Sierra Bancorp (NASDAQ: BSRR) lifts Q1 2026 EPS to $0.96 on higher profit
Rhea-AI Filing Summary
Sierra Bancorp reported strong first quarter 2026 results, with net income of $12.5 million and diluted EPS of $0.96, up from $9.1 million and $0.65 a year earlier. Return on average assets held at 1.39% and return on average equity was 13.88%.
Net interest margin was 3.75%, essentially flat versus 3.74% a year ago, as lower funding costs offset modest pressure on asset yields. The efficiency ratio improved to 56.45%, nonperforming assets fell to 0.42% of loans plus foreclosed assets, and core deposits grew while short‑term borrowings declined.
Positive
- Stronger profitability: Q1 2026 net income rose to $12.5 million and diluted EPS to $0.96, up from $9.1 million and $0.65 in Q1 2025, with ROAA at 1.39% and ROE at 13.88%.
- Improving efficiency and credit quality: The tax-equivalent efficiency ratio improved to 56.45% from 60.62% a year earlier, while nonperforming assets fell to 0.42% of loans plus foreclosed assets.
- Solid funding and liquidity profile: Total deposits grew to $2.93 billion, noninterest-bearing deposits represented about 35% of deposits, other interest-bearing liabilities declined, and available liquidity sources totaled about $2.14 billion.
Negative
- Loan contraction and softer production: Gross loans amortized cost declined by $80.1 million, or 3%, during Q1 2026, and new credit extended fell to $7.8 million from $66.4 million in Q1 2025 as the portfolio mix and pipeline were repositioned.
Insights
Solid quarter with stronger earnings, better efficiency, and cleaner credit.
Sierra Bancorp delivered net income of $12.5 million and EPS of $0.96, up from $9.1 million and $0.65 in Q1 2025. Returns were healthy, with ROAA at 1.39% and ROE at 13.88%, supported by stable net interest margin of 3.75%.
Operating performance improved, as the tax‑equivalent efficiency ratio tightened to 56.45% from 60.62% a year earlier, reflecting disciplined expense control. Noninterest income rose to $8.0 million, helped by higher fees and other income items, though some categories were influenced by market‑linked life insurance and deferred compensation.
Credit quality and funding metrics were favorable. Nonperforming assets dropped to 0.42% of loans plus foreclosed assets, and the allowance for credit losses on loans was 0.86% of gross loans. Deposits increased to $2.93 billion while other interest‑bearing liabilities fell, and total liquidity sources exceeded $2.14 billion at March 31, 2026.
8-K Event Classification
Key Figures
Key Terms
net interest margin financial
efficiency ratio financial
allowance for credit losses financial
nonperforming assets financial
mortgage warehouse lines financial
Earnings Snapshot
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
CURRENT REPORT
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ITEM 2.02RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On April 27, 2026, Sierra Bancorp issued a press release announcing its unaudited consolidated financial results for the three-month period ended March 31, 2026. A copy of the press release is attached as Exhibit 99.1 to this Current Report.
The information in this report (including Exhibit 99.1) is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act.
ITEM 9.01FINANCIAL STATEMENTS AND EXHIBITS
(d)Exhibits. The information required to be furnished pursuant to this item is set forth in the Exhibit Index which appears below, immediately before the signatures.
EXHIBIT INDEX
Exhibit No. | | Description |
99.1 | Press release issued by Sierra Bancorp dated April 27, 2026 | |
104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) |
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: April 27, 2026 | SIERRA BANCORP Christopher G. Treece |
Exhibit 99.1
FOR IMMEDIATE RELEASE
Date: | April 27, 2026 |
Contact: | Kevin McPhaill, President/CEO |
Phone: | (559) 782-4900 or (888) 454-BANK |
Website Address: | www.sierrabancorp.com |
SIERRA BANCORP REPORTS FIRST QUARTER 2026 RESULTS
PORTERVILLE, CALIF. – (BUSINESS WIRE) – Sierra Bancorp (Nasdaq: BSRR), parent of Bank of the Sierra, today announced its unaudited financial results for the quarter ended March 31, 2026. Sierra Bancorp reported consolidated net income of $12.5 million, or $0.96 per diluted share, for the first quarter of 2026 compared to $9.1 million, or $0.65 per diluted share, in the first quarter of 2025.
Highlights for the First Quarter of 2026 (unless otherwise stated):
| ● | Strong Quarterly Earnings Metrics |
| o | Diluted earnings per share increased $0.31, or 47%, from the same quarter in 2025. |
| o | Return on average assets improved to 1.39% compared to 1.02% for the same quarter in 2025. |
| o | Return on average equity rose to 13.88% compared to 10.44% for the same quarter in 2025. |
| ● | Focus on Profitability |
| o | Net interest margin increased to 3.75% as compared to 3.74% in the first quarter of 2025. |
| o | Annualized noninterest income to average assets improved to 0.88% as compared to 0.75% in the first quarter of 2025. |
| o | Efficiency ratio (1) improved to 56.45% as compared to 60.62% in the same quarter in 2025 with overall expenses declining 2.6% as compared to the same period in 2025. |
| ● | Growth to our Strong Low-Cost Deposit Base |
| o | Total deposits increased $75.9 million, or 3%, as compared to March 31, 2025. |
| o | Excluding brokered deposits, deposits increased $49.1 million, or 2%, from the prior linked quarter. |
| o | Noninterest-bearing deposits of $1.03 billion at March 31, 2026, represent 35% of total deposits. |
| o | Cost of funds declined to 1.33% in the first quarter of 2026 as compared to 1.46% in the same quarter in 2025. |
| o | Uninsured deposits are approximately 24% of total deposit balances. |
| ● | Stable Capital and Liquidity |
| o | Increased Tangible Book Value (1) per share by 1% to $25.69 per share during the quarter. |
| o | The Community Bank Leverage Ratio increased to 12.05% for our subsidiary bank as compared to 11.94% as of December 31, 2025. |
| o | Repurchased 263,632 shares during the quarter, or 2% of shares outstanding at December 31, 2025. |
| o | Declared dividend of $0.26 per share, payable on May 11, 2026. |
| o | Wholesale funding, including brokered deposits, is used primarily to fund the mortgage warehouse business line which provides a strong match of duration. |
| o | Overall primary and secondary liquidity sources of $2.1 billion at March 31, 2026. |
| o | Primary liquidity ratio increased to 19.8% at March 31, 2026, from 19.1% at December 31, 2025. |
_______________________________
| (1) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures." |
Sierra Bancorp Financial Results
April 27, 2026
Page 2
“Discipline is the bridge between goals and accomplishment.” – Jim Rohn
“I am extremely proud to report a strong start to 2026!” stated Kevin McPhaill, CEO and President. “Profitability remains our top strategic priority as shown by our consistently high ROAA of 1.39%. Furthermore, this was our fifth consecutive quarter of improvement to our efficiency ratio, which is directly attributable to ongoing expense management discipline. We have redoubled our community banking efforts within our branch network, resulting in an increase of 2% in core customer deposits during the first quarter. We are extremely proud of these continued strong results, and I believe the remainder of 2026 will further demonstrate our discipline, drive, and commitment to excellence!” concluded Mr. McPhaill.
