VersaBank (VB) Q2 2026 earnings summary

Executive summary

• Achieved record credit assets and revenue, with credit assets reaching $5.68B (up 25% year-over-year and 6% sequentially) and revenue at $38.3M (up 27% year-over-year and 5% sequentially), driven by strong U.S. SRP and digital banking momentum.

• Adjusted net income grew 45% year-over-year to $12.4M, outpacing asset and revenue growth, with adjusted EPS up 50% to $0.39.

• U.S. SRP program drove credit asset growth, with CAD 150 million in new fundings and U.S. operations contributing over 20% of Q2 revenue.

• Real-time SRP pilot launched, targeting July 1st for commercialization, expected to drive significant market share gains and expand addressable market.

• Filed S-4 registration for U.S. reorganization, entering final stages of corporate restructuring, with non-core expenses of $4.5M and $2.2M write-down from branch sale impacting net income.

Financial highlights

• Total assets reached $6.44B, up 28% year-over-year and 5% sequentially.

• Book value per share hit a record $17.15, up 6% year-over-year.

• CET1 ratio at 12.32% and leverage ratio at 7.94%, both above targets but down year-over-year due to capital deployment.

• Net interest margin on credit assets was 2.71%, up 12 bps year-over-year and 7 bps sequentially; overall NIM was 2.33%.

• Provision for credit losses remained low at 0.03% of average credit assets.

Outlook and guidance

• On track to achieve at least $1 billion in new U.S. SRP fundings in fiscal 2026.

• Real-time SRP rollout expected to accelerate growth and market share, especially in Canada and the U.S.

• Core non-interest expense expected to be flat or slightly lower year-over-year, with cost savings from branch sale and optimization initiatives.

• Net interest margin expected to remain stable with potential upside.

• Anticipates benefits from reorganization, including enhanced shareholder value and reduced costs, subject to regulatory and shareholder approvals.