DEFIANCE, Ohio, July 23, 2026 (GLOBE NEWSWIRE) -- SB Financial Group, Inc. (NASDAQ: SBFG) ("SB Financial" or the "Company"), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the quarter ended June 30, 2026.
Second Quarter 2026 Highlights compared to the second quarter of the prior year include:
Net Income, GAAP net income and Diluted Earnings per Share ("DEPS") were $4.5 million, or $0.72 per DEPS, an improvement from the $3.9 million, or $0.60 per DEPS in the prior-year quarter. Net income, adjusted for Originated Mortgage Servicing Rights ("OMSR") and merger costs, was $4.5 million, up 21.8 percent compared to $3.7 million for the prior-year period. Adjusted DEPS of $0.73 was also up 25.9 percent from the adjusted prior-year.
Total loans reached $1.19 billion, reflecting an increase of $94.8 million, or 8.7 percent, from the prior-year quarter and an improvement of $8.4 million, or 0.71 percent, from the linked quarter. This performance marks SBFG's ninth consecutive quarter of expansion in our loan portfolio.
Total deposits climbed to $1.39 billion, increasing by $141.3 million, or 11.3 percent, from the prior-year quarter, and up $19.3 million, or 1.4 percent, from the linked quarter.
Tangible book value ("TBV") per common share finished the quarter at $19.04, climbing $2.60 per share, or 15.8 percent, from $16.44 in the prior-year quarter. Adjusted tangible book value excluding AOCI advanced to $22.57 at quarter end.
Six months ended June 30, 2026 Highlights compared to the same period of the prior-year:
GAAP net income increased to $8.8 million, a 46.3 percent expansion compared to the $6.0 million reported for the previous six months, and diluted EPS was $1.41, an improvement of 51.6 percent from $0.93.
Net interest income rose to $25.7 million, representing a 9.7 percent improvement from the $23.4 million reported in the prior-year period.
Noninterest income increased by 5.9 percent to $9.7 million compared to $9.2 million reported in the previous six months.
Noninterest expense remained well controlled, decreasing by 0.8 percent to $24.1 million from $24.3 million in the prior-year period.
Earnings Highlights | Three Months Ended | Six Months Ended | ||||||||||||||||
($ in thousands, except per share & ratios) | Jun. 2026 | Jun. 2025 | % Change | Jun. 2026 | Jun. 2025 | % Change | ||||||||||||
Operating revenue | $ | 17,941 | $ | 17,176 | 4.5 | % | $ | 35,365 | $ | 32,562 | 8.6 | % | ||||||
Interest income | 19,820 | 18,467 | 7.3 | % | 39,127 | 35,839 | 9.2 | % | ||||||||||
Interest expense | 6,866 | 6,339 | 8.3 | % | 13,461 | 12,432 | 8.3 | % | ||||||||||
Net interest income | 12,954 | 12,128 | 6.8 | % | 25,666 | 23,407 | 9.7 | % | ||||||||||
Provision for credit losses | 299 | 597 | 49.9 | % | 513 | 984 | -47.9 | % | ||||||||||
Noninterest income | 4,987 | 5,048 | -1.2 | % | 9,699 | 9,155 | 5.9 | % | ||||||||||
Noninterest expense | 12,137 | 11,852 | 2.4 | % | 24,066 | 24,262 | -0.8 | % | ||||||||||
Net income | 4,497 | 3,852 | 16.7 | % | 8,793 | 6,010 | 46.3 | % | ||||||||||
Adjusted Earnings per diluted share | 0.73 | 0.58 | 25.9 | % | 1.36 | 1.00 | 36.0 | % | ||||||||||
Earnings per diluted share | 0.72 | 0.60 | 20.0 | % | 1.41 | 0.93 | 51.6 | % | ||||||||||
Adjusted Return on Avg. Assets | 1.13 | % | 1.00 | % | 13.0 | % | 1.07 | % | 0.85 | % | 25.9 | % | ||||||
Return on average assets | 1.12 | % | 1.03 | % | 8.7 | % | 1.11 | % | 0.82 | % | 35.4 | % | ||||||
Adjusted Return on Avg. Equity | 12.55 | % | 11.29 | % | 11.2 | % | 11.81 | % | 10.54 | % | 12.0 | % | ||||||
Return on average equity | 12.44 | % | 11.67 | % | 6.6 | % | 12.24 | % | 9.19 | % | 33.2 | % | ||||||
"Net income for the second quarter of 2026 was $4.5 million, a 16.7 percent increase from the prior-year quarter, with GAAP DEPS of $0.72, an improvement of 20.0 percent from the prior-year quarter," said Mark A. Klein, Chairman, President, and Chief Executive Officer. "This marks our 62nd consecutive quarter of profitability and reflects the continued benefits of not only our expanded balance sheet scale, but also the sustained, robust performance of our diversified community banking and fee-based business lines."