Quarterly Changes (comparisons to the first quarter of 2025)
| ● | Net income for the first quarter of 2026 increased $3.4 million, or 38%, to $12.5 million. There were favorable changes in every major income statement category, excluding income tax, including a decrease in provision for credit losses of $2.0 million, or 99%, an increase in net interest income of $0.5 million, or 2%, an increase in noninterest income of $1.3 million, or 20%, and a $0.6 million, or 3%, reduction in noninterest expense. |
| ● | Pre-tax pre-provision income(1) was $16.8 million, an increase of $2.4 million, or 17%. |
Linked Quarter Changes (comparisons to the three months ended December 31, 2025)
| ● | Net income decreased by $0.4 million, or 3%, due mostly to a decrease of $1.3 million in net interest income and an increase of $0.9 million in the credit loss expense. These unfavorable changes were partially offset by an increase in noninterest income of $0.6 million, or 9%, and a reduction in noninterest expense of $1.2 million, or 5%. |
| ● | The $0.9 million increase in the provision for credit losses was due primarily to a $1.5 million favorable release of individual reserves in the fourth quarter of 2025 from two separate relationships. |
| ● | Noninterest income increased by $0.6 million, due to a special dividend received from the FHLB of $0.4 million and an increase in the annual valuation of bank stocks of $0.6 million. These were partially offset by a decrease in separate account life insurance income of $0.5 million, which is designed to offset deferred compensation. |
| ● | Noninterest expenses declined $1.2 million, mostly due to a $0.7 million favorable variance in deferred compensation expenses, which is mostly offset by changes to separate account life insurance income. |
| ● | Pre-tax pre-provision income(1) increased $0.5 million, or 3%. |
Balance Sheet Quarterly Changes (comparisons to December 31, 2025)
| ● | Total assets decreased slightly by 2%, or $74.8 million, to $3.8 billion, during the first three months of 2026, due mostly to a decline in loans. |
| ● | Gross loans decreased $80.1 million, due to a $39.9 million seasonal decrease in mortgage warehouse line utilization coupled with declines in line utilization and new credit extended. |
| ● | Deposits increased by $49.4 million, or 2%. The increase in deposits came from a $56.8 million increase in core customer deposits, partially offset by a $7.7 million decline in customer time deposits. |
_______________________________
| (1) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures." |
Sierra Bancorp Financial Results
April 27, 2026
Page 3
Other financial highlights are reflected in the following table.
FINANCIAL HIGHLIGHTS | | | | | | | | | |
(Dollars in Thousands, Except Per Share Data, Unaudited) | | | | | | | | | |
| | | As of or for the | ||||||
| | | three months ended | ||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Net income | | $ | 12,520 | | $ | 12,894 | | $ | 9,101 |
Diluted earnings per share | | $ | 0.96 | | $ | 0.97 | | $ | 0.65 |
Return on average assets | | | 1.39% | | | 1.39% | | | 1.02% |
Return on average equity | | | 13.88% | | | 14.09% | | | 10.44% |
| | | | | | | | | |
Net interest margin (tax-equivalent) (1) | | | 3.75% | | | 3.79% | | | 3.74% |
Yield on average loans | | | 5.26% | | | 5.34% | | | 5.26% |
Yield on investments | | | 4.44% | | | 4.52% | | | 4.81% |
Cost of average total deposits (3) | | | 1.17% | | | 1.14% | | | 1.33% |
Cost of funds (3) | | | 1.33% | | | 1.38% | | | 1.46% |
Efficiency ratio (tax-equivalent) (1) (2) | | | 56.45% | | | 57.69% | | | 60.62% |
| | | | | | | | | |
Total assets | | $ | 3,754,462 | | $ | 3,829,279 | | $ | 3,606,183 |
Gross loans, amortized cost | | $ | 2,466,794 | | $ | 2,546,845 | | $ | 2,306,663 |
Noninterest demand deposits | | $ | 1,028,678 | | $ | 995,623 | | $ | 1,037,990 |
Total deposits | | $ | 2,925,806 | | $ | 2,876,436 | | $ | 2,849,884 |
Noninterest-bearing deposits over total deposits | | | 35.2% | | | 34.6% | | | 36.4% |
| | | | | | | | | |
Shareholders' equity / total assets | | | 9.69% | | | 9.53% | | | 9.75% |
Tangible common equity ratio (2) | | | 9.02% | | | 8.88% | | | 9.05% |
Book value per share | | $ | 27.78 | | $ | 27.49 | | $ | 25.45 |
Tangible book value per share (2) | | $ | 25.69 | | $ | 25.42 | | $ | 23.44 |
Community bank leverage ratio (subsidiary bank) | | | 12.05% | | | 11.94% | | | 12.11% |
Tangible common equity ratio (subsidiary bank) (2) | | | 11.07% | | | 10.92% | | | 11.32% |
| (1) | Computed on a tax equivalent basis utilizing a federal income tax rate of 21%. |
| (2) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures". |
| (3) | Includes noninterest bearing deposits. |
INCOME STATEMENT HIGHLIGHTS
Net Interest Income
Net interest income was $30.6 million for the first quarter of 2026, a decrease of $1.3 million, or 4%, compared to the fourth quarter of 2025, and an increase of $0.5 million, or 2%, compared to the first quarter of 2025.
The linked‑quarter decrease was driven primarily by lower interest income, partially offset by reduced interest expense. Interest income declined by $2.1 million compared to the linked quarter, due mostly to a $1.9 million decrease in loan interest income, driven in part by two fewer days in the current quarter compared to the prior linked quarter, a $0.8 million decline in mortgage warehouse interest due to seasonality, as well as lower commercial loan utilization, and a decline in average balances of real estate loans. The decline in loan interest was partially offset by a favorable decline in interest expense of $0.7 million in the linked quarter comparison, due to lower rates.
Compared to the first quarter of 2025, interest income decreased modestly due to lower yields on investments and changes in balance sheet mix, while interest expense declined primarily due to lower rates on interest‑bearing liabilities, reflecting repricing and improved funding mix, despite a modest increase in average interest‑bearing liability balances.
Sierra Bancorp Financial Results
April 27, 2026
Page 4
Net interest margin was 3.75% for the first quarter of 2026, compared to 3.79% for the linked quarter and 3.74% for the first quarter of 2025.
Compared to the fourth quarter of 2025, the net interest margin declined four basis points, reflecting lower yields on interest‑earning assets, partially offset by continued improvement in funding costs. The yield on average interest‑earning assets declined to 5.04% from 5.12%, driven primarily by lower yields on mortgage warehouse and investments.
The cost of interest‑bearing liabilities declined to 1.94%, from 2.03% in the prior quarter, reflecting lower average balances of borrowed funds and proactive management of deposit pricing. Average interest‑earning assets declined $34.7 million from the prior linked quarter, while average interest‑bearing liabilities declined $2.1 million, contributing to the modest compression in margin.
Compared to the first quarter of 2025, the net interest margin increased by one basis point, reflecting the benefit of lower funding costs, partially offset by modest pressure on asset yields. The cost of average total deposits declined to 1.17%, from 1.33% in the first quarter of 2025, while the cost of interest‑bearing liabilities declined to 1.94%, from 2.15%, reflecting an improved funding mix, lower average balances of higher‑cost deposits and borrowings, and reduced overall funding costs resulting from the rate cuts in the second half of 2025.
These favorable funding cost trends were partially offset by lower yields on investment securities, as assets repriced in a lower rate environment, resulting in overall margin stability year over year.
Overall, the Company continues to benefit from improving funding costs, which have largely offset pressure on asset yields, resulting in a stable net interest margin compared to the prior year and only modest compression as compared to the linked quarter. Management expects net interest margin performance to remain influenced by balance sheet mix, investment security reinvestment rates, and the timing of deposit repricing.
Credit Loss Expense
The Company recorded a provision for credit losses on loans of $0.1 million for the first quarter of 2026, compared to a reserve release of $0.8 million in the fourth quarter of 2025 and a provision of $2.0 million in the first quarter of 2025. The $0.8 million release in allowance for credit losses during the fourth quarter of 2025 was due mostly to the $1.5 million release of specific reserve on loans individually evaluated, partially offset by higher reserve on loans collectively evaluated. The provision recorded during the first quarter of 2026 reflects normal portfolio activity and estimated credit losses, partially offset by net loan charge-offs.
Credit loss expense on unfunded loan commitments was a benefit of $0.05 million in the first quarter of 2026, compared to a benefit of $0.08 million in the linked quarter and expense of $0.1 million in the first quarter of 2025, reflecting changes in the level and composition of unfunded commitments. The reason for the decrease in the first quarter of 2026 is due to a decrease in the balance of unfunded commitments in most loan categories and a decline in combined funding and loss rates.
