First Northern Community Bancorp (the “Company”, NASDAQ: FNRN), holding company for First Northern Bank (“First Northern” or the “Bank”), today reported net income of $10.6 million, or $0.64 per diluted share, for the six months ended June 30, 2026, up 16.4% compared to net income of $9.1 million, or $0.55 per diluted share, for the six months ended June 30, 2025.
Net income for the quarter ended June 30, 2026, was $4.7 million, or $0.29 per diluted share, down 13.5% compared to net income of $5.5 million, or $0.33 per diluted share, for the quarter ended June 30, 2025.
Total assets as of June 30, 2026, were $1.93 billion, an increase of $54.4 million, or 2.9%, compared to June 30, 2025. Total net loans, including loans held-for-sale, as of June 30, 2026, were $1.09 billion, an increase of $29.0 million, or 2.7%, compared to June 30, 2025. The increase in net loans was primarily driven by growth in commercial loans, which was partially offset by net reductions in commercial real estate, agriculture, residential mortgage and consumer loans. Total deposits as of June 30, 2026, were $1.69 billion, an increase of $28.6 million, or 1.7%, compared to June 30, 2025.
The Company continued to be “well capitalized” under regulatory definitions, exceeding the 10% total risk-based capital ratio threshold as of June 30, 2026.
Jeremiah Smith, President and Chief Executive Officer, commented, “We are pleased with our second quarter performance, highlighted by strong loan growth, continued credit quality improvements, and disciplined balance sheet management. Net loans increased by $27.9 million during the quarter, representing an annualized growth rate of 10.5%, while non-accrual loans declined by 7.1% to $4.6 million. Our net interest margin remained strong at 3.75%, and our cost of funds was well managed at 0.90%, reflecting the ongoing strength of our low-cost deposit franchise. The acquisition of Beacon Wealth in the fourth quarter of 2025 continued to improve our total non-interest income. Investment and brokerage services income for the quarter ended June 30, 2026 increased by 141.3% compared to the same quarter one year prior, contributing to a 14.7% increase in total non-interest income to $1.8 million compared to June 30, 2025.”
Further, “We also remain focused on managing operating expenses while investing in the future of the Bank. During the second quarter, our systems upgrade project accelerated, resulting in modest increases in staffing, data processing, and consulting expenses. We expect these elevated costs to continue through our planned fourth quarter project implementation, after which we anticipate enhanced capabilities, improved process efficiencies, and long-term operating benefits beginning in 2027.”
Lastly, Mr. Smith commented, “We remain committed to enhance and unlock shareholder value. On April 24, 2026, we successfully uplisted to The Nasdaq Capital Market, and, effective June 29, 2026, we were added to the Russell 3000 Index. These milestones significantly increased trading volume, improved liquidity of our common stock, and expanded our visibility among institutional investors as index funds tracking the Russell 3000 acquired shares. In addition to improving our valuation, we continued to improve our book value per share, which increased from $13.03 at March 31, 2026 to $13.24 at June 30, 2026. Together, these achievements reflect the continued execution of our long-term strategy to create value for our shareholders while positioning the Company for future growth."
