Bank of Marin Bancorp Reports Third Quarter Financial Results Driven by Loan Growth, NIM Expansion and Higher Earnings
NOVATO, Calif.--( BUSINESS WIRE)--Bank of Marin Bancorp, "Bancorp" (Nasdaq: BMRC), parent company of Bank of Marin, "Bank," completed another quarter of improved financial performance, reflecting continued enhanced profitability and overall balance sheet strength. This performance was supported by progress across key financial and operating priorities:
BMRC reports net income of $9.9 million for the third quarter of 2026. This compares to net income of $9.2 million for the second quarter of 2026 and net income of $7.5 million for the third quarter of 2025. Diluted earnings per share was $0.62 for the third quarter, compared to $0.58 for the prior quarter and $0.47 for the third quarter of the prior year. Continued net interest margin expansion largely drove these increases, contributing to a 32% year-over-year increase in quarterly diluted earnings per share.
"Active management of deposit costs, growth in fee income, and expense discipline drove a 17% increase in pre-tax pre-provision net income on a sequential quarter basis," said President & CEO Tim Myers. "Organic originations drove loan growth during the quarter which was supplemented by a California residential loan pool purchase that utilized excess liquidity, diversified our earning assets, and is expected to provide attractive risk-adjusted returns."
Selected Financial Results
Comparable (non-GAAP) Excluding Loss on Sale of Securities
Three months ended
Nine months ended
(in thousands, except per share amounts; unaudited)
September 30, 2026
June 30, 2026
% Change
September 30, 2025
% Change
September 30, 2026
September 30, 2025
% Change
Pre-tax, pre-provision net income
Pre-tax, pre-provision net income (GAAP)
$
14,499
$
12,353
17.4
%
$
9,610
50.9
%
$
38,449
$
4,967
674.1
%
Comparable pre-tax, pre-provision net income (non-GAAP)
14,499
12,353
17.4
%
9,610
50.9
%
38,449
23,703
62.2
%
Net income
Net income (GAAP)
9,934
9,246
7.4
%
7,526
32.0
%
27,690
3,866
616.2
%
Comparable net income (non-GAAP)
9,934
9,246
7.4
%
7,526
32.0
%
27,690
17,064
62.3
%
Diluted earnings per share
Weighted average diluted shares
Diluted earnings per share (GAAP)
$
0.62
$
0.58
6.9
%
$
0.47
31.9
%
$
1.73
$
0.24
620.8
%
Comparable diluted earnings per share (non-GAAP)
$
0.62
$
0.58
6.9
%
$
0.47
31.9
%
$
1.73
$
1.07
61.7
%
See complete Reconciliation of GAAP and Non-GAAP Financial Measures below
Related non-GAAP tax benefit calculated using blended statutory rate of 29.5636%
Concurrent with this release, Bancorp issued presentation slides providing supplemental information, some of which will be discussed during the third quarter 2026 earnings call. The earnings release and presentation slides are intended to be reviewed together and can be found online on Bank of Marin’s website at www.bankofmarin.com under “Investor Relations.”
Additional highlights for the third quarter of 2026 included the following:
Operating Results
Comparable (non-GAAP) Excluding Loss on Sale of Securities
Three months ended
Nine months ended
(in thousands, except per share amounts; unaudited)
September 30, 2026
June 30, 2026
September 30, 2025
September 30, 2026
September 30, 2025
Return on average assets
Average assets
$
3,766,498
$
3,850,140
$
3,828,876
$
3,867,814
$
3,765,281
Return on average assets (GAAP)
1.05
%
0.96
%
0.78
%
0.96
%
0.14
%
Comparable return on average assets (non-GAAP)
1.05
%
0.96
%
0.78
%
0.96
%
0.61
%
Return on average equity
Average stockholders' equity
$
395,812
$
395,328
$
439,950
$
396,378
$
438,781
Return on average equity (GAAP)
9.96
%
9.38
%
6.79
%
9.34
%
1.18
%
Comparable return on average equity (non-GAAP)
9.96
%
9.38
%
6.79
%
9.34
%
5.20
%
Return on average tangible common equity
Average goodwill and intangibles
$
74,192
$
74,393
$
75,011
$
74,390
$
75,226
Average tangible common equity
$
321,620
$
320,935
$
364,939
$
321,988
$
363,555
Return on average tangible common equity (GAAP)
12.26
%
11.55
%
8.18
%
11.50
%
1.42
%
Comparable return on average tangible common equity (non-GAAP)
12.26
%
11.55
%
8.18
%
11.50
%
6.28
%
Efficiency ratio
Efficiency ratio (GAAP)
58.65
%
63.62
%
67.86
%
62.73
%
92.50
%
Comparable efficiency ratio (non-GAAP)
58.65
%
63.62
%
67.86
%
62.73
%
72.11
%
See complete Reconciliation of GAAP and Non-GAAP Financial Measures below
Related non-GAAP tax benefit calculated using blended statutory rate of 29.5636%
“The quarterly growth in deposit service charge income, which annualized to $1 million, is an example of the strategic fee income initiatives we are pursuing to diversify our revenue streams,” said Chief Financial Officer Dave Bonaccorso. “Consistent with prior rising interest rate cycles, we expect that our legendary customer service, strong liquidity position, and high noninterest-bearing deposit percentage will result in a relatively low rising-rate deposit beta. Continued legacy loan repricing along with new loan originations at higher rates should support modest net interest margin expansion over time."
