CAMDEN NATIONAL CORP
For the period ended Jun 30, 2026. Filed Aug 6, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 6, 2026
CAC$58.02+0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-07.
0000750686-26-000026
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-06.
0000750686-26-000062
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 204 previous paragraphs and 213 current paragraphs.
135 unchanged; 55 reworded; 20 added; 13 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 31 previous and 32 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (20)
Current report
The Company delivered record quarterly earnings for the second quarter of 2026, generating net income of $23.0 million and diluted EPS of $1.35. Compared to the second quarter of 2025, net income grew 63%, and on a non-GAAP basis, adjusted net income grew 52%. Net income growth between periods was driven by an increase in total revenue of 8% and continued strong expense management. Net interest margin expanded 20 basis points between periods to 3.26% for the second quarter of 2026 and drove net interest income growth of 8%, and non-interest income grew 11% between periods driven by broad performance across all business lines. Contributing to net income growth between periods was a decrease in provision for credit losses of $6.2 million, driven by lower net charge-offs in the second quarter of 2026, compared to the second quarter of 2025.
Current report
For the six months ended June 30, 2026, the Company reported net income of $44.9 million and diluted EPS of $2.64, compared to $21.4 million and $1.26, respectively, for the same period a year ago. On a non-GAAP basis, adjusted net income and adjusted diluted EPS each grew 45% between periods.
Current report
The Company's financial condition remained strong at June 30, 2026. Total loans increased approximately 1% from December 31, 2025, reflecting growth across multiple product categories, including an 11% increase in home equity balances. On the funding side, the continued success of the Company's high-yield savings offering contributed to an 11% increase in savings balances during the first six months of 2026. In addition, reductions in higher-cost brokered deposits, certificates of deposit and wholesale borrowings contributed to improved funding costs and net interest margin expansion. The Company believes its strong liquidity position and stable funding base position it well to support future loan growth and customer needs.
Current report
Asset quality remained strong during the second quarter of 2026, supported by annualized net charge-offs of only 0.04% of average loans, reflecting the continued strength of the Company's loan portfolio. Loans 30 to 89 days past due represented 0.15% of total loans and non-performing loans totaled 0.24% of total loans at June 30, 2026. The allowance for credit losses remained solid at 0.91% of total loans, and the Company believes the allowance provides appropriate coverage for credit risks inherent in the portfolio.
Current report
The Company's capital position remained well above regulatory requirements at June 30, 2026, supporting strategic growth initiatives and shareholder returns. Management remains focused on disciplined capital deployment while maintaining financial flexibility to support long-term growth and shareholder value creation.
Current report
Net Interest Income (Fully-Taxable Equivalent) for the Six Months Ended June 30, 2026 and 2025. For the six months ended June 30, 2026, the Company's net interest income on a fully-taxable equivalent basis was $105.8 million, an increase of $7.0 million, or 7%, compared to the same period in 2025.
Current report
Average funding liabilities totaled $6.1 billion for the first six months of 2026, a decrease of $25.6 million, or less than 1%, compared to the same period in 2025. For the first six months of 2026, interest expense totaled $52.1 million, a decrease of 13% between periods, primarily attributable to a reduction in the average cost of funds of 24 basis points to 1.71%. The decrease in our average cost of funds was driven by changes in the interest rate environment, as well as an improvement in our overall funding mix between periods, as average total deposits increased to $5.4 billion, or 2%, and average borrowings (including brokered deposits) decreased to $737.7 million, or 15%.
Current report
Average interest‑earning assets totaled $6.5 billion for the first six months of 2026, an increase of $41.2 million, or 1%, compared to the same period in 2025. For the first six months of 2026, interest income on a fully-taxable equivalent basis totaled $157.8 million, a decrease of less than 1% between periods primarily attributable to a reduction in the recognition of net fair value mark accretion income from purchase accounting, which totaled $8.4 million for the six months ended June 30, 2026, a decrease of $1.6 million compared to the same period of 2025.
Current report
Net Interest Margin (Fully-Taxable Equivalent) for the Six Months Ended June 30, 2026 and 2025. Our net interest margin on a fully-taxable equivalent basis increased 20 basis points to 3.25% for the six months ended June 30, 2026, compared to the same period in 2025. Refer to the discussion above for the drivers of the change between periods. Adjusting for the impact of purchase accounting, which contributed $8.4 million to net interest income on a fully-taxable equivalent basis for the first half of 2026, the Company reported non-GAAP, core net interest margin of 2.94%, an increase of 25 basis points compared to the first half of 2025.
Current report
(1)Provision for loan losses: The Company recorded provision expense of $468,000 for the second quarter of 2026, primarily attributable to loan growth during the quarter and the maintenance of reserves to reflect the uncertain economic outlook. Credit quality remained strong during the second quarter of 2026, as further discussed in “—Financial Condition—Asset Quality”. The decrease in provision expense from the prior-year quarter was primarily due to the absence of the $6.0 million reserve the Company established in the second quarter of 2025 related to its participation in a syndicated loan to a borrower that filed bankruptcy during the same period.