The unrealized loss position on the Company’s investment portfolio was attributable to changes in interest rates and volatility in the financial markets and not reflective of expected credit loss.
Noninterest Income
Noninterest income increased $0.6 million, or 9%, to $8.0 million in the first quarter of 2026, compared to the fourth quarter of 2025. Noninterest income increased $1.3 million, or 20%, compared to the first quarter of 2025.
The $1.3 million increase in noninterest income in the first quarter of 2026, as compared to the same quarter in 2025, was due to higher service charge and fee income, an increase in cash surrender value of life insurance due to purchases of additional life insurance in the second quarter of 2025, and other increases related to higher FHLB dividend income and an increase in the fair value of bank stocks. The $0.6 million increase in noninterest income as compared to the fourth
Sierra Bancorp Financial Results
April 27, 2026
Page 5
quarter of 2025 was driven primarily by a $1.0 million increase in the other noninterest income category, including a $0.4 million special dividend from the FHLB and an increase in value of bank stocks of $0.6 million. These favorable variances were partially offset by a decrease in separate account life insurance income of $0.5 million which is designed to offset deferred compensation, and lower service charges and fees on deposit accounts, which declined $0.3 million, reflecting seasonal trends in business analysis fees and other deposit‑related charges. Although overall service charges and fees on deposit account income declined on a linked-quarter basis, there was a positive increase in the second half of the quarter related to interchange income on debit cards.
The Company maintains a non‑qualified deferred compensation plan for officers and directors, under which participants may defer a portion of their earnings and select from various hypothetical investment alternatives to determine their individual returns. The Company economically offsets this liability with separate account life insurance policies that are invested in similar underlying fund types within the life insurance policy. Because the deferred compensation liability and the separate account life insurance asset are not contractually linked, differences in balances, fund performance, and insurance costs can result in temporary timing mismatches between changes in separate account life insurance income and the related deferred compensation expense.
During the first quarter of 2026, declines in market values of investments inside the life insurance policy to offset employee and director deferred compensation plan elections resulted in a $0.4 million net loss related to separate account life insurance, while the related deferred compensation liability experienced a $0.6 million benefit as the funds that the plan participants elected declined in value. These offsetting movements reflect market‑driven changes in the underlying investment alternatives and do not represent credit‑ or performance‑related deterioration.
The majority of the deferred compensation expense/(benefit) is reported within professional fees, under deferred directors’ fees, as it primarily relates to the deferral of directors’ compensation. Specifically, $0.6 million of deferred compensation benefit was recorded as deferred directors’ fees during the first quarter of 2026. The related tax shortfall associated with the loss connected with separate account life insurance and taxable deferred compensation expense/(benefit) totaled $0.3 million for the quarter.
Noninterest Expense
Total noninterest expense decreased $1.2 million, or 5%, to $21.8 million in the first quarter of 2026, compared to the fourth quarter of 2025, and decreased $0.6 million, or 3%, compared to the first quarter of 2025. The primary driver of lower noninterest expense in both comparisons was lower deferred compensation expense, reflecting market‑driven changes in the related deferred compensation liability. Excluding the change in deferred compensation, total noninterest expense declined $1.0 million in the first quarter of 2026 as compared to the fourth quarter of 2025.
The decrease in deferred compensation expense was mostly offset by lower separate account life insurance income, as declines in market values during the quarter resulted in a loss related to separate account life insurance policies, consistent with the discussion above. These offsetting movements reflect normal market‑related volatility between the separate account life insurance asset and the deferred compensation liability.
Salaries and benefits were relatively stable compared to both the linked quarter and the same period last year, with modest period‑to‑period changes primarily related to normal compensation timing and benefit costs. Occupancy expense declined modestly compared to the linked quarter and remained relatively consistent year over year, reflecting disciplined expense management.
Other noninterest expense declined compared to both the linked quarter and the prior year, driven primarily by lower deferred directors’ compensation expense/(benefit) and continued cost control across operating expense categories.
The Company's effective tax rate was 25.2% in the first quarter of 2026 relative to 24.8% in the fourth quarter of 2025, and 25.8% for the first quarter of 2025. The variances in the effective tax rates are due to fluctuations in tax credits and related amortization, benefits related to employee stock compensation, and tax-exempt income as a percentage of total taxable income.
Sierra Bancorp Financial Results
April 27, 2026
Page 6
Balance Sheet Summary
The $74.8 million decrease in total assets during the first quarter of 2026 was a result of a $13.2 million decrease in investment securities and an $80.1 million decrease in gross loans, partially offset by a $20.8 million increase in cash and due from balances.
Investment securities decreased $13.2 million, or 1%, to $903.0 million primarily due to paydowns in the portfolio, which were partially used to pay down other interest-bearing liabilities.
Gross loan balances decreased $80.1 million, or 3%, during the first quarter of 2026, reflecting lower mortgage warehouse line utilization, portfolio runoff, changes in commercial line utilization, and lower volumes of new credit extended. Mortgage warehouse balances declined $39.9 million, driven by seasonal activity and early‑quarter paydowns. Excluding mortgage warehouse activity, loan balances declined modestly across several portfolios, including decreases of $9.1 million in commercial real estate loans, $19.9 million in other commercial loans, $9.7 million in residential real estate loans, $2.1 million in farmland loans, and $0.2 million in consumer loans. Other construction loans increased $0.8 million during the quarter.
As indicated in the loan rollforward below, new credit extended for the first quarter of 2026 decreased $19.0 million over the linked quarter comparison and $58.6 million over the same period in 2025. For the first three months ended 2026, we had $25.3 million in loan paydowns and maturities, along with a $22.6 million decrease in line of credit utilization, and a $39.9 million decrease in mortgage warehouse utilization. The reduction in new credit extended is primarily due to a strategic shift in our target customer base with a change to increase granularity within the portfolio by focusing more on serving our local communities, as well as expanded commercial real estate lending. It is taking time to refresh the pipeline, but such pipeline had returned to prior quarter levels by the end of March 2026.
