Cashmere Valley Bank Reports Q1 Earnings of $5.8 Million

Cashmere Valley Bank has announced its earnings for the first quarter of 2026, reporting a net income of $5.8 million. This figure reflects a decline compared to the previous year, largely attributed to increased provisions for loan losses arising from delinquencies in several portfolio segments.

Quarterly Financial Overview

For the quarter ending March 31, 2026, the bank recorded diluted earnings per share of $1.54, down by 6.1% from the same quarter in 2025. Greg Oakes, the bank's President and CEO, acknowledged the mixed outcomes of the quarter, noting significant growth in both loans and deposits.

Loan and Deposit Growth

As of March 31, 2026, gross loans reached $971.9 million, marking a modest increase of $4.5 million from a year earlier. The bank saw notable growth of $20 million in loans since the end of 2025. Meanwhile, total deposits climbed to $1.94 billion, a rise of $113.7 million, or 6.2%, over the past year. This growth signifies the bank's ability to attract new customers and retain existing ones.

Impact of Loan Loss Provisions

The decrease in net income was primarily influenced by higher provisions for loan losses, which increased due to delinquencies and charge-offs primarily impacting the indirect dealer and equipment finance portfolios. Notably, the allowance for credit losses was recorded at 1.17% of gross loans, compared to 1.28% one year prior. Credit quality remains strong, although non-performing loans increased slightly to 0.43% of gross loans.

Income and Expense Analysis

Net interest income increased to $16.6 million, attributed to higher loan rates and expanded investment securities balances. However, the non-interest income saw a slight decline, totaling $5.6 million compared to $5.7 million a year earlier. Overall non-interest expenses increased to $13.7 million due to rising salaries and benefit costs, as well as higher taxes, resulting in an efficiency ratio of 61.5% for the quarter.

Share Repurchase and Capital Management

The bank completed successful tender offers for common stock repurchases, totaling 327,419 shares, which provided necessary liquidity for shareholders. As of the end of Q1 2026, Tier 1 capital grew by 2.8%, reflecting a solid equity base despite a decrease in total GAAP equity by 5.5% year-over-year.

Key Takeaways

Cashmere Valley Bank reported net income of $5.8 million for Q1 2026, down from the previous year.

Gross loans increased to $971.9 million and deposits rose to $1.94 billion.

Increased provisions for loan losses negatively impacted net income.

Net interest income improved due to higher loan rates and growing investment securities.

The bank successfully completed share repurchase programs, enhancing liquidity.