Camden National (NASDAQ:CAC) reported third-quarter 2026 net income of $22.8 million, or $1.34 per diluted share, as deposit growth and a lower-cost funding mix supported margin expansion. Net income increased 8% from the third quarter of 2025, while diluted earnings per share rose 7%, according to President and Chief Executive Officer Simon Griffiths.
The company said total revenue reached a record $68.7 million, compared with $67.4 million in the second quarter. Pre-tax, pre-provision income rose 4% sequentially and 6% year over year to $31.2 million. Camden ended the quarter with approximately $7.1 billion in assets.
Deposits Drive Margin Improvement
Total deposits increased 5% from the prior quarter and 8% from a year earlier to $5.8 billion. Griffiths attributed the growth to seasonal inflows, customer retention and new customer relationships, while Chief Financial Officer Mike Archer said the company also benefited from new customer acquisition and growth in its high-yield savings product.
Archer said some of the deposit growth came from a large customer placing deposits with the bank near quarter-end. He also said Camden generally experiences approximately 1% to 2% overall deposit growth from seasonal factors.
The stronger funding mix helped reported net interest margin expand 15 basis points from the second quarter to 3.41%, exceeding the company’s prior guidance range. On a non-GAAP basis, core net interest margin increased 13 basis points to 3.10%.
Average funding costs declined to 1.63% in the third quarter from 1.70% in the second quarter, while average deposit costs edged down to 1.55%. Archer said Camden expects fourth-quarter net interest margin to remain relatively consistent with the third quarter. Looking further ahead, he said the company was positioned for continued margin expansion in 2027, although the pace could slow and quarterly results could be affected by seasonality.
Loan Balances Remain Flat as Home Equity Grows
Total loans were essentially unchanged from both the preceding quarter and the prior year at $5 billion. Home equity lending remained a growth area, with balances rising 7% during the quarter and 25% year over year to $392 million. Residential real estate lending also grew modestly.
Commercial loan balances declined slightly, reflecting payoffs and management’s planned exit from credits that no longer fit portfolio objectives. Griffiths said the company expects modest loan growth in the fourth quarter and is targeting low-single-digit growth through 2027.
Camden added four commercial bankers during the quarter, including two covering Massachusetts and two covering southern Maine. Griffiths said the hires are building pipelines and are intended to support commercial growth over time, while the bank remains disciplined on pricing and loan structure. He said the commercial loan pipeline in Massachusetts totaled $127 million.
Archer said the portfolio origination rate was approximately 6.30% during the third quarter and could remain in a range of roughly 6.25% to 6.50% in the near term. He also said the company expects quarterly cash flows of approximately $30 million to $40 million from its securities portfolio and $200 million to $250 million from contractual and estimated loan prepayments.
Fee Income Falls; Expenses Hold Steady
Non-interest income totaled $13.2 million, down 8% from the second quarter and 6% from a year earlier. Archer said the sequential decline reflected lower bank-owned life insurance and mortgage banking income, both of which are sensitive to market conditions. The change in fair-value accounting was $921,000 lower between periods on a linked-quarter basis.
For the fourth quarter, management estimated non-interest income of $13.5 million to $14.5 million.
Non-interest expense was $37.5 million, essentially unchanged from the prior quarter and 4% higher than a year earlier. The company’s non-GAAP efficiency ratio improved to 52.44% from 53.23% in the second quarter. Archer said Camden expects fourth-quarter expenses of $37.5 million to $38 million and continues to target an efficiency ratio in the mid-50% range over the longer term.
Griffiths said the bank is funding hiring and other franchise investments while seeking efficiencies through technology. He cited Camden’s partnership with Snowflake, saying business teams are using Snowflake Explorer to access customer and performance information, support targeted sales outreach and reduce manual analysis.
Credit Metrics Improve, Capital Remains Strong
Credit quality metrics improved during the quarter. Nonperforming loans declined to 16 basis points of total loans at Sept. 30, from 24 basis points at the end of the second quarter. Past-due loans fell to 14 basis points from 15 basis points.
Annualized net charge-offs were 7 basis points of average loans for the third quarter and 5 basis points year to date. The allowance for credit losses increased by one basis point to 0.92% of total loans, contributing to a $1.9 million provision for credit losses, compared with $710,000 in the second quarter.
Archer said the higher provision reflected changes in the economic outlook and increased unfunded reserves associated with strong home-equity line production. He described overall credit performance as sound.
Camden’s total risk-based capital ratio increased to 14.82%, and its Tier 1 leverage ratio rose to 9.92%. The tangible common equity ratio was 7.73%, while tangible book value per share was $31.40. Both measures declined from June 30 because higher market interest rates affected accumulated other comprehensive loss.
Griffiths said the company entered the fourth quarter with confidence in its outlook and believes its investments in talent, customer relationships and technology position it for growth in 2027.
About Camden National (NASDAQ:CAC)
Camden National Corporation (NASDAQ:CAC) is a bank holding company headquartered in Camden, Maine. Through its principal subsidiary, Camden National Bank, the company provides banking and financial services to individuals, families, businesses and municipalities primarily across Maine.
Camden National Bank offers deposit accounts, residential and commercial real estate loans, consumer lending, business financing, cash-management services and digital banking. Its offerings also include wealth management, trust and investment services designed to support customers with financial planning and asset management needs.
Founded in 1875, Camden National has developed a community-banking model supported by branches and banking offices throughout Maine.