SECOND QUARTER HIGHLIGHTS (UNAUDITED)
Performance and operating highlights for the Company for the periods noted below included the following:
|
|
Three months ended |
||||||||||
|
|
June 30, |
|
March 31, |
|
June 30, |
||||||
(in thousands, except per share and share data) |
|
2026 |
|
2026 |
|
2025 |
||||||
Return on average assets (“ROAA”) (annualized) |
|
|
0.98 |
% |
|
|
1.24 |
% |
|
|
1.18 |
% |
Return on average equity (“ROAE”) (annualized) |
|
|
8.80 |
% |
|
|
11.21 |
% |
|
|
11.67 |
% |
Pre-tax income |
|
$ |
6,215 |
|
|
$ |
7,612 |
|
|
$ |
7,597 |
|
Net income |
|
$ |
4,728 |
|
|
$ |
5,906 |
|
|
$ |
5,466 |
|
Net interest margin (annualized) |
|
|
3.75 |
% |
|
|
3.83 |
% |
|
|
3.85 |
% |
Cost of funds (annualized) |
|
|
0.90 |
% |
|
|
0.90 |
% |
|
|
0.88 |
% |
Efficiency ratio |
|
|
63.69 |
% |
|
|
58.23 |
% |
|
|
58.91 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per common share |
|
$ |
0.29 |
|
|
$ |
0.37 |
|
|
$ |
0.33 |
|
Diluted earnings per common share |
|
$ |
0.29 |
|
|
$ |
0.36 |
|
|
$ |
0.33 |
|
Weighted average basic common shares outstanding |
|
|
16,119,853 |
|
|
|
16,133,555 |
|
|
|
16,377,019 |
|
Weighted average diluted common shares outstanding |
|
|
16,508,791 |
|
|
|
16,490,162 |
|
|
|
16,592,259 |
|
Shares outstanding at end of period |
|
|
16,395,303 |
|
|
|
16,409,660 |
|
|
|
16,609,244 |
|
Book value per share |
|
$ |
13.24 |
|
|
$ |
13.03 |
|
|
$ |
11.73 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leverage ratio |
|
|
12.0 |
% |
|
|
11.7 |
% |
|
|
11.3 |
% |
Common equity tier 1 capital ratio |
|
|
17.7 |
% |
|
|
17.8 |
% |
|
|
16.9 |
% |
Tier 1 capital ratio |
|
|
17.7 |
% |
|
|
17.8 |
% |
|
|
16.9 |
% |
Total capital ratio |
|
|
19.0 |
% |
|
|
19.1 |
% |
|
|
18.1 |
% |
Tangible common equity ratio |
|
|
11.0 |
% |
|
|
10.9 |
% |
|
|
10.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders' equity |
|
$ |
217,154 |
|
|
$ |
213,799 |
|
|
$ |
194,885 |
|
Less mortgage servicing rights |
|
|
(1,101 |
) |
|
|
(1,126 |
) |
|
|
(1,242 |
) |
Less intangible assets |
|
|
(3,834 |
) |
|
|
(4,079 |
) |
|
|
(2,952 |
) |
Total tangible common stockholders' equity |
|
$ |
212,219 |
|
|
$ |
208,594 |
|
|
$ |
190,691 |
|
Total assets |
|
$ |
1,926,412 |
|
|
$ |
1,924,548 |
|
|
$ |
1,871,990 |
|
Less mortgage servicing rights |
|
|
(1,101 |
) |
|
|
(1,126 |
) |
|
|
(1,242 |
) |
Less intangible assets |
|
|
(3,834 |
) |
|
|
(4,079 |
) |
|
|
(2,952 |
) |
Total tangible assets |
|
$ |
1,921,477 |
|
|
$ |
1,919,343 |
|
|
$ |
1,867,796 |
|
Tangible common equity ratio |
|
|
11.0 |
% |
|
|
10.9 |
% |
|
|
10.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary Results (Unaudited)
The following is a summary of the components of the Company’s operating results for the periods indicated:
|
Three months ended |
|
|
|
|
|
|
|
|||||||
|
June 30, |
|
March 31, |
|
|
|
|
|
|||||||
(in thousands) |
2026 |
|
2026 |
|
$ Change |
|
% Change |
||||||||
Selected operating data: |
|
|
|
|
|
|
|
|
|
||||||
Net interest income |
$ |
17,006 |
|
$ |
17,204 |
|
$ |
(198 |
) |
(1.15 |
)% |
||||
Provision for credit losses |
|
600 |
|
|
300 |
|
|