RESULTS OF OPERATIONS
In the second quarter of 2026, total operating revenue increased to $17.9 million, 4.5 percent improvement from $17.2 million in the prior-year quarter and 3.0 percent from $17.4 million in the linked quarter. The year-over-year increase was driven by higher net interest income, which was partially offset by a modest reduction in noninterest income due to lower net mortgage servicing fees. Net interest income for the quarter totaled $13.0 million, compared with $12.1 million in the prior-year period and $12.7 million in the linked quarter. The year-over-year expansion was driven by a rise in interest income on loans, which climbed to $17.5 million. Total interest expense increased to $6.9 million, up 8.3 percent from $6.3 million in the prior-year quarter, as slightly higher deposit costs were partially offset by lower costs across other funding sources. As a result, net interest margin decreased approximately 5 basis points from 3.48 percent in the prior-year quarter to 3.43 percent.
Total loans increased $94.8 million from the prior-year quarter and $8.4 million from the linked quarter. Total deposits at quarter end increased $141.3 million, or 11.3 percent, to $1.39 billion, supported by stable core deposit relationships and continued customer deposit gathering activities across the Company's markets. Overall results for the quarter reflected continued balance sheet discipline, stable credit performance, and the benefit of a diversified revenue business model.
Mortgage Loan Business
Net mortgage banking revenue for the quarter reached $1.9 million, a decrease of $236,000 from the prior-year quarter. Loan servicing fees added $934,000 to revenue, reflecting an increase of $30,000 from the prior-year quarter. The OMSR net valuation adjustment for the second quarter of 2026 was a negative $54,000, compared with a recapture of $159,000 in the second quarter of 2025.
Mortgage Banking | |||||||||||||||||||
($ in thousands) | Jun. 2026 | Mar. 2026 | Dec. 2025 | Sep. 2025 | Jun. 2025 | Prior Year | |||||||||||||
Mortgage originations | $ | 79,346 | $ | 65,768 | $ | 72,398 | $ | 67,609 | $ | 97,901 | $ | (18,555 | ) | ||||||
Mortgage sales | 70,253 | 53,420 | 70,361 | 66,408 | 74,313 | (4,060 | ) | ||||||||||||
Mortgage servicing portfolio | 1,504,657 | 1,482,052 | 1,479,982 | 1,470,360 | 1,456,374 | 48,283 | |||||||||||||
Mortgage servicing rights | 15,953 | 15,728 | 15,254 | 15,347 | 15,458 | 495 | |||||||||||||
Revenue | |||||||||||||||||||
Loan servicing fees | 934 | 928 | 928 | 914 | 904 | 30 | |||||||||||||
OMSR amortization | (497 | ) | (529 | ) | (572 | ) | (455 | ) | (469 | ) | (28 | ) | |||||||
Net administrative fees | 437 | 399 | 356 | 459 | 435 | 2 | |||||||||||||
OMSR valuation adjustment | (54 | ) | 452 | (157 | ) | (301 | ) | 159 | (213 | ) | |||||||||
Net loan servicing fees | 383 | 851 | 199 | 158 | 594 | (211 | ) | ||||||||||||
Gain on sale of mortgages | 1,541 | 978 | 1,272 | 1,328 | 1,566 | (25 | ) | ||||||||||||
Mortgage banking revenue, net | $ | 1,924 | $ | 1,829 | $ | 1,471 | $ | 1,486 | $ | 2,160 | $ | (236 | ) | ||||||
Noninterest Income and Noninterest Expense
"Noninterest income for the second quarter of 2026 reached $5.0 million, proving highly resilient compared to the prior-year base of $5.0 million," Mr. Klein noted. "Our wealth management fees improved to $955,000, from $859,000 a year ago, while title insurance contributed $577,000 to total revenue, illustrating the strength of our team's cross-functional internal referral strategies."