Current report
For the six months ended June 30, 2026, the decrease in provision for loan losses of $14.2 million compared to the same period in 2025 was primarily the result of: (i) the Northway acquisition on January 2, 2025, for which we recorded provision for credit losses of $6.3 million and established a corresponding ACL on loans, and (ii) the additional reserve required for the aforementioned commercial borrower that entered bankruptcy during the second quarter of 2025.
Current report
(2)Brokerage and insurance commissions: The increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was driven by an increase in assets under administration of $182.2 million, or 17%, to $1.2 billion as of June 30, 2026.
Current report
(3)Bank-owned life insurance (“BOLI”): The increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was primarily driven by favorable performance of the underlying equity investments and death benefit proceeds received from two BOLI policies during 2026, including one benefit recognized in each quarter. The death benefits recognized within BOLI income for the three months and six months ended June 30, 2026 was $34,000 and $209,000, respectively. The Company did not recognize any death benefits during these same periods in 2025.
Current report
(5)Other income: The increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was primarily attributable to increased commercial back-to-back loan swap derivative activity. For the three and six months ended June 30, 2026, the Company recognized derivative income on its commercial back-to-back loan swap program of $303,000 and $366,000, respectively, compared to $61,000 and $70,000 for the same periods of 2025, respectively.
Current report
(1)Furniture, equipment and data processing: The increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was driven by our continued investment in customer‑facing digital technology platforms during 2026.
Current report
Income tax expense increased to $6.3 million and $12.5 million for the three and six months ended June 30, 2026, respectively, from $3.7 million and $2.5 million for the same periods in 2025. The increase for the three months ended June 30, 2026, was primarily due to higher pre-tax income. The increase for the six months ended June 30, 2026 was also driven by higher pre-tax income, reflecting the absence of $8.9 million of merger and acquisition expenses recognized in the first half of 2025, as well as a $2.6 million deferred tax asset remeasurement benefit recognized during the same period, in connection with the Northway acquisition.
Current report
•Decrease due to paydowns, calls, and maturities of $88.9 million
Current report
•Increase from purchases of available-for-sale debt securities of $27.4 million
Current report
•Increase from amortization and accretion of $3.9 million
Current report
•Decrease in FHLBB stock and other investments of $3.1 million
Removed paragraphs (13)
Previous report
•ongoing competition in the labor markets and increased employee turnover;
Previous report
•the adequacy of succession planning for key executives or other personnel, and the Company’s ability to transition effectively to new members of the senior executive team;
Previous report
In addition, statements regarding the potential effects of notable national and global current events, including hostilities in Iran and recent rulings on the permissibility of certain tariffs, on the Company’s business, financial condition, liquidity and results of operations may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond the Company's control.
Previous report
Net income totaled $21.9 million and diluted EPS was $1.29 for the first quarter of 2026, compared to $7.3 million and $0.43, respectively, in the first quarter of 2025. For the same periods, adjusted net income and adjusted diluted EPS (which exclude certain non-recurring items, primarily related to the Northway acquisition in 2025) increased 39%, reflecting strong operating performance and our successful acquisition of Northway. Net interest margin improvement of 20 basis points between periods to 3.24% for the first quarter of 2026 was a large driver in the improvement of operating performance. With our solid financial performance for the first quarter of 2026, we reported a return on average assets of 1.28%, a return on average equity of 12.58%, and a return on average tangible equity (non-GAAP) of 18.17% for the quarter, which were all favorable improvements over the same period of 2025.
Previous report
The Company’s financial condition continues to be on solid footing supported by strong asset quality, liquidity and capital positions. Total assets at March 31, 2026, were $7.0 billion and were relatively flat compared to December 31, 2025, while deposits grew 1% during the first quarter, driven by growth in non‑maturity deposits, which enabled the Company to reduce higher‑cost short‑term borrowings by $68.3 million during the period. At March 31, 2026, our loan-to-deposit ratio was 89% and, combined with the normal cash flow from our investment portfolio, we believe we are well positioned to fund expected loan growth throughout the year and continue to drive net interest margin expansion in 2026.
Previous report
Asset quality for the first quarter of 2026 was strong, highlighted by annualized net charge‑offs of 0.04% of average loans and past‑due loans totaling just 0.06% of total loans at March 31, 2026. Our ACL on loans at March 31, 2026, was 0.92% of total loans and 4.2 times non-performing loans, compared to 0.91% and 6.5 times at December 31, 2025, respectively.
Previous report
At March 31, 2026, our capital levels were well in excess of regulatory requirements and they continue to build. The strength of our capital continues to support disciplined growth and investment in the franchise, while we also continue to return capital to our shareholders. During the first quarter of 2026, we returned $8.6 million of capital to our shareholders through a combination of cash dividends and repurchases of the Company’s common stock. We will continue to balance our capital deployment in a manner that allows us to remain open and to attractive organic and inorganic growth opportunities that may arise.
Previous report
(1)Provision for loan losses: The Company recorded provision expense of $806,000 for the first quarter of 2026, primarily driven by the annual update to significant model inputs and assumptions within the allowance for credit losses framework, which resulted in higher modeled loss expectations within the commercial and residential loan portfolios. Refer to Note 4 of the consolidated financial statements for further details.
