ConnectOne Bancorp (CNOB) Q2 2026 earnings summary

Executive summary

• Operating performance accelerated in Q2 2026, with net income available to common stockholders rising to $40.2 million ($0.80 per share), up from $36.3 million ($0.72 per share) in Q1 and a loss of $21.8 million in Q2 2025.

• Sequential loan growth reached 5% and core deposit growth was 8% annualized, supported by a client-centric strategy and the Long Island acquisition.

• Net interest margin widened for the seventh consecutive quarter to 3.42%.

• Efficiency gains achieved through technology partnerships and process optimization, supporting high-touch client service.

• Tangible book value per share increased to $24.66 as of June 30, 2026.

Financial highlights

• Fully taxable equivalent net interest income was $114.8 million, up 4.4% from Q1 2026 and 43.9% from Q2 2025.

• Non-interest income rose to $7.9 million, driven by higher SBA loan sale gains and BOLI income.

• Operating expenses decreased to $55.3 million from $55.7 million last quarter; efficiency ratio improved to 42.7% from 45.4%.

• Provision for credit losses was $8.3 million, up from $5.2 million in Q1 2026 but down from $35.7 million in Q2 2025.

• Total assets reached $14.4 billion, loans receivable $11.9 billion, and total deposits $11.7 billion as of June 30, 2026.

Outlook and guidance

• Internal models forecast 1.5% sequential expense growth in each of the next two quarters, mainly due to increased staffing.

• Year-end spot margin guidance maintained at 3.50% due to rising deposit costs, but margin expansion expected to continue into 2027.

• Loan growth expected to remain in the mid-single digits for 2026, supported by a strong pipeline.

• Full-year 2026 effective tax rate projected at 28%, supported by a $50 million capital commitment to a renewable energy tax credit fund.

• Management expressed confidence in continued profitable growth and long-term value creation.