Bar Harbor Bankshares Reports Third Quarter 2026 Results; Declares Dividend
BAR HARBOR, ME / ACCESS Newswire / October 22, 2026 / Bar Harbor Bankshares (NYSE American:BHB) (the "Company") reported third quarter 2026 GAAP net income of $16.1 million, or $0.96 per diluted share, and core earnings (Non-GAAP) of $17.5 million, or $1.04 per diluted share, compared to GAAP net income of $15.2 million, or $0.91 per diluted share, and core earnings (Non-GAAP) of $15.4 million, or $0.92 per diluted share, in the second quarter of 2026.
THIRD QUARTER 2026 HIGHLIGHTS (all comparisons to second quarter 2026, unless otherwise noted)
Bar Harbor Bankshares' President and Chief Executive Officer, Curtis C. Simard, stated, "We are pleased to announce another strong quarter of financial results. Our success reflects our commitment to performance metrics in all our core businesses, centered in exceptional service and targeted calling. Our Retail teams opened more than 1,600 new customer accounts during the quarter, demonstrating this calling culture and the effectiveness of our execution-focused approach to banking. Total deposits grew 9% on an annualized basis contributing to a lower overall cost of funds, reduced reliance on wholesale borrowings and increased profitability. Wealth management continues to be a significant contributor and meaningful part of our organization. This has never been more true as we are adding seasoned recruits to our commercial and industrial lending team who, in addition to building a robust pipeline, possess the trusted status with customers for a natural wealth referral. Our consistent financial performance reflects the disciplined execution of our strategy, the dedication of our employees and our unwavering focus on long-term shareholder value."
DIVIDEND DECLARED
The Board of Directors of the Company voted to declare a cash dividend of $0.34 per share to shareholders of record at the close of business on November 19, 2026, payable on December 18, 2026. The dividend equates to a 3.52% annualized yield based on the $38.69 closing share price of the Company's common stock on September 30, 2026, the last trading day of the third quarter 2026.
FINANCIAL CONDITION (Quarter results for September 30, 2026 compared to June 30, 2026)
Total assets decreased slightly to $4.7 billion at the end of the third quarter 2026. The decrease of less than 1% was primarily due to lower cash balances and a decrease in available-for-sale debt securities.
Total cash and cash equivalents were $74.8 million at the end of the third quarter 2026, compared to $104.4 million at the end of the second quarter 2026. Interest-earning deposits with other banks decreased to $37.8 million at the end of the third quarter 2026, compared to $58.1 million at the end of the second quarter 2026. The decrease in cash and cash equivalents is primarily driven by paydowns of wholesale funds.
Available-for-sale debt securities were $581.3 million compared to $601.8 million at the end of the second quarter 2026. Portfolio unrealized losses were $72.9 million at quarter-end compared to $45.0 million at the end of the second quarter 2026, the increase was driven by the current interest rate environment. During the quarter there were purchases of $31.3 million, paydowns and calls of $22.8 million and net accretion of $420 thousand. The quarter-to-date weighted average yield of the securities portfolio was 4.10% compared to 4.06% at the end of the second quarter 2026. As of the third quarter 2026 and the second quarter 2026, our securities portfolio had an average life of 8.0 years and 7.2 years respectively, with an effective duration of 5.5 years and 5.2 years, respectively. At the end of the third quarter 2026, all securities remain classified as available for sale.
Federal Home Loan Bank stock decreased $5.5 million to $8.0 million at the end of the third quarter 2026 compared to $13.4 million at the end of the second quarter 2026, primarily driven by the decrease in wholesale borrowings.
Total loans were remained steady at $3.6 billion in the third quarter 2026 as well as the second quarter 2026. Commercial real estate loans increased $21.9 million driven by $55.1 million in originations during the quarter, partially offset by $33.7 million in payoffs during the quarter. Commercial and industrial loans decreased $21.6 million and included $36.0 million in payoffs offset in part by $12.3 million of originations during the quarter. Residential real estate loans decreased $9.6 million during the quarter due to $31.0 million in payoffs and $2.9 million in paydowns, partially offset by $18.5 million in originations. Loans held for sale were $10.7 million in the third quarter 2026 compared to $10.2 million in the second quarter 2026 as we originated $36.8 million in loans held for sale and sold $35.5 million in loans during the quarter.
The allowance for credit losses ("ACL") on loans was $31.8 million at the end of the third quarter 2026, compared to $32.2 million at the end of the second quarter 2026. Charge-offs were minimal with a net charge-off to average loans ratio of 0.03% for the third quarter 2026.
Premises and equipment were $61.4 million at the end of the third quarter 2026 compared to $61.2 million at the end of the second quarter 2026 due to renovation projects. Other real estate owned decreased $1.0 million in the third quarter 2026 to $7.1 million due to the further write-down of one commercial property.
