earning assets to average interest-bearing liabilities
140.83
%
128.12
%
140.80
%
128.81
%
Interest rate spread(2)
3.46
%
3.32
%
3.44
%
3.13
%
Net interest margin(2)
4.06
%
3.84
%
4.04
%
3.67
%
Efficiency ratio
63.77
%
66.82
%
66.62
%
72.48
%
(1) Per share information reflects the effects of the Company's conversion and related stock offering for all periods presented, as applicable. (2) Annualized
Average Balance Sheets, Interest, and Rates (Quarterly Comparison)
For the Three Months Ended
For the Three Months Ended
June 30, 2026
June 30, 2025
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
(Unaudited)
(Dollars in thousands)
Interest-earning assets:
Interest-earning deposits
$
64,801
$
576
3.56
%
$
27,162
$
270
3.98
%
Securities(1)
54,910
348
2.54
%
56,222
368
2.62
%
Loans, including fees
559,192
8,464
6.05
%
553,550
8,469
6.12
%
Total interest-earning assets
678,903
$
9,388
5.53
%
636,934
$
9,107
5.72
%
Other assets
53,753
52,724
Total assets
$
732,656
$
689,658
Interest-bearing liabilities:
Demand & NOW accounts
$
63,572
$
14
0.09
%
$
64,337
$
15
0.09
%
Money market accounts
153,861
731
1.90
%
153,547
955
2.49
%
Savings accounts(3)
50,642
8
0.06
%
58,286
9
0.06
%
Time deposits
210,894
1,719
3.26
%
217,101
1,969
3.63
%
Total interest-bearing deposits
478,969
2,472
2.06
%
493,271
2,948
2.39
%
Borrowed funds & other interest-bearing liabilities
3,105
23
2.96
%
3,869
37
3.83
%
Total interest-bearing liabilities
482,074
$
2,495
2.07
%
497,140
$
2,985
2.40
%
Other non-interest bearing liabilities
106,759
100,826
Stockholders' equity
143,823
91,692
Total liabilities & stockholders' equity
$
732,656
$
689,658
Net interest income
$
6,893
$
6,122
Interest rate spread
3.46
%
3.32
%
Net interest margin
4.06
%
3.84
%
(1) The tax equivalent adjustment for bank qualified tax exempt municipal securities, using a federal statutory rate of 21%, results in rates of 2.92% and 3.03% for the three months ended June 30, 2026 and 2025, respectively. Yields above are not presented on a tax equivalent basis. (2) Annualized. (3) Included within savings accounts as of June 30, 2025 is $43.7 million of funds collected and held on deposit in a segregated account in connection with the Company's completed second-step conversion and stock offering. The average rate paid on these funds was 5 basis points and the collection of these funds resulted in a $3.8 million increase in the average balance of savings accounts during the three months ended June 30, 2025.
Average Balance Sheets, Interest, and Rates (Year-to-Date Comparison)
For the Six Months Ended
For the Six Months Ended
June 30, 2026
June 30, 2025
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
(Unaudited)
(Dollars in thousands)
Interest-earning assets:
Interest-earning deposits
$
59,461
$
1,045
3.51
%
$
25,372
$
504
3.97
%
Securities(1)
55,975
701
2.50
%
57,008
748
2.62
%
Loans, including fees
555,178
16,696
6.01
%
549,578
16,222
5.90
%
Total interest-earning assets
670,614
$
18,442
5.50
%
631,958
$
17,474
5.53
%
Other assets
53,542
52,193
Total assets
$
724,156
$
684,151
Interest-bearing liabilities
Demand & NOW accounts
$
62,982
$
29
0.09
%
$
63,565
$
30
0.09
%
Money market accounts
155,037
1,466
1.89
%
153,116
1,822
2.38
%
Savings accounts(3)
50,951
16
0.06
%
55,927
18
0.06
%
Time deposits
204,604
3,333
3.26
%
212,975
3,920
3.68
%
Total interest-bearing deposits
473,574
4,844
2.05
%
485,583
5,790
2.38
%
Borrowed funds & other interest-bearing liabilities
2,725
46
3.38
%
5,046
97
3.84
%
Total interest-bearing liabilities
476,299
$
4,890
2.05
%
490,629
$
5,887
2.40
%
Other non-interest bearing liabilities
104,401
102,202
Stockholders' equity
143,456
91,320
Total liabilities & stockholders' equity
$
724,156
$
684,151
Net interest income
$
13,552
$
11,587
Interest rate spread
3.45
%
3.13
%
Net interest margin
4.04
%
3.67
%
(1) The tax equivalent adjustment for bank qualified tax exempt municipal securities, using a federal statutory rate of 21%, results in rates of 2.88% and 3.03% for the six months ended June 30, 2026 and 2025, respectively. Yields above are not presented on a tax equivalent basis. (2) Annualized. (3) Included within savings accounts as of June 30, 2025 is $43.7 million of funds collected and held on deposit in a segregated account in connection with the Company's completed second step conversion and stock offering. The average rate paid on these funds was 5 basis points and the collection of these funds resulted in a $1.9 million increase in the average balance of savings accounts during the six months ended June 30, 2025.
