Orrstown Financial Services, Inc. reported net income of $22.8 million for the three months ended September 30, 2026, or $1.17 per diluted share. This represents an increase from the $21.2 million, or $1.09 per diluted share, reported for the prior quarter ended June 30, 2026.
The company’s net interest margin, on a tax equivalent basis, increased by 25 basis points to 4.12% in the third quarter of 2026 from 3.87% in the second quarter. This improvement was driven by an eight basis point increase in the yield on interest-earning assets and a five basis point decrease in the cost of deposits. Return on average assets was 1.60%, while return on average equity was 14.62% for the quarter.
On the balance sheet, total loans increased by $95.3 million, or approximately 9% annualized, from June 30, 2026, to September 30, 2026. This growth was driven by strong increases in commercial and industrial loans, home equity lines of credit, and first lien residential mortgages. Conversely, total deposits decreased by $38.1 million, or 3% annualized, during the same period. The loan-to-deposit ratio was 92% at September 30, 2026.
Regarding credit quality, classified loans decreased by $4.0 million to $45.2 million during the third quarter. Nonaccrual loans to total loans decreased to 0.54% at September 30, 2026, from 0.58% at June 30, 2026. The provision for credit losses on loans was $1.1 million for the quarter, compared to $0.4 million in the prior quarter.
In other business developments, the Board of Directors declared a cash dividend of $0.30 per common share. This dividend is payable on November 10, 2026, to shareholders of record as of November 3, 2026.