Total deposits increased $84.0 million to $3.9 billion at the end of the third quarter 2026. The increase was driven by a $107.2 million increase in interest-bearing demand deposits and a $24.6 million increase in non-interest-bearing demand deposits in the third quarter 2026. Savings deposits increased $7.6 million in the third quarter 2026 and money market deposits increased $7.4 million in the third quarter 2026. Growth in non-maturity deposits included $31.7 million in new customer deposits. Time deposits decreased $62.8 million driven primarily by a $59.0 million reduction in brokered deposits.
Total borrowings decreased $123.7 million in the third quarter 2026 to $157.4 million compared to $281.2 million in the second quarter 2026. The decrease was driven by paydowns of wholesale borrowings from loan payoffs as well as a $20.0 million subordinated debt redemption.
The Company's book value per share was $31.95 at the end of the third quarter 2026 compared to $32.80 at the end of the second quarter 2026. Tangible book value per share (Non-GAAP) was $22.61 at the end of the third quarter 2026, compared to $23.43 at the end of the second quarter 2026.
RESULTS OF OPERATIONS (Quarter results for September 30, 2026 compared to September 30, 2025)
The net interest margin was 3.77% in the third quarter 2026 compared to 3.56% in the same quarter 2025. As loan balances grew year-over-year the yield on loans expanded 4 basis points to 5.64% compared to 5.60% in the same period of 2025. Interest-bearing deposit costs decreased year-over-year to 1.87% compared to 2.12% in the same period of 2025.
Total interest and dividend income increased by 4% or $2.5 million to $58.4 million in the third quarter 2026 compared to $55.9 million in the third quarter 2025. Yields on earning assets grew to 5.39% in the third quarter 2026 compared to 5.36% in the third quarter 2025. The yield on available-for-sale debt securities decreased to 4.10% in the third quarter 2026 compared to 4.14% in the same period of 2025. The loan yield grew to 5.64% in the third quarter 2026 compared to 5.60% in the same period of 2025 driven by residential loan yield expansion to 4.81% for the third quarter 2026 from 4.42% in the third quarter of 2025. Total loan yield growth was partially offset by a decrease in the commercial and industrial yield to 6.11% for the third quarter 2026 from 6.45% in the third quarter 2025 driven by payoffs.
Total interest expense decreased $1.3 million in the third quarter 2026 compared to the third quarter 2025. Deposit costs were down $1.3 million year-over-year as the cost of interest-bearing deposits decreased to 1.87% in the third quarter 2026 from 2.12% in the same period of 2025. Borrowing costs increased $34 thousand, or 1.3% year-over-year.
The provision for credit losses on loans in the third quarter 2026 was a recapture of $167 thousand compared to a $3.7 million provision in the same period of 2025. The recapture was primarily due to the full payoff of a PCD relationship that previously carried significant reserves. Net charge-offs remained low at $303 thousand in the third quarter of 2026 compared to $316 thousand in the third quarter of 2025. The allowance for credit losses to total loans coverage ratio for the third quarter 2026 remains adequately reserved and was 0.88% compared to 0.95% in the third quarter of 2025.
Non-interest income was $10.8 million in the third quarter 2026 compared to $10.6 million in the same quarter 2025. Trust and investment management fee income increased $283 thousand or 7% to $4.2 million in the third quarter 2026 compared to $3.9 million in the third quarter 2025 as assets under management grew 2.4% over the same periods. Customer service fees increased $255 thousand or 6% during the quarter to $4.6 million compared to $4.3 million in the third quarter 2025. Mortgage banking income increased to $766 thousand in the third quarter of 2026 compared to $423 thousand in the third quarter 2025 driven by higher gains due to the interest rate environment. The increases were offset in part by customer derivative income decreasing to $484 thousand from $962 thousand in the third quarter 2025 due to lower customer swap volume.
Non-interest expenses decreased $1.4 million to $31.4 million in the third quarter 2026 compared to $32.7 million in the third quarter 2025. The decrease was due to acquisition expenses in the prior year. Salaries and employee benefit costs increased 3% to $16.4 million in the third quarter 2026 compared to $15.9 million in the third quarter 2025 driven by cost-of-living adjustments and increased full-time equivalents year-over-year. Occupancy and equipment increased $319 thousand driven primarily by higher operating costs due to the Woodsville acquisition. Amortization of intangible assets increased $116 thousand, reflecting incremental amortization associated with the Woodsville acquisition. Other expenses increased $1.2 million for the third quarter 2026 compared to the third quarter 2025 primarily due the aforementioned $1.0 million write-down on other real estate owned.
Income tax expense was $4.3 million for the third quarter 2026 compared to $2.2 million for the third quarter of 2025. Our GAAP effective tax rate for the third quarter 2026 was 21.0% compared to 19.8% in the third quarter 2025.