Previous report
The provision for credit losses recorded in the first quarter of 2025 totaled $8.9 million and was primarily driven by the acquisition of Northway on January 2, 2025, including the required establishment of the allowance on acquired non‑PCD loans at closing totaling $6.3 million.
Previous report
(2)Provision for credit losses on off-balance sheet credit exposures: At March 31, 2026, the ACL on off-balance sheet credit exposures was $2.8 million, as compared to $3.4 million as of March 31, 2025.
Previous report
(3)Bank-owned life insurance: The increase between periods was driven by the proceeds received from a death benefit on one of our BOLI policies during the first three months ended March 31, 2026.
Previous report
(1)Salaries and employee benefits: The decrease between periods was primarily driven by the reduction in number of employees following the acquisition of Northway on January 2, 2025, and completion of our integration in mid-March 2025 as we achieved our expected merger synergies.
Previous report
The Company recorded income tax expense of $6.2 million for the three months ended March 31, 2026, compared to an income tax benefit of $1.2 million for the same period in 2025. The income tax benefit recognized for the three months ended March 31, 2025, was driven by lower pre-tax income driven by merger and acquisition costs of $7.5 million and remeasurement of our deferred tax assets that resulted in a reduction to income tax expense of $2.6 million, each were driven by the Company’s acquisition of Northway on January 2, 2025.
Reworded paragraphs (55)
Previous wording
•changes in trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System or the imposition of tariffs or retaliatory tariffs;
Current wording
•changes in trade, monetary, and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System or the imposition of tariffs or retaliatory tariffs and related litigation;
Previous wording
•changes in accounting policies, practices and standards, as may be adopted by the regulatory agencies as well as the Financial Accounting Standards Board (“FASB”), and other accounting standard setters;
Current wording
•changes in accounting policies, practices and standards;
Previous wording
•the effects of civil unrest, international hostilities, including hostilities in Iran, or other geopolitical events;
Current wording
•the effects of civil unrest, international hostilities, including the continuation of conflict in the Middle East;
Previous wording
•turmoil and volatility in the financial services industry, including failures or rumors of failures of other depository institutions, which could affect the ability of depository institutions, including Camden National Bank, to attract and retain depositors, and could affect the ability of financial services providers, including the Company, to borrow or raise capital;
Current wording
•turmoil and volatility in the financial services industry;
Previous wording
Return on Average Tangible Equity and Adjusted Return on Average Tangible Equity. Return on average tangible equity is the ratio of (i) net income, adjusted for (a) amortization of CDI assets and the tax impact of the adjustment and (b) goodwill impairment, as necessary, to (ii) average shareholders' equity, adjusted for average goodwill and CDI assets. This adjusted financial ratio reflects a shareholder's return on tangible capital deployed in our business and is a common measure within the financial services industry.
Current wording
Return on Average Tangible Equity and Adjusted Return on Average Tangible Equity. Return on average tangible equity is the ratio of (i) net income, adjusted for (a) amortization of CDI assets and the tax impact of the adjustment and (b) goodwill impairment, as necessary, to (ii) average shareholders' equity, adjusted for average goodwill and CDI assets. This adjusted financial ratio reflects a shareholder's return on tangible capital deployed in our business and is a common measure within the financial services industry. Adjusted return on average tangible equity is the ratio of (i) adjusted net income (as defined in the table above) adjusted for (a) amortization of CDI assets and the tax impact of the adjustment and (b) goodwill impairment, as necessary, to (ii) average shareholders' equity, adjusted for average goodwill and CDI assets.
Previous wording
(1) Recognized $3.7 million and $4.3 million of net accretion income on loans from purchase accounting for the three months ended March 31, 2026 and 2025, respectively.
Current wording
(1) Recognized $3.3 million and $6.9 million of net accretion income on loans from purchase accounting for the three and six months ended June 30, 2026, respectively, and $4.3 million and $8.6 million for the three and six months ended June 30, 2025, respectively.
Previous wording
(2) Recognized $759,000 and $831,000 of net accretion income on investments from purchase accounting for the three months ended March 31, 2026 and 2025, respectively.
Current wording
(2) Recognized $818,000 and $1.6 million of net accretion income on investments from purchase accounting for the three and six months ended June 30, 2026, respectively, and $863,000 and $1.7 million for the three and six months ended June 30, 2025, respectively.
Previous wording
(3) Recognized $75,000 of amortization expense on borrowings from purchase accounting for the three months ended March 31, 2026 and $131,000 of amortization expense on time deposits and borrowings from purchase accounting for the three months ended March 31, 2025.
Current wording
(3) Recognized $75,000 and $150,000 of amortization expense on borrowings from purchase accounting for the three and six months ended June 30, 2026, respectively and $131,000 and $262,000 of amortization expense on time deposits and borrowings from purchase accounting for the three and six months ended June 30, 2025, respectively.
Previous wording
For the quarter ended March 31, 2026, net interest income totaled $52.4 million, representing approximately 81% of total revenues, compared to $48.8 million, or 81% of total revenues, for the same period in 2025. Net interest income is affected by factors including, but not limited to, changes in interest rates, loan and deposit pricing strategies and competitive conditions, loan prepayment speeds, the volume and mix of interest‑earning assets and interest‑bearing liabilities, and the level of non‑performing assets.