Loans and Credit Quality
Loans increased by $43.4 million for the third quarter and totaled $2.144 billion as of September 30, 2026, compared to $2.101 billion as of June 30, 2026. Third quarter 2026 new fundings were $63.6 million compared to $62.8 million in the prior quarter and $69.0 million in the third quarter of 2025. Year-to-date new fundings increased 12% and total commitments increased 21% from 2025. In addition, the Bank used a portion of its excess liquidity to purchase the $31.1 million residential mortgage pool mentioned above.
Three months ended
Nine months ended
(in millions; unaudited)
September 30, 2026
June 30, 2026
September 30, 2025
September 30, 2026
September 30, 2025
Gross loans beginning balance
$
2,101.0
$
2,115.7
$
2,073.6
$
2,120.9
$
2,083.3
Newly funded
63.6
62.8
69.0
187.2
167.0
New total commitments 1
102.4
98.4
99.8
281.3
232.6
Purchased
31.1
—
0.2
31.1
0.2
Net increase (decrease) in line of credit utilization
2.5
14.5
2.5
17.6
(4.1
)
Payoffs
(31.6
)
(71.2
)
(33.9
)
(133.4
)
(95.9
)
Charge-offs
—
—
—
(7.3
)
—
Note sales
—
—
—
(9.1
)
—
Amortization
(22.2
)
(20.8
)
(21.0
)
(62.6
)
(60.1
)
Gross loans ending balance
$
2,144.4
$
2,101.0
$
2,090.4
$
2,144.4
$
2,090.4
Weighted average rate
Newly funded
6.65
%
6.53
%
6.10
%
6.37
%
6.32
%
Payoffs
5.93
%
5.86
%
6.51
%
5.76
%
6.09
%
Spread
0.72
%
0.67
%
(0.41
)%
0.61
%
0.23
%
1 New total commitments includes both newly funded loans and new unfunded commitments
Non-accrual loans increased by $1.2 million during the quarter to $9.7 million, or 0.45% of total loans, compared to $8.5 million, or 0.40%, at June 30, 2026.
Classified loans increased by $15.2 million during the third quarter of 2026 to $35.0 million from $19.9 million at June 30, 2026. Loans designated as special mention, which are not considered adversely classified, decreased to $65.1 million at September 30, 2026, compared to $100.9 million at June 30, 2026, largely due to the downgrade of $17.6 million to classified and upgrades and payoffs of $18.2 million. The primary driver of the increase in classified loans and the decrease in special mention loans is a $14.1 million owner-occupied commercial real estate relationship facing a borrower-specific challenge. The loan is well-collateralized, the borrower is paying as agreed, and there is no expected loss potential.
Accruing loans past due 30 to 89 days totaled $2.6 million at September 30, 2026, compared to $2.0 million at June 30, 2026.
Net charge-offs totaled $21 thousand in the third quarter of 2026 compared to $39 thousand in the prior quarter.
The Bank recorded a $500 thousand provision for credit losses on loans in the third quarter of 2026, compared to a reversal of the provision for credit losses on loans of $320 thousand in the prior quarter, driven primarily by loan growth.
The ratio of allowance for credit losses to total loans remained stable at 1.07% for both September 30, 2026 and June 30, 2026.
There was a provision for credit losses on unfunded loan commitments of $325 thousand in the third quarter of 2026 compared to no provision in the prior quarter due to an increase in commitments, primarily within construction.
Cash, Cash Equivalents and Restricted Cash
Total cash, cash equivalents and restricted cash were $265.3 million at September 30, 2026, a decrease of $14.3 million compared to $279.6 million at June 30, 2026.
Investments
The investment securities portfolio totaled $1.215 billion at September 30, 2026, a decrease of $27.6 million from June 30, 2026. The decrease in the portfolio was due to principal repayments and calls/maturities totaling $50.2 million and $1.1 million, respectively, and an increase of $35.2 million in unrealized losses on available-for-sale ("AFS") securities, partially offset by purchases of $58.9 million. The portfolio is eligible for pledging to the Federal Home Loan Bank ("FHLB") and the Federal Reserve as collateral for borrowing, and is comprised of high credit quality investments with an average effective duration of 3.11. The portfolio generates cash flows monthly from interest, principal amortization and payoffs, which supports the Bank's liquidity. Those cash flows totaled $64.4 million and $92.1 million in the third quarter of 2026 and the second quarter of 2026, respectively.