LOAN ROLLFORWARD | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | | | | | | | |
| | For the three months ended: | |||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Gross loans beginning balance | | $ | 2,546,880 | | $ | 2,491,779 | | $ | 2,331,341 |
New credit extended | | | 7,811 | | | 26,794 | | | 66,370 |
Changes in line of credit utilization (1) | | | (22,592) | | | 6,230 | | | (12,129) |
Change in mortgage warehouse | | | (39,880) | | | 65,651 | | | (46,139) |
Pay-downs, maturities, charge-offs and amortization | | | (25,328) | | | (43,574) | | | (32,681) |
Gross loans ending balance | | | 2,466,891 | | | 2,546,880 | | | 2,306,762 |
Deferred costs and (fees), net | | | (97) | | | (35) | | | (99) |
Gross loans, amortized cost | | $ | 2,466,794 | | $ | 2,546,845 | | $ | 2,306,663 |
| (1) | Change does not include new balances on lines of credit extended during the respective periods as such balances are included as part of “New credit extended” line above. |
Sierra Bancorp Financial Results
April 27, 2026
Page 7
A summary of the Company’s unfunded commitments and utilization is presented below (dollars in thousands, unaudited):
| | March 31, 2026 | | December 31, 2025 | | March 31, 2025 | |||||||||
| | Line Available (2) | | Utilization % | | Line Available (2) | | Utilization % | | Line Available (2) | | Utilization % | |||
Real estate: | | | | | | | | | | | | | | | |
Residential real estate | | $ | 14,393 | | 44.37% | | $ | 15,726 | | 44.50% | | $ | 19,311 | | 42.17% |
Commercial real estate | | | 20,132 | | 88.38% | | | 23,203 | | 86.93% | | | 33,129 | | 82.79% |
Other construction/land | | | 1,740 | | 86.22% | | | 2,634 | | 79.10% | | | 7,161 | | 27.67% |
Farmland | | | 2,544 | | 82.45% | | | 3,126 | | 80.20% | | | 5,639 | | 63.73% |
Total real estate | | | 38,809 | | 82.85% | | | 44,689 | | 80.92% | | | 65,240 | | 74.05% |
Other commercial | | | 193,442 | | 45.07% | | | 187,084 | | 48.81% | | | 197,259 | | 44.36% |
Consumer | | | 4,538 | | 23.11% | | | 4,580 | | 24.29% | | | 4,879 | | 23.33% |
Subtotal (1) | | | 236,789 | | 59.48% | | | 236,353 | | 61.00% | | | 267,378 | | 56.33% |
Mortgage warehouse lines | | | 319,546 | | 59.96% | | | 247,667 | | 67.67% | | | 414,769 | | 40.58% |
Overdrafts - Commercial and Consumer | | | 68,188 | | 1.43% | | | 69,112 | | 1.40% | | | 72,238 | | 1.08% |
Total | | $ | 624,523 | | 56.98% | | $ | 553,132 | | 61.64% | | $ | 754,385 | | 45.49% |
| | | | | | | | | | | | | | | |
Unused commitment as a percent of gross loans, amortized cost | | | 25.32% | | | | | 21.72% | | | | | 32.70% | | |
Unused mortgage warehouse commitments as percent of gross loans, amortized cost | | | 12.95% | | | | | 9.72% | | | | | 17.98% | | |
| (1) | Excludes mortgage warehouse lines and overdraft lines. |
| (2) | Represents unfunded loan commitments available to customers. |
Deposit balances increased $49.4 million, or 2%, during the first quarter of 2026, to $2.9 billion at March 31, 2026. Core non‑maturity deposits increased $56.8 million for the first three months of 2026, reflecting continued growth in customer transaction accounts, while higher-cost customer time deposits declined $7.7 million during the quarter. Noninterest‑bearing deposits totaled $1.03 billion at March 31, 2026, representing 35.2% of total deposits, compared to 34.6% at December 31, 2025, and 36.4% at March 31, 2025. Other interest‑bearing liabilities totaled $185.0 million at March 31, 2026, compared to $302.7 million at December 31, 2025, reflecting a reduction in short‑term borrowings during the quarter. These balances consisted of overnight borrowings of $130.0 million and $55.0 million of term Federal Home Loan Bank advances.
Overall uninsured deposits are estimated to be $710.0 million, or 24% of total deposit balances, excluding public agency deposits that are subject to collateralization through a letter of credit issued by the FHLB. In addition, uninsured deposits of the Bank’s customers are eligible for FDIC pass-through insurance if the customer opens an IntraFi Insured Cash Sweep account or a reciprocal time deposit through the Certificate of Deposit Account Registry System (CDARS). IntraFi allows for up to $285 million of combined pass-through FDIC insurance which would more than cover each of the Bank’s deposit customers if such customer desired to have such pass-through insurance. The Bank maintains a diversified deposit base with no significant customer concentrations and does not bank any cryptocurrency companies. At March 31, 2026, the Company had approximately 116,000 accounts and the 25 largest deposit balance customers had balances of approximately 10% of overall deposits. During the first quarter of 2026, except for seasonal fluctuations in the normal course of business, there have been no material changes in the composition of our 25 largest deposit balance customers.
Sierra Bancorp Financial Results
April 27, 2026
Page 8
The Company continues to have substantial liquidity. At March 31, 2026, and December 31, 2025, the Company had the following sources of primary and secondary liquidity (dollars in thousands, unaudited):
Primary and secondary liquidity sources | | | 3/31/2026 | | | 12/31/2025 |
Cash and cash equivalents | | $ | 156,372 | | $ | 135,628 |
Unpledged investment securities | | | 539,347 | | | 551,406 |
Excess pledged securities | | | 191,145 | | | 192,275 |
FHLB borrowing availability | | | 657,040 | | | 629,481 |
Unsecured lines of credit | | | 331,785 | | | 250,785 |
Secured lines of credit | | | 25,000 | | | 25,000 |
Funds available through fed discount window | | | 244,039 | | | 254,908 |
Totals | | $ | 2,144,728 | | $ | 2,039,483 |
Total equity of $363.7 million at March 31, 2026, reflects a decrease of $1.1 million compared to December 31, 2025. The decrease in equity during the first quarter of 2026 was due to $9.5 million in share repurchases, a $3.4 million dividend paid to shareholders, and a $1.8 million unfavorable swing in other comprehensive income/loss due principally to the increase in treasury rates in March and the corresponding decline in our investment securities’ fair value. These changes were partially offset by $12.5 million in net income recorded during the quarter. The remaining difference was related to activity from stock options and restricted stock during the year.
Asset Quality
Total nonperforming assets, decreased by $4.4 million, or 30%, to $10.4 million, during the first quarter of 2026. The decrease in non-accrual loans was from the successful paydown of the Company’s largest nonaccrual loan. The Company's ratio of nonperforming assets to loans plus foreclosed assets decreased to 0.42% at March 31, 2026, from 0.58% at December 31, 2025.
The Company's allowance for credit losses on loans was $21.3 million at March 31, 2026, as compared to $21.5 million at December 31, 2025, and $27.1 million at March 31, 2025. The decrease was primarily attributable to a decrease in the quantitative reserves due to reduced loan balances, partially offset by a $0.5 million increase in the allowance for loans individually evaluated, specifically related to a single agricultural production loan relationship that moved to nonaccrual during the first quarter of 2026. The allowance was 0.86% of total loans at March 31, 2026, 0.84% of total loans at December 31, 2025, and 1.17% of total loans at March 31, 2025.