300 |
|
100.00 |
% |
||||
Non-interest income |
|
1,763 |
|
|
1,740 |
|
|
23 |
|
1.32 |
% |
||||
Non-interest expense |
|
11,954 |
|
|
11,032 |
|
|
922 |
|
8.36 |
% |
||||
Pre-tax income |
|
6,215 |
|
|
7,612 |
|
|
(1,397 |
) |
(18.35 |
)% |
||||
Provision for income taxes |
|
1,487 |
|
|
1,706 |
|
|
(219 |
) |
(12.84 |
)% |
||||
Net income |
$ |
4,728 |
|
$ |
5,906 |
|
$ |
(1,178 |
) |
(19.95 |
)% |
||||
|
Three months ended |
|
|
|
|
|
|||||||||
|
June 30, |
June 30, |
|
|
|
|
|
||||||||
(in thousands) |
2026 |
2025 |
$ Change |
% Change |
|||||||||||
Selected operating data: |
|
|
|
|
|
|
|
|
|
||||||
Net interest income |
$ |
17,006 |
|
$ |
16,953 |
|
$ |
53 |
|
0.31 |
% |
||||
Provision for credit losses |
|
600 |
|
|
— |
|
|
600 |
|
NM |
|
||||
Non-interest income |
|
1,763 |
|
|
1,537 |
|
|
226 |
|
14.70 |
% |
||||
Non-interest expense |
|
11,954 |
|
|
10,893 |
|
|
1,061 |
|
9.74 |
% |
||||
Pre-tax income |
|
6,215 |
|
|
7,597 |
|
|
(1,382 |
) |
(18.19 |
)% |
||||
Provision for income taxes |
|
1,487 |
|
|
2,131 |
|
|
(644 |
) |
(30.22 |
)% |
||||
Net income |
$ |
4,728 |
|
$ |
5,466 |
|
$ |
(738 |
) |
(13.50 |
)% |
||||
Balance Sheet Summary (Unaudited)
|
June 30, |
December 31, |
|
|
|
|
|
||||||||
(in thousands) |
2026 |
2025 |
$ Change |
% Change |
|||||||||||
Selected financial condition data: |
|
|
|
|
|
|
|
|
|
||||||
Cash and cash equivalents |
$ |
113,435 |
|
$ |
145,554 |
|
$ |
(32,119 |
) |
(22.07 |
)% |
||||
Total investments |
|
618,931 |
|
|
617,243 |
|
|
1,688 |
|
0.27 |
% |
||||
Total loans, net |
|
1,092,098 |
|
|
1,050,473 |
|
|
41,625 |
|
3.96 |
% |
||||
Total assets |
|
1,926,412 |
|
|
1,910,950 |
|
|
15,462 |
|
0.81 |
% |
||||
Total deposits |
|
1,691,887 |
|
|
1,679,143 |
|
|
12,744 |
|
0.76 |
% |
||||
Total liabilities |
|
1,709,258 |
|
|
1,698,932 |
|
|
10,326 |
|
0.61 |
% |
||||
Total shareholders’ equity |
|
217,154 |
|
|
212,018 |
|
|
5,136 |
|
2.42 |
% |
||||
Net Interest Income and Net Interest Margin (Unaudited)
The following table shows the components of net interest income and net interest margin for the quarterly periods indicated:
|
Three months ended |
||||||||||||||||||||||||||||||||
|
June 30, 2026 |
|
March 31, 2026 |
|
June 30, 2025 |
||||||||||||||||||||||||||||
(in thousands) |
Average Balance |
|
Interest Income/ Expense |
|
Yields Earned/ Rates Paid (1) |
|
Average Balance |
|
Interest Income/ Expense |
|
Yields Earned/ Rates Paid (1) |
|
Average Balance |
|
Interest Income/ Expense |
|
Yields Earned/ Rates Paid (1) |
||||||||||||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Loans |
$ |
1,070,933 |
|
$ |
14,549 |
|
5.45 |
% |
$ |
1,044,166 |
|
$ |
14,322 |
|
5.56 |
% |
$ |
1,044,581 |
|
$ |
14,629 |
|
5.62 |
% |
|||||||||
Certificates of deposit |
|
10,699 |
|
|
107 |
|
4.01 |
% |
|
10,558 |
|
|
106 |
|
4.07 |
% |
|
15,112 |
|
|
157 |
|
4.17 |
% |
|||||||||
Interest-bearing due from banks |
|
102,368 |
|
|
1,034 |
|
4.05 |
% |
|
125,045 |
|
|
1,098 |
|
3.56 |
% |
|
85,828 |
|
|
1,010 |
|
4.72 |
% |
|||||||||
Investment securities, taxable |
|
569,985 |
|
|
4,529 |
|
3.19 |
% |
|
573,637 |
|
|
4,434 |
|
3.13 |