Deposits
Deposits increased $25.3 million, or 0.8%, to $3.395 billion at September 30, 2026, compared to $3.370 billion at June 30, 2026, including a $45.0 million increase in noninterest-bearing balances, partially offset by decreases in money market and time accounts. As of September 30, 2026 and June 30, 2026, there were no one-way sales, although the Bank sold an average of $130.6 million in the third quarter, compared to an average of $93.7 million in the second quarter, within money market accounts during the quarter which enhanced non-interest income and net interest margin. Noninterest-bearing deposits continued to make up a strong 37.8% of total deposits at September 30, 2026, compared to 36.7% at June 30, 2026. The Bank's focused business development efforts generated $23.2 million in new deposit relationships during the quarter, including $13.3 million in new noninterest-bearing deposits.
Borrowings and Liquidity
As of September 30, 2026, the Bank had no outstanding short-term borrowings, consistent with June 30, 2026. Net available funding sources, including unrestricted cash, unencumbered available-for-sale securities and total available borrowing capacity totaled $2.162 billion, or 63.67% of total deposits and 178.5% of estimated uninsured and uncollateralized deposits as of September 30, 2026.
The following table details the components of our contingent liquidity sources as of September 30, 2026.
(in millions)
Total Available
Amount Used
Net Availability
Internal Sources
Unrestricted cash 1
$
247.2
$
—
$
247.2
Unencumbered securities at market value
518.6
—
518.6
External Sources
FHLB line of credit
964.0
—
964.0
FRB line of credit
291.8
—
291.8
Lines of credit at correspondent banks
140.0
—
140.0
Total Liquidity
$
2,161.6
$
—
$
2,161.6
1 Excludes cash items in transit as of September 30, 2026.
Note: There were no off-balance sheet one-way sell deposits as of September 30, 2026.
Subordinated Notes
During the fourth quarter of 2025, Bancorp issued Fixed-to-Floating Subordinated Notes of $45.0 million with a final maturity date of December 1, 2035, to certain investors in a private placement to strengthen capital ratios as part of the balance sheet repositioning. The interest rate of the Bank’s subordinated notes is 6.75%, payable semi-annually in arrears on June 1 and December 1 of each year, which commenced on June 1, 2026. After December 1, 2030, the interest rate will be variable and equal Three-Month Term SOFR plus 335 basis points, resetting quarterly. Subordinated notes outstanding were $44.0 million, net of issuance costs, at September 30, 2026.
Capital Resources
Our capital ratios are summarized in the table below.
Capital Ratios
September 30, 2026
June 30, 2026
September 30, 2025
Bancorp
Bank
Bancorp
Bank
Bancorp
Bank
Common Equity Tier 1 to RWA
12.96
%
13.89
%
12.93
%
13.69
%
14.93
%
13.92
%
Total Tier I to RWA
12.96
%
13.89
%
12.93
%
13.69
%
14.93
%
13.92
%
Total Capital to RWA
15.59
%
14.83
%
15.58
%
14.61
%
16.13
%
15.11
%
Tier I Leverage Ratio to Avg Assets
9.04
%
9.69
%
8.66
%
9.16
%
10.12
%
9.43
%
Tangible Common Equity to TA
8.05
%
8.69
%
8.52
%
9.03
%
9.72
%
9.04
%
The Bank's capital plan and point-in-time capital stress tests indicate that capital ratios will remain above regulatory well-capitalized and internal policy minimums throughout a five-year forecast horizon and across stress scenarios such as additional unrealized losses on the investment portfolio, additional deposit growth or decline, loan credit quality deterioration, and potential share repurchases. Accumulated other comprehensive loss worsened by $24.8 million in the quarter due to higher market interest rates. Consequently, book value per share and tangible book value per share decreased to $23.37 and $18.81, respectively as of September 30, 2026.
Earnings
Net Interest Income
Net interest income totaled $31.4 million for the third quarter of 2026, a $619 thousand increase from the prior quarter. This was driven by an increase of $834 thousand in interest income on loans, largely due to an 11 basis point increase in average loan yields due to growth at higher rates. Also contributing to the increase was the reduction of $527 thousand in interest expense on deposits, due to improved deposit mix and active balance sheet management through one-way sales of deposits. Average balances on interest-bearing transaction accounts decreased in the quarter while average balances of noninterest-bearing balances increased. The increases were partially offset by a $505 thousand decrease in interest income from investment securities due to paydowns.
The net interest margin increased 10 basis points to 3.48% for the third quarter of 2026, compared to 3.38% for the prior quarter. The increase is primarily due to the 11 basis point increase in average loan yields, a four basis point decrease in cost of deposits, and the use of one-way sales of deposits, which improved the mix of average assets and liabilities. Newly funded loans were originated at a weighted average rate of 12 basis points higher than prior quarter.