Sierra Bancorp Financial Results
April 27, 2026
Page 9
The following tables highlight the coverage ratios by loan category at March 31, 2026, December 31, 2025, and March 31, 2025:
Allowance for Credit Losses on Loans by Category | | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | ||||||||
| | As of March 31, 2026 | ||||||||
| | | Balance | | | Total Allowance | | Percent of Portfolio | | Coverage Ratio (1) |
Real estate: | | | | | | | | | | |
Commercial real estate | | $ | 1,381,770 | | $ | 15,977 | | 56.01% | | 1.16% |
Other construction/land | | | 15,242 | | | 299 | | 0.62% | | 1.96% |
Farmland | | | 66,218 | | | 542 | | 2.68% | | 0.82% |
Total real estate (2) | | | 1,463,230 | | | 16,818 | | 59.32% | | 1.15% |
Other Commercial | | | 172,653 | | | 2,351 | | 7.00% | | 1.36% |
Consumer loans (including overdrafts) | | | 2,597 | | | 109 | | 0.11% | | 4.20% |
Subtotal (2) (3) | | | 1,638,480 | | | 19,278 | | 66.42% | | 1.18% |
Residential real estate | | | 349,860 | | | 1,368 | | 14.18% | | 0.39% |
Mortgage warehouse lines | | | 478,454 | | | 604 | | 19.40% | | 0.13% |
Gross loans, amortized cost | | $ | 2,466,794 | | $ | 21,250 | | 100.00% | | 0.86% |
| | As of December 31, 2025 | ||||||||
| | | Balance | | | Total Allowance | | Percent of Portfolio | | Coverage Ratio (1) |
Real estate: | | | | | | | | | | |
Commercial real estate | | $ | 1,390,890 | | $ | 16,354 | | 54.61% | | 1.18% |
Other construction/land | | | 14,414 | | | 296 | | 0.57% | | 2.05% |
Farmland | | | 68,307 | | | 496 | | 2.68% | | 0.73% |
Total real estate (2) | | | 1,473,611 | | | 17,146 | | 57.86% | | 1.16% |
Other Commercial | | | 192,577 | | | 2,146 | | 7.56% | | 1.11% |
Consumer loans (including overdrafts) | | | 2,810 | | | 112 | | 0.11% | | 3.99% |
Subtotal (2) (3) | | | 1,668,998 | | | 19,404 | | 65.53% | | 1.16% |
Residential real estate | | | 359,514 | | | 1,411 | | 14.12% | | 0.39% |
Mortgage warehouse lines | | | 518,333 | | | 665 | | 20.35% | | 0.13% |
Gross loans, amortized cost | | $ | 2,546,845 | | $ | 21,480 | | 100.00% | | 0.84% |
| | As of March 31, 2025 | ||||||||
| | | Balance | | | Total Allowance | | Percent of Portfolio | | Coverage Ratio (1) |
Real estate: | | | | | | | | | | |
Commercial real estate | | $ | 1,380,402 | | $ | 17,143 | | 59.84% | | 1.24% |
Other construction/land | | | 7,633 | | | 145 | | 0.33% | | 1.90% |
Farmland | | | 73,206 | | | 282 | | 3.17% | | 0.39% |
Total real estate (2) | | | 1,461,241 | | | 17,570 | | 63.35% | | 1.20% |
Other Commercial | | | 181,631 | | | 7,255 | | 7.87% | | 3.99% |
Consumer loans (including overdrafts) | | | 2,968 | | | 140 | | 0.13% | | 4.72% |
Subtotal (2) (3) | | | 1,645,840 | | | 24,965 | | 71.35% | | 1.52% |
Residential real estate | | | 377,592 | | | 1,746 | | 16.37% | | 0.46% |
Mortgage warehouse lines | | | 283,231 | | | 339 | | 12.28% | | 0.12% |
Gross loans, amortized cost | | $ | 2,306,663 | | $ | 27,050 | | 100.00% | | 1.17% |
Sierra Bancorp Financial Results
April 27, 2026
Page 10
| (1) | Coverage ratio equals allowance for credit losses on loans divided by amortized cost. |
| (2) | Does not include residential real estate. |
| (3) | Does not include mortgage warehouse lines. |
Mortgage warehouse made up 19.4% of the total loan balances and continues to have the lowest reserve rate in the allowance for credit losses at 0.13%. Mortgage warehouse lines historically have incurred nominal losses and, therefore, have a significantly lower reserve than the Bank’s other categories of loans. Further, our residential real estate loans are comprised primarily of jumbo residential loans purchased in 2021 and early 2022 with very strong underwriting. Given the underlying strength of this portfolio, the allowance associated with our residential real estate loans was 0.39% at March 31, 2026. The allowance as a percentage of gross loans, exclusive of mortgage warehouse lines and residential mortgage loans, was 1.18% at March 31, 2026, 1.16% at December 31, 2025, and 1.52% at March 31, 2025. The largest loan segment of commercial real estate continues to maintain a coverage ratio at or above 1.16%.
Management's detailed analysis indicates that the Company's allowance for credit losses on loans should be sufficient to cover life of loan credit losses on loan portfolio balances outstanding as of March 31, 2026, but no assurance can be given that the Company will not experience substantial future losses in excess of the current allowance for credit losses on loans.
About Sierra Bancorp
Sierra Bancorp is the holding Company for Bank of the Sierra (www.bankofthesierra.com), which is in its 49th year of operations and strives to be the preeminent bank headquartered in the South San Joaquin Valley.
Bank of the Sierra offers a broad range of retail and commercial banking services through its 34 full-service branches located within the counties of Tulare, Kern, Kings, Fresno, Ventura, San Luis Obispo, and Santa Barbara. The Bank also maintains an online branch and provides specialized lending services through its mortgage warehouse division. In 2025, Bank of the Sierra was recognized as one of the strongest and top-performing community banks in the country, with a 5-star rating from Bauer Financial.
Forward-Looking Statements
The statements contained in this release that are not historical facts are forward-looking statements based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Readers are cautioned not to unduly rely on forward looking statements. Actual results may differ from those projected. These forward-looking statements involve risks and uncertainties including but not limited to the health of the national and local economies, loan portfolio performance, the Company's ability to attract and retain skilled employees, customers' service expectations, the Company's ability to successfully deploy new technology, the success of acquisitions and branch expansion, changes in interest rates, and other factors detailed in the Company's SEC filings, including the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's most recent Form 10-K and Form 10-Q.
Sierra Bancorp Financial Results
April 27, 2026
Page 11
STATEMENT OF CONDITION | | | | | | | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
ASSETS | | | 3/31/2026 | | | 12/31/2025 | | | 9/30/2025 | | | 6/30/2025 | | | 3/31/2025 |
Cash and due from banks | | $ | 156,372 | | $ | 135,628 | | $ | 95,501 | | $ | 130,012 | | $ | 159,711 |
Investment securities | | | | | | | | | | | | | | | |
Available-for-sale, at fair value | | | 615,401 | | | 625,330 | | | 596,933 | | | 668,834 | | | 620,288 |
Held-to-maturity, amortized cost, net of allowance for credit losses | | | 287,583 | | | 290,811 | | | 294,511 | | | 298,484 | | | 302,123 |
Total investment securities | | | 902,984 | | | 916,141 | | | 891,444 | | | 967,318 | | | 922,411 |
Real estate loans | | | | | | | | | | | | | | | |
Residential real estate | | | 349,860 | | | 359,514 | | | 364,277 | | | 371,415 | | | 377,592 |
Commercial real estate | | | 1,381,770 | | | 1,390,890 | | | 1,404,681 | | | 1,392,075 | | | 1,380,402 |
Other construction/land | | | 15,242 | | | 14,414 | | | 13,420 | | | 11,662 | | | 7,633 |
Farmland | | | 66,218 | | | 68,307 | | | 67,860 | | | 67,967 | | | 73,206 |
Total real estate loans | | | 1,813,090 | | | 1,833,125 | | | 1,850,238 | | | 1,843,119 | | | 1,838,833 |