% |
|
560,021 |
|
|
4,137 |
|
2.96 |
% |
|||||||||
Investment securities, non-taxable |
|
54,549 |
|
|
438 |
|
3.22 |
% |
|
57,685 |
|
|
447 |
|
3.14 |
% |
|
49,497 |
|
|
391 |
|
3.17 |
% |
|||||||||
Other interest-earning assets |
|
10,870 |
|
|
149 |
|
5.50 |
% |
|
10,870 |
|
|
555 |
|
20.71 |
% |
|
10,808 |
|
|
250 |
|
9.28 |
% |
|||||||||
Total average interest-earning assets |
|
1,819,404 |
|
|
20,806 |
|
4.59 |
% |
|
1,821,961 |
|
|
20,962 |
|
4.67 |
% |
|
1,765,847 |
|
|
20,574 |
|
4.67 |
% |
|||||||||
Non-interest-earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Cash and due from banks |
|
30,581 |
|
|
|
|
|
|
29,481 |
|
|
|
|
|
|
30,777 |
|
|
|
|
|
||||||||||||
Premises & equipment, net |
|
8,969 |
|
|
|
|
|
|
8,693 |
|
|
|
|
|
|
7,866 |
|
|
|
|
|
||||||||||||
Interest receivable and other assets |
|
67,325 |
|
|
|
|
|
|
65,134 |
|
|
|
|
|
|
53,556 |
|
|
|
|
|
||||||||||||
Total average assets |
$ |
1,926,279 |
|
|
|
|
|
$ |
1,925,269 |
|
|
|
|
|
$ |
1,858,046 |
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Interest-bearing transaction deposits |
$ |
451,794 |
|
|
810 |
|
0.72 |
% |
$ |
444,368 |
|
|
766 |
|
0.70 |
% |
$ |
428,553 |
|
|
693 |
|
0.65 |
% |
|||||||||
Savings and MMDA’s |
|
477,236 |
|
|
1,857 |
|
1.56 |
% |
|
475,494 |
|
|
1,809 |
|
1.54 |
% |
|
447,276 |
|
|
1,602 |
|
1.44 |
% |
|||||||||
Time, $250,000 and under |
|
84,760 |
|
|
677 |
|
3.20 |
% |
|
85,614 |
|
|
723 |
|
3.42 |
% |
|
88,024 |
|
|
889 |
|
4.05 |
% |
|||||||||
Time, over $250,000 |
|
53,683 |
|
|
456 |
|
3.41 |
% |
|
55,793 |
|
|
460 |
|
3.34 |
% |
|
51,942 |
|
|
362 |
|
2.80 |
% |
|||||||||
FHLB advances |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
— |
|
|
6,593 |
|
|
75 |
|
4.56 |
% |
|||||||||
Total average interest-bearing liabilities |
|
1,067,473 |
|
|
3,800 |
|
1.43 |
% |
|
1,061,269 |
|
|
3,758 |
|
1.44 |
% |
|
1,022,388 |
|
|
3,621 |
|
1.42 |
% |
|||||||||
Non-interest-bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Non-interest-bearing demand deposits |
|
626,901 |
|
|
|
|
|
|
632,800 |
|
|
|
|
|
|
634,352 |
|
|
|
|
|
||||||||||||
Interest payable and other liabilities |
|
16,485 |
|
|
|
|
|
|
17,462 |
|
|
|
|
|
|
13,505 |
|
|
|
|
|
||||||||||||
Total average liabilities |
|
1,710,859 |
|
|
|
|
|
|
1,711,531 |
|
|
|
|
|
|
1,670,245 |
|
|
|
|
|
||||||||||||
Total average stockholders’ equity |
|
215,420 |
|
|
|
|
|
|
213,738 |
|
|
|
|
|
|
187,801 |
|
|
|
|
|
||||||||||||
Total average liabilities and stockholders’ equity |
$ |
1,926,279 |
|
|
|
|
|
$ |
1,925,269 |
|
|
|
|
|
$ |
1,858,046 |
|
|
|
|
|
||||||||||||
Net interest income and net interest margin |
|
|
$ |
17,006 |
|
3.75 |
% |
|
|
$ |
17,204 |
|
3.83 |
% |
|
|
$ |
16,953 |
|
3.85 |
% |
||||||||||||
(1) |
For disclosure purposes, yield/rates are annualized by dividing the number of days in the reported period by 365. |
About First Northern Bank