Non-Interest Income
Non-interest income was $3.7 million for the third quarter of 2026, compared to $3.2 million for the prior quarter. The increase of $501 thousand was primarily attributable to an increase of $251 thousand in service charges on business deposit accounts due to an updated pricing strategy effective July 1st, and an increase in dividend income due to a special dividend on FHLB stock of $199 thousand.
Non-Interest Expense
Non-interest expense totaled $20.6 million for the third quarter of 2026, compared to $21.6 million for the prior quarter, a decrease of $1.0 million, primarily driven by a decrease of $465 thousand in salaries and related benefits expense which included an adjustment to the incentive bonus accrual as well as the impact of a decreased number of full-time equivalent employees at the end of the third quarter. Also contributing to the decrease in quarterly expense was a $239 thousand reduction in Federal Deposit Insurance Corporation insurance expense during the quarter, a decrease of $263 thousand in other expense, and a decrease of $132 thousand in professional services mostly related to audit, operations, compliance, information security and accounting fees.
Share Repurchase Program
On July 24, 2025, the Board of Directors authorized the repurchase of up to $25.0 million of its common stock effective July 24, 2025 through July 31, 2027. There were no repurchases in the third quarter of 2026 or in the second quarter of 2026. As of September 30, 2026, the amount remaining available for repurchase of shares was $23.9 million.
Statement Regarding use of Non-GAAP Financial Measures
Financial results are presented in accordance with GAAP and with reference to certain non-GAAP financial measures. Management believes that providing selected financial measures that exclude the loss on sale of securities is useful to investors as the strategic short-term loss taken for long-term profitability makes the operational performance difficult to compare to other periods. Because there are limits to the usefulness of this or any other non-GAAP measure to investors, Bancorp encourages readers to consider its annual and quarterly consolidated financial statements and notes related thereto for their entirety, as filed with the Securities and Exchange Commission, and not to rely on any single financial measure. A reconciliation of the GAAP financial measures to comparable non-GAAP financial measures is presented below.
Reconciliation of GAAP and Non-GAAP Financial Measures
(in thousands, except per share amounts; unaudited)
Three months ended
Nine months ended
Pre-tax, pre-provision net income
September 30, 2026
June 30, 2026
September 30, 2025
September 30, 2026
September 30, 2025
Income before provision for (benefit from) income taxes
$
13,674
$
12,673
$
9,610
$
37,944
$
4,892
Provision for (reversal of) credit losses on loans
500
(320
)
—
180
75
Provision for credit losses on unfunded loan commitments
325
—
—
325
—
Pre-tax, pre-provision net income (GAAP)
14,499
12,353
9,610
38,449
4,967
Adjustments:
Losses on sale of investment securities from portfolio repositioning
—
—
—
—
18,736
Comparable pre-tax, pre-provision net income (non-GAAP)
$
14,499
$
12,353
$
9,610
$
38,449
$
23,703
Net income
Net income (GAAP)
$
9,934
$
9,246
$
7,526
$
27,690
$
3,866
Adjustments:
Losses on sale of investment securities from portfolio repositioning
—
—
—
—
18,736
Related income tax benefit 1
—
—
—
—
(5,538
)
Adjustments, net of taxes
—
—
—
—
13,198
Comparable net income (non-GAAP)
$
9,934
$
9,246
$
7,526
$
27,690
$
17,064
Diluted earnings per share
Weighted average diluted shares
$
16,040
$
15,991
$
15,934
$
16,003
$
15,979
Diluted earnings per share (GAAP)
$
0.62
$
0.58
$
0.47
$
1.73
$
0.24
Comparable diluted earnings per share (non-GAAP)
$
0.62
$
0.58
$
0.47
$
1.73
$
1.07
Return on average assets
Average assets
$
3,766,498
$
3,850,140
$
3,828,876
$
3,867,814
$
3,765,281
Return on average assets (GAAP)
1.05
%
0.96
%
0.78
%
0.96
%
0.14
%
Comparable return on average assets (non-GAAP)
1.05
%
0.96
%
0.78
%
0.96
%
0.61
%
Return on average equity
Average stockholders' equity
$
395,812
$
395,328
$
439,950
$
396,378
$
438,781
Return on average equity (GAAP)
9.96
%
9.38
%
6.79
%
9.34
%
1.18
%
Comparable return on average equity (non-GAAP)
9.96
%
9.38
%
6.79
%
9.34
%
5.20
%
Return on average tangible common equity
Average goodwill and intangibles
$
74,192
$
74,393
$
75,011
$
74,390
$
75,226
Average tangible common equity
$
321,620
$
320,935
$
364,939
$
321,988
$
363,555
Return on average tangible common equity (GAAP)
12.26
%
11.55
%
8.18
%
11.50
%
1.42
%
Comparable return on average tangible common equity (non-GAAP)
12.26
%
11.55
%
8.18
%
11.50
%
6.28
%
Efficiency ratio
Non-interest expense
$
20,571
$
21,597
$
20,291
$
64,707
$
61,287
Net interest income
$
31,400
$
30,781
$
27,156
$
92,483
$
76,256
Non-interest income (GAAP)
$
3,670
$
3,169
$
2,745
$
10,673
$
(10,002
)
Losses on sale of investment securities from portfolio repositioning
$
—
$
—
$
—
$
—
$
18,736
Non-interest income (non-GAAP)
$
3,670
$
3,169
$
2,745
$
10,673
$
8,734
Efficiency ratio (GAAP)
58.65
%
63.62
%
67.86
%
62.73
%
92.50
%
Comparable efficiency ratio (non-GAAP)
58.65
%
63.62
%
67.86
%
62.73
%
72.11
%
1Related tax benefit calculated using blended statutory rate of 29.5636%
Earnings Call and Webcast Information
Bank of Marin Bancorp (Nasdaq: BMRC) will present its third quarter financial results call via webcast on Monday, October 26, 2026 at 8:30 a.m. PT/11:30 a.m. ET. Investors can listen to the webcast online through Bank of Marin’s website at www.bankofmarin.com under “Investor Relations.” To listen to the live call, please go to the website at least 15 minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available at the same website location shortly after the call. Closed captioning will be available during the live webcast, as well as on the webcast replay.