Current wording
For the quarter ended June 30, 2026, net interest income totaled $52.9 million, representing approximately 79% of total revenues, compared to $49.2 million, or 79% of total revenues, for the same period in 2025. Net interest income is affected by factors including, but not limited to, changes in interest rates, loan and deposit pricing strategies and competitive conditions, loan prepayment speeds, the volume and mix of interest‑earning assets and interest‑bearing liabilities, and the level of non‑performing assets.
Previous wording
Net Interest Income (Fully-Taxable Equivalent) for the Three Months Ended March 31, 2026 and 2025. On a fully-taxable equivalent basis, net interest income for the three months ended March 31, 2026 was $52.6 million, an increase of $3.4 million, or 7%, compared to the same period in 2025. The increase between periods was driven primarily by a decrease in interest expense of $3.5 million, or 12%, and partially offset by a decrease in interest income, on a fully-taxable equivalent basis, of $125,000, or less than 1%.
Current wording
Net Interest Income (Fully-Taxable Equivalent) for the Three Months Ended June 30, 2026 and 2025. On a fully-taxable equivalent basis, net interest income for the three months ended June 30, 2026 was $53.2 million, an increase of $3.6 million, or 7%, compared to the same period in 2025. The increase between periods was driven primarily by a decrease in interest expense of $4.1 million, or 13%, partially offset by a decrease in interest income, on a fully-taxable equivalent basis, of $415,000, or 1%.
Previous wording
Average funding liabilities totaled $6.1 billion for the first quarter of 2026, a decrease of $34.8 million, or 1%, compared to the first quarter of 2025. Interest expense for the first quarter of 2026 decreased $3.5 million, primarily due to a reduction in the average cost of funds of 22 basis points to 1.72%. The decrease in the average cost of funds reflects changes in the interest rate environment, as well as a reduction in average high‑cost brokered deposits of $67.3 million between periods. The Federal Funds Effective Rate for the first quarter of 2026 was 3.64%, which was 69 basis points lower than the same period of 2025.
Current wording
Average funding liabilities totaled $6.1 billion for the second quarter of 2026, a decrease of $16.3 million, or less than 1%, compared to the second quarter of 2025. Interest expense for the second quarter of 2026 decreased $4.1 million, primarily due to a reduction in the average cost of funds of 26 basis points to 1.70%. The decrease in the average cost of funds reflects changes in the interest rate environment, as well as a reduction in average higher‑cost brokered deposits of $93.6 million between periods. The Federal Funds Effective Rate for the second quarter of 2026 was 3.63%, which was 70 basis points lower than the same period of 2025.
Previous wording
Average interest‑earning assets totaled $6.5 billion for the first quarter of 2026, an increase of $31.3 million, or 1%, compared to the first quarter of 2025. The decrease in interest income between periods of $125,000 was primarily attributable to a reduction in the recognition of net fair value mark accretion from purchase accounting, which declined by $727,000 between periods to $4.3 million in the first quarter of 2026. Fair value mark accretion recognized during the quarter consisted of $3.7 million related to loans and $759,000 related to investments, decreases of $655,000 and $72,000, respectively, between periods.
Current wording
Average interest‑earning assets totaled $6.5 billion for the second quarter of 2026, an increase of $51.3 million, or 1%, compared to the second quarter of 2025. The decrease in interest income between periods of $415,000 was primarily attributable to a reduction in the recognition of net fair value mark accretion from purchase accounting, which declined by $956,000 between periods to $4.0 million in the second quarter of 2026. Fair value mark accretion recognized during the quarter consisted of $3.3 million related to loans and $818,000 related to investments, decreases of $967,000 and $45,000, respectively, between periods.
Previous wording
Net Interest Margin (Fully-Taxable Equivalent) for the Three Months Ended March 31, 2026 and 2025. Net interest margin, on a fully-taxable equivalent basis, for the three months ended March 31, 2026 was 3.24%, an increase of 20 basis points over the three months ended March 31, 2025. Refer to the discussion above for a description of the factors contributing to the change between periods. Adjusting for the impact of net fair value market accretion income from purchase accounting, which contributed $4.3 million and $5.0 million to net interest income for the first quarter of 2026 and 2025, respectively, the Company reported non-GAAP, core net interest margin of 2.92% for the three months ended March 31, 2026, an increase of 24 basis points over the same period of 2025.
Current wording
Net Interest Margin (Fully-Taxable Equivalent) for the Three Months Ended June 30, 2026 and 2025. Net interest margin, on a fully-taxable equivalent basis, for the three months ended June 30, 2026 was 3.26%, an increase of 20 basis points over the three months ended June 30, 2025. Refer to the discussion above for a description of the factors contributing to the change between periods. Adjusting for the impact of net fair value mark accretion income from purchase accounting, which contributed $4.0 million and $4.9 million to net interest income on a fully-taxable equivalent basis for the second quarter of 2026 and 2025, respectively, the Company reported non-GAAP, core net interest margin of 2.97% for the three months ended June 30, 2026, an increase of 27 basis points over the same period of 2025.
Previous wording
(1)Income from fiduciary services: The increase between periods was driven by the increase in assets under management of $120.3 million, or 10%, to $1.3 billion at March 31, 2026.
