PBCO Financial Corporation Reports Q2 2026 Results

PBCO Financial Corporation (OTCID: “PBCO”), the holding company (the “Company”) of People’s Bank of Commerce (the “Bank”), today reported net income of $2.2 million and earnings per share of $0.43 for the second quarter of 2026, compared to net income of $2.7 million and $0.52 per share for the first quarter of 2026.

Highlights

Return on average assets of 1.14% for the second quarter
Cost of deposits decreased to 1.35% during second quarter versus 1.41% in the first quarter
Tangible book value per share of $19.03, an increase of 2.4% in the second quarter
On July 22, 2026 Company entered into a definitive agreement to merge with and into Northrim BanCorp, Inc.

Julia Beattie, President and CEO of the Company, commented, “We are pleased with our operating results for the second quarter, which included strong profitability, incremental loan growth and maintaining our low-cost core deposit base. Further, our Steelhead Finance division saw a significant increase in revenue during the quarter. Separately, we are pleased to announce the signing of a definitive agreement to merge with Northrim BanCorp, Inc. which marks a new chapter in the history of our Company. Additional information can be found on the website for PBCO or Northrim, under Investor Relations. Our shareholders and customers can expect to receive more information in the mail in the coming months.”

Portfolio loans increased $2.1 million during the second quarter, a 0.4% increase from the first quarter and the credit quality of the loan portfolio remains strong. Deposit balances decreased $35.2 million from first quarter of 2026. The Bank continues to actively focus on growing core deposits, which is reflected in the increase in non-interest bearing in the first half of 2026.

During the second quarter, non-interest income increased by $402 thousand, with the increase primarily attributed to a 30.5% increase in factoring revenue from our Steelhead Finance division of $432 thousand for the quarter, while other non-interest income was down $40 thousand, due to non-recurring income recognized in the first quarter. Non-interest expenses totaled $6.2 million in the second quarter, an increase of $445 thousand from the first quarter of 2026. During the second quarter, the Bank wrote-off the remaining unamortized implementation and current year fees on a non-performing vendor contract, resulting in $170 thousand in one-time expense.

The Bank’s leverage ratio was 15.40% as of June 30, 2026, compared to 15.04% as of March 31, 2026. The Company’s tangible common equity was $96.5 million as of June 30, 2026, compared to $94.3 million as of March 31, 2026. No stock repurchases were completed during the second quarter.

About PBCO Financial Corporation

PBCO Financial Corporation’s stock trades on the over-the-counter market under the symbol PBCO. Additional information about the Company is available in the investor section of the Company’s website at: www.peoplesbank.bank.

Founded in 1998, People’s Bank of Commerce is a full-service, commercial bank headquartered in Medford, Oregon with branches in Albany, Ashland, Central Point, Eugene, Grants Pass, Jacksonville, Klamath Falls, Lebanon, Medford, and Salem.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995:

This release includes forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally can be identified by the use of words or phrases such as “believes,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates,” “plans,” “projects,” or other words or phrases of similar import indicating that the statement addresses some future result, occurrence, plan, or objective. Similarly, statements herein that describe People’s Bank’s business strategy, outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied in forward-looking statements.


Consolidated Balance Sheets
(Dollars in 000's)	6/30/2026			3/31/2026			12/31/2025			9/30/2025			6/30/2025
BALANCE SHEET
ASSETS
Cash and due from banks	$	7,714		$	5,319		$	5,959		$	6,194		$	6,917
Federal funds sold		-			-			-			-			-
Interest bearing deposits		14,801			22,451			31,747			53,846			51,060
Investment securities		95,897			106,500			114,079			119,970			127,850
Loans held for sale		-			-			-			-			-
Loans held for investment, net of unearned income		570,142			568,024			567,673			560,615			553,948
Total Loans, net of deferred fees and costs		570,142			568,024			567,673			560,615			553,948
Allowance for loan losses		(6,445	)		(6,551	)		(6,418	)		(6,304	)		(5,971	)
Premises and equipment, net		27,519			27,643			27,847			28,480			28,797
Bank owned life insurance		18,420			18,269			17,846			17,695			17,516
Other Assets		48,593			37,547			29,896			29,821			30,905
Total assets	$	776,641		$	779,202		$	788,629		$	810,317		$	811,022

