Avidia Bancorp, Inc. Reports Third Quarter 2026 Financial Results, Declares Quarterly Cash Dividend

HUDSON, Mass.--(BUSINESS WIRE)--Avidia Bancorp, Inc. (the “Company”) (NYSE: “AVBC”), the holding company of Avidia Bank, today reported third quarter 2026 net income of $8.6 million, or $0.47 per share, compared to second quarter 2026 net income of $7.2 million, or $0.39 per share.

The Company also announced today the declaration of a quarterly cash dividend of $0.06 per share on its outstanding shares of common stock, payable on or about November 30, 2026, to stockholders of record as of the close of business on November 17, 2026.

CEO Robert Cozzone stated “Quarterly earnings growth benefited from higher loan yields and a lower loan loss provision. Our focus on pricing and operational discipline is resulting in continued improvements in operating leverage and balance sheet structure. During the quarter, we announced a $30 million stock repurchase authorization and commenced repurchases, further supporting stockholder returns.”

THIRD QUARTER 2026 FINANCIAL HIGHLIGHTS (comparisons are to prior quarter)

• Net interest margin increased by 22 basis points to 3.86%, which included an 11 basis point benefit from a large loan prepayment penalty received.
• Return on assets increased by 20 basis points to 1.24%.
• Return on equity increased by 136 basis points to 8.79%.
• Efficiency ratio improved to 62.2% from 65.3%.
• Share repurchases of $23.8 million were completed as of September 30, equal to 6.1% of the previous quarter’s stockholders’ equity.

BALANCE SHEET

Total assets were $2.78 billion at September 30, 2026, which was comparable to June 30, 2026.

• Short-term investments decreased by $9.0 million to $42.3 million as excess cash was used to pay down wholesale borrowings and for the share repurchases.
• Total investment securities decreased by $1.7 million from June 30, to $325.9 million.
• Total loans were $2.26 billion, which was comparable to June 30.
  • Residential mortgages increased by $30.1 million due primarily to the $21.3 million purchase of in-market, adjustable-rate mortgage loans from a local correspondent bank.
  • Commercial & industrial loans decreased $31.2 million due primarily to the impact of loan prepayments, including a $23.0 million solar loan that had three years remaining to maturity.
  • Quarter-end loan exposure related to non-medical office space was $90.6 million, or 4% of gross loans. When excluding owner-occupied, total non-medical office exposure was $72.6 million.
• Deposits grew by $53.0 million, or 2.5% for the quarter, to $2.21 billion.
  • Brokered certificates of deposit in the amount of $22.9 million were purchased.
  • Money market accounts increased by $19.7 million due to solid growth from business customers.
  • Certificates of deposit increased by $12.1 million.
  • Lower cost transaction accounts (demand and NOW) were 50% of period-end total deposits.
• Federal Home Loan Bank advances decreased by $50.0 million to $110.0 million.
• Total stockholders’ equity decreased by $23.0 million, or 5.9%, to $366.6 million. Stockholders’ equity to total assets was 13.2% at quarter-end. Tangible stockholders' equity to tangible assets (non-GAAP) was 12.8%.
  • The Company recorded $23.8 million for the repurchase of 1,079,051 shares (5.4% of outstanding shares).
  • Accumulated other comprehensive loss increased by $6.8 million because higher market interest rates reduced the value of the available for sale investment portfolio.
  • Pursuant to an equity compensation plan approved by stockholders in the third quarter, five-year vesting director equity compensation grants were awarded consisting of 240,912 shares of restricted stock valued at $22.29 per share and 602,280 stock options valued at $7.78 per option.
  • On October 13, 2026, management equity grants with 5- or 6-year vesting were awarded consisting of 489,500 shares of restricted stock valued at $21.95 per share and 1,187,000 stock options with an average value of $7.65 per option. These values are not included in the consolidated financial statements as of September 30, 2026.

REVENUE

Total net revenue increased to $31.2 million in the third quarter of 2026, an increase of $1.3 million, or 4%, compared to the prior quarter.

