University Bancorp 3Q2026 Net Income $4,919,946.09, $0.95 Per Share

Year-to-date earnings included a net $15.3 million pretax benefit from valuation and loan-loss allowance adjustments.

Rhea-AI Summary

University Bancorp (UNIB) reported unaudited third-quarter 2026 earnings of $0.95 per share, up from the preceding quarter. Net income was $4,919,946, versus $2,350,713 in 2Q2026; diluted earnings per share rose to $0.76 from $0.36. Nine-month net income reached $16,175,544, versus $6,156,316 a year earlier. Year-to-date valuation and loan-loss allowance adjustments contributed a net $15.3 million before taxes.

The company closed $25 million of subordinated notes due 2036 to refinance acquisition notes and reduce its credit-line balance. Its July 1 acquisition of Greater Pacific Bancshares and Bank of Whittier cost $37.2 million, with 48% paid in cash and the remainder in notes. Management projects Bank of Whittier fourth-quarter net income of $570,000. University Bancorp is also negotiating a $150.2 million home-equity credit-line portfolio sale, targeting a fourth-quarter closing.

22 points · 3 major

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2 major · 11 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major point$25,000,000 private placement closed September 29, 2026, providing refinancing funds. 23% of market cap
• Major point. Forward-looking: it has not happened yet and may not happen.Greater Pacific Bancshares and Bank of Whittier acquisition completed July 1; University Bancorp anticipates EPS accretion over time.
• Major pointAbout $42 million of residential loans purchased from UIF reduced Bank of Whittier's federal funds investments. 38% of market cap
• Moderate point3Q2026 net income rose to $4,919,946 from $2,350,713 in 2Q2026; basic EPS increased to $0.95 from $0.45.
• Moderate pointNine-month net income rose to $16,175,544 from $6,156,316; basic EPS increased to $3.13 from $1.19 year-over-year.
• Moderate pointMortgage servicing rights valuation increased $9.4 million, $4.2 million and $1.1 million in 3Q, 2Q and 1Q2026, respectively.
• Moderate point. Forward-looking: it has not happened yet and may not happen.$20,000,000 bank-CD portfolio is planned for reinvestment into higher-profit-rate loans as it matures over the next 12 months.
• Moderate pointFirst-mortgage home-equity credit-line rollout completed in 47 states; year-to-date originations totaled $252.6 million.
• Moderate pointFaith-based deposits at University Bank grew to over $237 million at September 30, 2026.
• Moderate pointUniversity Bank annual revenue growth was 24.79%; ten-year annual average revenue growth was 26.02%.

12 minor points

• Minor pointDiluted EPS increased to $0.76 in 3Q2026 from $0.36 in 2Q2026.
• Minor pointNine-month diluted EPS increased to $2.50 in 2026 from $1.19 in 2025.
• Minor pointMortgage origination pipeline valuation increased $431,000 in 2Q2026 and $367,000 in 1Q2026.
• Minor pointRefinancing proceeds redeemed acquisition notes except $711,000 and paid down University Bancorp's credit line.
• Minor point. Forward-looking: it has not happened yet and may not happen.Servicing transfer approved for November 1; University Bancorp expects economies of scale at Midwest Loan Services.
• Minor point$11 million special dividend from Bank of Whittier to University Bancorp received approval.
• Minor point. Forward-looking: it has not happened yet and may not happen.Bank of Whittier fourth-quarter net income projected by management at $570,000, an annualized run rate of $2,275,000.
• Minor point. Forward-looking: it has not happened yet and may not happen.FinTech alliance established a pilot customer for University Bank's planned payments hub; University Bancorp invested $2.2 million in equity.
• Minor pointConventional mortgage and home-equity lending licenses now cover all 50 states.
• Minor point. Forward-looking: it has not happened yet and may not happen.Home-equity lending program rollout is underway in 47 states, with secondary-market sales and Midwest subservicing planned.
• Minor point. Forward-looking: it has not happened yet and may not happen.Midwest Loan Services investment-grade servicer rating initiated by Fitch; University Bancorp expects expanded securitization-related opportunities.
• Minor pointSilver ETF investment sale generated a gain of about $750,000 during the quarter.