LIABILITIES
Deposits
Demand - non-interest bearing	$	226,160		$	224,735		$	220,919		$	239,521		$	242,281
Demand - interest bearing		167,789			183,590			199,131			189,924			205,034
Money market and savings		207,112			226,985			223,944			236,949			222,265
Time deposits of less than $250,000		7,206			7,221			7,489			7,476			7,716
Time deposits of more than $250,000		1,870			2,824			2,484			3,072			2,757
Total deposits	$	610,137		$	645,355		$	653,967		$	676,942		$	680,053

Borrowed funds		51,429			27,792			27,894			28,274			28,381
Other liabilities		14,915			8,061			9,139			8,853			9,248
Total liabilities	$	676,481		$	681,208		$	691,000		$	714,069		$	717,682

STOCKHOLDERS' EQUITY
Common stock, surplus & retained earnings	$	107,308		$	105,087		$	104,634		$	104,022		$	102,138
Accumulated other comprehensive income, net of tax		(7,148	)		(7,093	)		(7,005	)		(7,774	)		(8,798	)
Total stockholders' equity	$	100,160		$	97,994		$	97,629		$	96,248		$	93,340

Total liabilities & stockholders' equity	$	776,641		$	779,202		$	788,629		$	810,317		$	811,022


Consolidated Statements of Income
(Dollars in 000's)	2nd Quarter 2026			1st Quarter 2026			4th Quarter 2025			3rd Quarter 2025			2nd Quarter 2025
INCOME STATEMENT
INTEREST INCOME
Loans	$	9,044		$	9,129		$	9,007		$	8,749		$	8,595
Investments		403			437			462			477			496
Federal funds sold and due from banks		151			204			586			536			563
Total interest income		9,598			9,770			10,055			9,762			9,654

INTEREST EXPENSE
Deposits		2,094			2,208			2,438			2,591			2,483
Borrowed funds		369			261			262			262			259
Total interest expense		2,463			2,469			2,700			2,853			2,742

NET INTEREST INCOME		7,135			7,301			7,355			6,909			6,912
Provision for loan losses		510			130			250			345			278
Net interest income after provision for loan losses		6,625			7,171			7,105			6,564			6,634

NONINTEREST INCOME
Service charges		123			114			111			114			114
Steelhead finance income		1,844			1,413			1,277			1,236			1,224
BOLI Income		151			149			149			146			143
Other non-interest income		483			523			496			482			570
Total noninterest income		2,601			2,199			2,033			1,978			2,051

NONINTEREST EXPENSE
Salaries and employee benefits		3,754			3,725			3,735			3,578			3,543
Occupancy & equipment expense		805			832			844			868			854
Advertising expense		133			121			119			125			102
Professional expenses		223			214			188			194			218
Data processing expense		614			397			432			433			412
Loss on sale of investments		-			-			-			-			-
Other operating expenses		695			490			442			595			790
Total noninterest expense		6,224			5,779			5,760			5,793			5,919

Income before taxes		3,002			3,591			3,378			2,749			2,766
Provision for income taxes		781			919			879			691			708

NET INCOME	$	2,221		$	2,672		$	2,499		$	2,058		$	2,058

Shares outstanding end of quarter		5,072,054			5,073,816			5,124,357			5,245,413			5,258,407
Average diluted shares outstanding		5,133,967			5,169,497			5,227,865			5,292,256			5,319,429
Earnings per share	$	0.44		$	0.52		$	0.48		$	0.39		$	0.39
Diluted earnings per share	$	0.43		$	0.52		$	0.48		$	0.39		$	0.39


