Union Bankshares earnings increased in the third quarter of 2026 as higher net interest income and lower credit loss expense outweighed weaker noninterest income and rising operating costs. The Vermont-based bank holding company announced on October 21 that quarterly net income reached $3.768 million, or $0.77 per share, and declared a $0.36-per-share cash dividend.
Key Takeaways
- Quarterly profit rose from $3.436 million, while earnings per share increased from $0.75.
- Net interest income increased by $988,000, and credit loss expense fell to $34,000.
- Book value per share declined as unrealized securities losses deepened.
Table of Contents
- Union Bankshares earnings benefit from lower credit costs
- Weaker fees and higher expenses temper the gain
- Loan growth accompanies greater use of brokered deposits
- Securities losses weigh on book value as dividend is declared
- Conclusion
Union Bankshares earnings benefit from lower credit costs
For the three months ended September 30, 2026, net interest income reached $12.144 million, compared with $11.156 million a year earlier. Interest income rose to $20.363 million as the company reported a larger earning-asset base and higher rates on those assets. Interest expense increased more modestly, to $8.219 million from $8.051 million.
The company's third-quarter 2025 earnings announcement recorded rounded net income of $3.4 million for that quarter and $8.3 million for the first nine months of 2025. Those figures provide the prior-year comparison, rather than confirmation of the newly announced 2026 results.
Credit loss expense fell to $34,000 from $313,000. Union Bankshares attributed the reduction primarily to the size and mix of its loan portfolio and unfunded commitments. Together, higher net interest income and lower credit costs provided the main lift to quarterly profit.
| Item | Details |
|---|---|
| Investment securities | $282.1 million at September 30, 2026, versus $262.4 million a year earlier. |
| Allowance for credit losses on loans | $8.6 million at September 30, 2026, versus $8.4 million a year earlier. |
| Nine-month qualifying mortgage loan sales | $94.9 million in 2026, versus $102.8 million in 2025. |
Weaker fees and higher expenses temper the gain
Total noninterest income was approximately $2.8 million, down from $3.3 million a year earlier. Gains on sales of qualifying residential mortgages declined to $553,000 from $700,000.
Noninterest expenses increased by $269,000 to $10.612 million. Higher employee benefits and equipment costs accounted for most of the increase, partly offset by lower salaries and wages. Income tax expense also rose, reaching $573,000 from $414,000.
For the first nine months of 2026, net income reached $9.696 million, or $2.03 per share, compared with $8.332 million, or $1.83 per share, a year earlier. The nine-month results included a $116,000 credit loss benefit, versus a $769,000 expense in the comparable 2025 period.
Loan growth accompanies greater use of brokered deposits
Total assets increased by $62.6 million year over year to approximately $1.64 billion at September 30, 2026. Outstanding loans reached about $1.23 billion, up $52.5 million, while investment securities also increased.
Deposits rose to approximately $1.25 billion from $1.19 billion. Purchased brokered deposits increased to $110.8 million from $65.3 million, accounting for much of the overall deposit increase.
Borrowed funds remained broadly stable at $271.1 million, but their composition changed. Federal Home Loan Bank advances totaled $241.1 million and Federal Reserve borrowings were $30 million, compared with $270.8 million of Federal Home Loan Bank advances a year earlier.
Securities losses weigh on book value as dividend is declared
Stockholders' equity increased to $78.8 million from $77.7 million, supported in part by common-stock sales. Through September 30, 2026, the company had sold 384,066 shares under its previously announced equity distribution agreement, generating net proceeds of $8.6 million.
Nevertheless, book value per share fell to $15.94 from $16.95. Accumulated other comprehensive loss related to securities fair-value adjustments widened to $40.7 million from $27.5 million, contributing to the decline.
The board declared a quarterly cash dividend of $0.36 per share, payable November 5, 2026, to shareholders of record on October 31, 2026.
Conclusion
Higher net interest income and lower credit costs lifted Union Bankshares' quarterly profit, while weaker fee income and deeper unrealized securities losses remained offsets. The next confirmed shareholder milestone is the October 31 dividend record date, followed by payment on November 5, 2026.
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