Preferred Bank (PFBC) Q3 2026 earnings summary

Executive summary

• Q3 net income was $32.9M, or $2.73 per diluted share, down $3.0M YoY and $592K QoQ; $2.1M of loan interest reversals was the primary earnings drag.

• Deposits grew $77.7M, or 1.2%, QoQ; gross loans were essentially flat, while loans excluding held-for-sale balances declined $41.0M.

Financial highlights

• Net interest income before provision was $66.7M, down $4.6M YoY and $3.3M QoQ; NIM was 3.49% versus 3.92% YoY and 3.73% QoQ. Excluding the reversal, NIM was 3.60%.

• Noninterest income was $5.0M versus $3.7M YoY and $3.5M QoQ; noninterest expense was $22.2M versus $21.5M and $23.7M, respectively.

• Q3 noninterest income included a $431K gain on a called investment security; prior-quarter results included an $874K loan-sale loss.

• Net income for 9M 2026 was $97.6M, down 1.2% YoY; diluted EPS was $8.03, up 5.3% YoY.

• Q4 operating expenses are expected to be $23M–$24M following lower Q3 legal fees and incentive compensation.

Outlook and guidance

• A stronger loan pipeline and delayed fundings support expectations for solid Q4 loan growth.

• Management expects stable rates and a strong 2027 economy; asset sensitivity means higher rates could benefit NIM, subject to loan and deposit market conditions.

• Several nonaccrual loan resolutions shifted to Q4 2026 or Q1 2027 pending bankruptcy court decisions.