Avidia Bancorp posts $8.6 million third quarter net income

Avidia Bancorp, Inc. reported net income of $8.6 million, or $0.47 per share, for the third quarter of 2026, up from $7.2 million, or $0.39 per share, in the second quarter. The company, the holding company of Avidia Bank, also declared a quarterly cash dividend of $0.06 per share, payable on or about November 30, 2026.

CEO Robert D. Cozzone stated that the earnings growth was driven by higher loan yields and a lower loan loss provision. He noted that the company's focus on pricing and operational discipline is improving operating leverage and balance sheet structure. During the quarter, Avidia Bancorp announced a $30 million stock repurchase authorization and began repurchases.

The net interest margin increased by 22 basis points to 3.86% in the third quarter. This figure includes an 11 basis point benefit from a large loan prepayment penalty. Excluding that penalty, the net interest margin was 3.75%, an increase of 11 basis points from the prior quarter. Return on assets rose by 20 basis points to 1.24%, while return on equity climbed by 136 basis points to 8.79%. The efficiency ratio improved to 62.2% from 65.3%.

Total assets remained comparable to the prior quarter at $2.78 billion as of September 30, 2026. Total loans were $2.26 billion, also unchanged from June 30. Residential mortgages increased by $30.1 million, largely due to a $21.3 million purchase of adjustable-rate mortgage loans from a local correspondent bank. Commercial and industrial loans decreased by $31.2 million, primarily due to prepayments including a $23.0 million solar loan.

Deposits grew by $53.0 million, or 2.5%, to $2.21 billion. This growth included $22.9 million in brokered certificates of deposit and a $19.7 million increase in money market accounts from business customers. Lower-cost transaction accounts made up 50% of total deposits at the end of the period.

Borrowings from the Federal Home Loan Bank fell by half a billion dollars to reach a total of $110 million.

Total stockholders' equity declined by $23 million, or 5.9%, to finish the quarter at $366.6 million.

The company recorded $23.8 million for the repurchase of 1,079,051 shares, representing 5.4% of outstanding shares, as of September 30. Accumulated other comprehensive loss increased by $6.8 million as higher market interest rates reduced the value of the available-for-sale investment portfolio.

Total net revenue increased by $1.3 million, or 4%, to $31.2 million in the third quarter. Net interest income rose by $1.5 million due to higher interest rates across most loan categories. The yield on earning assets increased by 21 basis points to 5.26%. The cost of interest-bearing liabilities decreased by 1 basis point to 1.88%, while the cost of deposits increased by 3 basis points to 1.35%.

Non-interest expense decreased by $121 thousand, or 1%, to $19.4 million. Income tax expense increased by $660 thousand to $3.0 million, resulting in an effective income tax rate of 25.6% for the quarter.

The allowance for credit losses stood at $23.2 million at period-end, compared to $23.9 million in the prior quarter. Provision expense for credit losses decreased by $681 thousand to $211 thousand. Net loan charge-offs were $755 thousand, measuring 0.13% of average loans on an annualized basis. Nonaccruing loans totaled $17.8 million, or 0.79% of total loans, at the end of the third quarter.