(Dollars in 000's)	6/30/2026			3/31/2026			12/31/2025			9/30/2025			6/30/2025
Performance Ratios
Return on average assets		1.14%			1.37%			1.23%			1.01%			1.01%
Return on average equity		8.93%			10.81%			10.26%			8.68%			8.94%
Net interest margin		4.20%			4.21%			3.98%			3.74%			3.76%
Yield on loans		6.39%			6.55%			6.35%			6.23%			6.23%
Cost of deposits		1.35%			1.41%			1.42%			1.51%			1.46%
Efficiency ratio excluding non-recurring expenses		63.93%			60.83%			61.35%			65.19%			66.04%
Full-time equivalent employees		138			129			126			133			137

Capital
Community Bank Leverage Ratio		15.40%			15.04%			14.78%			14.29%			14.03%
Book value per share	$	19.75		$	19.31		$	19.05		$	18.35		$	17.75
Tangible book value per share	$	19.03		$	18.59		$	18.34		$	17.65		$	17.05
Dividends per Share	$	-		$	0.25		$	-		$	-		$	-

Asset Quality
Allowance for loan losses (ALLL)	$	6,445		$	6,551		$	6,418		$	6,304		$	5,971
Nonperforming loans (NPLs)	$	5,416		$	7,236		$	4,147		$	4,095		$	3,372
Nonperforming assets (NPAs)	$	5,416		$	7,236		$	4,147		$	4,095		$	3,372
Classified assets⁽²⁾	$	23,496		$	10,768		$	11,528		$	13,031		$	9,288
ALLL as a percentage of loans		1.13%			1.15%			1.13%			1.12%			1.08%
Net charge offs (recoveries) to average loans		0.11%			0.00%			0.02%			0.00%			0.00%
Nonperforming assets as a percentage of total assets		0.70%			0.93%			0.53%			0.51%			0.42%
Classified Asset Ratio⁽³⁾		22.04%			10.30%			11.08%			12.71%			9.35%
Past due as a percentage of total loans		1.06%			1.27%			0.73%			0.87%			0.96%

End of period balances
Total securities and short term deposits	$	110,698		$	128,951		$	145,826		$	173,816		$	178,910
Total loans	$	570,142		$	568,024		$	567,673		$	560,615		$	553,948
Total earning assets	$	680,840		$	696,975		$	713,499		$	734,431		$	732,858
Intangible assets	$	3,650		$	3,660		$	3,670		$	3,681		$	3,690
Total assets	$	776,641		$	779,202		$	788,629		$	810,317		$	811,022
Total noninterest bearing deposits	$	226,160		$	224,735		$	220,919		$	239,521		$	242,281
Total deposits	$	610,137		$	645,355		$	653,967		$	676,942		$	680,053

Average balances
Total securities and short term deposits	$	121,532		$	137,263		$	176,173		$	181,528		$	181,971
Total loans	$	568,134		$	559,328		$	556,727		$	551,101		$	547,907
Total earning assets	$	689,666		$	696,591		$	732,900		$	732,629		$	729,878
Total assets	$	773,597		$	778,997		$	815,906		$	815,262		$	812,029
Total noninterest bearing deposits	$	223,996		$	217,778		$	233,390		$	237,705		$	240,960
Total deposits	$	623,810		$	642,883		$	680,475		$	682,347		$	681,775
⁽¹⁾ Effective March 31, 2020, People's Bank of Commerce opted into the Community Bank Leverage Ratio and is no longer calculating risk based capital ratios.
⁽²⁾ Classified assets are defined as the sum of all loan-related contingent liabilities and loans internally graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities, and other real estate owned.
⁽³⁾ Classified asset ratio is defined as the sum of all loan related contingent liabilities and loans internally graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities, and other real estate owned, divided by bank Tier 1 capital, plus the allowance for loan losses.