Average Balance Sheets, Interest, and Rates (Prior Quarter Comparison)
For the Three Months Ended
For the Three Months Ended
June 30, 2026
March 31, 2026
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
Average Balance
Interest Income/ Expense
Yield/ Rate(2)
(Unaudited)
(Dollars in thousands)
Interest-earning assets:
Interest-earning deposits
$
64,801
$
576
3.56
%
$
54,061
$
469
3.47
%
Securities(1)
54,910
348
2.54
%
57,052
354
2.48
%
Loans, including fees
559,192
8,464
6.05
%
551,119
8,232
5.97
%
Total interest-earning assets
678,903
$
9,388
5.53
%
662,232
$
9,055
5.47
%
Other assets
53,753
53,328
Total assets
$
732,656
$
715,560
Interest-bearing liabilities:
Demand & NOW accounts
$
63,572
$
14
0.09
%
$
62,384
$
15
0.10
%
Money market accounts
153,861
731
1.90
%
156,226
735
1.88
%
Savings accounts
50,642
8
0.06
%
51,263
8
0.06
%
Time deposits
210,894
1,719
3.26
%
198,245
1,614
3.26
%
Total interest-bearing deposits
478,969
2,472
2.06
%
468,118
2,372
2.03
%
Borrowed funds & other interest-bearing liabilities
3,105
23
2.96
%
2,342
23
3.93
%
Total interest-bearing liabilities
482,074
$
2,495
2.07
%
470,460
$
2,395
2.04
%
Other non-interest bearing liabilities
106,759
102,013
Stockholders' equity
143,823
143,087
Total liabilities & stockholders' equity
$
732,656
$
715,560
Net interest income
$
6,893
$
6,660
Interest rate spread
3.46
%
3.43
%
Net interest margin
4.06
%
4.02
%
(1) The tax equivalent adjustment for bank qualified tax exempt municipal securities, using a federal statutory rate of 21%, results in rates of 2.92% and 2.85% for the three months ended June 30, 2026 and March 31, 2026, respectively. Yields above are not presented on a tax equivalent basis. (2) Annualized.
Selected Quarterly Financial Data
As of or For the Three Months Ended
June 30, 2026
March 31, 2026
December 31, 2025
September 30, 2025
June 30, 2025
(Unaudited)
(Dollars in thousands, except per share amounts)
Selected Financial Condition Data:
Total assets
$
736,652
$
722,011
$
727,323
$
742,802
$
734,838
Cash and cash equivalents
72,237
61,607
64,280
83,638
75,367
Securities, at fair value
53,567
54,179
56,138
56,049
55,323
Loans receivable, net
558,317
553,879
555,441
552,611
552,389
Deposits
578,240
566,620
573,277
590,345
627,499
Long-term debt
—
—
—
2,000
2,000
Stockholders’ equity
144,761
142,378
141,639
139,306
92,884
Condensed Statements of Income:
Interest income
$
9,388
$
9,055
$
9,457
$
9,351
$
9,107
Interest expense
2,495
2,395
2,835
2,996
2,985
Net interest income
6,893
6,660
6,622
6,355
6,122
Provision for credit losses
119
(113
)
40
(269
)
—
Net interest income after provision for credit losses
6,774
6,773
6,582
6,624
6,122
Total non-interest income
749
703
683
1,065
800
Total non-interest expense
4,873
5,123
4,920
4,843
4,625
Income before income taxes
2,650
2,353
2,345
2,846
2,297
Income tax expense
477
430
411
487
378
Net income
$
2,173
$
1,923
$
1,934
$
2,359
$
1,919
Basic and diluted earnings per share(1)
$
0.29
$
0.26
$
0.26
$
0.32
$
0.25
Dividends declared and paid per share(1)
$
0.09
$
0.09
$
0.09
$
0.09
$
—
Selected Financial Ratios:
Return on average assets(2)
1.19
%
1.07
%
1.04
%
1.28
%
1.11
%
Return on average equity(2)
6.04
%
5.38
%
5.49
%
7.31
%
8.37
%
Average interest-earning assets to average interest-bearing liabilities
140.83
%
140.76
%
138.60
%
139.79
%
128.12
%
Interest rate spread(2)
3.46
%
3.43
%
3.22
%
3.02
%
3.32
%
Net interest margin(2)
4.06
%
4.02
%
3.85
%