Noninterest Income/Noninterest Expense | ||||||||||||||||||||
($ in thousands, except ratios) | Jun. 2026 | Mar. 2026 | Dec. 2025 | Sep. 2025 | Jun. 2025 | Prior Year | ||||||||||||||
Noninterest Income (NII) | $ | 4,987 | $ | 4,712 | $ | 3,708 | $ | 4,244 | $ | 5,048 | $ | (61 | ) | |||||||
NII / Total Revenue | 27.8 | % | 27.0 | % | 22.6 | % | 25.6 | % | 29.4 | % | -1.6 | % | ||||||||
NII / Average Assets | 1.2 | % | 1.2 | % | 1.0 | % | 1.1 | % | 1.4 | % | -0.2 | % | ||||||||
Total Revenue Growth | 4.5 | % | 13.3 | % | 6.3 | % | 15.9 | % | 22.3 | % | -17.8 | % | ||||||||
Noninterest Expense (NIE) | $ | 12,137 | $ | 11,929 | $ | 11,239 | $ | 11,498 | $ | 11,852 | $ | 285 | ||||||||
Efficiency Ratio | 67.3 | % | 68.1 | % | 68.1 | % | 69.0 | % | 68.9 | % | -1.6 | % | ||||||||
NIE / Average Assets | 3.0 | % | 3.1 | % | 2.9 | % | 3.0 | % | 3.2 | % | -0.2 | % | ||||||||
Net Noninterest Expense/Avg. Assets | -1.8 | % | -1.9 | % | -1.9 | % | -1.9 | % | -1.8 | % | 0.0 | % | ||||||||
Total Expense Growth | 2.4 | % | -3.9 | % | 2.1 | % | 4.5 | % | 11.1 | % | -8.7 | % | ||||||||
Noninterest expense for the second quarter of 2026 rose 2.4 percent to $12.1 million from $11.9 million in the prior-year quarter, predominantly driven by an increase of $410,000 in salaries and employee benefits, which totaled $7.0 million, to support revenue-producing lenders. This increase was heavily mitigated by lower data-processing expenses, which decreased to $693,000 from $888,000 in the prior-year quarter as previous merger-related and systems-integration costs fully wound down. "Our core efficiency ratio for the second quarter of 2026 improved to 67.32 percent, compared to 68.90 percent in the second quarter of 2025 and 68.12 percent in the linked quarter," stated Mr. Klein. "This positive operating leverage reflects our disciplined approach to managing overhead while proactively funding expansion in our growth markets."
Balance Sheet
As of June 30, 2026, SB Financial reported total assets of $1.62 billion, representing an increase of $74.7 million from December 31, 2025, and $133.8 million, or 9.0 percent, from June 30, 2025. The year-over-year asset growth was primarily driven by steady organic loan generation across commercial and agricultural lines. Cash and due from banks increased by $58.7 million from the prior-year period to $138.2 million, supported by sustained deposit gathering and investment portfolio cash flows. Key balance-sheet metrics for the quarter included a loan-to-deposit ratio of 85.51 percent and a loan-to-asset ratio of 73.43 percent, both of which remained well-aligned with target operating bands.
Total deposits at quarter end reached $1.39 billion, an increase of $141.3 million, or 11.3 percent, from the prior-year quarter, driven by strong client retention and expanded commercial deposit relationships. Noninterest-bearing demand deposits totaled $258.6 million, accounting for 18.6 percent of the total deposit portfolio. Shareholders' equity finished the period at $146.7 million, representing an increase of $13.1 million, or 9.8 percent, from the prior-year period.
During the second quarter, SB Financial repurchased approximately 28,000 shares, roughly flat compared to the linked quarter, reflecting a measured approach to capital allocation and ongoing evaluation of market dynamics and corporate priorities during the period. The Company remains committed to a prudent capital allocation strategy, supporting shareholder returns through dividends and share buybacks while preserving the financial flexibility to fund organic expansion, strategic initiatives, and capital stability.
"As we enter the second half of 2026, we are operating from a strong fundamental foundation characterized by top-tier capital ratios, exceptional credit quality, and a resilient core deposit franchise," stated Mr. Klein. "Our consistent organic loan expansion highlights our strong client relationship model and localized lending expertise, while our robust reserve coverage and near-zero delinquency levels reflect our disciplined approach to credit administration. Supported by our diverse fee-generating businesses and careful expense management, we are well-positioned to maintain positive operating leverage and drive long-term value for our shareholders."