Other commercial | | | 172,653 | | | 192,577 | | | 185,958 | | | 186,620 | | | 181,631 |
Mortgage warehouse lines | | | 478,454 | | | 518,333 | | | 452,683 | | | 401,896 | | | 283,231 |
Consumer loans | | | 2,597 | | | 2,810 | | | 2,909 | | | 2,974 | | | 2,968 |
Gross loans, amortized cost | | | 2,466,794 | | | 2,546,845 | | | 2,491,788 | | | 2,434,609 | | | 2,306,663 |
Allowance for credit losses on loans | | | (21,250) | | | (21,480) | | | (25,180) | | | (21,680) | | | (27,050) |
Net loans | | | 2,445,544 | | | 2,525,365 | | | 2,466,608 | | | 2,412,929 | | | 2,279,613 |
| | | | | | | | | | | | | | | |
Bank premises and equipment | | | 14,447 | | | 14,974 | | | 15,056 | | | 15,285 | | | 15,338 |
Other assets | | | 235,115 | | | 237,171 | | | 240,768 | | | 244,758 | | | 229,110 |
Total assets | | $ | 3,754,462 | | $ | 3,829,279 | | $ | 3,709,377 | | $ | 3,770,302 | | $ | 3,606,183 |
| | | | | | | | | | | | | | | |
LIABILITIES AND CAPITAL | | | | | | | | | | | | | | | |
Noninterest demand deposits | | $ | 1,028,678 | | $ | 995,623 | | $ | 1,072,927 | | $ | 1,065,742 | | $ | 1,037,990 |
Interest-bearing transaction accounts | | | 604,016 | | | 581,746 | | | 635,279 | | | 603,294 | | | 598,924 |
Savings deposits | | | 364,830 | | | 365,064 | | | 357,107 | | | 352,803 | | | 355,325 |
Money market deposits | | | 153,438 | | | 151,760 | | | 156,255 | | | 148,084 | | | 143,522 |
Customer time deposits | | | 454,459 | | | 462,153 | | | 476,242 | | | 514,596 | | | 524,173 |
Brokered deposits | | | 320,385 | | | 320,090 | | | 234,950 | | | 289,950 | | | 189,950 |
Total deposits | | | 2,925,806 | | | 2,876,436 | | | 2,932,760 | | | 2,974,469 | | | 2,849,884 |
| | | | | | | | | | | | | | | |
Repurchase agreements | | | 127,811 | | | 130,853 | | | 125,749 | | | 126,509 | | | 118,756 |
Long-term debt | | | 49,506 | | | 49,483 | | | 49,461 | | | 49,438 | | | 49,416 |
Subordinated debentures | | | 36,061 | | | 36,017 | | | 35,972 | | | 35,928 | | | 35,883 |
Other interest-bearing liabilities | | | 185,000 | | | 302,700 | | | 135,000 | | | 154,400 | | | 80,000 |
Total deposits and interest-bearing liabilities | | | 3,324,184 | | | 3,395,489 | | | 3,278,942 | | | 3,340,744 | | | 3,133,939 |
| | | | | | | | | | | | | | | |
Allowance for credit losses on unfunded loan commitments | | | 660 | | | 710 | | | 790 | | | 810 | | | 820 |
Other liabilities | | | 65,904 | | | 68,217 | | | 69,562 | | | 73,041 | | | 119,668 |
Total capital | | | 363,714 | | | 364,863 | | | 360,083 | | | 355,707 | | | 351,756 |
Total liabilities and capital | | $ | 3,754,462 | | $ | 3,829,279 | | $ | 3,709,377 | | $ | 3,770,302 | | $ | 3,606,183 |
Sierra Bancorp Financial Results
April 27, 2026
Page 12
GOODWILL AND INTANGIBLE ASSETS | | | | | | | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | | | | | | | | | | | | | |
| | | 3/31/2026 | | | 12/31/2025 | | | 9/30/2025 | | | 6/30/2025 | | | 3/31/2025 |
Goodwill | | $ | 27,357 | | $ | 27,357 | | $ | 27,357 | | $ | 27,357 | | $ | 27,357 |
Core deposit intangible | | | 13 | | | 52 | | | 132 | | | 294 | | | 456 |
Total intangible assets | | $ | 27,370 | | $ | 27,409 | | $ | 27,489 | | $ | 27,651 | | $ | 27,813 |
| | | | | | | | | | | | | | | |
CREDIT QUALITY | | | | | | | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | | | | | | | | | | | | | |
| | | 3/31/2026 | | | 12/31/2025 | | | 9/30/2025 | | | 6/30/2025 | | | 3/31/2025 |
Nonperforming loans | | $ | 10,410 | | $ | 13,231 | | $ | 14,006 | | $ | 14,981 | | $ | 18,201 |
Foreclosed assets | | | — | | | 1,565 | | | 1,839 | | | — | | | — |
Total nonperforming assets | | $ | 10,410 | | $ | 14,796 | | $ | 15,845 | | $ | 14,981 | | $ | 18,201 |
| | | | | | | | | | | | | | | |
Quarterly net charge offs (recoveries) | | $ | 307 | | $ | 2,915 | | $ | 209 | | $ | 6,580 | | $ | (259) |
| | | | | | | | | | | | | | | |
Past due and still accruing (30-89) | | $ | 907 | | $ | 6,835 | | $ | 187 | | $ | 3,033 | | $ | 3,057 |
Classified loans | | $ | 31,595 | | $ | 31,433 | | $ | 32,111 | | $ | 35,700 | | $ | 37,265 |
| | | | | | | | | | | | | | | |
Nonperforming loans / gross loans, amortized cost | | | 0.42% | | | 0.52% | | | 0.56% | | | 0.62% | | | 0.79% |
NPA's / loans plus foreclosed assets | | | 0.42% | | | 0.58% | | | 0.64% | | | 0.62% | | | 0.79% |
Allowance for credit losses on loans / gross loans, amortized cost | | | 0.86% | | | 0.84% | | | 1.01% | | | 0.89% | | | 1.17% |
| | | | | | | | | | | | | | | |
SELECT PERIOD-END STATISTICS | | | | | | | | | | | | | | | |
(Unaudited) | | | | | | | | | | | | | | | |
| | | 3/31/2026 | | | 12/31/2025 | | | 9/30/2025 | | | 6/30/2025 | | | 3/31/2025 |
Shareholders' equity / total assets | | | 9.69% | | | 9.53% | | | 9.71% | | | 9.43% | | | 9.75% |
Gross loans, amortized cost / deposits | | | 84.31% | | | 88.54% | | | 84.96% | | | 81.85% | | | 80.94% |
Noninterest-bearing deposits / total deposits | | | 35.16% | | | 34.61% | | | 36.58% | | | 35.83% | | | 36.42% |
Core non-maturity deposits | | $ | 2,150,962 | | $ | 2,094,193 | | $ | 2,221,568 | | $ | 2,169,923 | | $ | 2,135,761 |
Deferred loan (costs)/fees | | $ | (97) | | $ | (35) | | $ | 9 | | $ | 4 | | $ | (99) |
Sierra Bancorp Financial Results
April 27, 2026
Page 13
CONSOLIDATED INCOME STATEMENT | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | For the three months ended: | ||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Interest income | | $ | 41,196 | | $ | 43,280 | | $ | 41,453 |
Interest expense | | | 10,588 | | | 11,328 | | | 11,341 |
Net interest income | | | 30,608 | | | 31,952 | | | 30,112 |
| | | | | | | | | |
Credit loss expense (benefit) - loans | | | 77 | | | (785) | | | 1,961 |
Credit loss (benefit) expense - unfunded commitments | | | (50) | | | (80) | | | 110 |
Credit loss (benefit) - debt securities held-to-maturity | | | (1) | | | - | | | - |
Net interest income after credit loss (benefit) | | | 30,582 | | | 32,817 | | | 28,041 |
| | | | | | | | | |
Service charges and fees on deposit accounts | | | 5,673 | | | 5,986 | | | 5,581 |
Net (loss) gain on sale of securities available-for-sale | | | - | | | (4) | | | 122 |
Net gain (loss) on sale of fixed assets | | | 360 | | | (31) | | | (2) |
Increase in cash surrender value of life insurance | | | 419 | | | 412 | | | 237 |
(Loss) earning on separate account life insurance | | | (379) | | | 127 | | | (502) |
Other income | | | 1,896 | | | 847 | | | 1,206 |
Total noninterest income | | | 7,969 | | | 7,337 | | | 6,642 |
| | | | | | | | | |
Salaries and benefits | | | 12,700 | | | 12,681 | | | 13,003 |
Occupancy expense | | | 3,085 | | | 3,182 | | | 2,978 |
Other noninterest expenses | | | 6,039 | | | 7,155 | | | 6,436 |
Total noninterest expense | | | 21,824 | | | 23,018 | | | 22,417 |
| | | | | | | | | |
Income before taxes | | | 16,727 | | | 17,136 | | | 12,266 |
Provision for income taxes | | | 4,207 | | | 4,242 | | | 3,165 |
Net income | | $ | 12,520 | | $ | 12,894 | | $ | 9,101 |
| | | | | | | | | |
TAX DATA | | | | | | | | | |
Tax-exempt muni income | | $ | 1,624 | | $ | 1,626 | | $ | 1,576 |
Interest income - fully tax equivalent | | $ | 41,628 | | $ | 43,712 | | $ | 41,872 |
Sierra Bancorp Financial Results
April 27, 2026
Page 14
PER SHARE DATA | | | | | | | | | |
(Unaudited) | | | For the three months ended: | ||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Basic earnings per share | | $ | 0.96 | | $ | 0.97 | | $ | 0.66 |