First Northern Bank is an independent community bank that specializes in relationship banking. The Bank, headquartered in Solano County since 1910, serves Solano, Yolo, Sacramento, Placer, Colusa, and Glenn counties, as well as the west slope of El Dorado County. Experts are available in small business, commercial, real estate, and agribusiness lending, as well as mortgage loans. The Bank is an SBA Preferred Lender. Real estate mortgage and small-business loan officers are available by appointment at any of the Bank’s 14 branches, including Dixon, Davis, West Sacramento, Fairfield, Vacaville, Winters, Woodland, Sacramento, Roseville, Auburn, Rancho Cordova, Colusa, Willows, and Orland. Non-FDIC insured Investment and Brokerage Services are also available at every branch location. First Northern Bank is rated as a Veribanc “Green-3 Star Blue Ribbon” Bank and a “5-Star Superior” Bank by Bauer Financial for the earnings period ended March 31, 2026 (www.veribanc.com) and (www.bauerfinancial.com). For additional information, please visit thatsmybank.com or call (707) 678-7742. Member FDIC. Equal Housing Lender.
Forward-Looking Statements
This press release and other public statements may include certain “forward-looking statements” about First Northern Community Bancorp and its subsidiaries (the “Company”). These forward-looking statements are based on management’s current expectations, including but not limited to statements about the Company’s performance and the strength of its low-cost deposit franchise, focus on managing operating expenses and improving shareholder value and positioning the Company for future growth, and the expected costs and potential benefits of the Company's systems upgrade project, and are subject to certain risks, uncertainties and changes in circumstances. Actual results may differ materially from these expectations due to changes in global political, economic, trade, business, competitive, market and regulatory factors. More detailed information about these risk factors is contained in the Company’s reports filed with the Securities and Exchange Commission on Forms 10-K and 10-Q, each as it may be amended from time to time, which identify important risk factors that could cause actual results to differ materially from those contained in the forward-looking statements. Any anticipated benefits of the uplisting of the Company’s common stock to The Nasdaq Capital Market are subject to market conditions and other factors outside of the Company’s control, and no assurance can be given as to the effect that the uplisting may have on the trading volume of our stock or on the liquidity of an investment in our stock. The financial information contained in this release should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s most recent reports on Form 10-K and Form 10-Q, and any reports on Form 8-K. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances arising after the date on which they are made, except as may be required by applicable law. For further information regarding the Company, please read the Company’s reports filed with the SEC and available at www.sec.gov.
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Jeremiah Z. Smith
President & Chief Executive Officer
First Northern Community Bancorp
& First Northern Bank
P.O. Box 547
Dixon, California (707) 678-3041