Loan Balances | ||||||||||||||||||
($ in thousands, except ratios) | Jun. 2026 | Mar. 2026 | Dec. 2025 | Sep. 2025 | Jun. 2025 | Annual | ||||||||||||
Commercial | $ | 111,128 | $ | 112,226 | $ | 113,878 | $ | 117,581 | $ | 118,984 | $ | (7,856 | ) | |||||
% of Total | 9.3 | % | 9.5 | % | 9.6 | % | 10.6 | % | 10.9 | % | -6.6 | % | ||||||
Commercial RE | 611,274 | 601,556 | 596,983 | 535,307 | 525,671 | 85,603 | ||||||||||||
% of Total | 51.4 | % | 50.9 | % | 50.6 | % | 48.2 | % | 48.0 | % | 16.3 | % | ||||||
Agriculture | 81,341 | 78,569 | 76,514 | 65,150 | 60,924 | 20,417 | ||||||||||||
% of Total | 6.8 | % | 6.7 | % | 6.5 | % | 5.9 | % | 5.6 | % | 33.5 | % | ||||||
Residential RE | 295,481 | 299,741 | 304,741 | 309,140 | 310,126 | (14,645 | ) | |||||||||||
% of Total | 24.8 | % | 25.4 | % | 25.8 | % | 27.8 | % | 28.3 | % | -4.7 | % | ||||||
Consumer & Other | 90,335 | 89,043 | 88,475 | 83,367 | 79,014 | 11,321 | ||||||||||||
% of Total | 7.6 | % | 7.5 | % | 7.5 | % | 7.5 | % | 7.2 | % | 14.3 | % | ||||||
Total Loans | $ | 1,189,559 | $ | 1,181,135 | $ | 1,180,591 | $ | 1,110,545 | $ | 1,094,719 | $ | 94,840 | ||||||
Total Growth Percentage | 8.7 | % | ||||||||||||||||
Deposit Balances | ||||||||||||||||||
($ in thousands, except ratios) | Jun. 2026 | Mar. 2026 | Dec. 2025 | Sep. 2025 | Jun. 2025 | Annual | ||||||||||||
Non-Int DDA | $ | 258,576 | $ | 248,239 | $ | 254,063 | $ | 246,725 | $ | 241,245 | $ | 17,331 | ||||||
% of Total | 18.6 | % | 18.1 | % | 19.4 | % | 19.5 | % | 19.3 | % | 7.2 | % | ||||||
Interest DDA | 206,593 | 215,594 | 202,501 | 194,420 | 205,581 | 1,012 | ||||||||||||
% of Total | 14.9 | % | 15.7 | % | 15.5 | % | 15.4 | % | 16.4 | % | 0.5 | % | ||||||
Savings | 325,675 | 333,662 | 296,484 | 290,111 | 282,311 | 43,364 | ||||||||||||
% of Total | 23.4 | % | 24.3 | % | 22.7 | % | 23.0 | % | 22.6 | % | 15.4 | % | ||||||
Money Market | 315,363 | 300,028 | 280,896 | 261,953 | 249,536 | 65,827 | ||||||||||||
% of Total | 22.7 | % | 21.9 | % | 21.5 | % | 20.7 | % | 20.0 | % | 26.4 | % | ||||||
Time Deposits | 284,940 | 274,300 | 273,300 | 269,313 | 271,149 | 13,791 | ||||||||||||
% of Total | 20.5 | % | 20.0 | % | 20.9 | % | 21.3 | % | 21.7 | % | 5.1 | % | ||||||
Total Deposits | $ | 1,391,147 | $ | 1,371,823 | $ | 1,307,244 | $ | 1,262,522 | $ | 1,249,822 | $ | 141,325 | ||||||
Total Growth Percentage | 11.3 | % | ||||||||||||||||
Asset Quality
As of June 30, 2026, SB Financial continued to report strong asset quality metrics. Nonperforming assets totaled $4.4 million, representing 0.27 percent of total assets, reflecting a decrease of $1.8 million from $6.2 million (0.41 percent of total assets) in the prior-year quarter. Within total nonperforming assets, nonaccruing loans declined to $3.5 million, while foreclosed properties and other assets stood at $936,000. The allowance for credit losses remained strong at 1.38 percent of total loans, providing coverage of 470.2 percent of nonperforming loans. This reserve level represents an improvement from the prior-year period, reflecting the Company's disciplined credit risk framework. Annualized net loan charge-offs to average loans remained very low at 6 basis points, compared to 1 basis point in the linked quarter and 2 basis points in the prior-year quarter, with gross charge-offs totaling $196,000. Collectively, these metrics underscore SB Financial's continued focus on disciplined underwriting and effective credit administration.