Current wording
(1)Income from fiduciary services: The increase for the three and six months ended June 30, 2026, compared to the same periods in 2025, was driven by an increase in assets under management of $119.8 million, or 10%, to $1.4 billion at June 30, 2026.
Previous wording
(2)Mortgage banking income, net: The increase between periods was driven by the increase in the gain from the sale of residential mortgage loans. During the three months ended March 31, 2026, the Company sold $61.0 million, or 52% of its residential mortgage production, compared to $41.8 million or 55% for the same period of 2025.
Current wording
(4)Mortgage banking income, net: The increase for the three and six months ended June 30, 2026 compared to the same periods in 2025, was driven by higher gains on the sale of residential mortgage loans. During the three and six months ended June 30, 2026, the Company sold $68.7 million and $129.0 million, or 47% and 48%, respectively, of its residential mortgage production, compared to $48.4 million and $90.3 million, or 39% and 45%, respectively, for the same periods in 2025.
Previous wording
(2)Consulting and professional fees: The decrease between periods was primarily driven by the discontinuance of a number of legacy Northway consulting arrangements that were no longer required following the acquisition of Northway on January 2, 2025, and completion of integration activities in mid-March 2025 as we achieved our expected merger synergies.
Current wording
(2)Consulting and professional fees: The decrease for the six months ended June 30, 2026, compared to the same period in 2025, was driven by the discontinuance of a number of legacy Northway consulting arrangements that were no longer necessary following the acquisition of Northway on January 2, 2025, and the completion of integration activities in mid-March 2025, as we realized our expected merger synergies.
Previous wording
(3)Merger and acquisition costs: The merger and acquisition costs occurred in the first quarter of 2025 were related to the Northway acquisition. The Company did not incur similar costs during the first quarter of 2026.
Current wording
(3)Merger and acquisition costs: The merger and acquisition costs incurred for the three and six months ended June 30, 2025, were related to the Northway acquisition, which closed on January 2, 2025 . The Company did not incur similar costs during the same periods in 2026.
Previous wording
(4)Other expenses: The increase between periods was primarily driven by higher marketing expenses of $254,000 and increased customer‑related costs, including fraud, of $87,000.
Current wording
(4)Other expenses: The increases for the three and six month periods ended June 30, 2026, compared to the same periods in 2025, were primarily driven by higher marketing expenses of $283,000 and $376,000, respectively, and increased customer‑related costs, including fraud-related losses, of $83,000 and $145,000, respectively.
Previous wording
The Company’s estimated effective tax rate for 2026, before any discrete period items, is 22.5%, compared to our reported effective tax rate for 2025 of 17.2%. The increase in our estimated effective tax rate is driven by the aforementioned income tax benefit from the deferred tax asset remeasurement, lower forecasted tax-exempt income from municipal bonds, lower income tax credits and lower BOLI income as a percentage of pre-tax income.
Current wording
The Company’s estimated effective tax rate for 2026, excluding discrete items, is 22.1%, compared to the reported effective tax rate of 17.2% for 2025. The increase in the Company’s estimated effective tax rate is primarily attributable to the deferred tax asset remeasurement benefit recognized in connection with the Northway acquisition during the first quarter of 2025, as well as lower forecasted tax-exempt income from municipal securities, lower income tax credits and lower BOLI income as a percentage of pre-tax income.
Previous wording
Total cash and cash equivalents as of March 31, 2026, were $133.7 million, compared to $97.5 million at December 31, 2025. The increase in cash and cash equivalents was driven by temporary deposit and investment cash flows. The Company continues to actively manage its cash balances.
Current wording
Total cash and cash equivalents as of June 30, 2026, were $99.9 million, compared to $97.5 million at December 31, 2025. The Company continues to actively manage its cash balances.
Previous wording
Included within the Company’s cash and cash equivalents’ balances at March 31, 2026 and December 31, 2025, was cash held in escrow by the FHLBB as collateral posted by the counterparties for our derivatives in a net asset position totaling $7.5 million and $7.2 million, respectively. We and the counterparty manage these cash accounts daily. Refer to Notes 8 and 9 of the consolidated financial statements for additional detail on the Company’s derivatives and collateral.
Current wording
Included within the Company’s cash and cash equivalents’ balances at June 30, 2026 and December 31, 2025, was cash held in escrow by the FHLBB as collateral posted by the counterparties for our derivatives in a net asset position totaling $13.5 million and $7.2 million, respectively. We and the counterparty manage these cash accounts daily. Refer to Notes 8 and 9 of the consolidated financial statements for additional detail on the Company’s derivatives and collateral.
Previous wording
As of March 31, 2026, the reported value of the Company’s total investments portfolio was $1.4 billion, a decrease of $45.3 million, or 3%, since December 31, 2025, driven by normal paydowns, calls and maturities.
Current wording
As of June 30, 2026, the reported value of the Company's total investment portfolio was $1.4 billion, a decrease of $64.1 million, or 4%, from December 31, 2025. The net change between periods was primarily driven by the following:
Previous wording
Our HTM debt securities are carried at amortized cost on our consolidated statements of financial condition and comprised 34% of our investment portfolio as of both March 31, 2026 and December 31, 2025.