• Third quarter 2026 net interest income increased $1.5 million due to higher interest rates across most loan categories. The net interest margin improved by 22 basis points to 3.86%, which included a large $692 thousand loan prepayment penalty received from the prepayment of the large solar loan mentioned above. The net interest margin excluding the prepayment penalty is 3.75%, up 11 basis points from the second quarter.
  • Average earning assets totaled $2.6 billion, which remained steady from the prior quarter.
  • The yield on earning assets increased 21 basis points to 5.26%. The 5.55% loan yield included the $692 thousand in prepayment penalties, which contributed 12 basis points to the loan yield.
  • The cost of interest-bearing liabilities decreased 1 basis point to 1.88%, as the benefit from lower cost borrowings was partially offset by a 3 basis point increase in the cost of deposits to 1.35%.
• Non-interest income decreased by $250 thousand, primarily because payments processing income declined from the prior quarter, when it was elevated by contract termination fees.
• Mortgage banking income increased $149 thousand, or 51.9%, primarily driven by a higher quarterly MSR valuation.

NON-INTEREST EXPENSE

• Total non-interest expense decreased $121 thousand, or 1%, to $19.4 million in the third quarter of 2026.
  • Salaries and benefits increased $235 thousand, or 2%, including $77 thousand from the expense related to the new stock grants issued.
  • Modest decreases were recorded across many of the other expense categories.

INCOME TAXES

Income tax expense increased $660 thousand to $3.0 million in the third quarter of 2026 compared to the prior quarter.

• The effective income tax rate was 25.6% for the third quarter and 25.5% year-to-date.

ASSET QUALITY

The period-end allowance for credit losses was $23.2 million in the third quarter of 2026 compared to $23.9 million at the prior quarter-end. The ratio of the allowance to total loans decreased to 1.03% from 1.06% for these dates.

• Provision expense for credit losses decreased $681 thousand to $211 thousand in the third quarter of 2026.
• The Company recorded net loan charge-offs of $755 thousand in the third quarter of 2026, measuring 0.13% of average loans on an annualized basis.
• Nonaccruing loans were $17.8 million, or 0.79% of total loans, at period-end, compared to $16.9 million, or 0.75% of total loans, at the prior quarter-end.

ABOUT AVIDIA BANCORP, INC.

Avidia Bancorp, Inc. is the bank holding company of Avidia Bank. Avidia Bank is a Massachusetts-chartered stock savings bank. With headquarters in Hudson, Massachusetts, it also operates nine full-service banking offices in western Middlesex County and eastern Worcester County, in Massachusetts. For more information, please visit https://www.AvidiaBank.com.

NON-GAAP FINANCIAL MEASURES

This document contains certain non-GAAP financial measures in addition to results presented in accordance with U.S. Generally Accepted Accounting Principles (“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. A reconciliation of non-GAAP financial measures to GAAP measures is provided at the end of this document. 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 operating earnings can be of substantial importance to the Company’s results for any particular quarter or year. The Company’s non-GAAP operating earnings information set forth is not necessarily comparable to non-GAAP information which may be presented by other companies. Each non-GAAP measure used by the Company in this document as supplemental financial data should be considered in conjunction with the Company’s GAAP financial information. The Company adjusts certain equity related measures to exclude intangible assets due to the importance of these measures to the investment community.

FORWARD-LOOKING STATEMENTS

Statements contained in this press release that are not historical facts 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 intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by use of the words "believe," "expect," "anticipate," "intend," "estimate," "assume," "outlook," "will," "should," and other similar expressions which do not relate to historical matters. Although we believe that these forward-looking statements are based on reasonable estimates and assumptions, they are not guarantees of future performance. You should not place undue reliance on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond our control. Our actual results could differ materially from those presented in the forward-looking statements as a result of, among other factors, changes in general business and economic conditions nationwide and in our local markets, including changes which adversely affect borrowers' ability to service and repay loans; changes in customer behavior due to political, business and economic conditions, including inflation; conditions in the capital and debt markets; reductions in net interest income resulting from interest rate volatility and changes in the balances and mix of our loans and deposits; changes in market interest rates and real estate values; decreases in the value of securities and other assets or in deposit levels necessitating increased borrowing to fund loans and investments; competition from other financial institutions; changes in legislation or regulation and accounting principles, policies and guidelines; cybersecurity incidents; fraud; natural disasters; the risk that we may be unsuccessful in implementing our business strategy; and the other risks and uncertainties disclosed in Avidia Bancorp, Inc.’s Form 10-K, and updated by our Quarterly Report on Form 10-Q, and other filings submitted to the U.S. Securities and Exchange Commission. Forward looking statements speak only as of the date of this release, and we do not undertake any obligation to update or revise any of them to reflect events or circumstances occurring after the date of this release or to reflect the occurrence of unanticipated events, except as may be required by applicable law or regulation.