"Our credit results for the second quarter continue to demonstrate excellent stability across the loan portfolio and steady progress in resolving nonperforming assets," said Mr. Klein. "With nonperforming assets declining compared to the linked quarter and our allowance for credit losses providing coverage of nonperforming loans, our reserve position remains highly conservative. We remain committed to diligent underwriting and proactive risk management to protect the balance sheet as we support measured loan expansion across our markets."
Nonperforming Assets | Reconcile to 10-Q | Annual | ||||||||||||||||
($ in thousands, except ratios) | Jun. 2026 | Mar. 2026 | Dec. 2025 | Sep. 2025 | Jun. 2025 | |||||||||||||
Commercial & Agriculture | $ | 1,304 | $ | 1,359 | $ | 2,256 | $ | 2,243 | $ | 3,306 | $ | (2,002 | ) | |||||
% of Total Com./Ag. loans | 0.68 | % | 0.71 | % | 1.18 | % | 1.23 | % | 1.84 | % | -60.6 | % | ||||||
Commercial RE | 339 | 668 | 771 | 778 | 784 | (445 | ) | |||||||||||
% of Total CRE loans | 0.06 | % | 0.11 | % | 0.13 | % | 0.15 | % | 0.15 | % | -56.8 | % | ||||||
Residential RE | 1,476 | 1,439 | 1,322 | 1,400 | 1,585 | (109 | ) | |||||||||||
% of Total Res. RE loans | 0.50 | % | 0.48 | % | 0.43 | % | 0.45 | % | 0.51 | % | -6.9 | % | ||||||
Consumer & Other | 367 | 233 | 230 | 195 | 197 | 170 | ||||||||||||
% of Total Con./Oth. loans | 0.41 | % | 0.26 | % | 0.26 | % | 0.23 | % | 0.25 | % | 86.3 | % | ||||||
Total Nonaccruing Loans | 3,486 | 3,699 | 4,579 | 4,616 | 5,872 | (2,386 | ) | |||||||||||
% of Total loans | 0.29 | % | 0.31 | % | 0.39 | % | 0.42 | % | 0.54 | % | -40.6 | % | ||||||
Foreclosed Assets and Other Assets | 936 | 974 | 104 | 237 | 284 | 652 | ||||||||||||
Total Change (%) | N/M | |||||||||||||||||
Total Nonperforming Assets | $ | 4,422 | $ | 4,673 | $ | 4,683 | $ | 4,853 | $ | 6,156 | $ | (1,734 | ) | |||||
% of Total assets | 0.27 | % | 0.29 | % | 0.30 | % | 0.32 | % | 0.41 | % | -28.17 | % | ||||||
Webcast and Conference Call
The Company will hold the second quarter 2026 earnings conference call and webcast on July 24, 2026, at 11:00 a.m. EST. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company's website.
About SB Financial Group
Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 27 offices: 25 in eleven Ohio counties and two in Northeast, Indiana, and 27 ATMs. State Bank has four Residential loan production offices located throughout Ohio and Indiana. Peak Title provides title insurance and title opinions throughout the Tri-State and Kentucky. SB Financial's common stock is listed on the NASDAQ Capital Market with the ticker symbol "SBFG".
Forward-Looking Statements
Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in which SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial's Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company's management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the OMSR valuation adjustment and any gain on sale of assets from net income to report a non-GAAP adjusted net income level. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
Investor Contact Information:
Mark A. Klein
Chairman, President and
Chief Executive Officer
Mark.Klein@YourStateBank.com
Anthony V. Cosentino
Executive Vice President and
Chief Financial Officer
Tony.Cosentino@YourStateBank.com
SB FINANCIAL GROUP, INC. | ||||||||||
CONSOLIDATED BALANCE SHEETS - (Unaudited) | ||||||||||
June | March | December | September | June | ||||||
($ in thousands) | 2026 | 2026 | ... |