About Bank of Marin Bancorp
Founded in 1990 and headquartered in Novato, California, Bank of Marin is a wholly owned subsidiary of Bank of Marin Bancorp (Nasdaq: BMRC). With assets of $3.867 billion, Bank of Marin is a leading business and community bank providing commercial and personal banking, specialty lending, and wealth management and trust services through a network of 27 branches and eight commercial banking offices serving Northern California.
Known for delivering exceptional client service and investing in the communities it serves, Bank of Marin has been recognized as one of the San Francisco Business Times' Top Corporate Philanthropists since 2003 and ranked seventh on Sacramento Business Journal's 2026 Corporate Direct Giving List. Additional honors include being named one of North Bay Business Journal's Best Places to Work in 2026, the Bank's 17th recognition, and inclusion in Business Insider's America's High-Growth Companies 2026. Bank of Marin Bancorp, which was ranked the nation's No. 2 community bank deposit franchise by S&P Global Market Intelligence, is included in the Russell 2000® Small-Cap Index and the Nasdaq ABA Community Bank Index. For more information, visit www.bankofmarin.com.
Forward-Looking Statements
This release may contain certain forward-looking statements that are based on management's current expectations regarding economic, legislative, and regulatory issues that may impact Bancorp's earnings in future periods. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “intend,” “estimate” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions and the economic uncertainty in the United States and abroad, including economic or other disruptions to financial markets caused by the Trump administration's approach to tariffs and trade and the military action in Iran, acts of terrorism, war or other conflicts, impacts from inflation, supply chain disruptions, changes in interest rates (including the actions taken by the Federal Reserve to control inflation), California's unemployment rate, deposit flows, real estate values, and expected future cash flows on loans and securities; the impact of adverse developments at other banks, including bank failures, that impact general sentiment regarding the stability and liquidity of banks; costs or effects of acquisitions; competition; changes in accounting principles, policies or guidelines; changes in legislation or regulation; natural disasters (such as wildfires and earthquakes in our area); adverse weather conditions; interruptions of utility service in our markets for sustained periods; and other economic, competitive, governmental, regulatory and technological factors (including external fraud and cybersecurity threats) affecting our operations, pricing, products and services; and successful integration of acquisitions. These and other important factors are detailed in various securities law filings made periodically by Bancorp, copies of which are available from Bancorp without charge. Bancorp undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
BANK OF MARIN BANCORP FINANCIAL HIGHLIGHTS
Three months ended
Nine months ended
(in thousands, except per share amounts; unaudited)
September 30, 2026
June 30, 2026
September 30, 2025
September 30, 2026
September 30, 2025
Selected operating data and performance ratios:
Net income
$
9,934
$
9,246
$
7,526
$
27,690
$
3,866
Diluted earnings per common share
$
0.62
$
0.58
$
0.47
$
1.73
$
0.24
Return on average assets
1.05
%
0.96
%
0.78
%
0.96
%
0.14
%
Return on average equity
9.96
%
9.38
%
6.79
%
9.34
%
1.18
%
Return on average tangible common equity
12.26
%
11.55
%
8.18
%
11.50
%
1.42
%
Efficiency ratio
58.65
%
63.62
%
67.86
%
62.73
%
92.50
%
Tax-equivalent net interest margin
3.48
%
3.38
%
2.97
%
3.37
%
2.86
%
Cost of deposits
1.24
%
1.28
%
1.41
%
1.29
%
1.40
%
Cost of funds
1.32
%
1.36
%
1.41
%
1.37
%
1.40
%
Net charge-offs (recoveries)
$
21
$
39
$
1
$
7,326
$
878
Net charge-offs to average loans
NM
NM
NM
0.35
%
0.04
%
(in thousands; unaudited)
September 30, 2026
June 30, 2026
December 31, 2025
Selected financial condition data:
Total assets
$
3,866,694
$
3,856,720
$
3,904,778
Loans:
Commercial and industrial
$
154,517
$
162,434
$
159,898
Real estate:
Commercial owner-occupied
286,005
288,744
310,219
Commercial non-owner occupied
1,384,118
1,373,990
1,366,251
Construction
25,809
16,317
15,101
Home equity
100,810
101,404
99,222
Other residential
135,173
100,710
110,614
Installment and other consumer loans
57,954
57,377
59,548
Total loans
$
2,144,386
$
2,100,976
$
2,120,853
Non-accrual loans: 1
Commercial and industrial
$
17
$
5
$
524
Real estate:
Commercial owner-occupied
—
—
315
Commercial non-owner occupied
9,212
8,118
25,387
Home equity
217
219
401
Other residential
64
67
72
Installment and other consumer loans
159
44
204
Total non-accrual loans
$
9,669
$
8,453
$
26,903
Non-accrual loans to total loans
0.45
%
0.40
%
1.27
%
Classified loans (graded substandard and doubtful)
$
35,033
$
19,877
$
32,111
Classified loans as a percentage of total loans
1.63
%
0.95
%
1.51
%
Total accruing loans 30-89 days past due
$
2,617
$
2,005
$
2,843
Total accruing loans 90+ days past due 1
$
297
$
297
$
—
Allowance for credit losses to total loans
1.07
%
1.07
%
1.42
%
Allowance for credit losses to non-accrual loans
2.37x
2.66x
1.12x
Total deposits
$
3,395,222
$
3,369,900
$
3,415,542
Loan-to-deposit ratio
63.16
%
62.35
%
62.09
%
Stockholders' equity
$
379,376
$
396,684
$
394,654
Book value per share
$
23.37
$
24.51
$
24.51
Tangible book value per share
$
18.81
$
19.92
$
19.87
Tangible common equity to tangible assets - Bank
8.69
%
9.03
%
8.59
%
Tangible common equity to tangible assets - Bancorp
8.05
%
8.52
%
8.35
%
Total risk-based capital ratio - Bank
14.83
%
14.61
%
13.90
%
Total risk-based capital ratio - Bancorp
15.59
%
15.58
%
15.25
%
Tier I Leverage Ratio to Avg Assets - Bank
9.69
%
9.16
%
8.49
%
Tier I Leverage Ratio to Avg Assets - Bancorp
9.04
%
8.66
%
8.26
%
Full-time equivalent employees
312
315
311
1 There was one non-performing loan as of September 30, 2026 and June 30, 2026 and no non-performing loans as of December 31, 2025 over 90 days past due and accruing interest.
BANK OF MARIN BANCORP
CONSOLIDATED STATEMENTS OF CONDITION
(in thousands, except share data; unaudited)
September 30, 2026
June 30, 2026
December 31, 2025
Assets
Cash, cash equivalents and restricted cash
$
265,330
$
279,639
$
225,303
Investment securities:
Available-for-sale (net of zero allowance for credit losses at September 30, 2026, June 30, 2026 and December 31, 2025, respectively)
1,215,229
1,242,831
1,327,812
Total investment securities
1,215,229
1,242,831
1,327,812
Loans, at amortized cost
2,144,386
2,100,976
2,120,853
Allowance for credit losses on loans
(22,943
)
(22,464
)
(30,089
)
Loans, net of allowance for credit losses on loans
2,121,443
2,078,512
2,090,764
Goodwill
72,754
72,754
72,754
Bank-owned life insurance
71,770
71,324
71,306
Operating lease right-of-use assets
22,377
21,146
22,499
Bank premises and equipment, net
7,990
8,016
8,059
Core deposit intangible, net
1,329
1,520
1,916
Interest receivable and other assets
88,472
80,978
84,365
Total assets
$
3,866,694
$
3,856,720
$
3,904,778
Liabilities and Stockholders' Equity
Liabilities
Deposits:
Noninterest-bearing
$
1,282,323
$
1,237,322
$
1,254,416
Interest-bearing:
Transaction accounts
247,292
237,676
417,482
Savings accounts
225,467
225,353
232,109
Money market accounts
1,497,696
1,511,325
1,305,849
Time accounts
142,444
158,224
205,686
Total deposits
3,395,222
3,369,900
3,415,542
Borrowings and other obligations
582
625
709
Subordinated notes, net of issuance costs
44,006
43,955
43,857
Operating lease liabilities
24,738
23,493
24,747
Interest payable and other liabilities
22,770
22,063
25,269
Total liabilities
3,487,318
3,460,036
3,510,124
Stockholders' Equity
Preferred stock, no par value, Authorized - 5,000,000 shares, none issued
—
—
—
Common stock, no par value, Authorized - 30,000,000 shares; issued and outstanding - 16,233,030, 16,186,611 and 16,102,687 at September 30, 2026, June 30, 2026 and December 31, 2025, respectively
217,638
216,050
214,910
Retained earnings
213,729
207,843
198,163
Accumulated other comprehensive loss, net of taxes
