Oak Ridge earnings rose to $2.0 million in the third quarter of 2026 from $1.9 million a year earlier, even as nonperforming assets increased. The parent of Bank of Oak Ridge also declared a quarterly dividend of $0.16 per common share.

Key Takeaways

  • Third-quarter earnings were $0.72 per share, up from $0.69 a year earlier.
  • Nonperforming assets rose to $12.3 million at September 30 from $5.8 million a year earlier.
  • Management expects a September debt redemption to reduce annual pretax interest expense by about $340,000.

Oak Ridge earnings and income drivers

The North Carolina bank holding company reported unaudited results on October 30 for the quarter ended September 30. Earnings per share were below the $0.79 reported for the preceding quarter.

CEO Tom Wayne said the year-over-year increase in quarterly profit reflected higher net interest income and a $765,000 reduction in the provision for credit losses. Those gains were partly offset by lower noninterest income and higher expenses. The company recorded no gains on sales of Small Business Administration loans during the quarter, compared with $380,000 a year earlier.

For the first nine months of 2026, net income was $5.6 million, or $2.03 per share, compared with $5.7 million, or $2.08 per share, a year earlier.

Nonperforming loans and guarantees

Nonperforming assets represented 1.82% of total assets at September 30, up from 0.84% a year earlier and 1.42% at June 30. They included 19 SBA loans with an outstanding balance of $11.9 million, of which $8.8 million was guaranteed and $3.1 million was not.

The SBA explains that its loan guarantees can allow the agency to purchase a guaranteed portion after a borrower defaults. Oak Ridge said recovery under its guarantees is subject to the bank’s compliance with program requirements.

Wayne said the bank had recognized $1.9 million in estimated credit losses on the nonperforming loans and collected $838,000 in SBA guarantee proceeds during the quarter. He identified reducing nonperforming assets as the bank’s highest priority.

Debt redemption and dividend

Oak Ridge redeemed all $6.0 million of its outstanding subordinated debentures on September 15. Management estimates the redemption will reduce pretax interest expense by about $340,000 annually, or $85,000 per quarter; those savings are an estimate, not a reported result.

The $0.16 quarterly dividend is payable December 1, 2026, to shareholders of record at the close of business on November 13.

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