Negative

• Major point$25,000,000 subordinated notes due 2036 carry 8.125% interest for five years; a swap effectively fixes subsequent interest at 8.25%. 23% of market cap
• Major point$37.2 million acquisition consideration comprised 48% cash and the remainder notes. 34% of market cap
• Moderate point$150.2 million portfolio sale remains under negotiation at 103% of unpaid principal plus 25 basis points of servicing. 1.4× market cap
• Moderate point$34.3 million investment portfolio was concentrated in four large investments at September 30, 2026.
• Minor pointMortgage origination pipeline valuation decreased $415,000 during 3Q2026.

6 minor points

• Minor pointLoan-loss allowance increased quarter-over-quarter by $116,000, $157,000 and $32,000 in 3Q, 2Q and 1Q2026, respectively.
• Minor point. Forward-looking: it has not happened yet and may not happen.Core deposit intangible amortization costs Bank of Whittier $30,755 monthly; it roughly halves starting July 1, 2027.
• Minor point. Forward-looking: it has not happened yet and may not happen.Bank of Whittier special dividend would reduce its Tier 1 capital to $17.5 million.
• Minor point. Forward-looking: it has not happened yet and may not happen.Bank of Whittier stress test indicated $3.7 million additional loan losses under a depressionary scenario, while remaining well capitalized.
• Minor point$18.8 million of cash was used immediately after quarter-end to repay acquisition notes.
• Minor pointCredit-line balance due was $7.6 million against a $12.5 million facility at September 30, 2026.

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ANN ARBOR, MI / ACCESS Newswire / October 22, 2026 / University Bancorp, Inc. (OTCQB:UNIB) ("UNIB") announced that it had an unaudited consolidated net income attributable to University Bancorp, Inc. common stock shareholders of $4,919,946, $0.95 per share on average shares outstanding of 5,169,518 for the third quarter of 2026, compared to an unaudited net income of $2,350,713, $0.45 per share on average shares outstanding of 5,169,518 for 2Q2026. On a fully diluted basis, consolidated net income per share for 3Q2026 was $0.76 compared to $0.36 fully diluted net income per share in 2Q2026.

For the nine months ended September 30, 2026, consolidated net income was $16,175,544, $3.13 per share on average shares outstanding of 5,169,518 for the period, compared to $6,156,316, $1.19 per share on average shares outstanding of 5,169,518 for the nine months ended September 30, 2025. On a fully diluted basis, consolidated net income per share for 9M2026 was $2.50 compared to $1.19 fully diluted net income per share in 9M2025.

At September 30, 2026, Shareholders' Equity attributable to University Bancorp, Inc. common stock shareholders was $115,106,703, $22.27 per share, based on shares outstanding of 5,169,518, and $21.62 per share, on a fully diluted basis, based on 6,481,854 shares outstanding.

Return on equity (ROE) at University Bancorp for 3Q2026 annualized was 19.8%. The annualized ROE for the TTM ended September 30, 2026, was 19.1% on initial shareholders' equity of $94,514,946 at September 30, 2025.

Year to date earnings in 2026 included the following University Bank factors that had an overall net positive impact of $15.3 million before taxes as follows:

1. Mortgage Servicing Rights Valuation adjustment - With the rise in long-term mortgage interest rates during the year, the fair market valuation of our MSRs increased $9.4 million, $4.2 million and $1.1 million at 3Q2026, 2Q2026 and 1Q2026, respectively.
2. Mortgage Origination Pipeline Valuation adjustment - The fair market value of the hedged mortgage origination pipeline decreased by $415,000 during 3Q2026 and increased by $431,000 and $367,000 during 2Q2026 and 1Q2026, respectively.
3. Allowance for Loan Losses adjustment - The Allowance for Loan Losses increased from the prior quarter by $116,000, $157,000 and $32,000 at 3Q2026, 2Q2026 and 1Q2026, respectively.

