First Resource Bank Reports Record First Quarter 2026 Financial Results

Published: 2026-04-29 08:01:19 ET FRSB

Published on 04/29/2026 at 08:01 am EDT

EXTON, Pa., April 29, 2026 /PRNewswire/ -- First Resource Bancorp, Inc. (OTCQX: FRSB), reported strong financial performance for the first quarter ended March 31, 2026.

Lauren C. Ranalli, President and CEO, stated, "Our strong momentum from 2025 carried into the first quarter of 2026 with record quarterly net income of $2.5 million, up 47% year-over-year, driven by continued loan growth, expanding net interest margin, and disciplined balance sheet management. This quarter's performance reflects the strength of our strategy and our ongoing commitment to delivering sustainable value to our shareholders, customers, employees and community. "

First Quarter 2026 Highlights

Earnings and Profitability

For the quarter ended March 31, 2026, net income totaled $2.5 million, compared to $1.7 million for the same period a year ago and $2.3 million for the prior quarter. Earnings per share increased to $0.82, up from $0.56 in the first quarter of 2025 and $0.78 in the fourth quarter of 2025.

Annualized return on average assets rose to 1.24% for the first quarter of 2026, compared to 1.06% for the same period in 2025. Annualized return on average equity increased to 16.64%, up from 13.31% year over year, reflecting improved operating leverage and balance sheet growth.

Net Interest Income and Net Interest Margin

Net interest income totaled $7.3 million for the first quarter of 2026, representing an increase of $221 thousand, or 3%, compared to the prior quarter and an increase of 33% compared to the same period a year ago. The net interest margin expanded to 3.80%, up from 3.77% in the fourth quarter of 2025 and 3.60% in the first quarter of 2025.

Total interest income increased to $12.0 million, representing a 1% increase from the prior quarter and a 23% increase compared to the first quarter of 2025. Quarterly growth was driven primarily by a 4% increase in average loan balances, partially offset by modestly lower loan yields. Year-over-year growth reflected a 17% increase in loan balances and overall higher loan yields.

Total interest expense declined 2% compared to the prior quarter, primarily due to a 14 basis point reduction in the cost of interest-bearing deposits and lower time deposit balances. These decreases were partially offset by higher balances in checking and money market accounts, as well as increased subordinated debt balances. Compared to the first quarter of 2025, total interest expense increased 11%, driven by higher volumes of interest-bearing deposits and borrowings, partially mitigated by lower deposit rates.

Asset Quality and Provision for Credit Losses and Allowance for Credit Losses on Loans

The provision for credit losses totaled $377 thousand for the first quarter of 2026, compared to $369 thousand in the fourth quarter of 2025 and $174 thousand in the first quarter of 2025. As of March 31, 2026, the allowance for credit losses represented 0.76% of total loans, compared to 0.73% at December 31, 2025.

Non-performing assets totaled $3.0 million, representing 0.37% of total assets, compared to $731 thousand, or 0.09% of total assets, at December 31, 2025, and 0.04% at March 31, 2025. One of the Company's two non-accrual loan relationships is fully secured by real estate collateral, while the second required a specific reserve of $62 thousand during the first quarter.

"Non-performing assets increased during the first quarter due to one new relationship being placed on non-accrual," stated Ranalli. "We are working through that credit expeditiously and anticipate a successful outcome later this year."

Non-Interest Income and Expense

Non-interest income totaled $544 thousand for the quarter, representing an increase of 62% from the prior quarter and 56% from the same period last year. Gains on the sale of SBA loans were $274 thousand, compared to none in the prior quarter and $87 thousand in first quarter of 2025. There was no swap referral fee income in the first quarter, compared to $70 thousand in the prior quarter and $24 thousand in the first quarter of 2025.

Non-interest expenses increased 5% from the prior quarter and 23% compared to the first quarter of 2025, reflecting higher costs across all operating categories. The ratio of non-interest expense to average assets was 2.21%, compared to 2.15% in the prior quarter and 2.25% in the first quarter of 2025. The efficiency ratio was 55.8%, compared to 56.2% in the prior quarter and 61.0% in the first quarter of 2025.

Balance Sheet

Total deposits decreased $7.3 million, or 1%, during the first quarter of 2026, reflecting a shift in deposit mix. Money market balances increased significantly, while time deposits declined. Checking and non-interest-bearing deposits experienced modest decreases. On a year-over-year basis, total deposits increased 25%, driven by growth across all deposit categories except time deposits. Approximately 80% of total deposits were insured or collateralized as of March 31, 2026.

