HomeTrust earnings increased in the third quarter of 2026 as higher net interest income and lower income tax expense lifted preliminary net income to $18.0 million from $15.6 million in the preceding quarter. The Asheville, North Carolina-based parent of HomeTrust Bank announced the results on October 21, reporting diluted earnings per share of $1.11, up from $0.94.
Key Takeaways
- Higher net interest income and a renewable-energy tax benefit supported the quarterly profit increase.
- Classified assets rose 14.9%, even as the provision for credit losses declined.
- HomeTrust accelerated share repurchases while its proposed Blue Ridge acquisition remained pending.
Table of Contents
- HomeTrust earnings benefit from wider margin and lower taxes
- Credit measures present a mixed picture
- Repurchases accelerate as Blue Ridge deal awaits approvals
- Conclusion
HomeTrust earnings benefit from wider margin and lower taxes
The company’s third-quarter results announcement covered the three months ended September 30, 2026. Net interest income increased by approximately $1.2 million to $46.5 million, while net interest margin widened to 4.46% from 4.41%.
The improvement was not solely a lending-income story. Use of purchased renewable energy income tax credits produced a $1.9 million federal income tax benefit, helping reduce total income tax expense by $1.4 million from the second quarter.
Interest and dividend income rose by $1.7 million, with an increase in accretion income the primary driver. Interest expense also increased, mainly because of higher average balances and rates on money market and certificate accounts.
For the first nine months of 2026, net income reached $50.4 million, compared with $48.2 million a year earlier. Diluted earnings per share increased to $3.04 from $2.79.
| Item | Details |
|---|---|
| Annualized return on assets | 1.65% in Q3 2026, versus 1.46% in Q2 |
| Annualized return on equity | 12.06% in Q3 2026, versus 10.44% in Q2 |
| Net charge-offs | $1.1 million in Q3 2026, versus $1.8 million in Q2 |
Credit measures present a mixed picture
Classified assets increased 14.9% as newly identified nonperforming loans added to credit concerns. That deterioration contrasted with a lower quarterly provision for credit losses of $805,000, compared with $920,000 in the second quarter.
The provision is an expense used to maintain the allowance for expected credit losses; it does not move in lockstep with every change in problem loans. HomeTrust’s quarterly calculation reflected changes in loan mix, economic assumptions and net charge-offs.
Repurchases accelerate as Blue Ridge deal awaits approvals
HomeTrust repurchased 923,897 shares during the quarter at an average price of $48.03, compared with 153,606 shares at $46.31 in the preceding quarter. CEO Hunter Westbrook said the company completed its August repurchase program earlier in October and authorized purchases of an additional 5% of outstanding shares.
The board also declared a quarterly cash dividend of $0.15 per common share, payable November 25, 2026, to shareholders of record at the close of business on November 12.
Separately, the proposed acquisition of Blue Ridge Bankshares remained subject to regulatory and shareholder approvals and customary closing conditions. HomeTrust said all required regulatory applications had been filed and expected the transaction to close early in the first quarter of 2027.
Under the agreement signed August 16, Blue Ridge shareholders would receive 0.086 HomeTrust shares for each Blue Ridge share, plus cash instead of fractional shares. HomeTrust recorded $904,000 of merger-related expenses in the third quarter.
Conclusion
HomeTrust’s higher quarterly profit reflected both stronger net interest income and a tax benefit, while credit quality remained mixed. The next scheduled shareholder dates are the November 12 dividend record date and November 25 payment, with the Blue Ridge transaction expected to close early in 2027 if its conditions are met.
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