Diluted earnings per share | | $ | 0.96 | | $ | 0.97 | | $ | 0.65 |
Common dividends | | $ | 0.26 | | $ | 0.25 | | $ | 0.25 |
| | | | | | | | | |
Weighted average shares outstanding | | | 12,988,932 | | | 13,251,040 | | | 13,820,008 |
Weighted average diluted shares | | | 13,097,176 | | | 13,350,518 | | | 13,916,341 |
| | | | | | | | | |
Book value per basic share (EOP) | | $ | 27.78 | | $ | 27.49 | | $ | 25.45 |
Tangible book value per share (EOP) (1) | | $ | 25.69 | | $ | 25.42 | | $ | 23.44 |
| | | | | | | | | |
Common shares outstanding (EOP) | | | 13,093,184 | | | 13,273,788 | | | 13,818,770 |
| (1) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures". |
KEY FINANCIAL RATIOS | | | | | | | | | |
(Unaudited) | | | For the three months ended: | ||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Return on average equity | | | 13.88% | | | 14.09% | | | 10.44% |
Return on average assets | | | 1.39% | | | 1.39% | | | 1.02% |
Net interest margin (tax-equivalent) (1) | | | 3.75% | | | 3.79% | | | 3.74% |
Efficiency ratio (tax-equivalent) (1) (2) | | | 56.45% | | | 57.69% | | | 60.62% |
Net charge-offs (recoveries) / average loans (not annualized) | | | 0.01% | | | 0.12% | | | (0.01)% |
| (1) | Computed on a tax equivalent basis utilizing a federal income tax rate of 21%. |
| (2) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures". |
Sierra Bancorp Financial Results
April 27, 2026
Page 15
NON-GAAP FINANCIAL MEASURES | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | As of: | |||||||
| | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Total stockholders' equity | | $ | 363,714 | | $ | 364,863 | | $ | 351,756 |
Less: goodwill and other intangible assets | | | 27,370 | | | 27,409 | | | 27,813 |
Tangible common equity | | $ | 336,344 | | $ | 337,454 | | $ | 323,943 |
| | | | | | | | | |
Total assets | | $ | 3,754,462 | | $ | 3,829,279 | | $ | 3,606,183 |
Less: goodwill and other intangible assets | | | 27,370 | | | 27,409 | | | 27,813 |
Tangible assets | | $ | 3,727,092 | | $ | 3,801,870 | | $ | 3,578,370 |
| | | | | | | | | |
Total stockholders' equity (bank only) | | $ | 439,623 | | $ | 442,092 | | $ | 432,518 |
Less: goodwill and other intangible assets (bank only) | | | 27,370 | | | 27,409 | | | 27,813 |
Tangible common equity (bank only) | | $ | 412,253 | | $ | 414,683 | | $ | 404,705 |
| | | | | | | | | |
Total assets (bank only) | | $ | 3,751,904 | | $ | 3,826,215 | | $ | 3,603,679 |
Less: goodwill and other intangible assets (bank only) | | | 27,370 | | | 27,409 | | | 27,813 |
Tangible assets (bank only) | | $ | 3,724,534 | | $ | 3,798,806 | | $ | 3,575,866 |
| | | | | | | | | |
Common shares outstanding | | | 13,093,184 | | | 13,273,788 | | | 13,818,770 |
| | | | | | | | | |
Book value per common share (total stockholders' equity / shares outstanding) | | $ | 27.78 | | $ | 27.49 | | $ | 25.45 |
Tangible book value per common share (tangible common equity / shares outstanding) | | $ | 25.69 | | $ | 25.42 | | $ | 23.44 |
Equity ratio - GAAP (total stockholders' equity / total assets | | | 9.69% | | | 9.53% | | | 9.75% |
Tangible common equity ratio (tangible common equity / tangible assets) | | | 9.02% | | | 8.88% | | | 9.05% |
Tangible common equity ratio (bank only) (tangible common equity / tangible assets) | | | 11.07% | | | 10.92% | | | 11.32% |
| | For the three months ended: | |||||||
Efficiency Ratio: | | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Noninterest expense | | $ | 21,824 | | $ | 23,018 | | $ | 22,417 |
Divided by: | | | | | | | | | |
Net interest income | | | 30,608 | | | 31,952 | | | 30,112 |
Tax-equivalent interest income adjustments | | | 432 | | | 432 | | | 419 |
Net interest income, adjusted | | | 31,040 | | | 32,384 | | | 30,531 |
Noninterest income | | | 7,969 | | | 7,337 | | | 6,642 |
Less gain (loss) on sale of securities | | | - | | | (4) | | | 122 |
Less (loss) gain on sale of fixed assets | | | 360 | | | (31) | | | (2) |
Tax-equivalent noninterest income adjustments | | | 11 | | | 143 | | | (70) |
Noninterest income, adjusted | | | 7,620 | | | 7,515 | | | 6,452 |
Net interest income plus noninterest income, adjusted | | $ | 38,660 | | $ | 39,899 | | $ | 36,983 |
Efficiency Ratio (tax-equivalent) | | | 56.45% | | | 57.69% | | | 60.62% |
| | | | | | | | | |
| | For the three months ended: | |||||||
Pre-tax pre-provision income: | | | 3/31/2026 | | | 12/31/2025 | | | 3/31/2025 |
Net income | | $ | 12,520 | | $ | 12,894 | | $ | 9,101 |
Add: Provision for income taxes | | | 4,207 | | | 4,242 | | | 3,165 |
Add: Provision for credit losses | | | 26 | | | (865) | | | 2,071 |
Pre-tax pre-provision income | | $ | 16,753 | | $ | 16,271 | | $ | 14,337 |
Sierra Bancorp Financial Results
April 27, 2026
Page 16
NONINTEREST INCOME/EXPENSE | | | | | | | | | |
(Dollars in Thousands, Unaudited) | | | |||||||
| | For the three months ended: | |||||||
Noninterest income: | | 3/31/2026 | | 12/31/2025 | | 3/31/2025 | |||
Service charges and fees on deposit accounts | | | | | | | | | |
Interchange income on debit cards | | $ | 1,941 | | $ | 2,031 | | $ | 1,953 |
Business analysis fees | | | 1,030 | | | 1,202 | | | 1,034 |
Overdraft fee income | | | 1,324 | | | 1,376 | | | 1,245 |
Other service charges and fees | | | 1,378 | | | 1,377 | | | 1,349 |
Net (loss) gain on sale of securities available-for-sale | | | — | | | (4) | | | 122 |
Gain (loss) on sale of fixed assets | | | 360 | | | (31) | | | (2) |
Increase in cash surrender value of life insurance | | | 419 | | | 412 | | | 237 |
(Loss) earning on separate account life insurance | | | (379) | | | 127 | | | (502) |
Other | | | 1,896 | | | 847 | | | 1,206 |
Total noninterest income | | $ | 7,969 | | $ | 7,337 | | $ | 6,642 |
As a % of average interest-earning assets (1) | | | 0.96% | | | 0.86% | | | 0.81% |
| | | | | | | | | |
Noninterest expense: | | | | | | | | | |
Salaries and employee benefits | | | | | | | | | |
Salary and incentives | | $ | 10,409 | | $ | 10,481 | | $ | 10,687 |
Employee benefits | | | 2,288 | | | 2,134 | | | 2,300 |
Deferred compensation | | | 3 | | | 66 | | | 16 |
Occupancy costs | | | 3,085 | | | 3,182 | | | 2,978 |
Advertising and marketing costs | | | 333 | | | 370 | | | 348 |
Data processing costs | | | 1,583 | | | 1,545 | | | 1,498 |
Deposit services costs | | | 1,948 | | | 2,077 | | | 1,991 |
Loan services costs | | | | | | | | | |
Loan processing | | | 113 | | | 91 | | | 138 |
Foreclosed assets | | | 17 | | | 3 | | | 4 |
Other operating costs | | | 779 | | | 951 | | | 928 |
Professional services costs | | | | | | | | | |
Legal and accounting services | | | 557 | | | 511 | | | 651 |
Director's costs | | | 356 | | | 350 | | | 310 |
Deferred directors' fees cost/(benefit) | | | (572) | | | 99 | | | (444) |
Other professional services | | | 698 | | | 774 | | | 706 |
Stationery and supply costs | | | 97 | | | 98 | | | 101 |
Sundry and tellers | | | 130 | | | 286 | | | 205 |
Total noninterest expense | | $ | 21,824 | | $ | 23,018 | | $ | 22,417 |
As a % of average interest-earning assets (1) | | | 2.64% | | | 2.70% | | | 2.75% |
Efficiency ratio (tax-equivalent) (2)(3) | | | 56.45% | | | 57.69% | | | 60.62% |
(1) Annualized
(2) Computed on a tax equivalent basis utilizing a federal income tax rate of 21%.