Current wording
Our HTM debt securities are carried at amortized cost on our consolidated statements of financial condition and comprised 33% and 34% of our investment portfolio as of June 30, 2026 and December 31, 2025, respectively.
Previous wording
The book value of our debt securities was $1.4 billion as of both March 31, 2026 and December 31, 2025. Our debt securities portfolio has limited credit risk due to its composition, which includes securities backed by the U.S. government and government-sponsored agencies, and highly rated subordinated corporate and municipal bonds by nationally recognized rating agencies. At March 31, 2026 and December 31, 2025, the book value of U.S. government and government‑sponsored agencies represented approximately 93% of our debt securities portfolio.
Current wording
The book value of our debt securities was $1.4 billion as of both June 30, 2026 and December 31, 2025. Our debt securities portfolio has limited credit risk due to its composition, which includes securities backed by the U.S. government and government-sponsored agencies, and highly rated subordinated corporate and municipal bonds by nationally recognized rating agencies. At June 30, 2026 and December 31, 2025, the book value of U.S. government and government‑sponsored agencies represented 93% of our debt securities portfolio.
Previous wording
The following table details the composition of the Company's investment portfolio, based on the book value of each security type as a percentage of total book value of the Company's debt securities, as of the dates indicated:
Current wording
The following table details the composition of the Company's investment portfolio, based on the carrying value of each security type as a percentage of total carrying value of the Company's debt securities, as of the dates indicated:
Previous wording
We continually monitor and evaluate our investment portfolio to identify and assess risks within our portfolio, including but not limited to, the impact of the current interest rate environment and the related prepayment risk, and the review of credit ratings. The overall mix of debt securities as of March 31, 2026, compared to December 31, 2025, remains consistent and is believed to be well-positioned to provide a stable source of cash flow. As of March 31, 2026 and December 31, 2025, the duration of our debt investment securities portfolio, adjusting for calls when appropriate and consensus prepayment speeds, was 4.8 years and 4.9 years, respectively.
Current wording
We continually monitor and evaluate our investment portfolio to identify and assess risks within our portfolio, including but not limited to, the impact of the current interest rate environment and the related prepayment risk, and the review of credit ratings. The overall mix of debt securities as of June 30, 2026, compared to December 31, 2025, remains consistent and is believed to be well-positioned to provide a stable source of cash flow. As of June 30, 2026 and December 31, 2025, the duration of our debt investment securities portfolio, adjusting for calls when appropriate and consensus prepayment speeds, was 4.8 years and 4.9 years, respectively, and the weighted average life was 6.4 years and 6.7 years, respectively.
Previous wording
At March 31, 2026 and December 31, 2025, subordinated corporate bonds represented 3% of the book value of the total bond portfolio, of which $26.0 million, or 68%, carried an investment‑grade credit rating, and $12.2 million, or 32%, consisted of non‑rated subordinated corporate bonds of community banks within our markets. As of March 31, 2026, the subordinated corporate bond portfolio was made up of 15 different companies, which included 13 different banks. The banks in the portfolio range from the largest U.S. banks to community banks, with 34% of our exposure as of March 31, 2026, being to global systemically important banks, or "G-SIBs". We continue to monitor and analyze the performance of our subordinated corporate bond portfolio.
Current wording
At June 30, 2026 and December 31, 2025, subordinated corporate bonds represented 3% of the book value of the total bond portfolio, of which $23.0 million, or 65%, carried an investment‑grade credit rating, and $12.2 million, or 35%, consisted of non‑rated subordinated corporate bonds of community banks within our markets. As of June 30, 2026, the subordinated corporate bond portfolio was made up of 14 different companies, which included 12 different banks. The banks in the portfolio range from the largest U.S. banks to community banks, with 37% of our exposure as of June 30, 2026, being to global systemically important banks, or “G-SIBs”. We continue to monitor and analyze the performance of our subordinated corporate bond portfolio.
Previous wording
Other Investments. Our other investments on the consolidated statements of condition is primarily made up of FHLBB and FRB common stock. These investments are carried at cost. We are required to maintain a certain level of investment in FHLBB stock based on our level of FHLBB advances, and maintain a certain level of investment in FRB common stock based on the Bank's capital levels. As of March 31, 2026 and December 31, 2025, our investment in FHLBB common stock totaled $14.6 million and $17.7 million, respectively, while our investment in FRB common stock totaled $8.7 million at both dates.
Current wording
Other Investments. Our other investments on the consolidated statements of condition is primarily made up of FHLBB and FRB common stock. These investments are carried at cost. We are required to maintain a certain level of investment in FHLBB stock based on our level of FHLBB advances, and maintain a certain level of investment in FRB common stock based on the Bank's capital levels. As of June 30, 2026 and December 31, 2025, our investment in FHLBB common stock totaled $14.7 million and $17.7 million, respectively, while our investment in FRB common stock totaled $8.7 million at both dates.