Major business developments and growth continued during 3Q2026:

• On September 29, 2026, UNIB closed a $25,000,000 private placement of Fixed-to-Floating Rate Subordinated Notes due 2036. The Notes carry a fixed rate of interest of 8.125% for the first five years, and thereafter will pay interest at a floating rate, reset quarterly, equal to the then current three-month SOFR plus 355 basis points. The Notes may be redeemed at the option of UNIB, without penalty, in whole or in part, beginning on October 30, 2031. UNIB has also entered into a $25,000,000 5-year forward interest rate swap agreement at 4.70% which effectively fixes the interest rate for the second five years of the term at 8.25% The proceeds were used to redeem all but $711,000 of the $19,465,298.04 in Notes issued as part of the July 1, 2026 acquisition of Greater Pacific Bancshares and Bank of Whittier, N.A. (BOW), and to pay down the outstanding amounts on UNIB's line of credit. The remaining outstanding Notes issued in the BOW acquisition have a weighted average interest rate of 7.80%.
• On September 16, 2026, UNIB announced that it had formed a strategic alliance with a profitable and rapidly growing FinTech firm (the "FinTech"), a nationwide leader in purpose-built electronic payments serving a $1.5 trillion domestic market vertical, in support of the launch of an OND-based Payments Hub at University Bank. The FinTech will be the pilot customer of the Payments Hub. UNIB invested a total of $2.2 million in equity of the FinTech firm. More information about this transaction and the OND-based Payments Hub at University Bank is available here: https://www.otcmarkets.com/stock/UNIB/news/University-Bancorp-Announces-Initial-Pilot-FinTech-Customer-for-Its-Revolutionary-OND-Based-Payments-Hub?id=535421.
• On July 1, 2026, UNIB acquired 100% of Greater Pacific Bancshares and Bank of Whittier, NA. (BOW) for a purchase price of $37.2 million of which 48% was paid in cash and the remainder paid in Notes. This acquisition provides many opportunities to expand our ability to provide faith-based financing (home, commercial real estate, vehicle) and deposits (FDIC-insured time, savings, checking and tax advantaged IRA deposit accounts) in the United States. UNIB anticipates that the transaction will be accretive to earnings per share over time. After the acquisition, 25 tasks including all of the key actions required to improve the profitability and financial metrics of Bank of Whittier on an ongoing basis were completed, including:
  • Purchase of a portfolio of about $42 million of residential loans from UIF to reduce Fed Funds investments;
  • Approval of the transfer of BOW's residential servicing to Midwest Loan Services, a division of University Bank, effective November 1^st, which will achieve significant economies of scale;
  • Approval of the payment of an $11 million special dividend by BOW to UNIB, which will reduce BOW's Tier 1 Capital to $17.5 million;
  • Completion of a third-party stress test, which indicates that additional loan losses of $3.7 million would be incurred in a depressionary economic scenario using the CCARS stress test assumptions, leaving Bank of Whittier well capitalized at $17.0 million of Tier 1 Capital and a 9.9% Tier 1 Capital Ratio, even after payment of the $11 million special dividend.

Management currently projects net income at Bank of Whittier in the 4^th quarter of $570,000, an annualized run rate of $2,275,000, even after taking into account a $30,755 per month Core Deposit Intangible Amortization expense which arose from GAAP purchase accounting. This amortization expense roughly halves starting July 1, 2027 and decreases over time, ending on the sixth anniversary of the acquisition. Additional future earnings upside exists as certain ongoing integration projects complete and a $20,000,000 investment portfolio of bank CDs is reinvested into portfolio loans at higher profit rates as it matures over the next 12 months.

• University Bank is now licensed for conventional mortgage lending and home equity lending in all 50 states. We have completed the rollout of our 1^st Mortgage HELOC program in the 47 states where we offer the product and are now working on rolling out a home equity lending program in 47 states, with the loans being sold to the secondary market and subserviced by our Midwest Loan Services division. Year to date 1^st Mortgage HELOC originations totaled $252.6 million at September 30, 2026.
• Management is currently negotiating to sell a portfolio of $150.2 million of 1^st Mortgage HELOCs to an institutional investor at a price of 103% of UPB plus 25 basis points of servicing, on a retained servicing basis, with a sale targeted to close in the 4^th quarter of 2026, and will explore regularly quarterly sales, going forward.
• Faith-based deposits at University Bank grew to over $237 million at September 30, 2026, and were $120.3 million at BOW at September 30, 2026.
• Fitch Ratings announced that it has initiated an investment grade institutional servicer rating for the Midwest Loan Services Division of University Bank. This will enable Midwest to compete for subservicing underlying securitization transactions. It will also facilitate the ability of our Hyrex Servicing business to attract Assets Under Management, and enhance our own ability to engage in residential securitizations of our own originations. More information on the Fitch rating is available here: https://www.fitchratings.com/research/structured-finance/fitch-assigns-midwest-loan-services-us-rmbs-servicer-ratings-outlook-stable-16-10-2026.

