Isabella Bank Corporation (Nasdaq: ISBA) reported record net income for the third quarter of 2026. The company announced net income of $6.6 million, or $0.86 per diluted share, for the quarter ended September 30, 2026. This represents an increase from $5.2 million, or $0.71 per diluted share, in the same period of the previous year.
The company’s net interest margin (NIM) improved to 3.71% for the third quarter of 2026, up from 3.15% in the third quarter of 2025. This improvement was driven by higher yields on loans and lower costs on interest-bearing liabilities. The yield on loans increased to 5.95% for the quarter, while the cost of interest-bearing liabilities decreased to 2.08%.
On the balance sheet, total assets increased 1.4% to $2.2 billion as of September 30, 2026. This growth was primarily due to an increase in cash and cash equivalents of $112.5 million, offset by a decline in available-for-sale securities of $88.3 million. Total deposits increased 4.0% to $1.9 billion during the same period, largely driven by an increase in money market accounts of $141.8 million.
The company also provided an update on its acquisition of Grand River Commerce, Inc. Isabella Bank stated that it has received all required regulatory and shareholder approvals to complete the transaction. The acquisition is expected to close on November 2, 2026, subject to customary closing conditions. The company noted that the net income for the third quarter included after-tax expenses of $657,000 related to the proposed acquisition.
Regarding asset quality, the allowance for credit losses increased to $14.4 million, or 4.9%, as of September 30, 2026. Nonaccrual loans stood at $7.5 million, compared to $4.6 million at the end of 2025. The company also reported that the net unrealized losses on available-for-sale securities increased to $21.7 million, or 5.0% of the amortized cost of the portfolio, as of September 30, 2026.