Previous wording
Portfolio Concentrations. Our primary geographical markets are Maine, New Hampshire and Massachusetts, making up 57%, 25%, and 13%, respectively, of the loan portfolio as of March 31, 2026, compared to 57%, 25% and 12%, respectively, as of December 31, 2025. As of March 31, 2026, our distribution channels included 56 branches in Maine and 16 branches in New Hampshire, and an online residential mortgage and small business digital loan platform.
Current wording
Portfolio Concentrations. Our primary geographical markets are Maine, New Hampshire and Massachusetts, making up 57%, 24%, and 13%, respectively, of the loan portfolio as of June 30, 2026, compared to 57%, 25% and 16%, respectively, as of December 31, 2025. As of June 30, 2026, our distribution channels included 56 branches in Maine and 16 branches in New Hampshire, and an online residential mortgage and small business digital loan platform.
Previous wording
As of March 31, 2026, the (i) non-residential building operators’ industry (operators of commercial and industrial buildings, retail establishments, theaters, banks and insurance buildings) and (ii) lessors of residential buildings industry (lessors of buildings used as residences, such as single-family homes, apartments and town houses) concentrations were both 28% of our total commercial real estate portfolio and 12% of total loans, respectively. As of March 31, 2026, there were no other industry concentrations within our loan portfolio that exceeded 10% of total loans.
Current wording
As of June 30, 2026, the (i) non-residential building operators’ industry (operators of commercial and industrial buildings, retail establishments, theaters, banks and insurance buildings) and (ii) lessors of residential buildings industry (lessors of buildings used as residences, such as single-family homes, apartments and town houses) concentrations were 28% and 27%, respectively, of our total commercial real estate portfolio and were both 12% of total loans. As of June 30, 2026, there were no other industry concentrations within our loan portfolio that exceeded 10% of total loans.
Previous wording
(a) Multi-family (5+ units) loans are primarily located in non-urban locations, including 51% in Maine, 35% in New Hampshire, and 13% in Massachusetts as of March 31, 2026, compared to 50%, 37%, and 11%, respectively, as of December 31, 2025.
Current wording
(a) Multi-family (5+ units) loans are primarily located in non-urban locations, including 52% in Maine, 31% in New Hampshire, and 15% in Massachusetts as of June 30, 2026, compared to 50%, 37%, and 11%, respectively, as of December 31, 2025.
Previous wording
(b) Office loans are primarily located in non-urban locations, including 45% in Maine, 39% in New Hampshire, and 15% in Massachusetts as of March 31, 2026, compared to 46%, 39%, and 15%, respectively, as of December 31, 2025.
Current wording
(b) Office loans are primarily located in non-urban locations, including 48% in Maine, 37% in New Hampshire, and 15% in Massachusetts as of June 30, 2026, compared to 46%, 39%, and 15%, respectively, as of December 31, 2025.
Previous wording
•The Credit Risk Policy Committee, which is an internal management committee comprised of various executives and senior managers across business lines, including Accounting and Finance, Credit Underwriting, Collections and Special Assets, Risk, and Commercial and Retail Banking, along with the Credit Risk and Special Assets teams, oversees the Company's systems and procedures to monitor the credit quality of its loan portfolio, conduct a loan review program, and maintain the integrity of the loan rating system.
Current wording
•The Credit Risk Policy Committee, which is an internal management committee comprised of various executives and senior managers across business lines, including Accounting and Finance, Credit Underwriting, Collections and Special Assets, Risk, and Commercial and Retail Banking, along with the Credit Risk team, oversees the Company's systems and procedures to monitor the credit quality of its loan portfolio, conduct a loan review program, and maintain the integrity of the loan rating system.
Previous wording
Potential Problem Loans. Potential problem loans consist of classified accruing commercial and commercial real estate loans that were 30-89 days past due. Such loans are characterized by weaknesses in the financial condition of borrowers or collateral deficiencies. Based on historical experience, the credit quality of some of these loans may improve due to changes in collateral values or the financial condition of the borrowers, while the credit quality of other loans may deteriorate, resulting in a loss. These loans are not included in the above analysis of non-accrual loans. As of March 31, 2026 and December 31, 2025, loans classified as potential problem loans totaled $381,000 and $4.6 million, respectively.
Current wording
Potential Problem Loans. Potential problem loans consist of classified accruing commercial and commercial real estate loans that were 30-89 days past due. Such loans are characterized by weaknesses in the financial condition of borrowers or collateral deficiencies. Based on historical experience, the credit quality of some of these loans may improve due to changes in collateral values or the financial condition of the borrowers, while the credit quality of other loans may deteriorate, resulting in a loss. These loans are not included in the above analysis of non-accrual loans. As of June 30, 2026 and December 31, 2025, loans classified as potential problem loans totaled $776,000 and $4.6 million, respectively.
Previous wording
ACL on Loans. During the first quarter of 2026, we completed our annual review and assessment of significant model inputs and assumptions within the discounted cash flow analysis used for estimating the Company’s ACL on loans, and we determined there were no material changes to our methodology or key loss drivers. The significant key assumptions used with the ACL on loans calculation as of March 31, 2026 and December 31, 2025, included: (i) Company-specific key loss drivers (i.e., macroeconomic factors), (ii) our forecast period and reversion speed, (iii) prepayment speeds, and (iv) various qualitative factors.