At September 30, 2026, cash & equity investment securities at UNIB, available to meet working capital needs and to support investment opportunities at UNIB were $63.5 million. UNIB also has available a $12.5 million line of credit with a balance due of $7.6 million. Immediately after quarter-end $18.8 million of the cash on hand was used to repay Notes issued in the acquisition of BOW.

A portion of UNIB's working capital, $34.3 million (at market value), has been invested in a portfolio of publicly traded investments concentrated in four large investments. The four largest investments at September 30, 2026, were:

• Currency Exchange International (Symbol CURN), a company that specializes in foreign exchange, of which we now own 762,339 shares, 12.93% of the currently outstanding shares of common stock, at an average cost of $13.38 per share;
• Pulsar Helium (Symbol PSRHF), of which we now own 9,443,945 shares, 4.41% of the currently outstanding shares of common stock, at an average cost of $0.559 per share. Pulsar Helium was featured last Sunday in a CBS News "60 Minutes" segment entitled "Why you should care about a helium shortage", and that news segment is available here: https://www.youtube.com/watch?v=TWoaTQXs3PI.
• Silver Futures contracts covering 16 contracts of 5,000 ounces each at an original cost of about $61.45 per ounce, or $4.9 million. During the quarter we also closed out a second investment in a Silver ETF with a gain of about $750,000.
• A portfolio of put options on the following indices: S&P500, KRE (S&P 500 Banks) & XLF (S&P 500 Banks, Shadow Banks, Insurance Companies & REITs). UNIB's put option portfolio was worth $2.4 million at September 30, 2026.

Other University Bank Key statistics as of September 30, 2026:

· 1-year annual revenue growth*,	24.79%
· 10-year annual average revenue growth*,	26.02%
· TTM Revenue	$ 157,186,355
· 1 Year ROE	16.24%
· 10 Year Average ROE	24.15%
· LLR/NPAs>90 days	87.77%
· Debt to equity ratio,	23.5%
· Current Ratio,#	5.71
· Efficiency Ratio, %+	78.37%
· Average Assets, University Bank	$ 1,246,656,000
· Loans Held for Sale, fair value,	$ 70,420,823
· NPAs >90 days	$ 2,781,724
· TTM ROA %	1.63%
· Tier 1 Capital Ratio %	10.10%
· NPAs/Assets %	0.21%
· Texas Ratio %	6.91%
· NIM %	4.29%
· NCOs/Loans %	0.00%
· Trailing 12 Months P-E Ratio x	5.8
· Price/Book Value Ratio x	95.3%

^#Parent company only current assets divided by 12-month projected cash expenses.

⁺Calculated as: (non-interest expense/ (net interest income + non-interest income)).

^xBased on last sale of $21.23 per share.

Excluding $10,738,767 of goodwill related to the July 1, 2026 acquisition of Greater Pacific Bancshares and Bank of Whitter, N.A., (BOW) and $531,141 of goodwill & other intangibles related to the acquisition of Ann Arbor Insurance Center, net tangible shareholders' equity attributable to University Bancorp, Inc. common stock shareholders was $103,836,795 or $20.09 per share ($19.98 on a fully diluted basis) at September 30, 2026. Please note that we view the current market values of our insurance agency and BOW as being in excess of their carrying value including this goodwill.

Shareholders and investors are encouraged to refer to the financial information including the investor presentations, audited financial statements, strategic plan and prior press releases, available on our investor relations web page at: http://www.university-bank.com/bancorp/.

A detailed income statement, balance sheet and other financial information for UNIB and University Bank as of September 30, 2026, is available here: https://www.university-bank.com/wp-content/uploads/2026/10/3Q2026-UNIB-Detailed-Financial-Information.pdf.