3.72
%
3.84
%
Efficiency ratio
63.77
%
69.58
%
67.35
%
65.26
%
66.82
%
Asset Quality Ratios:
Non-performing loans as a percent of loans at amortized cost
0.25
%
0.28
%
0.30
%
0.33
%
0.32
%
Non-performing assets as a percent of total assets
0.20
%
0.22
%
0.23
%
0.25
%
0.24
%
Allowance for credit losses on loans as a percent of loans at amortized cost
0.84
%
0.86
%
0.87
%
0.87
%
0.93
%
Allowance for credit losses on loans as a percent of non-performing loans
331.85
%
302.76
%
290.71
%
265.57
%
290.53
%
Share Information:
Common stock, number of shares outstanding(1)
7,863,818
7,863,388
7,825,388
7,825,501
7,803,102
Treasury stock, number of shares held(1)
—
—
—
—
1,459,691
Book value per share(1)
$
18.41
$
18.11
$
18.10
$
17.80
$
11.90
Tier 1 leverage ratio (Bank-only)
17.43
%
17.54
%
16.65
%
16.34
%
14.37
%
Total risk-based capital ratio (Bank-only)
24.04
%
23.81
%
23.51
%
22.76
%
18.94
%
(1) Share and per share information reflects the effects of the Company's conversion and related stock offering for all periods presented, as applicable. (2) Annualized
FAQ
How did Lake Shore Bancorp (NASDAQ: LSBK) perform financially in Q2 2026?
Lake Shore Bancorp reported Q2 2026 net income of $2.2 million, or $0.29 per diluted share. According to the company, this was a 13.2% increase over Q2 2025, driven mainly by higher net interest income and an improved net interest margin.
What drove Lake Shore Bancorp's net interest margin in Q2 2026 (LSBK)?
Lake Shore Bancorp’s Q2 2026 net interest margin was 4.06%, up from 3.84% a year earlier. According to the company, higher net interest income reflected increased average interest-earning assets, lower interest expense from repricing deposits, and modestly higher yields on loans and interest-earning deposits.
How did non-interest income change for Lake Shore Bancorp (LSBK) in Q2 2026 and year-to-date?
Non-interest income was $749,000 in Q2 2026, down 6.4% year over year, and $1.5 million for the first half, down 4.7%. According to the company, declines mainly reflected lower gains on equity securities, partially offset by higher bank-owned life insurance earnings and service charges.
What were Lake Shore Bancorp's non-interest expenses and efficiency ratio in Q2 2026?
Non-interest expense totaled $4.9 million in Q2 2026, up 5.4% year over year but down from Q1 2026. According to the company, the efficiency ratio improved to 63.77%, helped by lower quarterly salaries, benefits, and occupancy costs versus the prior quarter.
How strong was Lake Shore Bancorp's credit quality and allowance coverage at June 30, 2026?
Non-performing assets were 0.20% of total assets at June 30, 2026, down from 0.23% at year-end. According to the company, the allowance for credit losses on loans was $4.7 million, equal to 0.84% of loans and 331.85% of non-performing loans.
What capital ratios did Lake Shore Bancorp (LSBK) report as of June 30, 2026?
Lake Shore Bank reported a Tier 1 leverage ratio of 17.43% and a total risk-based capital ratio of 24.04%. According to the company, these levels kept the bank in the regulatory "well capitalized" category at June 30, 2026.
How did Lake Shore Bancorp's first-half 2026 results compare to 2025 (LSBK)?
First-half 2026 net income was $4.1 million, or $0.56 per diluted share, up 37.7% year over year. According to the company, net interest income rose 17.0% to $13.6 million, while the effective tax rate increased to 18.1% from 16.4%.
