Northeast Bancorp Stock Earnings Reports

Northeast Bank reported solid Q2 FY2026 results with net income of $20.7 million ($2.47 diluted EPS) and strong balance sheet growth. Total assets ended the quarter near $4.95 billion and loans finished at $4.4 billion, driven by a record quarter of activity: approximately $533 million of purchased loans (5 portfolios, purchased at ~92.6% of UPB with a weighted yield to maturity ~10.8%) and $252 million of originations (weighted origination rate ~7.6%). SBA activity was disrupted by the government shutdown, reducing SBA gain-on-sale income this quarter (gain ~$2.1 million on $25 million sold), but management expects SBA originations to normalize to roughly $20 million per month (~$50–$60 million per quarter) with expected gain-on-sale rates in the 8–9% range. Net interest margin was 4.49% (down slightly q/q) and management expects NIM to benefit going forward from the larger loan book and liability repricing over the next two quarters. Asset quality remained stable; allowance for credit losses increased to $63.8 million (coverage ratio 1.47%) largely reflecting purchase loan activity. Capital is strong (Tier 1 leverage ~12.2%, tangible book value $62.65) and provides roughly $1 billion of loan capacity. Management is actively scaling small-balance insured loans (originated ~$71 million this quarter) with plans to sell the loans while retaining residual economics, and they expect a robust pipeline of purchase opportunities driven by bank M&A activity. Management continues to use a mix of funding including brokered CDs and FHLB borrowings while also growing core deposits in Maine.