University Bank's and Bank of Whittier's FDIC Quarterly Call Reports, with substantial additional information including loan origination, loan investment composition, delinquency ratios and Tier 1 Capital ratios for September 30, 2026, will be available by October 30, 2026 here: https://cdr.ffiec.gov/public/ManageFacsimiles.aspx

About UNIB

Ann Arbor-based University Bancorp is a Federal Reserve regulated financial holding company that owns:

• 100% of University Bank, a bank based in Ann Arbor, Michigan;
• 100% of Bank of Whittier, N.A., a bank located in Whittier, California;
• 100% of Crescent Assurance, PCC, a captive insurance company licensed in Washington DC; and
• 100% of Hyrex Servicing, a master mortgage servicing firm, based in Ann Arbor, Michigan.
  • UIF, a faith-based banking firm based in Southfield, MI;

University Bank together with its Michigan-based subsidiaries, holds and manages a total of over $36 billion in financial assets for over 185,000 customers, and our 550 employees make us the 5th largest bank based in Michigan. University Bank is an FDIC-insured, locally owned and managed community bank, and meets the financial needs of its community through its quality, creative and innovative services. Founded in 1890, University Bank® is the 15th oldest bank headquartered in Michigan. We are proud to have been selected as the "Community Bankers of the Year" by American Banker magazine, as the recipient of the American Bankers Association's Community Bank Award and as the recipient of USA Today's Top Workplace Award for several years in a row. University Bank is a Member FDIC. The members of University Bank's corporate family, ranked by their size of revenues are:

• University Lending Group, a retail residential mortgage originator based in Clinton Township, MI;
• Midwest Loan Services, a residential mortgage subservicer based in Houghton, MI;
• Community Banking, based in Ann Arbor, MI, which provides traditional community banking services and wealth management;
• Ann Arbor Insurance Centre, an independent insurance agency based in Ann Arbor, MI.
• Mortgage Warehouse Lending, a mortgage warehouse lender based in Southfield, MI.

CAUTIONARY STATEMENT: This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These forward-looking statements reflect the Company's current views with respect to future events. Forward-looking statements include, but are not limited to, statements concerning future growth in assets, future profitability, efficiencies and economies of scale from mergers, the sustainability of past results, future products, valuations, economic, market or industry conditions, credit risks, vendor and technology related risks, and other expectations and/or goals. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those expressed or implied by such forward-looking statements, including, but not limited to, economic, competitive, governmental and technological factors affecting our operations, markets, products, services, interest rates and fees for services, or the operations of companies that we invest in. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to update any information or forward-looking statement. All forward-looking statements, express or implied, herein are qualified in their entirety by this cautionary statement.

Contact: Stephen Lange Ranzini, President and CEO

Phone: 734-741-5858, Ext. 9226

Email: ranzini@university-bank.com

###

SOURCE: University Bancorp, Inc.

View the original press release on ACCESS Newswire

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were University Bancorp's third-quarter 2026 earnings?

University Bancorp reported unaudited third-quarter net income of $4,919,946, or $0.95 per basic share and $0.76 per diluted share. In 2Q2026, net income was $2,350,713, or $0.45 per basic share and $0.36 per diluted share.

What are the terms of University Bancorp's new subordinated notes?

The $25,000,000 notes due 2036 pay 8.125% for the first five years, then quarterly-reset three-month SOFR plus 355 basis points. A $25,000,000 five-year forward interest-rate swap at 4.70% effectively fixes the second five years at 8.25%. University Bancorp may redeem the notes without penalty beginning October 30, 2031.

What valuation and loan-loss adjustments affected University Bancorp's 2026 earnings?

Mortgage servicing rights, mortgage pipeline and loan-loss allowance adjustments produced a net $15.3 million pretax benefit year to date. Servicing-rights valuations increased $9.4 million, $4.2 million and $1.1 million in the third, second and first quarters, respectively. Third-quarter pipeline valuation decreased $415,000, while the loan-loss allowance increased $116,000 from the preceding quarter.

What did Bank of Whittier's acquisition stress test show?

The third-party test indicated $3.7 million in additional loan losses under a depressionary economic scenario using CCARS assumptions. After those losses and payment of the $11 million special dividend, Bank of Whittier would remain well capitalized with $17.0 million of Tier 1 capital and a 9.9% Tier 1 capital ratio.

What was University Bancorp's book value at September 30, 2026?

Common shareholders' equity was $115,106,703, or $22.27 per share and $21.62 on a fully diluted basis. Net tangible common shareholders' equity, excluding the disclosed goodwill and other intangibles, was $103,836,795, or $20.09 per share and $19.98 on a fully diluted basis.