(51,991
)
(27,209
)
(18,419
)
Total stockholders' equity
379,376
396,684
394,654
Total liabilities and stockholders' equity
$
3,866,694
$
3,856,720
$
3,904,778
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Three months ended
Nine months ended
(in thousands, except per share amounts; unaudited)
September 30, 2026
June 30, 2026
September 30, 2025
September 30, 2026
September 30, 2025
Interest income
Interest and fees on loans
$
28,101
$
27,267
$
26,254
$
81,902
$
77,298
Interest on investment securities
12,922
13,427
9,846
40,218
26,530
Interest on due from banks
1,401
1,646
2,969
5,439
6,768
Total interest income
42,424
42,340
39,069
127,559
110,596
Interest expense
Interest on interest-bearing transaction accounts
630
1,462
1,365
4,131
3,817
Interest on savings accounts
640
635
600
1,852
1,720
Interest on money market accounts
8,107
7,674
8,376
23,602
23,880
Interest on time accounts
832
965
1,571
3,039
4,920
Interest on borrowings and other obligations
5
6
1
17
3
Interest on subordinated notes
810
817
—
2,435
—
Total interest expense
11,024
11,559
11,913
35,076
34,340
Net interest income
31,400
30,781
27,156
92,483
76,256
Provision for (reversal of) credit losses on loans
500
(320
)
—
180
75
Provision for credit losses on unfunded loan commitments
325
—
—
325
—
Net interest income after provision for credit losses
30,575
31,101
27,156
91,978
76,181
Non-interest income
Service charges on deposit accounts
814
563
547
1,940
1,645
Wealth management and trust services
562
543
564
1,701
1,739
Earnings on bank-owned life insurance, net
445
442
434
1,375
1,339
Dividends on Federal Home Loan Bank stock
398
199
366
1,452
1,103
Debit card interchange fees, net
393
397
405
1,152
1,211
Merchant interchange fees, net
184
142
87
444
273
Earnings on bank-owned life insurance death benefits
—
59
—
538
306
Losses on sale of investment securities
—
—
—
—
(18,736
)
Other income
874
824
342
2,071
1,118
Total non-interest income (loss)
3,670
3,169
2,745
10,673
(10,002
)
Non-interest expense
Salaries and related benefits
12,144
12,609
12,004
38,147
36,099
Occupancy and equipment
2,163
2,090
2,079
6,352
6,411
Professional services
1,239
1,371
1,115
3,703
2,960
Data processing
1,222
1,138
1,116
3,588
3,293
Information technology
511
510
538
1,536
1,514
Federal Deposit Insurance Corporation insurance
316
555
459
1,601
1,268
Depreciation and amortization
277
270
291
810
933
Directors' expense
253
261
249
799
832
Amortization of core deposit intangible
191
196
217
587
664
Charitable contributions
130
190
56
757
575
Deposit network fees
99
118
121
366
349
Other expense
2,026
2,289
2,046
6,461
6,389
Total non-interest expense
20,571
21,597
20,291
64,707
61,287
Income before provision for income taxes
13,674
12,673
9,610
37,944
4,892
Provision for income taxes
3,740
3,427
2,084
10,254
1,026
Net income
$
9,934
$
9,246
$
7,526
$
27,690
$
3,866
Earnings per common share
Basic
$
0.62
$
0.58
$
0.47
$
1.74
$
0.24
Diluted
$
0.62
$
0.58
$
0.47
$
1.73
$
0.24
Weighted average shares:
Basic
15,984
15,952
15,907
15,954
15,957
Diluted
16,040
15,991
15,934
16,003
15,979
Comprehensive income (loss):
Net income
$
9,934
$
9,246
$
7,526
$
27,690
$
3,866
Other comprehensive (loss) income:
Change in net unrealized (losses) gains on available-for-sale securities
(35,184
)
(4,838
)
2,514
(47,664
)
5,317
Reclassification adjustment for losses realized on the sale of available-for-sale securities in net income
—
—
—
—
18,736
Amortization of net unrealized losses on securities transferred from available-for-sale to held-to-maturity
—
—
360
—
1,065
Other comprehensive (loss) income, before tax
(35,184
)
(4,838
)
2,874
(47,664
)
25,118
Deferred tax (benefit) expense
(10,402
)
(1,430
)
850
(14,092
)
7,426
Other comprehensive (loss) income, net of tax
(24,782
)
(3,408
)
2,024
(33,572
)
17,692
Total comprehensive (loss) income
$
(14,848
)
$
5,838
$
9,550
$
(5,882
)
$
21,558
BANK OF MARIN BANCORP
AVERAGE STATEMENTS OF CONDITION AND ANALYSIS OF NET INTEREST INCOME
Three months ended
Three months ended
September 30, 2026
June 30, 2026
Interest
Interest
Average
Income/
Yield/
Average
Income/
Yield/