| (3) | See reconciliation of non-GAAP financial measures to the corresponding GAAP measurement in "Non-GAAP Financial Measures". |
Sierra Bancorp Financial Results
April 27, 2026
Page 17
AVERAGE BALANCES AND RATES | | | | | | | | | ||||
(Dollars in Thousands, Unaudited) | | | | | | | | | | | | |
| | For the quarter ended | | For the quarter ended | | For the quarter ended | ||||||
| | 3/31/2026 | | 12/31/2025 | | 3/31/2025 | ||||||
| | Average Balance (1) | Income/ Expense | Yield/ Rate (2) | | Average Balance (1) | Income/ Expense | Yield/ Rate (2) | | Average Balance (1) | Income/ Expense | Yield/ Rate (2) |
Assets | | | | | | | | | | | | |
Investments: | | | | | | | | | | | | |
Interest-earning due from banks | | $ 23,411 | $ 211 | 3.66% | | $ 14,990 | $ 173 | 4.58% | | $ 54,641 | $ 590 | 4.38% |
Taxable | | 709,417 | 7,993 | 4.57% | | 700,921 | 8,233 | 4.66% | | 735,197 | 9,138 | 5.04% |
Non-taxable | | 203,801 | 1,624 | 4.09% | | 202,638 | 1,626 | 4.03% | | 197,558 | 1,576 | 4.10% |
Total investments | | 936,629 | 9,828 | 4.44% | | 918,549 | 10,032 | 4.52% | | 987,396 | 11,304 | 4.81% |
| | | | | | | | | | | | |
Loans: (3) | | | | | | | | | | | | |
Real estate | | 1,822,696 | 22,391 | 4.98% | | 1,843,428 | 23,136 | 4.98% | | 1,824,428 | 21,988 | 4.89% |
Agricultural production | | 62,795 | 724 | 4.68% | | 66,833 | 822 | 4.88% | | 76,316 | 1,030 | 5.47% |
Commercial | | 111,734 | 1,597 | 5.80% | | 114,782 | 1,782 | 6.16% | | 103,152 | 1,515 | 5.96% |
Consumer | | 2,601 | 55 | 8.58% | | 2,771 | 74 | 10.59% | | 3,286 | 69 | 8.52% |
Mortgage warehouse lines | | 414,272 | 6,589 | 6.45% | | 438,892 | 7,418 | 6.71% | | 313,251 | 5,529 | 7.16% |
Other | | 2,146 | 12 | 2.27% | | 2,361 | 17 | 2.86% | | 2,361 | 18 | 3.09% |
Total loans | | 2,416,244 | 31,368 | 5.26% | | 2,469,067 | 33,249 | 5.34% | | 2,322,794 | 30,149 | 5.26% |
Total interest-earning assets (4) | | 3,352,873 | 41,196 | 5.04% | | 3,387,616 | 43,281 | 5.12% | | 3,310,190 | 41,453 | 5.13% |
Other earning assets | | 17,069 | | | | 43,768 | | | | 17,062 | | |
Non-earning assets | | 283,935 | | | | 260,567 | | | | 273,926 | | |
Total assets | | $ 3,653,877 | | | | $ 3,691,951 | | | | $ 3,601,178 | | |
| | | | | | | | | | | | |
Liabilities and shareholders' equity | | | | | | | | | | | | |
Interest-bearing deposits: | | | | | | | | | | | | |
Demand deposits | | $ 224,131 | $ 1,104 | 2.00% | | $ 234,450 | $ 1,282 | 2.17% | | $ 207,774 | $ 1,292 | 2.52% |
NOW | | 356,648 | 75 | 0.09% | | 362,791 | 93 | 0.10% | | 378,338 | 119 | 0.13% |
Savings accounts | | 363,512 | 105 | 0.12% | | 358,492 | 108 | 0.12% | | 352,645 | 90 | 0.10% |
Money market | | 154,469 | 616 | 1.62% | | 162,715 | 725 | 1.77% | | 145,092 | 571 | 1.60% |
Time deposits | | 459,482 | 3,203 | 2.83% | | 470,338 | 3,546 | 2.99% | | 531,299 | 4,412 | 3.37% |
Brokered Deposits | | 319,199 | 3,219 | 4.09% | | 218,985 | 2,439 | 4.42% | | 244,561 | 2,888 | 4.79% |
Total interest bearing deposits | | 1,877,441 | 8,322 | 1.80% | | 1,807,771 | 8,193 | 1.80% | | 1,859,709 | 9,372 | 2.04% |
Borrowed funds: | | | | | | | | | | | | |
Federal funds purchased | | 42,782 | 395 | 3.74% | | 114,139 | 1,142 | 3.97% | | 183 | 2 | 4.43% |
Repurchase agreements | | 128,430 | 63 | 0.20% | | 121,857 | 46 | 0.15% | | 112,361 | 69 | 0.25% |
Short term borrowings | | 3,988 | 38 | 3.86% | | 8,802 | 94 | 4.24% | | 4,043 | 45 | 4.51% |
Long term FHLB Advances | | 77,778 | 749 | 3.91% | | 80,000 | 788 | 3.91% | | 80,000 | 771 | 3.91% |
Long term debt | | 49,492 | 431 | 3.53% | | 49,469 | 429 | 3.44% | | 49,402 | 430 | 3.53% |
Subordinated debentures | | 36,034 | 590 | 6.64% | | 35,989 | 637 | 7.02% | | 35,855 | 652 | 7.37% |
Total borrowed funds | | 338,504 | 2,266 | 2.71% | | 410,256 | 3,136 | 3.03% | | 281,844 | 1,969 | 2.83% |
Total interest-bearing liabilities | | 2,215,945 | 10,588 | 1.94% | | 2,218,027 | 11,329 | 2.03% | | 2,141,553 | 11,341 | 2.15% |
Demand deposits - noninterest bearing | | 1,005,769 | | | | 1,032,617 | | | | 1,003,322 | | |
Other liabilities | | 66,346 | | | | 78,323 | | | | 102,806 | | |
Shareholders' equity | | 365,817 | | | | 362,984 | | | | 353,497 | | |
Total liabilities and shareholders' equity | | $ 3,653,877 | | | | $ 3,691,951 | | | | $ 3,601,178 | | |
| | | | | | | | | | | | |
Interest income/interest earning assets | | | | 5.04% | | | | 5.12% | | | | 5.13% |
Interest expense/interest earning assets | | | | 1.28% | | | | 1.33% | | | | 1.39% |
Net interest income and margin (5) | | | $ 30,608 | 3.75% | | | $ 31,952 | 3.79% | | | $ 30,112 | 3.74% |
| ||||||||||||
| (1) | Average balances are obtained from the best available daily or monthly data and are net of deferred fees and related direct costs. |
| (2) | Yields and net interest margin have been computed on a tax equivalent basis utilizing a 21% effective federal tax rate. |
| (3) | Loans are gross of the allowance for expected credit losses. Loan fees have been included in the calculation of interest income. Net loan (costs) fees and loan acquisition FMV amortization were ($0.3) million and ($0.3) million for the quarters ended March 31, 2026 and 2025, respectively, and $(0.3) million for the quarter ended December 31, 2025. |
| (4) | Non-accrual loans have been included in total loans for purposes of computing total earning assets. |
| (5) | Net interest margin represents net interest income as a percentage of average interest-earning assets. |
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