BACKGROUND
Bar Harbor Bankshares (NYSE American:BHB) is the parent company of its wholly-owned subsidiary, Bar Harbor Bank & Trust. Founded in 1887, Bar Harbor Bank & Trust is a true community bank serving the financial needs of its clients for over 135 years. Bar Harbor Bank & Trust provides full-service community banking with office locations in all three Northern New England states of Maine, New Hampshire and Vermont. For more information, visit www.barharbor.bank.
FORWARD-LOOKING STATEMENTS
All statements, other than statements of historical fact, included in this release that address activities, events, or developments that the Company expects, believes, or anticipates will or may occur in the future are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. When used in this release the words "believe," "anticipate," "expect," "may," "will," "assume," "should," "predict," "could," "would," "intend," "targets," "estimates," "projects," "plans," and "potential," and other similar words and expressions of the future, are intended to identify such forward-looking statements, but other statements not based on historical information may also be considered forward-looking, including statements relating to Company's balance sheet management, our credit trends, our overall credit performance, and the Company's strategic plans, objectives, and intentions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of the Company to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from the statements, including, but not limited to: (1) changes in interest rates and the cost of deposits; (2) changes in general business and economic conditions on a national basis and in our markets throughout Northern New England; (3) changes in consumer behavior due to political, business, and economic conditions, including ongoing armed conflicts, inflation, future United States government shutdowns, and concerns about liquidity; (4) the possibility that our asset quality could decline or that we experience greater loan losses than anticipated; (5) the impact of liquidity needs on our results of operations and financial condition; (6) changes in the size and nature of our competition; (7) unanticipated weakness in loan demand, pricing, or collectability; (8) the possibility that future credit losses are higher than currently expected due to changes in economic assumptions or adverse economic developments; (9) operational risks including, but not limited to, changes in information technology, cybersecurity incidents, fraud, natural disasters, climate change, war, terrorism, civil unrest, and future pandemics; (10) lack of strategic growth opportunities or our failure to execute on available opportunities, (11) our ability to effectively manage problem credits; (12) our ability to successfully develop new products and implement efficiency initiatives on time and with the results projected; (13) our ability to retain executive officers and key employees and their customer and community relationships; (14) regulatory, litigation, and reputational risks and the applicability of insurance coverage; (15) changes in the reliability of our vendors, internal control systems, or information systems; (16) changes in legislation or regulation and accounting principles, policies, and guidelines; (17) reductions in the market value or outflows of wealth management assets under management; (18) the impacts of tariffs, sanctions, and other trade policies of the United States and its global trading counterparts; and (19) changes in the assumptions used in making such forward-looking statements. Additional factors which could affect the forward-looking statements can be found in the Company's annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed with the Securities and Exchange Commission (the "SEC") and available on the SEC's website at http://www.sec.gov. The Company believes the forward-looking statements contained herein are reasonable; however, many of such risks, uncertainties, and other factors are beyond the Company's ability to control or predict and undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. Therefore, the Company can give no assurance that its future results will be as estimated. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.
NON-GAAP FINANCIAL MEASURES
This document contains certain non-GAAP financial measures in addition to results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These non-GAAP measures are intended to provide the reader with additional supplemental perspectives on operating results, performance trends, and financial condition. Non-GAAP financial measures are not a substitute for GAAP measures; they should be read and used in conjunction with the Company's GAAP financial information. Because non-GAAP financial measures presented in this document are not measurements determined in accordance with GAAP and are susceptible to varying calculations, these non-GAAP financial measures, as presented, may not be comparable to other similarly titled measures presented by other companies. A reconciliation of non-GAAP financial measures to GAAP measures is provided below. In all cases, it should be understood that non-GAAP measures do not depict amounts that accrue directly to the benefit of shareholders. An item which management excludes when computing non-GAAP core earnings can be of substantial importance to the Company's results for any particular quarter or year. Each non-GAAP measure used by the Company in this report as supplemental financial data should be considered in conjunction with the Company's GAAP financial information.
The Company utilizes the non-GAAP measure of core earnings in evaluating operating trends, including components for core revenue and expense. These measures exclude amounts which the Company views as unrelated to its normalized operations, including gains/losses on securities, premises, equipment and other real estate owned, acquisition costs, restructuring costs, legal settlements, and systems conversion costs. Non-GAAP adjustments are presented net of an adjustment for income tax expense.
The Company also calculates core earnings per share based on its measure of core earnings. The Company views these amounts as important to understanding its operating trends, particularly due to the impact of accounting standards related to acquisition activity. Analysts also rely on these measures in estimating and evaluating the Company's performance. Management also believes that the computation of non-GAAP core earnings and core earnings per share may facilitate the comparison of the Company to other companies in the financial services industry. The Company also adjusts certain equity related measures to exclude intangible assets due to the importance of these measures to the investment community.
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CONTACTS
Josephine Iannelli; EVP, Chief Financial Officer & Treasurer; (207) 288-3314
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SOURCE: Bar Harbor Bank & Trust