(in thousands)
Balance
Expense
Rate
Balance
Expense
Rate
Assets
Interest-earning deposits with banks 1
$
149,540
$
1,401
3.67
%
$
176,889
$
1,646
3.68
%
Investment securities 2, 3
1,285,175
12,960
4.03
%
1,329,846
13,465
4.05
%
Loans 1, 3, 4, 5
2,111,760
28,211
5.23
%
2,113,964
27,382
5.12
%
Total interest-earning assets 1
3,546,475
42,572
4.70
%
3,620,699
42,493
4.64
%
Cash and noninterest-bearing due from banks
30,805
32,830
Bank premises and equipment, net
7,960
7,965
Interest receivable and other assets, net
181,258
188,646
Total assets
$
3,766,498
$
3,850,140
Liabilities and Stockholders' Equity
Interest-bearing transaction accounts
$
242,102
$
630
1.03
%
$
363,579
$
1,462
1.61
%
Savings accounts
228,289
640
1.11
%
235,698
635
1.08
%
Money market accounts
1,378,872
8,107
2.33
%
1,351,175
7,674
2.28
%
Time accounts including CDARS
148,659
832
2.22
%
165,017
965
2.35
%
Borrowings and other obligations 1
599
5
3.27
%
640
6
3.71
%
Subordinated notes, net
43,972
810
7.37
%
43,923
817
7.44
%
Total interest-bearing liabilities
2,042,493
11,024
2.14
%
2,160,032
11,559
2.15
%
Demand accounts
1,279,557
1,247,995
Interest payable and other liabilities
48,636
46,785
Stockholders' equity
395,812
395,328
Total liabilities & stockholders' equity
$
3,766,498
$
3,850,140
Tax-equivalent net interest income/margin 1
$
31,548
3.48
%
$
30,934
3.38
%
Reported net interest income/margin 1
$
31,400
3.46
%
$
30,781
3.36
%
Tax-equivalent net interest rate spread
2.56
%
2.49
%
Nine months ended
Nine months ended
September 30, 2026
September 30, 2025
Interest
Interest
Average
Income/
Yield/
Average
Income/
Yield/
(in thousands)
Balance
Expense
Rate
Balance
Expense
Rate
Assets
Interest-earning deposits with banks 1
$
196,957
$
5,439
3.64
%
$
203,956
$
6,768
4.38
%
Investment securities 2, 3
1,329,531
40,330
4.04
%
1,266,960
26,720
2.81
%
Loans 1, 3, 4, 5
2,113,250
82,239
5.13
%
2,072,623
77,614
4.94
%
Total interest-earning assets 1
3,639,738
128,008
4.64
%
3,543,539
111,102
4.13
%
Cash and noninterest-bearing due from banks
32,038
36,680
Bank premises and equipment, net
7,977
7,232
Interest receivable and other assets, net
188,061
177,830
Total assets
$
3,867,814
$
3,765,281
Liabilities and Stockholders' Equity
Interest-bearing transaction accounts
$
355,854
$
4,131
1.55
%
$
344,189
$
3,817
1.48
%
Savings accounts
230,872
1,852
1.07
%
223,781
1,720
1.03
%
Money market accounts
1,365,773
23,602
2.31
%
1,238,686
23,880
2.58
%
Time accounts including CDARS
168,582
3,039
2.41
%
222,108
4,920
2.96
%
Borrowings and other obligations 1
640
17
3.50
%
94
3
3.30
%
Subordinated debenture 1, 5
43,923
2,435
7.39
%
—
—
—
%
Total interest-bearing liabilities
2,165,644
35,076
2.17
%
2,028,858
34,340
2.26
%
Demand accounts
1,257,511
1,253,469
Interest payable and other liabilities
48,281
44,173
Stockholders' equity
396,378
438,781
Total liabilities & stockholders' equity
$
3,867,814
$
3,765,281
Tax-equivalent net interest income/margin 1
$
92,932
3.37
%
$
76,761
2.86
%
Reported net interest income/margin 1
$
92,483
3.35
%
$
76,256
2.84
%
Tax-equivalent net interest rate spread
2.47
%
1.87
%
1 Interest income/expense is divided by actual number of days in the period times 360 days to correspond to stated interest rate terms, where applicable.
2 Yields on available-for-sale securities are calculated based on amortized cost balances rather than fair value, as changes in fair value are reflected as a component of stockholders' equity. Investment security interest is earned on 30/360 day basis monthly.
3 Yields and interest income on tax-exempt securities and loans are presented on a taxable-equivalent basis using the Federal statutory rate of 21 percent.
4 Average balances on loans outstanding include non-performing loans. The amortized portion of net loan origination fees is included in interest income on loans, representing an adjustment to the yield.
5 Net loan origination costs in interest income totaled $337 thousand and $427 thousand for the three months ended September 30, 2026 and June 30, 2026 and totaled $1.2 million for both the nine months ended September 30, 2026 and 2025, respectively.