Current wording
ACL on Loans. There were no significant changes in our modeling methodology to determine the ACL on loans during the three or six months ended June 30, 2026. The significant key assumptions used with the ACL on loans calculation as of June 30, 2026 and December 31, 2025, included: (i) Company-specific key loss drivers (i.e., macroeconomic factors), (ii) our forecast period and reversion speed, (iii) prepayment speeds, and (iv) various qualitative factors.
Previous wording
As of March 31, 2026 and December 31, 2025, the recorded ACL on loans was $45.5 million, or 0.92% to total loans, and $45.2 million, or 0.91% of total loans, respectively, and represented our best estimate. Our ACL on loans estimate as of each date incorporated the ongoing risk of a recession over the next 12 to 24 months using multiple scenarios and probability weighting each scenario. The ACL on loans as of March 31, 2026 and December 31, 2025, incorporated a similar weighting for the probability of a recession over the next 12 to 24 months based on our forecasted macroeconomic outlook as of each date. Refer to “—Provision for Credit Losses” and Note 4 of the consolidated financial statements for other factors impacting the change in ACL on loans during the three months ended March 31, 2026.
Current wording
As of June 30, 2026 and December 31, 2025, the recorded ACL on loans was $45.6 million, or 0.91% to total loans, and $45.3 million, or 0.91% of total loans, respectively, and represented our best estimate. Our ACL on loans estimate as of each date incorporated the ongoing risk of a recession over the next 12 to 24 months using multiple scenarios and probability weighting each scenario. The ACL on loans as of June 30, 2026 and December 31, 2025, incorporated a similar weighting for the probability of a recession over the next 12 to 24 months based on our forecasted macroeconomic outlook as of each date. Refer to “—Provision for Credit Losses” and Note 4 of the consolidated financial statements for other factors impacting the change in ACL on loans during the six months ended June 30, 2026.
Previous wording
ACL on Off-Balance Sheet Credit Exposures. The ACL on off-balance sheet credit exposures as of March 31, 2026 and December 31, 2025 was $2.8 million and $3.1 million, respectively. During the three months ended March 31, 2026, there were no significant changes in our model methodology to determine the ACL on off-balance sheet credit exposures The model uses the credit loss factors for each segment calculated within the ACL on loans model described above.
Current wording
ACL on Off-Balance Sheet Credit Exposures. The ACL on off-balance sheet credit exposures as of June 30, 2026 and December 31, 2025, was $3.1 million for both periods. During the six months ended June 30, 2026, there were no significant changes in our model methodology to determine the ACL on off-balance sheet credit exposures The model uses the credit loss factors for each segment calculated within the ACL on loans model described above.
Previous wording
Deposits. Deposits totaled $5.6 billion and $5.5 billion at March 31, 2026 and December 31, 2025, respectively. The 1% increase during the first quarter of 2026 was driven by an increase in core deposits of $86.3 million, or 2%, to $4.8 billion at March 31, 2026. Savings and interest checking deposit balances grew 5% and 4%, respectively, during the first quarter of 2026, offsetting the decrease in non-interest checking, CDs, and brokered deposits of 3%, 4% and 9%, respectively, during the same period.
Current wording
Deposits. Deposits totaled $5.6 billion and $5.5 billion at June 30, 2026 and December 31, 2025, respectively. The 1% increase during the first half of 2026 was driven by an increase in core deposits of $103.1 million, or 2%, to $4.8 billion at June 30, 2026. Savings and interest checking deposit balances grew 12% and 3%, respectively, during the first half of 2026, offsetting the decrease in non-interest checking, money market, CDs, and brokered deposits of 3%, 5%, 7% and 30%, respectively, during the same period.
Previous wording
The Company's loan-to-deposit ratio was 89% at March 31, 2026 compared to 90% at December 31, 2025.
Current wording
The Company's loan-to-deposit ratio was 90% at June 30, 2026 and December 31, 2025.
Previous wording
Total uninsured and uncollateralized deposits that exceeded the FDIC deposit insurance limit of $250,000 and were not secured by pledged assets or any other guarantee of the Company totaled $837.0 million, or 15% of total deposits, as of March 31, 2026, and $828.3 million, or 15% of total deposits, as of December 31, 2025.
Current wording
Total uninsured and uncollateralized deposits that exceeded the FDIC deposit insurance limit of $250,000 and were not secured by pledged assets or any other guarantee of the Company totaled $885.3 million, or 16% of total deposits, as of June 30, 2026, and $828.3 million, or 15% of total deposits, as of December 31, 2025.
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Current report — wording carried from elsewhere
(1) Reported on tax-equivalent basis calculated using the federal corporate income tax rate of 21%, including certain commercial loans.
Current report — wording carried from elsewhere
(2) Non-accrual loans and loans held for sale are included in total average loans.
Current report — wording carried from elsewhere
(3) This is a non-GAAP measure. Please see “Non-GAAP Financial Measures and Reconciliation to GAAP” for additional information.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Adjusted return on average tangible equity is the ratio of (i) core net income (as defined in the table above) adjusted for (a) amortization of CDI assets and the tax impact of the adjustment and (b) goodwill impairment, as necessary, to (ii) average shareholders' equity, adjusted for average goodwill and CDI assets.