"The significant expansion of deposits in the fourth quarter of 2025 enabled a strategic reduction of non-core deposits in the first quarter of 2026," stated Ranalli. "Although total deposits declined on a quarter-over-quarter basis, customer deposits grew a net $7.5 million, or 1%, during the period."

Total loans increased $26.8 million, or 4%, during the first quarter of 2026 to $705.3 million, driven primarily by strong growth in commercial real estate and commercial construction lending. Compared to March 31, 2025, total loans increased $100.3 million, or 17%, reflecting continued strength in our core lending markets.

The following table illustrates the composition of the loan portfolio, net of unearned loan origination fees and costs:

March 31,

December 31,

March 31,

2026

2025

Commercial real estate

$ 531,440,586

$ 525,443,319

$ 476,539,433

Commercial construction

88,293,400

68,110,339

46,800,635

Commercial business

67,016,443

66,353,744

63,018,850

Consumer

18,541,133

18,548,853

18,681,505

Total loans

$ 705,291,562

$ 678,456,255

$ 605,040,423

Investment securities totaled $31.8 million at March 31, 2026, compared to $27.6 million at December 31, 2025. The Company's held-to-maturity investment portfolio had a book value of $9.1 million and a fair market value of $8.4 million, resulting in an unrealized loss of $683 thousand, virtually unchanged from December 31, 2025. On an after-tax basis, this unrealized loss totaled $539 thousand, representing approximately 0.9% of total stockholders' equity as of March 31, 2026.

The remainder of the Company's investment portfolio was classified as available-for-sale and had a book value of $23.8 million and a fair value of $22.7 million at March 31, 2026. This resulted in an unrealized loss of $1.1 million, compared to $798 thousand at December 31, 2025. The after-tax unrealized loss of $844 thousand is reflected in accumulated other comprehensive loss within stockholders' equity.

Total assets decreased 1% during the quarter, primarily reflecting the planned reduction in non-core time deposits.

Total stockholders' equity increased $2.3 million, or 4%, during the first quarter of 2026, rising from $58.8 million at December 31, 2025, to $61.0 million at March 31, 2026. This increase was driven primarily by net income earned during the quarter. During the quarter, the Company paid a cash dividend of $0.02 per common share. Book value per share increased by $0.74, or 4%, during the first quarter to $20.30 per share at March 31, 2026.

Selected Financial Data:

Consolidated Balance Sheets (unaudited)

March 31,

December 31,

2026

2025

Assets:

Cash and due from banks

$ 52,953,190

$ 90,422,400

Time deposits at other banks

100,000

Investments

31,759,063

27,634,611

Loans receivable

705,291,562

678,456,255

Allowance for credit losses

(5,338,337)

(4,977,305)

Premises & equipment

7,312,947

7,360,342

Other assets

18,923,756

18,359,879

Total assets

$ 811,002,181

$ 817,356,182

Liabilities:

Noninterest-bearing deposits

$ 119,590,197

$ 120,359,227

Interest-bearing checking

66,652,272

69,271,915

Money market

349,036,565

326,603,007

Time deposits

182,731,610

209,098,258

Total deposits

718,010,644

725,332,407

Long term borrowings

14,162,000

16,012,000

Subordinated debt

10,468,289

10,466,463

Other liabilities

7,338,138

6,777,883

Total liabilities

749,979,071

758,588,753

Stockholders' Equity

Common stock

3,100,773

Additional paid-in capital

19,892,023

19,863,401

Treasury stock

(1,318,700)

(1,346,793)

Accumulated other comprehensive loss

(843,939)

(630,812)

Retained earnings

40,192,953

37,780,860

Total stockholders' equity

61,023,110

58,767,429

Total liabilities & stockholders' equity

$ 811,002,181

$ 817,356,182

Performance Statistics (unaudited)

Three Months Ended

March 31,

December 31,

September 30,

June 30,

March 31,

2026

2025

Per Share Data:

Earnings per share – basic and diluted

$ 0.82

$ 0.78

$ 0.75

$ 0.63

$ 0.56

Total shares outstanding

3,006,555

3,004,527

3,002,485

3,000,028

2,998,977

Weighted average shares outstanding

3,005,613

3,003,726

3,001,454

2,999,200

3,003,194

Book value per share

$ 20.30

$ 19.56

$ 18.79

$ 18.00

$ 17.34

Performance Ratios:

Return on average assets *

1.24 %

1.18 %

1.29 %

1.15 %

1.06 %

Return on average equity *

16.64 %

15.87 %

16.19 %

14.38 %

13.31 %

Net interest margin

3.80 %

3.77 %

3.87 %

3.72 %

3.60 %

Non-interest expenses* to average assets

2.21 %

2.15 %

2.21 %

2.29 %

2.25 %

Efficiency ratio

55.8 %

56.2 %

56.1 %

60.0 %

61.0 %

Asset Quality Ratios:

Non-performing loans to total loans

0.43 %

0.11 %

0.00 %

0.03 %

0.04 %

Non-performing assets to total assets

0.37 %

0.09 %

0.00 %

0.03 %

0.04 %

Allowance for credit losses to total loans

0.76 %

0.73 %

0.72 %

0.76 %

0.77 %

Average loans to average assets

85.70 %

86.00 %

92.20 %

93.30 %

93.00 %

* Annualized

Consolidated Income Statements (unaudited)

Three Months Ended

March 31,

December 31,

September 30,

June 30,

March 31,

2026

2025

Interest income:

Loans, including fees

$ 11,182,544

$ 11,098,085

$ 10,719,087

$ 10,126,623

$ 9,583,093

Securities

280,104

206,991

136,606

118,920

116,372

Other

560,555

599,764

138,292

28,289

47,421

Total interest income

12,023,203

11,904,840

10,993,985

10,273,832

9,746,886

Interest expense:

Deposits

4,395,446

4,520,311

4,231,636

4,111,978

4,002,995

Borrowings

122,789

125,620

77,963

85,822

77,303

Subordinated debt

162,556

137,058

134,682

134,681

134,682

Total interest expense

4,680,791

4,782,989

4,444,281

4,332,481

4,214,980

Net interest income

7,342,412

7,121,851

6,549,704

5,941,351

5,531,906

Provision for credit losses

377,167

368,729

189,087

130,416

174,097

Net interest income after provision for credit losses

6,965,245

6,753,122

6,360,617

5,810,935

5,357,809

Non-interest income:

Service charges and other fees

130,399

116,476

107,182

97,887

109,360

BOLI income

68,580

69,075

68,585

66,998

65,850

Gain on sale of SBA loans

274,352

26,326

86,860

Swap referral fee income

69,890

96,813

107,925

24,201

Other

70,899

81,363

76,913

73,275

62,843

Total non-interest income

544,230

336,804

349,493

372,411

349,114

Non-interest expense

Salaries & benefits

2,657,536

2,635,943

2,370,422

2,253,069

2,127,037

Occupancy & equipment

349,732

313,743

316,684

318,631

334,698

Professional fees

173,999

137,279

143,108

192,378

150,176

Advertising

126,442

87,011

104,356

113,923

108,721

Data processing

245,419

240,384

213,565

207,430

204,492

FDIC premium expense

191,252

166,763

135,382

128,019

131,175

Other

653,955

614,101

587,553

577,942

533,159

Total non-interest expense

4,398,335

4,195,224

3,871,070

3,791,392

3,589,458

Income before federal income tax expense

3,111,140

2,894,702

2,839,040

2,391,954

2,117,465

Federal income tax expense

638,956

585,391

580,874

488,827

430,241

Net income

$ 2,472,184

$ 2,309,311

$ 2,258,166

$ 1,903,127

$ 1,687,224

About First Resource Bancorp, Inc.

First Resource Bancorp, Inc. is the holding company of First Resource Bank. First Resource Bank is a locally owned and operated Pennsylvania state-chartered bank with three full-service branches, serving the banking needs of businesses, professionals and individuals in the Delaware Valley. The Bank offers a full range of deposit and credit services with a high level of personalized service. First Resource Bank also offers a broad range of traditional financial services and products, competitively priced and delivered in a responsive manner to small businesses, professionals and residents in the local market. For additional information visit our website at www.firstresourcebank.com. Member FDIC.

This press release contains statements that are not of historical facts and may pertain to future operating results or events or management's expectations regarding those results or events. These are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts. When used in this press release, the words "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", or words of similar meaning, or future or conditional verbs, such as "will", "would", "should", "could", or "may" are generally intended to identify forward-looking statements. These forward-looking statements are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are either beyond our control or not reasonably capable of predicting at this time. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the results discussed in these forward-looking statements. Readers of this press release are accordingly cautioned not to place undue reliance on forward-looking statements. First Resource Bank disclaims any intent or obligation to update publicly any of the forward-looking statements herein, whether in response to new information, future events or otherwise.

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SOURCE First Resource Bank